Subject: [NEXTEL-1] Center for an Urban Future - "Call for Backup"

From: [email-masked]
Date: Thu, 22 May 2003 17:18:15 -0400

-------- Original Message --------
From: Anthony Townsend <[email-masked]>
Subject: Center for an Urban Future - "Call for Backup"

http://www.nycfuture.org/content/reports/report_view.cfm?repkey=112

May 16, 2003

Call for Backup

By Jordan Silbert

How much would it be worth to the city to be able to tell employers 
that lower Manhattan is the most reliable place in the world to do 
business? A billion dollars? Two?

Then imagine that boast could be fulfilled within one year. Without 
digging up the city's streets.

Now how much would you pay?

What if all this could be ours for a public investment of less than $10 
million?

That's the number initially estimated by technology providers for the 
Lower Manhattan Telecommunications Users Working Group--a group of 
senior telecom executives from a variety of downtown's leading 
companies. The group, convened after September 11, 2001, by the 
Alliance for Downtown New York, the Real Estate Board of New York, the 
Association for a Better New York, and the New York Building Congress, 
charged itself with identifying the potential telecom weaknesses 
revealed by the attacks, and developing a strategy for ensuring that 
the area's communications infrastructure was made more secure and 
reliable than ever before. The participants found two important ways in 
which individual building owners could make tenants' telecom 
connections more secure, but it determined that what lower Manhattan 
needs most is a true redundancy, or backup, system.

It also learned that with new wireless technology such a system could 
be implemented for what, in the context of the larger rebuilding 
effort, amounts to pocket change.

The payoff, however, would be enormous. When companies choose a 
location, they are increasingly considering "business continuity"--that 
is, how certain they can be that their ability to do business will not 
be interrupted. This is particularly true of the 
communications-dependent businesses that are both predicted to grow 
over the coming decades and inclined to be attracted to New York City. 
The world's most reliable telecom service would be a very compelling 
reason for such businesses to remain or relocate here.

Says Richard Kennedy, a senior director at the commercial real estate 
firm Cushman & Wakefield: "With the emphasis on business continuity 
planning, more and more tenants in the market for new space are asking, 
'How reliably will the telecommunications infrastructure at this 
particular location serve my business?'"

Fortunately, one of the best-kept secrets about lower Manhattan is 
that, due to decades of investment aimed at meeting the needs of the 
world's leading financial companies, its telecom infrastructure is 
already superb. Second only to a tiny island in Hawaii, which serves as 
a meeting point for the trans-Pacific fiberoptic cables to Japan and 
Australia, lower Manhattan is the "most wired" place on the globe. With 
billions of dollars invested in optical fiber, routers and switches, 
and fiber-optic cable running under virtually every street and into 
virtually every major building, downtown's capacity for communication 
is already one of its great competitive advantages.

Since lower Manhattan has such a solid head start, taking the next 
steps to make it the undisputed world leader in telecom reliability 
would be a quick and relatively cheap way to attract and retain jobs in 
New York City.

The Lower Manhattan Telecommunications Users Working Group identified a 
wireless redundancy system as the most cost-effective means of rapidly 
enhancing the reliability of lower Manhattan's telecom infrastructure. 
Recent technological advances make it possible to transmit enough data 
through the air at speeds high enough to ensure business continuity in 
the event of the disruption of traditional communication lines, even 
for firms that are heavily dependent on their ability to share 
information. The city could make use of this technology to build a 
wireless backup system that serves all of lower Manhattan.

Here's what such a system would look like: An individual company's data 
would flow wirelessly between equipment mounted on the roof of the 
building it occupies and transceivers placed atop strategically chosen 
tall buildings in lower Manhattan. These transceivers would in turn 
connect--also wirelessly--to already existing hubs both within lower 
Manhattan and elsewhere (e.g. Brooklyn or New Jersey). These would 
safely shunt the information onto or off of the proverbial information 
superhighway in the event of a problem with the traditional 
communication lines.

Companies including Merrill Lynch and Bank of New York have already 
given a de facto stamp of approval to such plan by implementing their 
own wireless redundancy systems. However, as one might guess, their 
systems are custom-designed to serve their needs alone--a solution that 
is prohibitively expensive for all but the largest companies, and which 
doesn't allow businesses to share infrastructure costs, as they could 
with the district-wide system described above.

In a very preliminary analysis for the Lower Manhattan Telecom Users 
Working Group, telecom providers estimate that the shared 
infrastructure for such a system would require a public investment of 
less than $10 million. Though both the city and the state are currently 
cash-strapped, this small investment would quickly pay for itself. The 
Economic Development Corporation estimates the direct fiscal impact of 
one $150,000 financial-services job at $150,000 in present dollars, 
over ten years. That includes only the income and sales tax paid by the 
employee. Consequently, a lower Manhattan wireless redundancy system 
would have to retain or attract only 67 jobs over the next 10 years to 
make the initiative cost-effective. And since these numbers do not take 
into account the indirect benefits, also known as the "ripple" or 
"multiplier" effect, the actual economic impact would be far greater.

The funds available for the rebuilding of lower Manhattan are a good 
and appropriate source for the needed investment monies. The Lower 
Manhattan Development Corporation (LMDC), a joint state-city 
corporation, was allocated $2.7 billion by the federal government (out 
of a total federal allocation of $21 billion) and charged with 
"ensuring lower Manhattan recovers from the attacks and emerges even 
better than it was before." A lower Manhattan wireless system would do 
just that, by quickly positioning the area to thrive in the Information 
Age, and it would do so at a cost of less than four-tenths of 1 percent 
(.37%) of LMDC's total allocation. In addition, because a wireless 
system would not require any digging up of city streets, it could be 
implemented rapidly, easily within one year of initiation, 
demonstrating in a highly visible way that the new and improved lower 
Manhattan was already open for business.

While the wireless system would be a natural public-sector project, the 
Lower Manhattan Telecom Users Working Group noted that the capacity to 
improve the reliability of the "wired" telecom infrastructure rests 
largely with private building owners. It identified two specific ways 
in which individual property owners could shore up the reliability of 
the current system, making both the area in general and their 
properties in particular more attractive to prospective tenants.

The first is not much more complicated than drilling a hole. According 
to a recent Downtown Alliance survey, 63 percent of buildings in lower 
Manhattan have more than one entrance, or conduit, through which 
telecom cables enter. While this is a greater percentage than in 
virtually all other central business districts, upgrading the other 37 
percent of buildings would eliminate one of the last cracks in the 
armor. Today, if something happens at the one conduit entrance in one 
of these buildings, whether it be a backhoe accident or a small 
explosion, tenants are likely to lose their voice and data connections 
to the world. Adding an additional conduit entrance and running 
additional cable through it, at a cost of approximately $50,000 per 
building, would dramatically reduce this vulnerability. It would also 
make these buildings much more attractive to existing and potential 
tenants.

"We've found, with our properties, that offering the best in 
telecommunications has helped us attract and retain tenants," says John 
Gilbert, executive vice president and chief operating officer of Rudin 
Management, which owns and operates 14 commercial office buildings in 
the city, including the Information Technology Center at 55 Broad 
Street. "Anything that significantly enhances the reliability of 
tenants' telecom systems would undoubtedly help."

The second way the working group found that building owners can enhance 
the reliability of their tenants' telecom networks is to give tenants 
more choices when purchasing telecom services.

One of the barriers preventing new telecom carriers from serving a 
given building is that the necessary equipment and wiring is expensive 
to purchase and install. As a consequence, the carrier can only justify 
the required investment with a very large new customer or numerous 
smaller customers.

Individual property owners could help solve the problem by installing 
and maintaining central telecom distribution systems in each of their 
buildings--much the way they would install central heating and air 
conditioning units. In other words, rather than requiring each telecom 
carrier to install its own equipment and cables--a costly and 
cumbersome arrangement--a landlord would own the equipment and a 
universal system of cables. Then a variety of carriers could "plug in" 
at the building entrance and serve as many tenants as they could woo 
with the best combination of price and reliability.

The cost to install such a central distribution system in one of Lower 
Manhattan's office buildings ranges from approximately 65 cents to 
$1.25 per square foot, depending on the building's existing 
infrastructure. Assuming that the equipment can be used for 10 years, 
this means that additional per-square-foot cost would be between 10 and 
19 cents per year. Already a mere pittance, that expense could in some 
cases be partially offset by existing economic incentives. For example, 
one provision of the Lower Manhattan Revitalization Plan offers 
property tax exemptions to landlords who increase the assessed value of 
their buildings; another offers real estate and commercial rent tax 
exemptions to tenants in downtown buildings that make investments in 
their permanent infrastructure.

In rebuilding lower Manhattan, billions will be spent and bold visions 
will be realized. However, this will take years, if not decades. 
Investing in a wireless redundancy system could, within a year, make 
lower Manhattan the most reliable place in the world to do business. 
This would not only be a smart, cost-effective way to promote the 
city's economic vitality, but it would also be a high-profile, 
high-impact way to attract jobs that could be started right now.

New York City has faced challenges before. And each time, in a fashion 
that has come to be called "quintessentially New York," we have 
responded boldly with new bridges, new inventions and new industries. 
Today we have another opportunity to reach boldly. We must seize it.

Jordan Silbert is director of rebuilding initiatives at the Alliance 
for Downtown New York, which manages the Business Improvement District 
for the area roughly below City Hall.

NYC Inc., a project of the Center for an Urban Future, is edited by 
Andrea Coller McAuliff.

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