Sustainable Land Development Today - October 2007 - (Page 33)

TRENDS Communication Easements: Developers Capitalize on Their Rights By Caitlin Clinard As technology becomes engrained into daily life, homebuyers have started considering telecommunications services as an important factor when making their purchasing decisions. As a result, developers are less willing to place the responsibility of these services in the hands of the dominant cable, telephone, and internet providers in the area. Instead, developers are taking matters into their own hands by granting communications easements in their developments, thus no longer being at the mercy of these providers. But meeting customer needs is not the only reason developers are taking advantage of this opportunity. With developers investing a lot of money into the overall improvement of the land, capitalizing on any opportunity that can increase their return on investment makes great business sense. Communication easements not only give the developer some level of control over the services being delivered to the residents, but they also create a generous revenue opportunity. Nearly every day, as the National Vice President of Business Development for Connexion Technologies, Brian Gullette enables developers to negotiate on behalf of future residents for better technology services and products. “An easement is a property right - an interest in the land that shouldn’t be taken away without compensating the developer,” Gullette stresses. “It’s stronger than a right-of-entry used by the public utility companies and it secures an economic right for the developer. It’s like a currency. If the government backs up an easement as a private contract, you’ve got the protection of the U.S. Constitution under the fifth amendment.” There are two fundamental reasons to secure a communication easement: control and return on investment. Control Communication easements allow developers to gain control over the scope of communications amenities offered at their property. The dominant cable, telephone, and internet providers in the area (incumbent communications providers) are typically bound by regulatory requirements that restrict their ability to offer diverse or custom-tailored solutions specific to the community. When public right-of-ways are granted in a new community, the incumbent telephone and cable companies are required to extend their networks into the community in a manner consistent with their entire service area. However, a private communications easement, inside the public right-of-way, provides a tool for independent infrastructure companies and alternative service providers to offer a differentiated solution from the beginning. This way, regardless of what the incumbents are required to offer in that local market, the community can be built-out with truly state-of-the-art communications technologies. In the absence of such an alternative, the incumbent providers own and control the only networks serving the area. Without an immediate and viable threat of competition, the provider has little incentive to provide a higher quality of service. It’s a model that leaves frustrated and helpless customers with little negotiating power. Return on Investment If developers retain the rights to control the telecommunications services that will be delivered throughout their property, they can rent the land for those rights and realize a significant revenue opportunity. They can receive this revenue in two ways: door fees or monthly rent. A door fee is an initial payment or lump sum to acquire customer contracts and provide services to those customers. Monthly rent is a sum paid every month to use the property for network-based service delivery to residents. A steady, recurring revenue stream takes the place of a one-time giveaway to incumbent communications providers. www.SLDTonline.com 33 http://www.SLDTonline.com

Table of Contents Feed for the Digital Edition of Sustainable Land Development Today - October 2007

Sustainable Land Development Today - October 2007 Contents Our Voice Your Voice Editorial Board Mapping the Development Process Looking at a New Dimension The Environmental Liability Continuum GPS System Makes the Grade Regulations: Reactions Mixed Trends: Communications Easements Business Management: Recycling Sustainable Practices: LEED-ND Energy: Community Propane Systems Transportation: Mountain Solutions Recommended Reading Calendar Products/Services Showcase Classifieds Advertiser Index The Last Word

Sustainable Land Development Today - October 2007

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