BOMA and Rockrose Provide Telecom Insight

The Rise and Fall of Telecoms (continued)...  My April 27 Dispatch, Telecoms Seek Critical Mass of Tenants for Survival, triggered some very interesting e-mail. ... Gerry Lederer, who leads the BOMA efforts to prevent mandatory access, writes: "According to the BOMA 2000 EER [Experience Exchange Report], gross income for office buildings was just about $21.00 per square foot, with only 12 cents of that income being generated by telecommunications operations.  Of the 12 cents, 9 cents was generated from the traditional roof top operators such as paging, cellular, broadcasters etc.  All the folks that wanted or demanded access to our buildings but claimed we were gouging them were generating in the aggregate 3 cents a square foot.  So you see, it has never been the 3 cents that was the concern.  It has always been and continues to be the $21.00 that property professionals seek to protect."

David Pian, Director of Technology and Telecommunications at Rockrose Development Corp. in New York City, writes:  "CLECs [Competitive Local Exchange Companies] have more competitive rates than the incumbents.  This is a fact.  However, it is up to each end user (usually the office manager) to decide whether to take advantage of the lower rates that the CLECs are offering or to 'play it safe' and continue doing business with the incumbent.  Many times the decision is made to stay with the incumbent since the incumbent's infrastructure is simply more reliable than a CLEC's infrastructure.  If I were the office manager making the decision, I would choose to spend more money for a more reliable service.  Why should I put my neck on the line to save the company a few hundred dollars every month?   It is a fact that all phone service will go down from time to time, more often in the case of CLECs."

Rich Miller writes for CarrierHotels, a news portal covering the data center industry from a facilities/real estate perspective: "While many players in the broadband building access market are struggling, some others have recently gained substantial new funding in the midst of a severe telecom capital crunch. One is Intellispace, which has received $60 million in new funding in February and another $60 million earlier this month. Yipes! Communications and Telseon are other players in this space that have received new funding this year. ... There is a 'flight to quality' underway throughout the telecom arena in which customers are seeking out providers who are financially stable and are not going to disappear tomorrow. These companies may charge a 'stability premium,' but many end-users will find it's worth it."

--Peter Pike / ppike@pikenet.com