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Old 06-11-2007, 08:29 PM
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Default DC Relationship With Carriers

Hello All!
We have been in the hosting/colo business for over 4 years and now have a great opportunity to partner with another company to open a 26,000 sq ft datacenter with room to expand further.

Obviously the easy (and most popular) way to bring bandwidth to the site is to simply purchase multiple lines from several providers. My question is: at what point do providers begin to establish a POP at your facility to directly service your customers?

Perhaps I’m going off in the wrong direction but my thought was that if we can convince a few providers to establish POPs in our datacenter at the beginning (based on location, space available, pre-sale commitments, facilities, projected bandwidth needs, etc.) then we would significantly reduce our initial bandwidth costs and allow clients to either buy mixed bandwidth from us or connect directly to one of the carriers—we win by having lower bandwidth costs, clients win by having a greater choice of providers, and providers win by having a relatively large customer base in a small area.

Assuming that is just a dream and carriers only grow their on-site facilities as bandwidth needs increase how do DCs handle cost/fees when several large clients begin to connect directly to a provider? Do we live with only the revenue from space and power? Do we charge the provider for space occupied in the DC? Do we charge the client for the lines run outside of their cage/suite?

Thanks in advance for your input,
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Old 06-12-2007, 02:27 PM
katietwtc katietwtc is offline
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Join Date: Oct 2006
Location: Tampa, FL
Posts: 27

From a carrier perspective... without going "POP"

If you had a fiber based provider in the area where you anticipate the data center to be... you can see what revenue commitment it would take to bring your building "on net". In doing this, the carrier would terminate service in a common area. You would charge your customers to do the cross connect into their cage. By having a fiber based provider, virtually any carrier can buy last mile connectivity from that provider.

For example, I work for Time Warner Telecom. We provide our facilities into a number of data centers. We can service our customers in your facility via that connection, we can service you via that connection and any carrier that wants to use our loop can provide service to your customers.

In Tampa, we built fiber directly to Company X. Company X bought Ethernet Internet from us and Level 3. Company X sells their customers Internet Access in their space. We are not allowed to sell to them directly, that's how Company X get money. We can, however, provide transport circuits directly to their customers.

If Company X allowed us to, we could easily service their customers directly. Ultimately, it is up to the Data Center. They make a nice profit off of the resell.

Having a fiber based provider eliminates the need to order additional larger circuits for capacity. It also allows you to provide your customer a quicker turnaround on getting circuits installed. AND... if you choose to resell the circuits instead of your customer directly buying it, you can pass along the SLAs to your customers.

I know that in our market, Tampa, Time Warner Telecom, Level 3 Communications and Bright House Networks are still doing fiber builds to customers. Without knowing your area, I can't recommend a company.

Just a thought from a carrier perspective.
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Old 06-15-2007, 08:50 PM
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Thanks Katie, that was very helpful. We actually have a meeting scheduled with our local TWTC next week, it turns out your SONET is right outside our location
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Old 03-19-2008, 02:26 AM
Zitibake Zitibake is offline
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Join Date: Dec 2005
Posts: 113

Originally Posted by katietwtc
In Tampa, we built fiber directly to Company X. Company X bought Ethernet Internet from us and Level 3. Company X sells their customers Internet Access in their space. We are not allowed to sell to them directly, that's how Company X get money. We can, however, provide transport circuits directly to their customers.
Is this limitation against Internet transit common when a non-neutral colo provides cross-connect to a carrier? I wonder how Company X prevents TWTelecom from selling Internet direct to its own colo customers. Once the cross-connect is in place, how is the colo provider to know what is riding on it?
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Old 03-19-2008, 02:03 PM
katieatqwest katieatqwest is offline
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Join Date: Feb 2008
Location: Reston, VA
Posts: 7

Of course, in this industry, there are work arounds. Just depends how many hops you want and points of failure you are willing to take on.
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Old 06-05-2008, 12:23 PM
Blast Blast is offline
Join Date: Jun 2008
Posts: 45

I would say two things...

1. Never tie yourself to a contract or agreement for long periods because the industry's technology and packages are changing or should I say evolving.

2. In this way you are now able to move with the services / arrangements best suited to profit, because after all at the end of the day making a buck is what it's all about.
USA Wants These People
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Old 09-21-2008, 11:16 AM
tomandrew tomandrew is offline
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Join Date: Sep 2008
Posts: 25

Thats a great idea, but creating a datacenters is not a easy task. Once done with the permission of the companies, surely it will help in increasing our task.
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Old 03-30-2009, 04:31 PM
rebeccahawkins rebeccahawkins is offline
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Join Date: Mar 2009
Posts: 2
Default Level 3 Communications

Many large DC's utilize Level 3. Please shoot me an email or note to link up in more specific terms.

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