December 20, 2016 —
At first blush, John Foley and Seth Buechley seem to have little in common. Buechley began building and owning cell towers fresh out of high school and has worked as a systems integrator, while Foley has decades of experience building out fiber networks, including co-founding XO Communications. Yet they both see a business opportunity in the in-building wireless (IBW) space.
In the fall of 2015, Foley had left Henkels and McCoy and Buechley had left his position as president of DAS OEM SOLiD. The two came together to form a consulting services firm aimed at helping enterprises make decisions on the public safety in-building wireless deployment.
“We decided the in-building space on the enterprise side had a lot of opportunity,” Foley said. “We were both very interested in it. We thought that public safety was going to be a key component of that.”
Buechley had started experimenting with an alternative to carrier-funded or third-party funded DAS. The wireless in-building financial model allowed the venue to maintain control over IBW system and the financial structure of the deployment and receive the benefit from it. Priority RF then began advising large venues on how to make that happen
“We have been evolving that model for about a year,” Foley said. “We have been helping both the venue owners figure out how to get systems developed for their space and we have also helped the supply chain understand what the venue owners need and how to sell to them.”
Part of consulting as the building owner’s representative is determining whether the facility requires public safety or cellular or Wi-Fi or location services or digital signage or some combination of them. Then money must be found to pay for them.
“We look at how convergence plays in making the various wireless systems work well and optimizing costs. Then we get it designed and engage the carriers,” Foley said. “It looks like there is no one size fits all, economically. Carriers might be interested in
funding some of the common infrastructure, the signal source, but not Wi-Fi or public safety. We help the venue fund the rest of the project but keep it all knitted together.”
As well as penetrating the second tier enterprises, Buechley sees opportunity in the early movers in large, third-party owner DAS, which are coming to the end of their contracts. “First-tier building owners, in some cases, have 15 years of experience with a certain financial model for their IBW systems. They get to ask themselves if they want to stay with that model,” he said.
Second tier building owners are increasingly motivated to deploy public safety IBW systems, because of the building codes that are being enforced that require it, Buechley said.
“That’s where things are different for the building owner, because now they have something they need to solve for. They are not given the chance to wait for the carriers to fund the DAS in their building,” he said.
An important component of consulting in the IBW space is structuring financing for the equipment. Some systems are paid for through capital expenditures and some through operational expenditures. No two deals are alike.
“Part of our ecosystem is a deep set of assets on the money side. It is important to get it structured properly,” Foley said.
One of the things that have surprised Buechley and Foley is that the demand for consulting has gone beyond venue owners to include OEMs, integrators and others in the supply chain.
Perhaps the biggest surprise has been the inability of carriers to commit to supplying the signal for the building after the venue owner stepped up with funding for the DAS. But that is changing. For the right size business with dozens or hundreds of properties, some carriers have a program to allow venues to purchase the signal source, according to Buechley.
“The problem is the carrier has a lack the rules of engagement for the ecosystem. T-Mobile, however, has laid out expectations and in some ways jumped ahead of the pack,” Foley said. “The reality has been that the carriers were not well positioned to provide the signal source in a way that protected everything they need to protect, but gave the building owner assurance that if they made the investment in the infrastructure the signal source would actually show up. We are seeing the beginnings of that.”