What the new age of Internet technology means for student housing.
Not surprisingly, one of the biggest challenges in the student housing industry is centered on technology. The advancement and proliferation of connectivity devices such as smartphones and tablets is certainly no secret, and providing the ability for anyone to connect anytime anywhere is an infrastructural conundrum on top of mind for today’s developers, owners and operators.
But on a micro-level, similarly to the way the student housing industry is unique when it comes to real estate, technology at both on- and off-campus properties plays a different game than what we see in the general public. In particular, university students create a higher demand for Internet bandwidth than any other concentrated demographic, and managing that demand continues to become more complicated.
Trends in Internet Technology
For the most part, it’s no surprise where the trends are going for on-property usage of technology in student housing. Residents not only are bringing more devices along with them, but also they’re running more complicated applications on them.
“In a nutshell, it doesn’t take a rocket scientist to see that more and more applications are being added on the property,” says Bill Rinard, CEO of Airwave Networks. “Two years ago, every resident had one to two devices that could connect to the Internet, and now we’re seeing them come in with four to five.”
From traditional web browsing to a wide variety of connected applications such as social media, online video, voice, gaming, and mobile apps, on-property networks are now expected to handle academic learning systems as well as more complex property management system software. The question is how all this information will fit on a single network. The answer is simple. It won’t, at least not on what has been in place in the past.
“The real message is the old way we did this is no longer valid; I get a lot of calls from owners and property managers who have 2,000 beds, and they’re losing leases because Internet is poor,” says Andrew Marshall, executive vice president of Campus Technologies Inc. “The biggest challenge is dealing with the history from before student housing became a sector in its own right, when traditional management came from multifamily and signed a seven-year agreement for cable and Internet, to which they’re still locked in. We’re suffering from legacy of all these agreements with the ‘mystery meat’ of bandwidth coming into the property.”
Amidst all these new technologies, the biggest bandwidth user is entertainment video. Students are still watching cable on their big-screen TVs, but they’re also using them to stream video, and in many cases, “co-viewing” — as Rinard puts it — which means that they’re simultaneously watching TV while looking at Internet video, and texting and emailing their friends through their mobile devices to talk about it, all of which takes up precious bandwidth.
“We are seeing dramatic growth in video consumption across a number of devices with many universities reporting entertainment video traffic accounting for 60 to 90 percent of bandwidth demand,” says Brian Benz, CEO of Campus Televideo. “So as before we were delivering content just to the TVs, it’s now going to the PC, the smartphone and the tablet, and on top of that, Skype and Facebook among others are further integrating videoconferencing technology into their framework.”
All of that, quite obviously, adds up to demand for higher bandwidth speeds. “At an average property, we’re seeing a 15 to 25 percent increase year over year,” says David Lippke, director of operations for Korcett.
What does that increase mean for the student housing industry? Basically, that bandwidth needs not only to be available, but also to be managed properly.
Keeping Students Connected at Full Capacity
Since Internet access, and access to bandwidth in particular, is the perhaps the number one amenity in the student housing environment, property owners and managers need to realize that there’s a new way to handle this amenity.
“The student housing industry has purpose-built real estate, and what we need is purpose-built technology,” says Kirk Priess with The Preiss Company, an owner of off-campus student properties, based in Raleigh, North Carolina.
Marshall agrees. “There are plenty of hardware suppliers or vendors that can supply one piece of the jigsaw, but nobody who could deliver designed, well thought out, tested and appropriate solutions,” he says. “For this reason, we had to come up with our own.”
What that means is the tools need to be in place in student housing-specific communities so that everyone has the amount of access they need.
Benz reports that keeping up with bandwidth demand continues to be a challenge for universities. In the Campus Televideo Annual Bandwidth and Information Technology Survey, of the 221 colleges that responded, 40 percent reported that their networks were saturated (at capacity) for seven-plus hours per day. And while 65 percent added bandwidth in the past year, more than 50 percent still plan to add bandwidth in the next year as well.
Benz goes on to explain how the dramatic increase in usage has changed the over-subscription model used by ResNet service providers to estimate bandwidth requirements. Just a few years ago, a property could meet service levels using a 20 to 1 over-subscription. In other words, only 5 Megabits of bandwidth would be needed to deliver 1 Megabit service to 100 tenants.
“Today, estimating bandwidth requirements is not so easy, because you have more and more people watching two-hour movies on the Internet,” Benz says. “Now the math is down to 10 to 1 and getting smaller, and scale matters. That’s one advantage on campus, whereas if you have 100 to 200 units in a property off-campus, managing bandwidth demand patterns get more difficult.”
Marshall notes from Campus Technologies’ white paper Future Bandwidth Requirements for Student Housing Networks that “a law termed Nielson’s law stated that bandwidth available to high-end-users will increase at a rate of 50 percent each year. While this has proved largely correct in the last decade in the U.S., some other countries have outstripped this law and are continuing to do so. In the case of Hong Kong, we previously noted that instead of 50 percent the actual number in 2005 was 1,000 percent.”
He adds that the U.S. is 24th in the world when it comes to bandwidth usage per person, whereas a lot of other countries are providing 200 to 400 megabits per user, and that’s the norm. “We’re now saying if you have less than 100 megabits connected you have a problem, and if you don’t have a way to control it you’ve got a problem,” Marshall says.
Beyond just having enough overall, however, making sure each resident has appropriate access is paramount.
“Traditionally, most student housing operators have just thrown bandwidth at a property on a building-by-building or property wide basis,” says Lippke. “This allows the higher use residents to draw more than their share of bandwidth and restricts the usage of the other users. This type of scenario also allows for speeds to drop for all residents during peak usage times, which can create a negative experience and generates noise from a help desk perspective.”
Rinard supports this. “Left unchecked, 6 percent of the users will use 98 percent of the bandwidth, and if we turn off the tools, it would revert to that,” he says. “So whoever they work with, property owners have to have a ‘bandwidth fairness’ policy. We make that sure 100 percent of residents gets fair access to the bandwidth resources.”
Cost of Access
The issue, of course, is providing all Internet usage for free, because connectivity is now a free amenity rather than a paid service.
“We’re looking at strategies for property managers to best handle the challenges that come along with providing this service as part of their rental rate,” says Henry Pye, vice president of RealPage.
Even if your property provides equal access to everyone, there will be certain users that want more, and there are options for tiered access and pay-to-play type scenarios. However, John Baloga, vice president strategic planning and chief investment officer for Airwave, is confident that a student housing complex won’t have to worry about that too much, if it offers a reliable amenity service with reasonable base levels of bandwidth.
“We don’t offer additional bandwidth for heavy users at all our properties, but at the properties we do offer upgrades, there’s less than 1 percent take rate,” he says. “It’s a funny demographic; they will all tell you they want as much as they can get until they have to spend for it.”
The final piece of the puzzle goes beyond the resident and focuses on guests to the property. While bandwidth is a lot easier to upgrade through wired access, mobile and wireless devices are what’s taking a healthy percentage of the overall usage.
“Both on and off campus, students and their guests want ubiquitous wireless everywhere, whether in a lounge area on campus or maybe a pool area off campus,” says Benz. “The challenge with ubiquitous access outside the buildings is that network access authentication is critical. Unlike off-campus properties, colleges and universities typically want to provide guest access services which adds another layer of complexity to authentication.”
Wireless introduces a new range of complications because more mobile service providers are ending unlimited data plans and introducing usage caps, so mobile device owners are seeking out open wi-fi networks to a greater extent. Thus, as Internet access becomes more prevalent on mobile devices, a robust wireless infrastructure for residents becomes increasingly critical. However, proper installation is paramount.
“One of the most common mistakes a property owner inexperienced in technology makes is putting up a couple wireless access points themselves with free unfettered access,” adds Baloga. “In that case, the property becomes the customer of record for the Internet service, and anything done on the network is their liability.”
The solution to this is to have a high speed wireless canopy over the development, and while that is not a complicated endeavor, there are limitations.
“Wireless is finite, similar to what’s happening the cellular industry, where there can be only so many users in a space,” says Rinard. “But that said, rolling out wifi as a canopy isn’t expensive, but it must be done properly. You can over-engineer it and get bad service, and you can under-engineer it and have holes. There’s a balance here.”
“Wireless networks bring a number of new administrative challenges; for one, they tend to feel the weight of multiple simultaneous connections more than wired networks and there’s more risk for higher ping rates (lag), which means it’s probably not the optimal solution for anyone doing any sort of online gaming,” adds Tim Stanton, creative director with Campus Habitat. “So while it may come at a slightly higher cost, I think we’re still at a point where offering both options is preferred, though I expect this to change over the next couple of years as wireless technologies improve.”
Lippke notes that because usage patterns in a student housing environment are completely different than an average household, installation, electronics, cabling infrastructure or support staff has to be ready for spikes in activity every time they happen.
“In our environment, individual users have their own account so there is no difference between being in a common area or their apartment. They receive the same speeds and ease of connecting no matter their physical location within the community,” he says. “With regards to security, I think it is incumbent upon the data management company to provide a degree of security through a firewall or like device at the property. This combined with well refined switch configurations, can maintain the security of the individual residents whether it’s from another resident in the community or in the outside world.”
But overall, the challenges presented by the student housing environment are an incubator for the larger trends in technology, and as a result, being on the forefront of these trends is leading the way for future standards in Internet infrastructure.
“It’s an exciting time, because we’re breeding the next class of tenant in multifamily,” says Baloga. “We get to experience the youngest of a consumer demographic, and we’re providing an indicator of what’s going to be desired.”
— Dan Marcec