FORT LAUDERDALE, Fla.—Verizon (NYSE: VZ) may be aggressively bringing fiber to the home (FTTH) services into multi-dwelling units (MDUs)--particularly in areas like New York City--but the segment has a number of unique attributes.
Speaking during the 2014 FTTH Conference & Expo's MDU Panel, Michael Weston, senior executive, Verizon Enhanced Communities for Verizon, said that there are three special considerations: MDU gatekeepers, sub segments and the millennial generation.
While Verizon does serve a number of MDU types, including condominium developments, its main focus is in serving apartment rental complexes.
Being able to work with the MDU gatekeepers--a mix of property owners, managers, rental agents and superintendents--is a key challenge because they are the first point of contact a service provider meets.
"Getting these property owners, property managers--and even in some large cities like New York City property superintendents--on your side is a big deal," Weston said. "If you really succeed even getting them to buy your product on behalf of their residents is one way you can help yourself in succeeding."
What the gatekeepers want to hear is how a service provider bringing their FTTH-based service will be able to enhance their property from others.
"When you talk to these gatekeepers, you got to go beyond your product value proposition and talk to them about how having your product on their property really helps them in their mission," Weston said. "Their mission largely revolves around can you help them lease units, help them retain residents, help them increase rent somehow, or help enhance the property value."
In recent years, Verizon has seen its fair share of issues with apartment property owners in the New York City market. According to one report, the service provider has filed petitions with state regulators accusing 219 building owners in five boroughs of not permitting crews to wire these facilities with service.
Besides the gatekeepers, service providers have to understand the unique dynamics of residents, or what Weston calls "sub segments," that live in each building. This could include lower income residents and specific ethnic groups that want specific kinds of video content.
"As we talk about financially-strapped residents, you need to think about how you can be more flexible with credit policies if you're going to have success in penetrating properties that have a high concentration of those folks living there," Weston said. "Do your content packages have the content they want? If you go into a property and all the residents are looking for one or two channels in a particular language and you don't have it, you may draw a big goose egg selling into that property."
Finally, there's the millennial group, which represents people born between the early 1980s to the early 2000s, a market segment that tends to place large value on social media, smartphones, mobile computing and other new technologies.
"The way you reach millennials is very different than the way you think about your marketing through social and digital as well as some of the traditional outreach," Weston said.
Echoing Weston's sentiment was Barry Walton, senior consultant, FTTH, who also spoke on the panel.
Before retiring last year, Walton served as senior advisor, Access, FTTH for Bell Aliant. He drove its effort to pass 1 million premises with its FibreOP FTTH network by the end of 2014.
Bell Aliant's FTTH bet has been paying off. During the first quarter, the telco reported it added 16,000 new FibreOP Internet customers, ending the quarter with a total of 200,000 subscribers.
While there's a lot of excitement surrounding FTTH technology, Walton said the engineering teams need to have a clear understanding of what the marketing and sales teams are trying to sell to each consumer.
"The key thing is start off with a good marketing strategy," Walton said. "What are the products you want to sell, because you could come up short with your design that today may work but maybe tomorrow they want to go to something more."
Similar to the way Bell Aliant and others wired buildings for POTS service in the 1970s and 1980s by placing jacks in each living unit, Walton said that service providers should consider ways to automate the FTTH service activation process.
At that time, the service provider put in systems inside the back end of its network to make each jack active. This meant that a new customer could call Bell Aliant and have their service activated immediately without having to dispatch a technician to the premise.
"When I look at what I learned about the MDU, you have to think back at all those evolutions that you went through to finally get to a no-install truck roll," Walton said. "Those are the things you should be thinking about when you're building your network today."
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