Instead of constructing their own offices, many businesses rent space in large buildings like office complexes, shopping centers, or strip malls. This shared situation offers a unique opportunity to secure better bandwidth at lower costs by joining forces with other tenants in the building.

There are a few approaches to leverage the collective bandwidth requirements of multiple businesses. One method is for the building owner to become an ISP, providing bandwidth to all tenants. This involves the owner determining everyone’s needs and then seeking the best bandwidth deals based on the combined demand. Once a provider is chosen, they install a line to the building’s router, which then distributes the bandwidth to each tenant based on their requested amount. The owner then bills the tenants monthly for their usage and pays the provider.

Alternatively, the service provider might handle individual tenant billing directly, removing the building owner from the equation. This can be viewed as both positive and negative. While it relieves the owner of managing telecom matters, it also eliminates the opportunity to add a markup to telecom services for additional revenue.

This concept works because bandwidth costs decrease per Mbps as the purchased amount increases. Contrary to what one might assume, 100 Mbps rarely costs ten times more than 10 Mbps. In reality, it’s likely to be only two or three times the cost, depending on the competitiveness of the market. Even the difference between 10 Mbps and 1 Mbps is significantly less than tenfold. A savvy building manager can leverage this to offer tenants better bandwidth deals than they could get independently, all while generating a profit.

To attract tenants, some buildings include basic business broadband in their lease agreements. This could involve the building owner installing a router and wiring the building for 10 or 100 Mbps Ethernet, possibly including wireless access points. The telecom feed can be as basic as a single T1 line for light usage or Ethernet over Copper, providing up to 5, 10, or 20 Mbps to meet tenant needs. With 1.5 Mbps T1 lines or 3 Mbps EoC costing less than $300 monthly in some areas, providing this service to 10 or 20 offices is relatively inexpensive.

Another important factor to consider is the need for fiber optic bandwidth, which is essential for businesses engaged in video production, medical imaging, computer-aided design, simulation, and various research activities. Obtaining these high-bandwidth services requires the building to be “lit” for fiber optic service, meaning a fiber optic cable connects the building to a carrier’s equipment, actively delivering bandwidth.

If dark fiber was installed during construction, getting it lit might be simple. However, it’s more likely that the building’s only communication lines are copper pairs installed by the telephone company. While these can be used for T1 lines and Ethernet over Copper, substantial bandwidth requires fiber optic strands. Installing new fiber in established areas, whether underground or overhead, can be incredibly challenging. This difficulty is amplified in remote locations where fiber infrastructure is nonexistent for miles.

This lack of fiber access can hinder businesses with high bandwidth demands, potentially compelling them to relocate for better service availability. While carriers might be open to installing a fiber drop, they often expect the building owner to bear the construction costs. The potential to secure multiple customers with significant bandwidth needs within a single building can influence their decision. Carriers are always searching for profitable expansion opportunities, so a combined request from multiple tenants or the building owner representing a substantial bandwidth requirement might be enough to persuade them to cover some or all of the construction costs.

If you’re a building owner, manager, or tenant requiring private lines, dedicated internet access, SIP Trunks, or similar telecom services, it’s worth exploring competitive quotes for yourself, your tenants, or the collective needs of multiple businesses in your building.

Note: Photo of Portland office building courtesy of Ian Poellet on Wikimedia Commons.