Navigating the complicated business environment caused by COVID-19 is not easy for neutral-host DAS and communications infrastructure providers. But thanks to the pent-up demand, expertise and some fancy footwork, ExteNet has still announced a number of recent wins this spring, keeping its crews busy.
In May and June, it extended its neutral host in-building DAS networks at the recently opened Reach building within the campus of the John F. Kennedy Center for Performing Arts in Washington, D.C. where it already has a multi-carrier network and at two office buildings in Philadelphia-One Penn Center and 1515 Market St. Additionally, Citizen Broadband Radio Service (CBRS) networks were deployed for RTO Wireless, which provides mobile voice and data, broadband, backhaul, and IoT for rural markets in the North-East states, and Cal.net which focuses on enabling connectivity and bridging the digital divide in rural California.
We spoke with Tormod Larsen, chief technology officer, and Greg Spraetz, SVP of real estate solutions, to get an update on ExteNet’s progress and how it is weathering the pandemic. Tormod has been with ExteNet since 2004 and oversees product strategy, network architecture and strategic solution development while Greg oversees all in-building sales activities.
How have the municipalities dealt with the pandemic and what was the effect on your business?
Larsen: I would say that the environment was different and somewhat unique in each city. Although some of the municipalities were impacted more than others, we were able to achieve a lot because wireless infrastructure was deemed essential in jurisdictions. We are glad to see things beginning to stabilize now and businesses opening up once again.
On the deployment side of things, both indoor and outdoor, we have found that the pandemic and all the restrictions that came into play meant that our deployments just needed closer management. With construction crews being prioritized owing to its “essential services” categorization, we were able to remain on site to a large extent. On the indoor side, access to some buildings were closed during the peak of the pandemic but we gained access relatively soon. There are several in-building deployments for mobility and fiber solutions we can point to where we had short term closure but resumed activities soon after, while there are many situations where network construction continued without much disruption.
How has ExteNet reacted to the pandemic?
Larsen: We prioritized the health and safety of our employees and contractors and ensured our staff had access to PPE [personal protective equipment], followed newly established safety protocols, and took extra precaution in everything affecting our communities. We became more efficient in many ways, often learning to do more with less. Optimizing our processes and building efficiencies were majorly emphasized. Our crews are working collaboratively with others, achieving more in single visits to the sites and inherently avoiding risks and exposure.
What about deploying DAS in venues where the seasons had been canceled or postponed?
Spraetz: It was easier working on systems in some sports and entertainment venues where the season and internal operations had come to a virtual halt. Some of those venues were transformed to makeshift hospitals and testing centers, so we had to convert the existing wireless system to a different use case to assist the frontline workers. But we have also had to work through situations where some venues were temporarily shut down. Overall though, we are back on track now and upgrading the networks including transitioning to 5G in many venues.
Are there vertical markets where you are forecasting growth coming out of the COVID pandemic?
Spraetz: A key vertical where we are seeing new opportunities is healthcare. The carriers and others are prioritizing mobile and fiber connectivity in these facilities. The pandemic highlighted the need for mobility infrastructure and underlying fiber connectivity to serve caregivers, first responders, staff, patients and their families. The commercial real estate market will also need to adapt to social distancing measures inside the building while upgrading their facilities to touch-less access with mobile connectivity being a key enabler. Building owners need to increase their occupancy and connectivity will become an increasingly important amenity. We also see uptick networks being deployed in suburban and second-tier markets as people and businesses increasingly adapt toremote work. Rural networks will be prioritized as bridging the digital divide by providing high-speed and affordable connectivity for the underserved will be an ongoing focus.
How has the pandemic changed use of the communications infrastructure?
Larsen: The wireless industry has stabilized at about 25 percent increase in capacity. Both mobility and fiber requirements will continue to increase as the bandwidth used and speed requirements will continue to grow exponentially with video, collaboration tools, augmented reality (AR) and virtual reality (VR) becoming mainstream in many verticals. There is also a change in traffic origination expected with an increasing number of people working remote, being educated at home, and the location of use moving from the urban centers to the suburbs. This changing traffic pattern is resulting in an increasing load on data centers requiring high-bandwidth and low-latency fiber connectivity. Applications are now residing more in the cloud with some research indicating that by next year roughly 90 percent+ of all enterprise workload will transition to the cloud, leading to an even higher need for fiber connectivity with purpose-built networks.
How are enterprises evolving in their data infrastructure?
Spraetz: While reports show vacancy rates in some office buildings increasing to 20 percent owing to the pandemic and some companies embracing remote working for some staff members in the longer term, we are still early in the assessing full impact on the commercial real estate market. As enterprises gauge and assess their on-premise staffing requirements for the short and longer term, they are definitely transitioning their applications to the cloud or to an offsite data center to improve their network operations and drive efficiencies. We firmly believe that while the network architectures will evolve, the underlying demand for advanced mobile and fiber connectivity will continue to rise as the enterprise data and video usage will continue to grow exponentially.
You recently completed a neutral-host DAS network at 1515 Market Street in Philadelphia, a 20-story, Class A, 500,000 square foot building. You also deployed a DAS at Philadelphia’s One Penn Center, a 670,000-square-foot Class A commercial office art deco building. What are the trends for DAS in the enterprise?
Spraetz: We are seeing an uptick in deployments in the middleprise building market. The carriers are looking at this from the network perspective and where they need to offload traffic. This can also be part of the preparation for 5G deployment, which will demand that in-building coverage is shored up with seamless connectivity for 4G.
Both of these buildings were undergoing major renovations, and building owners were investing millions into the building. At the same time, they were interested in improving mobile connectivity. The awareness of the need for mobile connectivity and fiber is increasing as I have mentioned before.
Historically carriers deployed only in buildings that were more than 1 million square feet, then it dropped to 750,000 square feet and now we are seeing 500,000 square foot buildings become important to carriers depending on their capital allocation and on the size of the market. In these deployments, you see the flavors of the different sizes that we can cater to in different verticals. Today, we target any building of 250,000 square feet and above with a mix of carrier and building owner participation in the funding. However, the need for a neutral-host network is no longer a question as it lends effectively to a multi-carrier setting.
What do you think of in-building wireless systems that use general access authorizations in the Citizens Broadband Radio Service?
Larsen: There are some companies that say CBRS will take care of all the communications needs in buildings. We adopt a more neutral approach and believe in co-existence. Wi-Fi has its role; the public networks have their role and private LTE will have its role in these buildings.
For example, CBRS will have a different role in commercial real estate than it does in a manufacturing plant or a hospital. In manufacturing, private LTE will provide a level of service that Wi-Fi cannot, and it will provide low latency levels that the commercial network may not be able to deliver. CBRS can enable smart building applications and flex-space solutions in commercial real estate.
Wi-Fi may meet tenants’ needs given it’s lower cost but Wi-Fi is quite rudimentary with no service guarantees, mobility and/or voice coverage. However, it’s important to know that private LTE is not as simple as enabling Wi-Fi. With private LTE, you essentially become your own carrier.
The real question with private LTE for an enterprise is whether their IT department is ready to take on a a carrier’s responsibilities as effectively the network owner becomes the carrier. That’s another example of how ExteNet becomes extremely important for the network owner by deliver a carrier-class experience for the private networks, both LTE and 5G.