There are a couple of ways to capitalize on the combined demand of several or many businesses. One option is for the owner of the building to become an ISP or bandwidth provider for all the tenants. The owner surveys everyone in the building as to their needs. Next, the owner shops for the best bandwidth prices based on the combined needs of the tenants. The selected service provider installs the line to the building’s router, which then distributes the bandwidth according to how much each tenant has requested. The owner bills those tenants for service each month and pays the telecom bill to the carrier.
It’s also possible that the service provider will take responsibility for breaking out the bandwidth from the carrier managed Customer Premises Equipment (CPE) and bill each tenant separately. That gets the building owner out of the loop, which could be a good or bad thing depending on how you look at it. Yes, it’s less hassle to let the service provider handle all the telecom issues. However, with the building owner as provider there is an opportunity to add some markup to the telephone, broadband and private line services and make telecom a profit center.
The reason this idea makes sense is that the more bandwidth you buy, the cheaper it gets per Mbps. You might think that 100 Mbps would cost 10x as much as 10 Mbps. Not so in most cases. You’ll probably pay 2 or 3 times as much depending on how competitive service is in your area. Even lower levels of 10 Mbps vs 1 Mbps have a cost difference of several times, not 10 times. You can see that a savvy building manager could give each tenant a better deal on their bandwidth needs than they could get by going directly to the carriers, while making a tidy profit in the process.
Some buildings have basic business broadband included in their lease prices as a sweetener to attract tenants. A building owner can have the building wired for 10 or 100 Mbps Ethernet and install a router for signal distribution. Wireless access points can be included. The telecom feed can be as simple as a single T1 line for light duty usage or Ethernet over Copper to get the bandwidth up to 5, 10 or 20 Mbps as needed to keep everyone happy. With 1.5 Mbps T1 lines or 3 Mbps EoC costing under $300 a month in some areas, it’s not that expensive to provide this service to 10 or 20 offices.
Here’s something else to consider. Quite a few businesses now really need fiber optic bandwidth levels to support video production, medical imaging, computer aided design and simulation, and research of all types. You can’t get these high bandwidth services unless your building is “lit” for fiber optic service. Lit means that a fiber optic cable connects from inside the building to a carrier’s equipment outside and that the fiber is delivering bandwidth.
If someone thought to install dark fiber during construction, getting it lit may be an easy process. Chances are, though, that the only communication lines coming into the building are a bundle of copper pairs installed by the telephone company. Spares can be used for T1 lines and Ethernet over Copper, but truly large bandwidths require nothing less than fiber strands. In built up areas, it can be a nightmare to install new fiber in the ground or overhead. It can be even worse in the middle of nowhere when there is no fiber for miles in any direction.
This can be a real inhibitor for high demand business users and a reason to move company operations to a location with better service availability. Carriers might be willing to install the fiber drop but often want the building owner to pay construction costs. What can sway their opinion is the opportunity to sign up a number of customers in one building with a very large total bandwidth need. All carriers are looking for lucrative business opportunities to expand their networks. If you and several to several dozen of your fellow tenants or the building owner can present a tempting enough opportunity, one or more carriers might absorb some or all of the construction costs to light your building.
Are you a building owner, manager or tenant who needs private lines, dedicated Internet access, SIP Trunks or similar telecom services? If so, get competitive telecom service quotes for yourself, your tenants or the combined needs of multiple businesses in your building.
Note: Photo of Portland office building courtesy of Ian Poellet on Wikimedia Commons.