Landlords become kingmakers in the race to get wired

By Campbell McIlroy

Friday 12th May 2000

SHORTLAND TOWERS: Attica's own wired building

Building owners and property developers are the targets in the battle to grab customers for internet and application service providers.

Attica Communications has launched a new campaign to connect entire buildings to the internet and email instead of individual tenants.

As an incentive to the building owner or developer the company is offering to install all the necessary hardware free and then pay either a one-off fee or a monthly commission on subscriber fees.

The only expense to the owner or manager of the building is if they want to market the service to tenants.

So far Attica has connected eight buildings in the Auckland CBD to its network including Shortland Towers and West Plaza Building. All tenants need to be connected is a phone jack. All hardware is housed in the basement of the building, removing the need to buy or lease network hardware or firewalls or lease any costly dedicated circuits.

The high-speed digital access is delivered to a central point in the building, but access is then segmented over the local area network ensure a secure and separate connection for each customer.

The company and its partners also offer services that include a firewall, file backup, domain name and web hosting, pornography filter, server rental and dial virtual private network. The VPN enables companies in constant contact with each other to establish their own internet and phone network - for example, a system connecting all members of a supply chain, cutting the costs of having to use the normal telephone network.

Attica marketing and business development manager Iain Stewart said a lawyer in Attica's own building, Shortland Towers, joined up after the company pointed out he was not paying the $40 a month flat fee he thought he was.

There was also around $200 a month in local business calls from dialling into his ISP and a $60 a month line rental.

Because the company connects customers to the internet over its own data cables there is no need to use traditional phone lines to access the internet and none of the associated costs.

Mr Stewart said the service would not be suitable for all buildings and his company's primary focus was on providing access for small to medium enterprises.

Connecting a building did not prevent tenants from signing up with the internet service provider of their choice, he said.

Soon the company will be launching additional services, including internet protocol telephony, e-commerce hosting and ASP (application service providers) services over the same infrastructure.

In a recent visit, Property Council of Australia chief executive Peter Verwer warned those in the property industry who did not adapt to the digital age would end up as "road kill" on the information super highway.

He said one of the best examples of how the web could enhance the property business was by creating additional non-rental income streams through the provision of business services to tenants.

This opportunity has already been seized on overseas.

In the US property owners have become virtual king makers. A recent article in the Wall Street Journal said telcos were showering landlords with incentives from dinners to stock warrants, and the landlords have become powerful gatekeepers doing the tango with four, five, even six companies at a time.

Predictions for e-commerce revenue in the Asia-Pacific over the next decade is expected to top $US1.5 trillion.

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