Telecom access to office towers attracts foreign companies to Canadian market

Business demand for telecom services is growing so rapidly, foreign firms are now flocking to Canada. One of the most recent to enter is OnSite Access Inc of New York, which recently established a Canadian subsidiary to provide services to small- and medium-sized businesses in commercial buildings. OnSite Access-Canada's new president and GM believes there are two reasons his employer has set up shop here. "The Canadian market actually represents a large market in North America when it comes to real estate and this type of service of providing business-centric communications," John Piercy explained to Network Letter. "The ‘why now' is really a result of the fact that we have our first customer in Canada, which is Oxford Properties Group Inc. It's kind of nice coming into a country and having a large chunk of the market already under your control." Oxford holds assets of more than $3 billion. It owns a net 22 million square feet in a 43 million square foot portfolio and manages 68 million square feet of commercial real estate. It operates in Vancouver, Calgary, Edmonton, Toronto, Ottawa and Montreal. It also manages property in Louisville KY and Tampa FL. Oxford has formed a partnership with OnSite to provide intensive telephony and high-speed bandwidth access. Piercy says it makes sense for developers to align themselves with communications providers. "I think what building managers are recognizing is it's no longer ‘here's your square feet and isn't this a beautiful view' to sell square footage. People now are much more sophisticated," he says. Tenants are more likely to come in and state their needs and then demand the best price available. Developers realize they can turn to an outside company to run turnkey operations for them, he adds.OnSite is in the final stages of negotiating an agreement with a telco for voice services. Piercy was reluctant to name the company until the final pact is in place, but he expects a formal announcement to be made before the beginning of July. He knows something of the telecom world himself, having been VP of marketing for AT&T Canada. He also has experience at Leitch Technology Corp and The Becker Group of Companies. Bypassing the ILEC's local wiring OnSite also serves as its own ISP, offering email and web hosting services to customers in office towers. One of the differences in its provision of telephony services is that the company does not use ILEC wiring. "We run up the riser in buildings our own category three and category five copper as well as multi-mode fibre and then we terminate that on every floor of the building," Piercy explains. "We own the wiring right up to the telecom closet on the floor of the building where the client is. That way if there's a problem, we have visibility to it. We have responsibility to fix it. "The other thing on ILEC wiring is a lot of buildings that were wired even five years ago have all twisted pair wiring and that is not really conducive to broadband services." OnSite will be using a combination of DSL drivers and fibre drivers. It all depends on the customers. "If they're looking for high-speed Internet for 100 kilobits, DSL is a perfect fit even up to multi or a few megabits. If they're looking for 40 or 50 megabit service because they're doing some really high end web hosting then we would bring the fibre to bear and that's why we run fibre with our copper." The company is concentrating on the six Canadian cities in which Oxford Properties operates. Piercy says OnSite will only expand if the real estate demands are there. He questions the approach of many CLECs, which strive for more and more points of presence. "Our attempt is to get into the building and then sell a large population base," he says. "I don't know how seven or eight CLECs are going to compete for the number of customers in the building and make money at it."

Telecom access to office towers attracts foreign companies to Canadian market

News | June 5, 2000

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