What if I gave you a way to remove an obstacle in deploying DAS systems? When selling DAS, usually the price can be in the way, even though you offer your best price, you may need a way to help the customer pay for it. Maybe this will help you move ahead in your next DAS deployment. You all know that the carriers are not crazy about smaller shared DAS venues any more. T-Mobile made this very clear with their recent statements that they don’t want to pay for DAS systems. They are tired of paying for these systems and getting a limited return. They are not alone because Verizon, AT&T, and Sprint were already headed in that direction. Small cells are going to help drive the cost of DAS systems down and now that LTE is taking over, the new systems will be all digital. It also looks like they will be a mix of Wi-Fi and LTE-U. Here is a way to help the enterprise and real estate companies pay for the systems.
Before you start to panic, the large venues, like stadiums, will continue to be paid for by the carriers using a combination of LTE and Wi-Fi for content delivery. As you know everyone is using their phones and tablets to see the replays and the extended coverage at these games. The NFL gets it because they offer enhanced services in most stadiums for the people who pay to see these games. They want you to appreciate the game by seeing it live and seeing every possible angle on your device. That is really cool!
Back to the smaller venues. I just watched a presentation that Iain Gillott of IGR put together to show that most users of smart phone rely on it indoors. I would say in an enterprise environment. He sells the report here if you’re interested. This is a growing area of concern but the carriers no longer want to pay for any DAS systems. So the business or building owner will need to pick a carrier and then install. Now Wi-Fi makes it easy, if you install Wi-Fi then you offer them a data solution. But what if they need to make a call or if there is an emergency and 911 becomes an issue. If there is no voice coverage in the building then the problems compound. Many work places no longer rely on landlines, so the wireless coverage is crucial!
Voice still matters! If someone collapses do you text someone for help? Just like public safety coverage in large buildings. The first responders need to stay in touch with their crews on every floor, whether it’s the roof or the basement, everywhere in between is a critical area when there is an emergency. Lately there have been many emergencies here in the US such as fires, bombings, and shootings. What about a medical emergency? If you have a heart attack you want to make sure they can do what they can on the scene so you are stable for the ride to the hospital. That’s how I see it. First responders need to have seamless coverage.
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So I see the need for DAS and not just for the carriers but for public safety’s first responders. This is becoming a requirement in most cities. I am sure that building owners will push back because of the additional cost, but when someone dies in their building they may see the need. I have an example of an ordinance for Riverside, California, which has requirements for public safety radio coverage in buildings of excess of 50,000 square feet here. City of Irvine, Ca, here. Seattle, Washington, here.
First off, I would recommend that the carriers let go of their hold on the front end, it could be a small cell or the BTS, I wrote about it here, but they need to come up with a system to allow DAS to get installed so they stop being the bottle neck of the process. They say that they don’t want to pay then they won’t let anyone else install the system. Well, which is it Verizon and AT&T? Make up your mind to let the public do this so they can help your coverage. Public safety groups are so happy when someone offers to put in a system for them. They don’t push back, they say thank you!
This is where Sentry Financial can help. They will finance the DAS system for creditworthy customers so that the installers and vendors get paid. Then the owner can make reasonable payments over time and it will be a write off for them all the same. See the win-win? The vendors all get paid, the building or business owner meets the requirements without all the upfront costs.
I had a conversation with Jenn Faber (firstname.lastname@example.org ) of Sentry Financial Corporation, the director of business development, about financing these systems. I am interested because I plan to work with small cell and DAS side of the industry more and more. This is a segment that is booming. We just have to come up with ways to make it affordable.
We all know that the carriers need to free the small cells so that the integrators can put in more affordable DAS systems without the carriers slowing them down. Carriers are becoming an obstacle in system growth! My job is to remove as many obstacles as possible.
So Jenn told me that financing is a great option for the larger DAS systems going in, why? Because it provides a model where the financing is taken care of ahead of time. Here are some questions I asked her.
- What DAS systems would you finance?
- All DAS systems for creditworthy end users. Financing may include passive or active equipment as well as design and installation.
- Who would finance these systems? Would it be enterprise, building owners, government entities, utilities, small to medium businesses, installers, or who?
- We will provide lease financing to all creditworthy end-users including enterprise, building owners, utilities and middle market companies (e.g., revenues >$50M and positive net income last 3 years, tangible net worth, and audited financials).
- What price range would the DAS system be in?
- Minimum project cost of $250,000, no maximum if the end-user’s credit supports the transaction.
- What OEM do you see deployed the most often?
- Primarily SOLiD, CommScope, TE Connectivity (now part of CommScope), Corning, and JMA in DAS.
- Do you have a requirement for the integrators doing the DAS installation?
- We typically work through the OEM or integrator partner and rely on their expertise for the installation. Nevertheless, the integrators must be experienced and reputable.
- When financing, what would the payment terms be like for time, like 5 or 10 years?
- For DAS the lease term generally ranges from 36 to 60 months depending on the business accounting, tax, and other objectives of the end-user. At the end of the lease term, the end-user had the option to: purchase the system, upgrade the system, or extend the lease term.
- Do you work mostly with the DAS contractors or the end-user when finding the business?
- We typically work through an OEM or integrator partner (DAS contractor) to enable them to offer the lease financing solution to the end-user customer. We have also worked directly with the end-user.
- How would a potential customer go about getting financing with your group?
- An OEM, integrator, or end-user may contact Sentry directly, information below. Sentry typically starts with a high level overview of the project, project costs, and financials of the end-user (3 full years and most recent interim financials). If the end user is a public company, we can get their financials online. The creditworthiness of the end user must support the transaction.
So there you have it, all you need to know about financing a DAS system. This is one more way you can deliver DAS to your customer, one less obstacle that the integrators have to contend with.
For more information about Sentry Financial Group contact the people below.
Director, Business Development
Director, Business Development
Chief Executive Officer
So remember that wireless deployment will have challenges but here is a way for you to remove one of them.
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