An apartment complex owner wanted to attract and retain more residents at her property. She wanted a high-speed internet provider to attract and retain residents who watch online video, work from home, or game online. The last time she negotiated a contract with a telecommunications provider, a cable company paid her a lump sum to be the only provider at her property for a 7 year period. While she appreciated the money, she realized after she was stuck in a contract she had been bribed to allow a monopoly at the property. Frustration over poor service, speeds and prices led to resident turnover and angry property reviews.
Since her contract with the cable company was nearing the end of 7 years, she wanted her residents to have a choice of telecommunication providers. Frontier (the local telco) had increased its fiber footprint and capabilities in her town and could now offer higher speed internet and TV over the copper/DSL (old telephone lines) at her property. She allowed Frontier access to the telephone lines and to market their services to her residents. She was glad there was some competition for the cable company, but she still wasn’t sure she wanted to renew with the cable company.
DISH approached the apartment complex owner with an intriguing offer. DISH was not willing to bribe her for exclusive rights to her residents. If she was willing to give DISH access to her property’s coaxial wiring instead of the cable company, however, DISH would bring a high bandwidth dedicated internet circuit to her property through a third party internet provider. DISH could then offer residents faster internet than the local cable company with speeds up to 1 gigabyte per second, which would attract and retain residents who demand fast, reliable internet connections. DISH could also use three discrete satellite dishes above the central equipment room, and its smartbox to provide satellite quality TV over the same coaxial wire.
DISH gave the property owner two options to implement their service at the property: 1. Individual service, where anyone who wanted to sign up with internet and/or TV from DISH could at individual rates (which were competitive with or better than Frontier’s rates) or 2. Bulk service: the property owner could pay a bulk rate for all units to get a TV package and/or high-speed internet.
The property owner chose to provide bulk services to her residents: a 25 MB download speed x a 5 MB upload speed to all residents and a TV package that included some of the most popular channels (ABC, CBS, Fox, NBC, AMC, ESPNs, Disney, Discovery, etc). Since she could essentially purchase DISH’s service at a discounted bulk rate, she realized this expense would really be an investment in attracting and retaining more residents and allow her to charge a higher rent.
There were also some unexpected benefits to the property owner. DISH hosted property events at the property which created a sense of community on the property. New residents were thankful they did not have to wait for an installer or drive to wait in line to pick up equipment at a local cable company in order to watch TV or connect to the internet. Current residents loved that they no longer had to pay a cable bill and were willing to pay slightly higher rent for the new amenity. Most residents found the 25 MB download speed fast enough to do everything they wanted online from streaming video to working from home. DISH also allows residents who wanted more (faster internet speeds, DVR, more TV channels, etc.) to be able to subscribe with individual accounts. Since satellite TV was available from each coax jack in the apartments, the property owner no longer had to abide by the FCC’s Over the Air Reception Device Rule and could eliminate all of the satellite dishes that had popped up during the cable contract since so many people had gone to satellite after frustration with the cable company. DISH was able to provide service to the fitness center equipment TVs, while the cable company was threatening to eliminate the analog signal that the TVs were compatible with.
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