There is no way any building company is going to outmuscle the consumer electronics or telecommunications and entertainment companies in the realm of marketing. A builder's brand in this space is going to depend upon the reputation of the components and services it offers in a digital home package.
So it's critical that when a builder chooses a digital partner, it picks one with a reputation for delivering quality and value. This may seem an odd way to introduce the concept of a marketing partnership with a phone company, given that most consumers love to hate them. But the old “Baby Bells,” which have shrunk through mergers from seven to four, are courting consumers—and builders—with bundled telecommunications offerings that are usually priced lower than those offered by their chief competitors, cable TV operators. And their quality of service, especially in old-fashioned, self-powered telephony, is not offered anywhere else.
Phone companies are starting to seek relationships with builders of large developments, both residential and mixed-use, and master planned communities. Their goal is to sign up large numbers of customers for their bundled packages, who are more likely to remain customers than those who take these services on an a la carte basis.
That's all well and good, but what's in it for the builder/developer? According to Andrew Ward, CEO of Cuscowilla on Lake Oconee in the Georgia Lakes region outside Atlanta, the peace of mind offered by turning over communications and entertainment to BellSouth late last year was worth the price of admission. “They blew me away with the tech support they brought in,” he says.
Ward was faced with a unusual predicament. Cuscowilla is a mixed-use development, with 255 homes (eventually 555) and 180 villa-style bedrooms and a corporate conference center. Telecommunications was a nightmare. Guests and residents could not use their laptops at the pool. The conference center lacked facilities for video conferencing. Homeowners had to shop around for phone, Internet, TV and security services.
Ward's payback was the technical work BellSouth did on his corporate infrastructure. There are any number of ways a Bell-South partnership can be structured, with builder/developers reaping cash benefits through door fees, residuals, or by buying services in bulk and reselling them at a margin to residents. “When we know we're going to get 100 percent penetration, we'll go in and offer them a much more aggressive package,” says Jacobs.
BellSouth established its Community Technologies Unit specifically to work with builders/developers. Last November, Pulte Homes signed a preferred provider agreement in BellSouth's nine-state service area.
As for branding, BellSouth traces its roots to the old Southern Bell Division of AT&T. It still uses the Bell logo, albeit a modernized version. That symbol remains among the most recognized icons in corporate America, synonymous with quality of service. Which is exactly what Cuscowilla's Ward wanted. “When you're master developing a project like ours, you're supposed to be doing it right.”