Broadband Communities

AUG-SEP 2017

BROADBAND COMMUNITIES is the leading source of information on digital and broadband technologies for buildings and communities. Our editorial aims to accelerate the deployment of Fiber-To-The-Home and Fiber-To-The-Premises.

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36 | BROADBAND COMMUNITIES | www.broadbandcommunities.com | AUGUST/SEPTEMBER 2017 INDUSTRY ANALYSIS MDUs Are Back! What Does That Mean for Broadband? Construction of multiple-dwelling-unit (MDU) housing is booming, but owners and broadband providers need to read the fine print. By Steven S. Ross / Broadband Communities N ew apartment buildings have always been the sweet spot for broadband network deployments. at sweetness has grown. In the United States, more than 300,000 new privately developed dwelling units have been started each year since 2014 – a rate that exceeds the prerecession peak – even though construction of single-family homes has not recovered. All but about 12,000 units a year are in buildings with five or more units. Vendors have taken note and introduced a wide array of products to make MDU fiber deployments ever-cheaper to implement. Fiber cables are thinner and more flexible. Connections rarely require fusion splicing, so deployments are faster and require less skilled labor. Outdoor fiber can be pulled inside with no splice at all – workers can simply strip off weather shielding. Hubs have been made smaller with a dizzying array of tricks, including standardized trays and simple but effective gaskets that allow easier maintenance. Older buildings can benefit from new techniques that combine existing copper with wireless, G.fast, DOCSIS 3.1 and all-fiber passive optical networks that extend at least to the property line or basement, if not to the unit. However, most new MDUs are still outfitted with copper broadband infrastructure rather than far more robust (and often less expensive) fiber-based systems. As gigabit internet service becomes the norm, it behooves builders to look beyond their lists of "old, reliable" low-voltage wiring contractors and search for contractors that can supply the latest technologies. What's more, even experienced property developers and broadband suppliers may fall into the new economy's financial traps when justifying broadband builds. THE RENTAL TRAP One glaring example: New MDU construction overwhelmingly consists of rental units. e proportion of households that own their dwelling units has fallen from its peak – nearly 70 percent – to less than 64 percent today. Young, first- time buyers and those who lost their homes to foreclosure or short sales in the recession have great difficulty finding mortgage lenders. Rental costs are rising relative to income, driven by the resulting demand for rental units, so more unmarried renters must now share apartments and houses with friends and roommates. Deployers are attuned to credit issues. e weak credit history of many renters accounts for much of the gradual increase in the number of households offered bulk services – broadband and video services whose costs are included in the rent rather than billed separately by providers. Bulk service saves residents money, cuts deployer per-unit operating and marketing costs, and puts building owners on the hook for the fees. at helps deployers obtain financing. However, it also reduces residents' broadband choices and induces many to take only the bulk video package with no extras. Residents then look for content online,

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