All right. I have no further questions for the time being; I may come back for more. Councilmember Rizzo?
Thank you. Getting back to apparently your philosophy to go aerial. It seems that most communities, most new construction is normally more desirable underground for esthetic reasons. I'm wondering, when you reach areas that are, by 104 5/16/00 STREETS, SERVICES - BILL 000121 law, ten units or more required to be underground, I believe it is ten residential units or more, are you going to not provide service to those customers because they don't have aerial facilities? Are you going to not provide service to those people? If you get into the far Northeast, where you get into a development and there's no 10 aerial facilities to attach to and someone would want to be your customer, what would you tell them?
Councilman Rizzo, it's John Young again. Thank you for the question. We will be serving 100 percent of the residents of Philadelphia regardless of whether we are able to build directly into their location. In areas where we're not able to build directly into their location for various reasons, you know, there may not be -- there may be, for example, a moratorium, as there's going to be this summer, with the Republican Convention. We will still serve those customers by utilizing existing Bell Atlantic wiring from our collocated facility with Bell Atlantic into that site. 105 5/16/00 STREETS, SERVICES - BILL 000121
Now, Councilman DiCicco referred to the aerial fee of some nominal per-mile charge. I believe, if my memory serves me correctly, that there's an attachment fee for each pole that you attach your facilities to, so you pay PECO Energy, and PECO Energy, I believe -- I don't know what -- does PECO pay per pole?
Yes, there is a fee that we pay per attachment per pole that PECO charges us.
Could the Streets Department tell me -- I believe they have a blanket permit that they want to change, replace poles that L&I and whatever, but does the energy company or the telephone company pay any fee at all to the City per pole?
Councilman, it's John Cunningham again. Yes, they do pay. I think the total revenue is approximately somewhere around a quarter of a million a year for their pole.
All the poles that are the City of Philadelphia, a quarter of a million?
And, again, that 106 5/16/00 STREETS, SERVICES - BILL 000121 revenue that you pay per attachment will be revenue that PECO Energy gets but, again, nothing back to the City?
And that's not your problem, we understand that, but we're obviously looking for means of additional revenue because it's a business, it's a business that you're in, and as I said to the other folks from Columbia when they were up here, this is all becoming new to me, so it's a business, and businesses are taxed for whatever -- for a lot of reasons, obviously, but, you know, we tax businesses in a lot of different shapes and forms. And I'm just wondering if there's a possible revenue stream that we could generate for the City in addition to the revenue that the businesses want to generate for themselves, which you're entitled to, obviously, to make a profit. Did you have any more questions?
Yeah, just to follow up. So that I understand clearly, if a person is in an underground development and they would choose to be a customer of Cavalier, that to 107 5/16/00 STREETS, SERVICES - BILL 000121 compensate for the fact that you don't have underground facilities there, you would provide your service via Bell Atlantic equipment to them at the same price any other customer would pay?
Yes. Our network design primarily, we're building our network fiber optic backbone to Bell Atlantic central offices. Central offices are located strategically throughout the City, and from that central office, we collocate equipment that allows us to basically lease the last mile of Bell Atlantic copper into the home. Basically with the equipment we're going to put in those central offices, we'll be able to provide newer technology and newer services and higher bandwidth to the home. For example, with our DSL product, we'll be able -- currently under a normal plain old telephone service line going into your house, the bandwidth going into your house is about 56 Will kilobits per second. With our DSL product utilizing the existing copper wire of Bell Atlantic into that community with underground wires that we'll lease from Bell to get there, we'll be able to up that 108 5/16/00 STREETS, SERVICES - BILL 000121 bandwidth 100-fold. You're talking about megabytes per second. And that definitely will help bridge the digital divide, I believe, and that's what we're all about.
Did you hear the scenario that I described earlier of the circuit- busy situation? Will you contribute to making that a better situation? 'Cause it's hard for me to believe that our Bell Atlantic company has put themselves in a situation with growth and have not spent the money to upgrade their facilities to meet the demand. I mean, I again have personally been involved in four or five issues where they say they just don't have the facilities to deal with the fax machines and the Internet, that people tie up the phone lines. So will you help or will you --
Councilman Rizzo, I don't know if you noticed when I was sitting back there, but I almost chuckled when you asked that question because the network we're building is definitely 100 percent increasing the capacity of the ability for a residential customer in Philadelphia to make 109 5/16/00 STREETS, SERVICES - BILL 000121 and receive telephone calls and Internet telephony calls definitely. What we're doing is, we're installing a new switch -- the problem that Bell has is that they're out of capacity on their switches to the machine that actually routes a call from one user to the other. We're installing a new switch here in the area, and that switch is going to provide additional capacity to alleviate those concerns.
But I've been told -- in all fairness now, I've talked to some of the outside people, the cable people that tell me that the problem -- and, again, you need to clarify something because you're telling me if you're going to start utilizing some of the existing Bell Atlantic facilities that you're going to have a negative impact on an already bad situation, because I've been told by some of the retirees -- I'll put it that way -- that have retired from Bell Atlantic that Bell's got a cable, a 50-pair cable going down a street that every time they have a problem with a pair, they go from that pair to another pair, and now they're down to 36 pair. And at night, when you try to 110 5/16/00 STREETS, SERVICES - BILL 000121 make a phone call, that there's just no place for those calls to reach the central office or whatever. And I heard Councilwoman Miller say, "Is that why I get a fast busy signal?" Is that what you said? And I've been told it's not because of the central office switch; it's because the facilities on the street have deteriorated to the point where they just cannot accommodate all of the people with one, two, three, call-waiting, all those things that are so -- that we depend upon. So when I hear you telling me that you're going to use Bell Atlantic facilities, that says, Wow, now we'll load it up with even more calls. So correct me if I'm wrong but, again, I'd like to comment on the fact that maybe --
Cavalier has the capability to providing adequate transport from the end-user customer to our central office. At our central office, you can -- it's a virtual pipe from the end-user customer all the way over to our central office switch. There is no Bell Atlantic switch in the way to provide a fast busy signal. The dial tone would come from our central office 111 5/16/00 STREETS, SERVICES - BILL 000121 switch, and there would be -- the capacity there is from the Bell Atlantic residence customer all the way to our switch. There's no in-between. It's a virtual connection that starts at the residence customer, comes to the Bell Atlantic central office, never touches the Bell Atlantic switch, and is immediately put onto our network for transport back to our switch.
You bypass the switch but then you eventually go back to the Bell Atlantic facilities that I described that are already overwhelmed with calls.
It's my understanding and, you know, I'm not sure of the exact instance you're referring to, but it's my understanding that Bell Atlantic's primary problem right now is on the switch side because of the all the Internet hold times. The average call has gown gone three minutes -- you know, ten years ago, the average call, you pick up the phone and you talk to somebody for three minutes and you hang up -- to over an hour, when you pick up your phone through your modem line and dial the Internet and surf the 112 5/16/00 STREETS, SERVICES - BILL 000121 Web for over an hour. That's what I understand is the capacity issue.
Okay, and I'm going to move on because there's other people that want to speak, and it's taken a while now. But, again, I'm surprised that Bell Atlantic's not here, but I'm concerned, again, what I'm hearing is that the facilities are starting in our neighborhoods to deteriorate to the point where rather than fix or replace something, that they're just moving from this defective pair to the next good pair, and then when something else becomes defective, that cable that once could carry 50 telephone calls is now down to or 30. 17 And once you arrive on the scene, your 18 going to be taking or placing calls through those 19 same lines, so something's got to give. Either we 20 have to have Bell Atlantic put additional cables 21 to support what you're going to do or repair the 22 ones that they have. So this abandonment policy 23 that they have to go from bad to good and then 24 they're down to hardly anything is -- 25
We're building a new 113 5/16/00 STREETS, SERVICES - BILL 000121 network in Philadelphia and increasing the capacity of an existing telecommunications infrastructure today. Our business requires that Bell Atlantic provide us adequate capacity for access to the end-user customer that, as you can see by that chart over there, 99 percent is still on Bell. And when you don't have competition in place, Bell can say to you, "I'm sorry, there's just nothing we can do." When our business depends on it, we have the ability to go to the FCC, to go to the State Public Utility Commission, and really make a big issue of it.
Before I recognize Councilwoman Miller, and Councilmember Rizzo raised some very interesting questions as to systems that are in place today and many of these systems are very old and beginning to deteriorate. What are your experiences in constructing telecommunications systems in other cities?
Basically, Cavalier Telephone has about 250 miles of fiber already up and running and constructed in the Richmond area 114 5/16/00 STREETS, SERVICES - BILL 000121 and also going up to northern Virginia and also, I believe, the Virginia Beach area. Prior to that, the owner of Cavalier Telephone, Brad Evans, used to own Phone Michigan, and also Phone Michigan built a substantial network in the Michigan area. So we've done this several times and --
Have you had any issues in those municipalities? And if you had, how did you resolve them? Were there any construction issues out there that you know of?
Well, the installation of the facility -- of the conduits, or if you're coexisting with other companies, have ever there been any problems in these various municipalities, that you know of?
Okay, thank you, Mr. Chairman. I'd just like to get back to this whole 115 5/16/00 STREETS, SERVICES - BILL 000121 issue of the digital divide and the fact that -- I think your name is John Young?
John Young described it as the new civil rights struggle, and I'd like to hear more about that.
Councilwoman Miller, thank you for the question. Those are actually Chairman Canard's words, the FCC Chairman, who called the digital divide the civil rights issue of the 21st century. And by that, I think he meant that whereas, you know, there were different civil rights issues of this century, the information divide and digital divide between, like he said, the haves and have-nots has already created a gap between those inner-city urban populations and the populations that have had access to high bandwidth Internet services and advanced telephony services. What we're trying to do at Cavalier, where -- I don't know if you were present for the testimony of the group just before us when they 116 5/16/00 STREETS, SERVICES - BILL 000121 came in and talked about business services, but we are actually, I believe, the first facilities- based competitive local-exchange carrier to come into Philadelphia and offer an actual alternative to Bell Atlantic for regular telephony services and Internet services, a company that owns its own switch and that owns its own infrastructure in Philadelphia.
So basically what you're saying in English is -- I'm not technical.
People can opt to have telephone service through you; is that what you're saying?
Yes. What we hope to do also is really prod Bell Atlantic into offering a better quality of service here in Philadelphia. Obviously, the network we're building cannot handle 100 percent of the telephone lines in Philadelphia, but give us half and we'll be happy.
Okay. So then the digital divide is not just about economics; it's about access.
Okay, let me just ask you one more question. Because of the overloading -- and that's my term -- on Bell Telephone or Bell Atlantic's wiring, is that why we're kicked off the Internet, off AOL?
There's a number of reasons you'd be kicked off the Internet, and I'm not going to pretend to give you all of them. I have AOL also. Part of the problem is AOL's capacity on their own backbone network, but Bell Atlantic does have problems with overload on their network when people get on the phone and stay on for an hour versus the three-minute call I talked about before. That really chokes up the system, and what we're doing is bring additional capacity to that telecommunications infrastructure in Philadelphia.
When do you anticipate -- a twofold question. When do you anticipate that you will first be offering services to Philadelphia customers, and when would 118 5/16/00 STREETS, SERVICES - BILL 000121 you expect that those services would be available to all residents and businesses?
Councilman DiCicco, thank you for the question. As the Director of Sales for Cavalier Telephone here in Philadelphia, it is my job to push our operations folks to get this network turned up as soon as possible. My performance is based on the number of lines that we have installed. Currently, our plans call to begin installing our switch probably around July 1st. We anticipate that will take about six weeks to finish installing that switch, at which time, we will begin to offer services. Our current collocation plans call for turning up the Market Street and Locust Street central offices, I believe, if not as one and two, in the top ten of our COs. So I anticipate that by September 1st, we will be offering some services to the residences and the businesses of Philadelphia, completing our installations through the end of the year and into 2001. 119 5/16/00 STREETS, SERVICES - BILL 000121
What residential communities do we anticipate first? I would expect the business community, which is primarily Center City, so to me, that's a given. But do you have a plan? What communities do you expect to go in first? I'm sure you have a priority list of those communities.
Actually, we do have a list. The neighborhoods we would start with, I believe, from our network build-out would be coming first through the northern end of Philadelphia, I believe, coming down through Broad Street, hitting the central offices along that area.
What central offices do you mean? Can you give me the locations or -- do you mean Cheltenham Avenue, coming from north to south?
Yes, coming from north down to south. The reason we're starting that way is that we need to get to what is called "a tandem," which is the main interconnection point between my network and Bell Atlantic network. The tandem is located at Market Street, so I need to complete 120 5/16/00 STREETS, SERVICES - BILL 000121 that connection first. From there, we'll branch out, going to West Philadelphia and also going down to South Philadelphia, and then go to Northeast Philadelphia to complete various loops.
When you say "West Philadelphia," I assume you're speaking to the universities first, or would it be the residential? I'm really interested in what residential communities you anticipate will be able to have access to your services. And although I consider the University of Pennsylvania Drexel obviously our neighbors and friends, but there's a residential community beyond University City that I'm concerned about.
Exactly. And after our network is completed, if can you look at our network, we're hitting every Bell Atlantic central office that serves all residential communities in Philadelphia. So following the dots on our backbone, it's easy to see that from every dot there, we'll be able to serve a radius area of, like, one to two miles, and they will all overlap.
But, again, I'm 121 5/16/00 STREETS, SERVICES - BILL 000121 just curious in what order, if you have a plan. I assume there's got to be an order to that plan.
You used the word "underserved" in your testimony, that one of the purposes of Cavalier is to serve the underserved communities in Philadelphia. Could you define, and I think that's the answer the chairman is looking for, which of those communities that you believe are underserved in Philadelphia. And what do you mean by "underserved"?
Well, by "underserved," I mean areas in which no other company currently is offering local telephone service or high bandwidth DSL services.
Those neighborhoods would be South Philadelphia, West Philadelphia, North Philadelphia, Northeast, every -- basically every -- 122 5/16/00 STREETS, SERVICES - BILL 000121
You mean, this service is not being offered anywhere in Philadelphia?
And that's the wrong -- Bell Tel -- if you're telling me that there's no competition --
That's different from being underserved. Is there a service -- is this service being provided, let's say, to North Philadelphia, in the Barrio, in the Latino community? Does Bell Tel provide this service in that area?
Bell Telephone does not provide high bandwidth DSL services at every one of their COs in Philadelphia, and we certainly intend to provide DSL services for all the communities served by --
Again, answer my 123 5/16/00 STREETS, SERVICES - BILL 000121 question, though. I mean, is it serving -- does Bell Tel serve that community, does it offer these services to that community?
As to regular dial tone telephone service, yes. With respect to the newer technologies that we're bringing, not all.
I have a line, I get AOL, I got a Bell Telephone. Is Bell Telephone offering me all of the services that Cavalier is offering?
Do you have a choice of digital subscriber loop services right now from your house?
You're talking to -- 124 5/16/00 STREETS, SERVICES - BILL 000121 we're trying to get informed here.
Yes. Basically, you have a regular plain old telephone system line called "POTS," which its bandwidth is approximately 56 kilobits at this point, and you probably do not have in that area DSL services that I'm aware of at this point. DSL will allow you to dial up to the Internet at speeds of to 100 times faster. 10
Could you speak more directly into the microphone. I keep missing a word here and there.
Basically -- I apologize, I'll speak closer here. Basically, right now, you have regular telephone service to your home. The services we're talking about is not just only -- not only regular POTS telephone dial tone service where you call your neighbor, but I'm also talking about digital subscriber link services that would increase the bandwidth from your home when you dial up to the Internet by 10- to 100-fold.
Bandwidth. Bandwidth is 125 5/16/00 STREETS, SERVICES - BILL 000121 the amount of data through-put your lines can carry per second.
There's a lot of information that will be able to be put in through those wires, right?
So that's what I mean by "underserved," that -- first of all, you don't have a competitive choice of local service today.
So you increase the amount of information that you're able to store or send, right?
And you increase speed at which you gain access to the online and to the Internet?
And you increase the speed in which you are able to communicate through the Internet?
Okay. And Bell Tel does not currently offer that level of networking 126 5/16/00 STREETS, SERVICES - BILL 000121 that you're talking about?
I believe not to all neighborhood, not to all Philadelphia areas.
Do you know why they don't? Is it an economic decision, a business decision they've made?
Councilman DiCicco, John Young again. I can't testify to what Bell Atlantic thinks, but I have my own thoughts on it, which is that there has been no competition up until now and, therefore, Bell hasn't had to respond. I testified earlier that our aim here is to get Bell Atlantic not only to respond -- obviously, we want to win business from the residential consumer, but we also want to improve the lot for the people who don't want to leave Bell Atlantic. We want Bell Atlantic to start offering new and innovative services like Internet caller ID, which --
New and innovative Internet such as, for example, Internet caller ID, which 127 5/16/00 STREETS, SERVICES - BILL 000121 currently is not provided by Bell Atlantic anywhere in the State of Pennsylvania.
Internet caller ID is, if you were on the Internet, what's known as "surfing the Web," looking for information, and a call -- and that line at your home is being used for that, the line that you normally use to call your friends or family, and somebody calls you while you are online, you don't know that that call is being placed, and they either get a busy signal or are sent directly to your voice mail. With our service Internet caller ID, something will pop up on your screen with the telephone number and the name of the person calling you, and you will have the choice to disconnect your Internet service for the time being, pick up the phone call, speak to the person, hang up, and then continue surfing online. It's just a new, innovative service, it's just something that Bell doesn't offer today. And what we hope to do is to create the atmosphere in Philadelphia where Bell feels that 128 5/16/00 STREETS, SERVICES - BILL 000121 they have to offer these types of services to the community of Philadelphia.
Councilmember Rizzo, then I'll come back to my question.
Thank you. I'd like you to clarify something that you said earlier. Today copper wire is pretty much an antiquated communication mode.
Well, it's dependable but it's not fiber optic, it's not -- what's other --
Well, no, there's a new wire that's the buzz around the industry now, that people are installing in their homes. It's not copper.
I forget, but that's not my point. My point is that when you transition from this high-tech wire back down to 129 5/16/00 STREETS, SERVICES - BILL 000121 conventional copper wire, your system -- I'm trying to think of the name of it. It's cad five?
Well, cat five wiring is actually copper, it's copper wiring and it -- I'm not a technical person, either.
Well, here's where I'm going. If a home was equipped with this upscale wire, would your system provide more bandwidth than it would if it weren't attached to conventional copper wiring? In other words, are some of your customers that build new construction going to be able to install a different type of wiring? Will that give them more?
The network infrastructure that we're building takes advantage of, like we talked about before, the existing copper wiring that's in the ground today. However, the electronics that we -- I guess for lack of a better word -- strapped to either end of that copper wire will allow that copper wire to go from -- an analogy I can think of is a garden hose today to a water main. It's really that type of 130 5/16/00 STREETS, SERVICES - BILL 000121 difference. It's 100-fold increase in the speed or the bandwidth available on that line.
So you're going to utilize this existing copper wire, get more out of the existing copper wire, but if there were a different type of wire available to support your system, you could even do more.
I -- I think -- and let me clarify here. I think what we're talking about is wiring that gets us from the central office to the home, which would be the, quote/unquote, existing copper wire. Then if cat five is what you meant before, cat five would be a wiring for an internal local-area network that some homes even have now, and what that does is, it gives you the ability to run high bandwidth within the home, without having to strap on those electronics, which I talked about before.
Councilmember Ortiz? I'm sorry, excuse me. Councilmember Clarke.
Thank you, Mr. Chairman. I'll be brief. Mr. Arias, I had a question about in 131 5/16/00 STREETS, SERVICES - BILL 000121 your testimony where you speak of these 200 high-tech jobs and construction jobs in the Philadelphia region. Could you be a little bit more specific about the type of jobs and who those jobs will go to in both categories?
Yes. With respect to our jobs to run our network, we're going to have switch technicians, which we have. We're going to have engineers, internal engineers, outside plant engineers, customer service, sales, dispatch, installers, repairmen, and just a host of other -- information systems analysts, probably, let's see, billing, customer care, assignment and transactions, and just a host of many types of jobs in order to run a telecommunications company. Those are the types of jobs that we're expecting to --
With respect to construction, basically fiber construction is the type of jobs we'll be offering and we'll be subcontracting in the Philadelphia area.
Where will those 132 5/16/00 STREETS, SERVICES - BILL 000121 jobs be recruited from, those individuals to fill those jobs?
The reason I ask that is because Philadelphia region versus Philadelphia, there's been a discussion about that and the ability for us to get some revenue associated with the wage tax.
Yes. Basically, our new office we just purchased is in Warminster, Bucks County. It's conveniently located two or three blocks away from the R2 SEPTA line, which pulls directly from the City. So definitely, when we advertise for jobs, we advertise in the Philadelphia Inquirer and will be pulling from Philadelphia and from many regions.
For construction and/or just permanent network jobs, you know, for people to run our company.
Is there -- you know, 'cause we recently had a public hearing and 133 5/16/00 STREETS, SERVICES - BILL 000121 we talked about locating your type of facilities in the City of Philadelphia, and we were trying to come up with some strategies associated with the taxing structure and the way we do business. Could you briefly just give me a reason why the decision was made to locate there as opposed to the City of Philadelphia, given what you've said here today about the ability to create these new type of industries targeting the City of Philadelphia and why you wouldn't locate here in the City of Philadelphia with your headquarters?
Certainly. I'm glad you asked that question. We did work closely with the Mayor's Business Acton Team and also the Philadelphia Industrial Development Corporation, and I was looking at several Keystone Opportunity Zones in the Philadelphia area. The Navy base was one, I was looking at Building 11 specifically, which was one of the final buildings that we were seriously considering. However, we came across a building up in Bucks County, that the price was right. It was owned by a former communications-type company and 134 5/16/00 STREETS, SERVICES - BILL 000121 it was pretty much set up to go. And that's why we decided to go with that location.
Yes, but also the Keystone -- well, the tax -- well, the Building was 11 also close to the Delaware River and we were concerned, due to our electronics in the building, as to flooding issues, and that was one concern our engineers raised, which kind of made us decide maybe that's not the best place.
And there was nothing in any of those zones that was to your liking?
Well, in the other zones, a lot of the buildings were basically abandoned and in very bad shape for the Keystone Opportunity 135 5/16/00 STREETS, SERVICES - BILL 000121 Zones in Philadelphia. I toured just about every single building available in the Keystone Opportunity Zone, to tell you frankly. And also, I think there was going to be a new building built in West Philadelphia, a new technology center. However, that wasn't going to be ready for my timeline, and I spoke to the people doing that, and they couldn't accommodate my type of network and company. It was more built for start-ups and smaller company, not for a switch being put over there. So it didn't have the infrastructure for that. When you put a switch in a building, you have to have certain floor-weight specs that hold a lot of weight, you have battery backups, you have generators, you have that type of thing, and they weren't equipped for that. So that's another reason why we decided that that really wasn't good for our needs. The building we have in Bucks County does have the specifications we need to run our network.
Do you have a recruitment plan other than just advertising in 136 5/16/00 STREETS, SERVICES - BILL 000121 local newspapers?
Yeah, no 5 billboards, right. I'm just asking these questions because I'm concerned. We Councilpeople, we obviously would like for individuals to be located in the City of Philadelphia as it relates to their residency. We would prefer that work in the City of Philadelphia, given the nature of the tax structure on the wage tax, and wherever possible, we try and promote that. And you speak of providing a service to an underserved Philadelphia, and to make the decision not to locate here kind of troubles me.
But we did give it a -- with all due respect, we did give Philadelphia a very fair shake. We did look and I worked closely with the Mayor's Business Action Team for months, looking at various buildings, we toured them. And it just came down to costs, the dynamics of the building, and just the availability, and, you know, what was acceptable to our network needs.
And the Bell 137 5/16/00 STREETS, SERVICES - BILL 000121 Atlantics of the world that you would essentially be competing with, to your knowledge, are they located in the City of Philadelphia?
Well, Bell Atlantic's headquarters moved to New York, I believe, last time I checked. They still have a presence here but --
So you -- and would have no employees here, located here, working, and you're saying Bell potentially has a -- probably has a number of employees that we get City wage tax benefits from.
True. And we have employees right now from Philadelphia, and we're obviously going to pull a lot of our employees from Philadelphia. That definitely is something that we'd be interested in. 138 5/16/00 STREETS, SERVICES - BILL 000121
I couldn't understand what you said about the employees.
Yes. Currently we have Philadelphia employees, and we will be pulling more, I'm sure, from the labor pool here. That is definitely something we're interested in.
Would it be possible for you to provide the Chair and, therefore, members of the committee, with a recruitment strategy? 'Cause as we enter into this new technology, we would like to know what needs to happen, you know, both from our end of it and kind of give us a sense of what happened as you looked for location in the City of Philadelphia, just briefly summarizing the reason why you felt that, you know, you had to make the decision to locate outside of the City and how you will, on the backside of that decision, try to, wherever it's possible, to get employees to come from the City of Philadelphia and work at your facility, both from the construction side as it relates to the installation and also on the permanent side as it relates to your facility in the suburban county. 139 5/16/00 STREETS, SERVICES - BILL 000121
Councilman Clarke, it's John Young again. Thank you for the question. As the Director of Sales, one of my jobs is to heavily recruit people to staff my sales force and sales support staff. And what we have started to do in the last couple of weeks is advertise in the Philadelphia Inquirer. We'll probably be starting to continue that on a weekly basis from now on to pull not only sales and sales support staff from my side, but also to get additional support staff from the technical side. We -- like Martin had said, our location in Warminster is, I believe, two to three blocks from the R2 and SEPTA regional rail. Our plans -- you know, given the nature or the situation with the relatively low unemployment rates right now, we're going to need to pull people from everywhere we can get them and get them into these high-technology jobs. Where we have to, we will train people to come into these high-technology jobs. In Richmond, we have pulled extensively from the City of Richmond residents to come in and staff our positions anywhere from the sales side, 140 5/16/00 STREETS, SERVICES - BILL 000121 all the way to, you know, the customer support and then the technical support side. So we have a record of providing a lot of jobs. Martin testified that we'll be providing upwards of 200 jobs by the time we've completed our network build-out and are turned up and ready to go, and they'll range from, again, sales, customer support, all the way to the technical staff.
And how will you deal with the construction side of it?
With respect to the construction side, we'll be bidding out the work to subcontractors to build the network, and we would submit requests for proposals, I believe, and set our bid specs to a vast array of contractors. We've been meeting with several, as we speak -- some from Philadelphia, others who are not to do the construction. And with respect to construction work in Philadelphia, we would -- for subcontracting, we would definitely entertain prevailing wage to do so. That is not a problem for construction work subcontracting in Philadelphia, and we would welcome lists of potential contractors that could 141 5/16/00 STREETS, SERVICES - BILL 000121 this kind of work, we'll definitely welcome them.
Okay. So there are people before the general contractor, and then that general contractor will do the subcontracting with the various trades?
That is correct, that's how we would work it out. I mean, if I were provided a list of available contractors, we would definitely consider them in the bidding process.
So those 200 jobs will actually be located outside of the City of Philadelphia, right?
Yes, that's correct initially, yes. I don't know if all 200 would fit in that building; we may outgrow it eventually and have to look for another site.
And although you hope that some of them are from Philadelphia, it could be that a minority of them could be from Philadelphia.
That is also true. I can't predict exactly what percentage will or will not 142 5/16/00 STREETS, SERVICES - BILL 000121 be from Philadelphia.
I would have a question on the switch, and then I'll recognize Councilman Cohen and Rizzo. You mentioned something about a switch. Could you explain briefly, in layman's terms, what a switch system is.
Councilman DiCicco, John Young again. As a layman, I also hope to be able to explain this in such a way. A switch is a vehicle in which you connect one party to another party who may not be directly connected to your location. There are different types of connectivity -- it's a word we use in the industry -- to determine different ways of getting from one person to another. Point-to-point connectivity is done without a switch and involves the direct connection of either copper or fiber optics.
The switch, is that done manually? Is there somebody who does 143 5/16/00 STREETS, SERVICES - BILL 000121 something manually? 'Cause I have a little sense of this from a meeting with --
A switch is electronic. It sets up virtual circuits, and a circuit is just a connection between two sites to transit voice or data over that line to get from one point to the other. I think Martin's got a clarification on that.
Basically to put it in layman's terms, a switch is really the heart of your network, it's the brains of your operation, it is what controls the incoming and outgoing voice and data signals.
And does that require a manual or a human being to operate that? I mean, somebody has to make the switch, that's what a switch infers as far as --
That's correct, it needs constant updating and you have switch managers.
It's in Warminster, correct. 144 5/16/00 STREETS, SERVICES - BILL 000121
All right. I think Councilman Clarke may have asked the question earlier or it was in your testimony. When you were looking at some of the KOZ areas, you mentioned that none of the buildings that you had seen in KOZ areas -- and correct me if I'm wrong -- were adequate to support a switch; is that correct?
That is correct. Well, for the most part. I was generalizing there.
Does Bell Atlantic have switch or switches in buildings in Philadelphia?
Is there a way in which you could coexist with Bell Atlantic at those sites? And, again, I know nothing about --
Can I put a switch in their collocation site? I believe that was subject of litigation, and I believe right now, under the FCC rules, that we cannot put a switch at this point at a Bell central office. However, we can put other electronic equipment to facilitate switching 145 5/16/00 STREETS, SERVICES - BILL 000121 operations, but not necessarily the switch, that I'm aware of.
How many people does the switching operation require on a 7-day, 24-hour-aday, 7-day-aweek? You have 8-hour shifts where someone is there monitoring this or --
It's a 24-by-7 operation. When you're dealing with a network such as ours that deals with 911 also and emergency calls, you definitely have to have a full staff. I would say anywhere from 6 to 10, depending on --
To operate or monitor or observe, whatever the correct word is, the switch?
Outside of the KOZ zone, did you look at any other buildings that might be able to accommodate a switch in the Philadelphia County?
We were looking to purchase buildings. I looked at some, a few, actually, 146 5/16/00 STREETS, SERVICES - BILL 000121 yes.
What were the reasons for that decision? City wage taxes? What was it? It was a business decision, obviously.
Well, I guess price, taxes, issues such as that, yes, correct.
How many counties, including Philadelphia, would be affected by Cavalier?
And there are about 200 jobs that you would anticipate totally will be created at some point in time?
What percentage of Philadelphia County will account for -- what percentage of the business will Philadelphia County account for? Ballpark it.
Well, I would say, you know, 20 percent if there are 5 counties.