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November 30, 2004
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ARCHIVE: LV Information Technology

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The failed energy titan Enron is often described as a shell of a company with no real assets. But it did have fixed property, including one structure in Nevada. As KNPR's Ky Plaskon reports, it's a symbol of Las Vegas' future as a powerful center of the information technology industry.

SOUND: Street

PLASKON: Stoic fortresses of concrete block dot one street on the east side of Las Vegas. They are no more than a blur at the side of the road for passers by, and that's the way data gurus like it.

BALLARD: We have a lot of information here that the average person doesn't need to know about. We are just trying to keep a low profile and do what we do.

PLASKON: Mike Ballard is the front man for Switch Communications Group. The company's majority share-holder is Rob Roy. Switch wouldn't allow an interview with Roy, but some of his acquaintances say he has been marketing southern Nevada as a data storage site since the Internet boom of the late 1990s and today he operates many of these buildings. Few have seen the inside of them but it's time Las Vegans know what Roy and the city are sitting on says Warren Hioki CCSN Associate Dean of Information Technology.

HIOKI: Thinking back to what he told me when we were touring the facility that he didn't like to be in the public eye but now he has got no other choice but to get out there in the community and answer questions, what is it that you are doing? Ha.

PLASKON: Roy started here, at this strip mall at Lamb and Sahara. On the outside, it's an average strip mall except for the darkly tinted glass door with name, just a keypad on the wall. Inside that door are cameras and red and blue lights to alert of any intruders.

SOUND: Hum

PLASKON: Inside it is dark, cool and clean. It's a scene right out of a science fiction movie. Tall, one-person wide red cabinets secured with black dials of combination locks. Through a glass window on the cabinet doors, green lights flash with the perpetual flow of critical data from some of the nation's most profitable companies. Many Americans have probably interacted with one of these computers. This is what's called an NAP. Network Access Point are high-capacity data connection spots found in a few places around the U-S. This one has some airline ticketing services. Another building nearby holds federal information. Across from that another is mostly empty but prepared to be filled up with customer's financial information. Financial institutions are scrambling to comply with the Sarbanes-Oxley Act that went into effect this month. It requires massive data storage of financial records in the wake of 9-11. According to Switch Communications, one financial company here is already storing 120-thousand e-mails an hour.

THOMAS: Zantaz specializes in providing e-mail storage services for fortune 500 companies like Citigroup.

PLASKON: The new opportunity to provide financial data storage has the building's owner Tom Thomas of Thomas and Mack, financing a 200 percent expansion of Switches operations to be completed by the beginning of next year.

THOMAS: After MCI, Enron, some of the problems that occurred in the past two years it might be a knee jerk reaction but it is there and the compliance is creating a new industry for data storage and disaster recovery.

PLASKON: Nevada is touted as a good place because it is not only safe, but cheap. Four Seasons Resorts is consolidating it's data storage here because it can save 50 percent over other locations. Part of the reason for a recent surge in businesses moving here is Rob Roy and Switch Communications' acquisition of a former Enron building that already had connections to more than a dozen national backbones of information technology companies. The connectivity is rare. Mike Ballard of Switch explains that when a customer moves in the building allows them to broker access with the different information carriers.

BALLARD: Nevada is fortunate that all these carriers chose to build all in one space which created this commodity exchange that allows for our pricing to continue to go down, so now not only can they be located that. They can be located in a city that has the most modern power grid of any city in America. They can be connected to any carrier they choose and can connect at prices that are not found in California, Arizona, Texas Seattle or any other community like that

PLASKON: And that's an advantage Sommer Hollingsworth of the Nevada Development Authority is happy to promote.

HOLLINGSWORTH: We are sending this brochure out and they are saying you have got to be kidding me how did this happen in Vegas because they don't think of us as a technology center and the technology infrastructure is probably second to none in the united states. So that is a good thing, a very good thing. It kind of takes off that stigma off that there is no technology in the resort industry and there is. It is extremely technology driven.

PLASKON: It helps him in his current quest to court of circuit board and software manufacturers. But is it really that special? Tim Boyle of Cisco Systems says yes.

BOYLE: It's real easy to confirm. Qualcomm is moving to Nevada.

PLASKON: It's a symbol of how Nevada is coming into it's own as a major telecom center. Companies are dumbfounded by the capabilities according to Switch representatives. Gaming companies also see the potential here. Boyle says they can make slot machine updates available through the network.

BOYLE: That could not only work for our folks, the MGMs to create new revenue from accounts in Russia, Asia, South America. That is one of the hopes.

PLASKON: Boyle likens this expansion of information technology to the build-out of the power infrastructure that put electricity in every home. But to date there has been one missing link.

BOYLE: UNLV has never been able to use it as good as they could because they didn't have a big enough pipe.

PLASKON: Without the big fiber optic pipes, the school's students were isolated making it difficult to build its information technology school, and without a strong school, professional company didn't want to move here. But recently UNLV installed a ring of large fiber optic pipes with high capacity connections to the rest of the world. After a little calculating Boyle says under UNLV's old connection it would have taken 92 days transfer data equivalent to the Library of Congress. Now UNLV can transfer the same amount of data anywhere in the world within an hour. Suddenly departments are part of what's called the National Research Network, cooperating with university research all over the world. Boyle knows what they are capable of because of who runs the school.

BOYLE: A guy from Cornell and Cornell is a business. Cornell does over a billion dollars a year and that is what they are going to do.

PLASKON: CCSN is on the bandwagon too, having built an information technology school from nothing 2 years ago to now more than 2000 students.

BOYLE: In my opinion it is probably better than any other networking program in the United States. And we know that for a fact because we have visited other sites and other campuses have looked at what we have and it is far superior to what they have in their own institution. Everything is relative, you walk into Rob Roy's place.

PLASKON: No one for this story would speculate on the limits of capabilities in the former Enron building run by Roy, only that it dwarfs the University's capabilities. Warren Hioki of CCSN says this information technology reality has snuck up on Southern Nevadans and that the era of seclusion that takes shape on East Sahara will come to an end.

HIOKI: What you see there is quite hidden from the community you would never know it is hidden from the community and I think Rob Roy wanted to keep it that way, he doesn't have any choice now with an organization that is handling that much vast amounts of data and very, very important data he has no choice other than to become involved with business figures and very, very important people.

PLASKON: He's a local legend in information tech circles, and Rob Roy is living up to his Scottish literary namesake as an enigmatic figure.

SOUND: Music

PLASKON: CCSN held this swanky unveiling of its fancy new information technology building this month. It was attended by the who's who of Las Vegas. Leutenant Governor Loraine Hunt and North Las Vegas Mayor Mike Montandon among them. But Roy But while the literary Rob Roy loved to dance and celebrate at Scottish ceilidhs (KAY-lees) the 21st Century Rob Roy was absent from this celebration.

Ky Plaskon, News 88-9 KNPR

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