Publication Date: Winter 2000
Every autumn, the Council of New
York Cooperatives & Condominiums holds its day-long information-packed
Housing Conference at Hunter College, where 60 workshops and
seminars present unparalleled opportunities for board of cooperatives
and condominiums to learn and to share information on every
aspect of operating their buildings. The following article,
providing an overview of high-speed Internet access options
available to buildings and their residents, is based on information
presented at a workshop at the 19th Annual Cooperative Housing
Conference, chaired by Michael Jay Wolfe, president of Midboro
HARNESSING THE INTERNET
FOR YOUR BUILDING
Technology has brought about enormous changes in the way New Yorkers
live and work, and this has created new challenges for cooperative and
condominium boards. With more and more shareholders and unit owners going
online and adopting new technologies, boards are faced with new decisions
that will affect building finances, the sales prices and marketability
of the apartments, and the everyday lives of building residents. The key
to staying on top of the technological wave is to do your homework and
try not to panic ë new technology is available every day, but that doesn.t
mean you have to have it all.
For most individuals and businesses, the doorway to the Internet
is through an Internet Service Provider (ISP). The best-known
ISP is America Online, which provides software that makes
it easy for users to get onto the Internet. The field also
includes Mindspring, RCN, Earthlink and others. Most home
Internet users now connect to their ISP's using modems, ranging
in speed from 28.8K (28,000 kilobytes per second) to 56.6K.
But others, generally those who work from home or do a lot
of Web-surfing, are looking to higher-speed access.
And that.s where the board comes into the equation. Many high-speed access
options require bringing additional wiring into the building, so there
are economies of scale to be had if many residents convert to any new
technology at once. The ultimate decision rests with the board because
these options generally require contracts with the building.
According to Michael J. Wolfe, President of Midboro Management, Inc.,
there are now a handful of options for high-speed Internet access, and
boards need to choose carefully among them. "The important thing
to remember is that you don.t need to rush," he says. "New technology
is coming along all the time. You don.t want to be the first on your block
to adopt a new technology; you do want to make the best choice for your
building." The current crop of high-speed Internet access options
includes two front-runners --Cable Modem and Digital Subscriber Line (DSL).
Here.s a look at both:
Cable modems are devices that attach to the cable TV network connection
in a home. This broadband technology is being offered by the cable companies,
including Time Warner and RCN. The two advantages of cable modems include
speed and convenience. They can download information from the Internet
at up to 30 megabytes per second, and they are always "on" --you
never have to dial up; when you turn on your computer, you.re online.
The main drawback of cable modems is that the bandwidth is shared among
all users on a line, so as more users in a neighborhood get online at
the same time, your access could slow to a relative crawl. Another problem
is that at this time in New York City, many homes can only receive one-way
cable modem --they download information through the cable modem, but upload
data (sending e-mail and requests for Web pages) through a phone line.
This means that users will pay about $40 per month for a cable modem,
and still have to set aside a separate telephone line for uploading.
Many boards might feel their options are limited in the cable arena.
The dominant cable player in New York City, Time Warner, has a franchise
contract with the City through the year 2008 to provide service. This
means that even if one resident of your building wants to use Time Warner,
you must allow them access to your building. However, you can bring in
other providers to offer service at the same time. Shop around to see
if these alternative providers will offer a better price to residents.
If you use this option, note that the second company can use Time Warner
cables inside apartments, but must bring in their own outside wires and
string their own cable in the public areas of the building. "This
may not be practical for some older buildings," says Mr. Wolfe. If
they can.t bring it up the elevator shaft, it could mean core drilling
to get the wire in. Most buildings would rather concentrate on a leaky
roof than on getting cable wire into the building."
Digital Subscriber Line (DSL).
DSL provides high-speed access to the Internet, corporate networks and
on-line services over ordinary phone lines. That is, you can surf the
Internet and speak on your telephone at the same time. That provides enormous
advantages whether at home or at work. DSL is fast --more than 100 times
faster than 56.6K modems. And, like a cable modem, it.s always on.
DSL requires some installation. The company you use --dozens of companies,
including many local ISPs, are installing DSL in residential buildings
--must place a piece of equipment called a "router" into your
building, usually in the basement. This allows the digital signal to travel
to computers in individual units. The cost of installing this piece of
equipment is generally borne by the ISP --if it is assured that it will
sign up a certain percentage of residents for service. This is all part
of the negotiation between the board and the provider.
One major drawback to DSL is that not everyone is capable of getting
it. Your building must be within about 18,000 feet of a central phone
company switching station. That.s "telephone company" feet,
not actual distance. A good way to find out whether DSL is available to
your building is on the Website DSL Reports (www.dslreports.com). Type
in your home area code, phone number and address, and it will deliver
the verdict. This Website is also a good place to begin your search for
a DSL service provider, with more that 800 providers in its database.
It shows you service options, specials and prices.
But DSL offers one major advantage over cable modem: your data travels
along your own line, so your speed isn.t reduce by others surfing at the
same time. DSL comes in a selection of speeds, from 128K up to 2 megabytes
of transfer capability (faster than a T1 line, which runs at 1.5 megabytes
per second). Service costs to users generally starts at $40 per month
(about the same as a cable modem). THE
A third option is wireless access to the Internet. Compared with cable
and DSL, this is "bleeding-edge" technology, and is now mainly
used in high-end hotels and businesses. In a wireless scheme, the building
is wired with a high-bandwidth connection --usually a T1 line --and then
fitted with transmitters on every other floor (depending on the floorplan
and other considerations)o-on-demand. The transmitters communicate with
wireless modems in each user.s apartment. This option is a viable option
for older buildings where stringing wire is difficult and costly. It is
currently being implemented in the Plaza hotel in Manhattan, where each
room will soon have wireless Internet access.
NEGOTIATING AN ACCESS DEAL
According to Mr. Wolfe, the best route for cooperatives and condominiums
is to negotiate a building-wide access deal for all residents. "You
can be assured that if you wait and do nothing, individual tenants will
start bringing in their own solutions one by one," he says. "Instead,
you can provide significant economies of scale to all residents, and help
improve apartment values overall, by getting one large package deal for
the entire building."
This means researching the options and providers available to your building,
then contacting the providers serving your area. Remember, notes Mr. Wolfe,
that you have a lot to offer providers --namely, a demographically attractive
group of users. Don.t speak to just one provider; many offer limited-time
deals and other incentives. For example, providers may throw in the router
and other necessary equipment for free if they believe they can sign a
certain percentage of the building. The cable operators may give users
the required cable modem and the first month.s access for free. In addition,
most providers will become partners with the building, paying a percentage
of the monthly fees to the building. Co-ops and condos may choose to pass
this incentive along as savings to residents. "It.s like any other
bidding process," says Mr. Wolfe. "You want to know the market
before you go shopping, and you want to make sure you get the best possible