Companies embrace connectivity centres

PUBLISHED : Friday, 03 December, 2010, 12:00am
UPDATED : Friday, 03 December, 2010, 12:00am

Every aspiring entrepreneur dreams of transforming a well thought-out idea into a million-dollar business, but few manage to break even, and fewer still sustain a viable business for the long term.

However, HKCOLO, winner of this year's SME Award, has accomplished both; breaking even in just over two years and growing steadily to become one of Asia's leading interconnectivity centres for the telecommunications industry.

Now in its 11th year, the city's first neutral co-location services provider offers a secure, environment-controlled and network-neutral facility to telecommunications customers such as operators of submarine cables, satellites and fixed lines and wholesale and retail telecommunications providers.

Customers are able to co-locate their equipment under one roof, and benefit from cost-effective and reliable interconnectivity solutions with access to different markets through collaborations with each other.

'Clients avoid the hefty costs of local providers, and can cross-connect with other telecom providers should they find themselves without the necessary connectivity in place,' explained Andrew Pang, director of HKCOLO. 'They can therefore improve network performance and tap into new business opportunities.'

The company, which initially launched its operations in a 1,000 square foot centre, has made steady progress in recent years, adding around 10 to 20 new clients to its books each year.

Over 300 telecom providers use HKCOLO's services, which also include industry-specific seminars, presentations and an annual telecom networking event.

Pang said one reason for HKCOLO's success was the people at the front and centre of the business.

'We have very good staff who do an excellent job of catering to customers' requests,' he said. 'The majority of them are straight from college. They were trained from zero and enjoy being in a professional and well-respected industry. As a result, our staff turnover is low.'

The company runs a 50,000sq ft facility in Chai Wan and handles up to around 70 per cent of international telecommunication traffic in the East Asia region.

'The industry is quite stable in spite of the economic cycles,' Pang said. 'Although return is not as fast as some other sectors, prospects are good once a carrier signs on, because it will most likely grow and stay at our facility for the long term.'

HKCOLO's business strategy requires clients to take a long-term lease, and to pay an advance lump-sum fee for a discounted rate. As a result, the company has leased 25 per cent of its space for between five to 15 years and received all fees.