Blog Series #7: How to Leverage a Carrier Neutral Hotel to Grow your Business
Roger Willey, VP of Sales and Marketing for Nebraska Data Centers recently shared his perspective on the best strategies to leverage a carrier neutral hotel at the Fall INCOMPAS show. This blog series is an extension of that presentation.
Session 7: How to Leverage Carrier Neutral Hotels to Grow Your Business
So this is the last session of this series. In past posts, we identified industry impact trends, customer demands and expectations in the new world, and the advantages of having a presence in a carrier neutral hotel. Now, where do you go from here?
Each case is different. How, where and why you choose a carrier neutral hotel is specific to your business objectives. But, here are some general guidelines to help direct your discovery and ultimately get the most out of your hotel presence.
- Select a Carrier Neutral Hotel – Identify carrier neutral hotels within reach of your market area. You want to stretch your reach, but not too far. If your network is on the east coast, having a presence in a west coast carrier neutral hotel won’t make much sense. When doing your site selection, start with a natural progression or location that either stretches to the edge of your network or connects the dots between two regions. A quick assessment of your current customers will also help you in the selection of the best location.
Beyond geography, look for a significant number and mix of carriers (regional, national, and international) evaluate their management practices and processes for operations to be sure they are responsive and thorough. Lean toward sites that seem to be growing as that can be an indication that other carriers are finding value in that location. And finally, be sure it is a true “neutral” carrier hotel and that they express a value to a partnership.
- Build your Business Case – Be sure to get a full disclosure of all costs associated with the carrier neutral hotel. Specifically, how they charge for cross connects. Contrast those costs with projected revenue, network operational cost savings, and itemize any network performance advantages (redundancy on IP, diverse route options, peering, etc.). Establish at least a 3 year ROI model to fully evaluate the opportunity beyond the initial capital investment required.
- Don’t Overbuild Initially – Only take on the minimal amount of space required to get your network presence established. Plan for growth by securing a right of first refusal for contiguous cabinets. This allows you to “get in the game” but let the market develop. Initial cost advantages will offset some portion of the monthly operating costs, but as you sell more circuits (either wholesale or retail), these opportunities will help fund the full build out.
- Advertise Your Presence – Be sure to let your wholesale and retail customers know that you have established a presence at a carrier neutral hotel. Based on the feedback we get from the enterprise and wholesale markets, this is a key selling point for you. Yet it seems, at times, it isn’t always communicated effectively. Don’t forget that your retail customers may need a remote site for disaster recovery and that opens up opportunities for additional circuits.
- Educate your Carrier Hotel Contacts – I take the initiative to try to learn each carrier’s connectivity footprint, as well as their key value propositions so that I can best direct our customers for the circuits they need. That has become very difficult with over 40 carrier partners and all the fiber that is being installed. So treat your carrier neutral hotel as a sales channel partner. Keep them updated as networks expand and additional products and services are released. They have a window to prospective customers that you may be interested in your service, so build a relationship with your contacts and keep them posted.
There is certainly more to it than these five steps. But the bottom line is that, with today’s market changes, a presence at a carrier neutral site should at the very least, be considered. Selecting a location that both enhances your network as well as expands your market is essential to the overall success.
I hope you are as excited about the future of our industry as I am. There are some great years to come. The demand and reliance on networks and fiber is greater than ever. I wish you the best as you work to achieve your business goals.
Nebraska Data Centers owns and manages the carrier neutral hotel located at 1623 Farnam Street in Omaha as well as the Sharp Annex which is located in downtown Lincoln. Overall, Nebraska Data Centers offers over 200,000 sq. ft. of data center space for colocation and wholesale data center applications. For more information, or to request a current list of carriers, please call 800 349-0924 or email us at email@example.com.