[WSJ: Is the Web Speed Limit Climbing For Gotham's Bandwidth-Bereft?]
By TIMOTHY HANRAHAN
THE WALL STREET JOURNAL INTERACTIVE EDITION
NEW YORK -- For 11 months I lived in a sunless cave in lower Manhattan. I almost never got direct sunlight, and then only if I stuck my head out the window. The one perk was that my apartment was wired so I could piggyback off a T-1 line for $50 a month. It was nice: In a flash, I could download pictures, new browser software, 120-page SEC filings, etc.
At the time, I didn't realize how lucky I was, bandwidth-wise. (Though I would've traded it -- and in fact eventually did -- for being able to see the sun.) One of the many inexplicable things about New York City is that while it's the self-styled media capital of the world, it's also a bandwidth ghetto: Unless you have an absurd amount of money you're willing to part with, or move to a wealthy suburb, you can't get on-line at a decent speed.
Okay, that's also true for most of the rest of the planet Earth -- but at least there you get promises. In our office, some of those who dwell in distant suburbs are already enjoying cable-modem access, or salivating about its imminent arrival. But the New Yorkers? Strictly analog. In Brooklyn, Time Warner Cable isn't even offering extra channels until after the millennium. What's the point of asking for a cable modem when you can't even get Animal Planet?
But for the lucky, lower Manhattan has been a bit of an exception to the cruel bandwidth calculus: The scattering of T-1-equipped residential buildings like the one that held my cave is now being joined by buildings offering much faster surfing over cable modems.
RCN Takes the Stage
Take RCN Corp., for instance: The telecommunications upstart is offering a bundle of high-speed Internet access, phone and cable-TV service to customers in several new high-rise apartment buildings near Wall Street.
Cable giant Time Warner Cable hasn't set a date for rolling out its Road Runner modem service in Manhattan, so RCN -- at least for now -- has a head start. (The company refused to disclose numbers.) RCN is charging $40 a month, in line with amounts charged by rivals Road Runner and AtHome Corp. -- though not in New York, of course. And while only available in a handful of properties, RCN's cable modems can be bundled with plain-old telephone service and cable TV -- something Road Runner can't offer.
You say, you don't have RCN? Then, good luck. Road Runner spokeswoman Sandy Colony says that New York City is "a high priority" for the venture, which is backed by Time Warner and MediaOne Group, the former cable arm of U S West, but the company hasn't set a date for service rollouts. Ms. Colony says RCN could be a competitor, but adds that the high-speed Internet-access industry "is growing so fast, there's room" for rival services. How big of a rival remains a question: Even as RCN plasters subway cars with its ads as part of a multimillion-dollar marketing campaign, eliciting specifics from the company about its plans can be excruciating.
The High-Bandwidth Class
While the mere existence of cable-modem service from RCN offers the bandwidth-hungry some hope, it isn't exactly easy to find: It's available only in a limited number of properties. In newspaper advertisements for 21 West Street and nearby apartment building 100 John Street, cable modems are being packaged as another amenity for upscale city dwellers, much like fancy dishwashers or marble bathrooms. Cable modems, like New York City's recently legalized garbage disposals, are a nice perk but not a deal maker.
Indeed, at 21 West, cable modems themselves haven't brought in many potential residents, says Cathy Lanzarotti, a leasing agent for the 31-story Art Deco building. Instead, prospective residents simply like having one carrier -- and one phone call to make when they move in -- for phone, cable and Internet services. Still, the office is trying to drum up interest: The leasing office has a PC hooked up to a cable modem and it's, well, it's pretty darn fast.
At 21 West, the influence of the Internet is more apparent elsewhere. A lot of apartment seekers have stopped by to look at apartments after first checking out the building's Web site. The site, set up by building developer Rose Associates, offers views from the building, a description of the neighborhood and a list of building amenities.
The site also offers an unwitting insight into one reason lower Manhattan enjoys more high-speed access than other parts of the city. It puts a soft spin on 21 West's location: True, it's a stone's throw from Wall Street, but it's also a soft lob from the Brooklyn Battery Tunnel ramps and West Street, a six-lane highway that doubles as a parking lot for tourist buses. Similarly, 100 John Street's Web site devotes a lot of space talking about how close the building is to the South Street Seaport and trendy Tribeca and SoHo -- and then deadpans: "Since downtown is still mainly a business center, you will be free from noise and disturbances at night since the area generally clears out after 5 p.m."
In other words, crank up the cable modem, because there isn't a thing to do once the lights go down.
But in Manhattan's hot real-estate market, none of these potential negatives matter much. Wall Street firms are generating record profits, crime is down precipitously, and there is scant new apartment development elsewhere on the island. Also, generous tax breaks from the city in the Lower Manhattan business improvement district further eased the risk for Rose and 100 John Street developer Moinian Group.
And again, these apartments aren't cheap. At 21 West, which already has tenants moving in, one-bedroom apartments are starting at about $2,300, and apartments on the upper floors -- which boast stunning views of New York Harbor and downtown office towers -- can be more than $5,000 a month.
Waiting for Fiber-Optic
But even if you can't afford to pay $30,000 a year in rent, RCN may soon come knocking. Flush with cash from a bond offering, the company is rapidly laying fiber in the Boston-to-Washington corridor, and has set plans to lay a similar network in California. RCN's network has 123,000 homes passed -- meaning homes eligible for service -- as of the end of the third quarter, up 94% from the first quarter. While RCN has 710,000 customers overall, its total number of service connections on its fiber network, or "on-net," was 48,000 in the second quarter, with most of those for cable TV and a mere 1,500 for high-speed Internet access.
The "off-net" connections were helped by a string of acquisitions, including Internet-service provider Erol's Internet, which have made RCN the biggest provider in the Northeast. Michael Harris, of market-research firm Kinetic Strategies, says it will be "interesting" to see how well RCN can convert its dial-up Internet-service customers to its bundled, "on-net" services as its network expands.
"RCN's been making a lot of noise, but they're only passing about 120,000 homes," says Mr. Harris, adding "that's not a big footprint" compared with millions of homes for the companies aligned with Road Runner and AtHome.
"The big challenge," he says, "is to continue the buildout and get enough return on that," in the face of expanding service offerings from the big cable companies.
As for me, I can now only gaze in envy at the bandwidth-bathed towers of lower Manhattan from my new residence in Jersey City, N.J., where looking at the sun is a nice alternative to watching the hourglass on my browser.
The move landed me in the service area of Comcast Corp., which runs infomercials all the time touting their ComcastAtHome cable-modem service. After finding out that the company's Web site didn't show Jersey City on its rollout map, I called customer service. The guy who answered asked me where Jersey City was -- not a good sign -- then added that if it's not on the map, you're looking 21st century. At the earliest.
Mr. Harris and others are confident the big cable firms will pick up the pace. But I've been hedging my bets, just in case. Several months ago, I put myself on a Bell Atlantic mailing list: After all, they'd just announced a big DSL rollout that included Jersey City. The Bell Atlantic folks sent me a note a couple of weeks ago:
"I have placed your name on our ADSL reservation list for notification when the service will be available in your area. This is not a guarantee that you will be able to receive InfoSpeed service. Due to certain technical limitations, ADSL may not be available to everyone in a particular service area."
At least now I'll be able to see them coming. |
