I shake my head everytime I see a stat like 1% to 5% for fiber connected office buildings. I don't dispute that it may be literally true (I don't stipulate it is true, either) -- this seems like one of those "prove me wrong" statistics.
As a practical matter, for the next several years at least, the count and percentage of office buildings with ACCESS to wireline broadband services is much higher. Class A buildings in the NE can virtually all be presumed fiber connected -- some by several fiber networks. That is normally not the point of the statistic when it gets quoted by WCII, TGNT, ARTT, or other companies with an alternative broadband approach. These companies all say they are now focused on the medium to small business opportunity. So ... what is the situation with Class B and smaller multi-tenant office buildings, say, 10k to 100k+ square feet, with several tenants sharing a roof?
There is a demand side and a supply side to consider. On the demand side, it is still rare for medium and small businesses to decide they need higher than T1 access speeds (yes, it happens, but it is a miniscule portion of the building inventory.) Virtually every building is accessible with HDSL or HDSL2 for wireline T1 access via the ubiquitous copper network, at very competitive costs (I said cost, not price; price is complicated by tariffs and CLEC coverage.) One might ask, How relevant is the statistic of fiber access to such buildings?
On the supply side, these kind of statistics ignore the most common network topology for fiber penetration into "lowrise" business areas. Typically, a controlled environment vault is strategically located a short distance by wire or fiber from multiple business buildings, and houses the Fiber mux, voice channelization gear, UPS, etc. Accordingly, until there is demand for a T3 or faster service in a specific building, the literal fiber penetration into buildings stays modest. (In some companies, there may be a policy to extend fiber with the 4th or 6th or whatever T1 service, but this is an engineering decision, not a design imperative.)
Note, then,that while the BB wireless companies may suggest that the ILEC fiber is stalled back at the CO vault, it is actually often staged within 100 - 1000 feet or so of many of the buildings in the "97% dont have fiber connection" count.
I might note as well that some of the published PR puff pieces that offer-up pro-forma financials on wireless vs. fiber broadband access cost structures include an average of up to $300k to get fiber into each of the "97%". I have noticed such nonsense financials even being picked up by non-discriminating (or sleepy?) analysts who build them into their own pro-formas. These add credibility to the bottom line numbers but hide this significant error a layer deeper in aggregated financial assumptions.
Since I'm criticizing someone elses numbers, I need to make my challenge with an estimate of my own. I can speak first hand about fiber building access in the NE where this kind of business service topology is the standard and therefore common. Typically, the building entrance facility from the closest CEV plus the basic multiplexer cage and power costs between $40k to $80k, all-in. A big part of the spread is distance to the CEV, road crossings, and how big the initial mux installation will be -- the forecasting element of engineering. |
