TARGET MARKET

Telecom providers agree that another major impetus for serving the MDU space is that apartment dwellers include a high percentage of younger, more mobile and more tech-savvy customers. That makes them perfect targets for many new services, including higher-speed data offerings, wireless services and advanced video.

“Service providers need to be bringing the right set of services to this market, and that means focusing on broadband and wireless, not a wireline service,” Yankee Group's Vittore said. “They should go in there selling value-added services on top of the broadband pipe. One thing we found in our surveys is that if you do a cross-section of the people that have gone primarily wireless, a significant number of them live in MDUs. They are recent graduates, single people or childless couples.”

AT&T saw this trend, Story said, and has “begun rolling out packages that are not tethered to the landline. It used to be the anchor product was the landline, and now we are rolling out packages that include broadband data and wireless or broadband data, wireless and video. We wish we wouldn't lose those landlines, but we want to make sure that shift occurs to another product in that AT&T portfolio.”

In addition, Wi-Fi is included as part of basic U-verse packages, Story said, and that is attractive in the MDU as well. AT&T customers who buy broadband services at speeds of 1.5 Mb/s or higher get free Wi-Fi roaming.

“If they have broadband with us and they are in another city at an AT&T Wi-Fi hotspot, those broadband subscribers of ours can get free Wi-Fi access,” Story said. “It's perfect for the MDU demographic. You see all these young tech-centric individuals sitting in Starbucks, which is now part of our Wi-Fi program.”

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