You already know the joke, so lets skip straight to the punchline: Location, location, location. Thats what business renters and buyers have always looked for, and its still the rule.
These days, however, the list oflocation issues is a little longer and more detailed. Nearby availability of skilled labor and proximity to transportation are still important. But so, increasingly, is the location of the nearest central office, long-haul carrier POP, or metropolitan access node. Todays businesses run on bandwidth and communications services: Where these arent available, other amenities matter much less. Where they
available, however, tenants come running. And theyre willing to pay premium prices
even forego other perks to do business somewhere their information growth-path wont be stunted.
Certainly, the growing e-conomy presents unique threats and challenges to real-estate stakeholders. Retail space renters look like ground zero to become early casualties of the e-commerce revolution (wanna buy a brick-and-mortar mall?). Folks specializing in huge, landscape-overwhelming cubicle-farms may end up foiled by downsizing or commute-reduction legislation,
or trumped by distributed-office and work-at-home technologies. (For example, Texas Instruments Houston A facility, former home base for a major commodity RAM chip-fab and thousands of workers, now stands virtually empty TI no longer plays in that volatile, low-margin business. Our tour-guide, (TIs youngest-ever Fellow) quipped: We used to make memories here ... But now there are
Overall, however, the picture is one of enormous opportunity. Anyone who
controls a physical plant is ideally situated to capitalize on every major development in convergent communications, often from several different angles. Consider:
A chance to change the rules.
Location, location, location sounds like a good value-proposition, if you hold a lot of property on Main Street. It doesnt sound so great, if youre on the wrong side of the tracks. But when Main Street becomes MainStreet.com, the rules change. Whoever provides the smoothest onramp to
the InfoBahn wins.
Landlords are natural aggregators.
You can resell. You can become a micro-carrier (it costs under $50 to register with the PUC as a CLEC in New York). Most profitably, you can become an application service provider start a whole new business. Its easy to offer web-linked ACD/CRM to a building full of service businesses.
Youre the person in place and it costs $500 to roll a truck.
Every time a carrier sends somebody out to do a
simple install (e.g., a DSL modem), it costs them a painful amount of money. Enormous ingenuity is going into developing auto configuring DSL router technologies ... which still wont work in a certain percentage of cases. So theyll roll a truck, and your people will spend time giving their people access to the premise. Whereas, if you learned how to install DSL modems (for example), carriers would happily pay you a nice chunk of change for a half-hours work. This cooperative model
can be extended infinitely you can earn profits for any degree of consultative expertise or access facilitation you provide. As the landlord, youre the person who can do it most cost-effectively.
Carriers often fall short.
All myth and legend aside, we havent yet reached the customer-driven, competitive telecom market of the future. Carriers of all kinds are still pretty bad at serving customers especially small- to medium-sized businesses. (The New York
office of Doctors Without Borders, for example, has been waiting more than 90 days for voice/data T-1 from AT&T. Apparently, winning the Nobel Peace Prize isnt enough to give you pull.) If you can develop the expertise required to mediate between clients and carriers: Provide certain services, facilitate provisioning, help tie sales up in neat packages theres enormous money to be made. See our sidebar on
Newmark & Co.
, whos taking the consultative model to an
elegant, logical conclusion.
THE TECHNOLOGIES AT HAND
All the foregoing is just lead-in for the subject of our roundup: Convergence products aimed at the burgeoning market for in-building distribution of broadband-based voice/data services. Topologically, these products are similar: High-density integrated access devices (IADs) that terminate loads of bandwidth in your basement (or rooftop), and generate a range of easily-provisioned services for large tenant populations. Many of the makers of
these products Copper Mountain is a good example supply the hot technologies of the moment (DSL), wrapped in consulting services aimed at bringing carriers and real-estate stakeholders together in profitable ways.
(Palo Alto, CA 650-687-3300) makes DSLAMs that cater particularly well to the MTU environment. Last April, the company announced the
program. The CopperEdge 150, which comes in 24 and 48 port configurations, is a smaller version of the CopperEdge 200, a 192 port DSL concentrator that can be used both for large MTUs and for central office aggregation. The 150 supports SDSL at speeds ranging from 128 Kbps to 1.5 Mbps, as well as VPNs, frame relay access, voice-over-DSL, and remote PBX extensions.
The CopperPowered Building program was conceived to make Copper Mountain a one-stop shop for MTU service providers and real
estate owners. Beyond supplying the necessary equipment, along with a fairly extensive line of compatible CPE and SNMP-based network management software, Copper Mountain offers a portfolio of services that include system install and maintenance, equipment financing, network management services (through a partnership with Lucents NetCare division), and WAN backhaul resources (which offers an installed base of data CLECs to newer service providers as an alternative to leasing T-1s).
The CopperEdge 150 is
priced at $16,995 for a 24-port configuration, and $28,990 for 48 ports.
s (North Andover, MA 978-688-6164)
is a DSL access device for multi-tenant buildings. Unlike traditional DSLAMs, the System 500 DSLAR (DSL access router) has the functionality of an ATM switch and an IP router, in addition to simple aggregation and multiplexing. The advantages of this are that it cuts down on
equipment costs, improves efficiency through oversubscription of its uplinks, and facilitates the deployment of multimedia services. (Interspeed is currently in trials with other vendors to support voice-over-DSL and voice-over-frame relay.) The System 500 supports up to 48 ports of DSL, while its big brother, the System 1000, houses 192 ports. Both have the ability to provision multiple userID/password-secured VPNs within a single chassis.