TowerXchange-Issue 18 PDF

New site typologies and business
Tower Xchange models for 5G

edotco, Ericsson, ExteNet, Arqiva and Analysys Mason insights
Journal of the telecom tower industry in EMEA, CALA and Asia
Issue 18 | January 2017 | www.towerxchange.com
TowerXchange Europe:
< Cellnex, EI Towers, INWIT and HighTel on Italy
< Telxius and Global Tower’s alternatives to IPO
< AMT acquires FPS and their diverse site typology
TowerXchange CALA:
< Who’s who in CALA towers
< A history of the Brazilian tower market
< Interviews: Plata Tower Company and Balesia
TowerXchange Africa and the Middle East:

< How Moody’s rated IHS Towers
< Deeper infrastructure sharing by MEA’s MNOs
< Energy, RMS and civil works working group reports
TowerXchange Asia:
< What and how China Tower Corporation buys
< A history of Indonesian towers; India’s 4G future
< Myanmar spotlight: tenancy ratios, consolidation, power
Don’t miss TowerXchange Meetups for Europe (4-5 April) and CALA (7-8 June)! Tower Xchange
Contents
Regular and special features
5 Europe tower count, analysis and news

51 CALA tower count, analysis and news
71 MEA tower count, analysis and news
92 Asia tower count, analysis and news
125 TowerXchange Industry Awards winners
131 Ranking the top 249 towercos worldwide
136 Towerco business model diversity increases
182 - 239 Europe: Italian towercos,

Portugal and France analyses 240 - 274 CALA: Who’s who, history of
Brazil, new Argentinian entrants
145 The rise of the operator-led towerco
183 Cellnex, EI Towers, Inwit and HighTel on Italy 241 Who’s who in CALA towers 151 Why the Telxius IPO was cancelled
201 The postponement of Turkcell’s tower IPO 253 A history of the Brazilian tower market 158 How towercos should navigate emerging headwinds
210 Portuguese market analysis 262 Interviews: Plata Tower Company and Balesia 167 The knowns and unknowns about 5G rollout
227 Newly acquired FPS’ diverse cell site typology 268 Spotlight on Mexico
170 5G deployments: A window of opportunity for
towercos?
TowerXchange’s who’s who
399 Directory of over 200 vendor profiles

403 Over 30 new interviews with leading vendors
TowerXchange Meetup calendar
275 - 348 MEA: IHS’s rating, SSA’s latest

deal, Meetup MEA report 349 - 398 Asia: Indonesia history, India
future, Myanmar & China present < TowerXchange Meetup Europe, April 4-5, 2017
276 How Moody’s rated IHS Towers 353 What and how China Tower Corporation buys < TowerXchange Meetup Americas, June 7-8, 2017
294 The top 20 tips for operational excellence 364 TowerXchange’s history of the Indonesian tower industry < TowerXchange Meetup MEA, October 3-4, 2017
300 Deeper infrastructure sharing by MEA’s MNOs 371 Myanmar: tenancy ratios, consolidation, power < TowerXchange Meetup Asia, December 12-13, 2017
330 Meetup MEA working group reports 389 4G accelerates consolidation in India
2 | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | XX

With special thanks to the TowerXchange “Inner Circle”
Our informal network of advisers: About TowerXchange
(Chairman) Daniel Lee Chuck Green Kurt Bagwell
Managing Director Executive Chairman President International Founded in 2012, TowerXchange is your
Intrepid Advisory Partners Helios Towers Africa SBA Communications
independent community for operators,
Zhiyong Zhang Suresh Sidhu Jim Eisenstein towercos, investors and suppliers interested
Chairman & President CEO Chairman & CEO
edotco Grupo TorreSur in EMEA, CALA and Asian towers. We’re
Miteno
Bimal Dayal a community of practitioners formed to
Akhil Gupta Malcolm Collins CEO
Chairman Chief Executive promote and accelerate infrastructure
Indus Towers
Bharti Infratel CTIL sharing. TowerXchange don’t build,
Inder Bajaj
Nat-sy Missamou Ted Zhong Advisor, Helios Investment Partners & former CEO operate or invest in towers; we’re a neutral
Sharing New Business Program CEO HTN Towers community host and commentator on
Director, Orange Q Towers International
Riana Donaldson telecoms infrastructure.
Nina Triantis Hal Hess Manager: International Network Operations
Managing Director, Global, Head of EVP, International Operations and Support
President, EMEA and Latin America Vodacom The TowerXchange Journal is free to
Telecoms & Media
Standard Bank American Tower qualifying recipients. We also provide
Tunde Titilayo
Nobel Tanihaha Vice Chairman webinars and regular meetups.
Terry Rhodes SWAP International
CEO President Director TowerXchange monetises this community
Eaton Towers PT SOLUSI TUNAS PRATAMA (STP) Jack Dessay
Managing Director through hosting annual Meetups and the
Marc Ganzi Umang Das Macquarie Capital sale of advertising, without compromising
President, Digital Bridge & Chief Mentor
Mexico Tower Partners American Tower Jeffrey Eldredge editorial integrity.
Partner
Arun Kapur Gilles Kuntz Vinson & Elkins
CEO
TowerXchange was founded by Kieron
Co-Founder Enda Hardiman
Irrawaddy Green Towers TowerCo of Madagascar Managing Partner Osmotherly, a TMT community host and
Hardiman Telecommunications Ltd. events organiser with 18 years’ experience,
James Maclaurin Maria Scotti
formerly CEO CEO Adeel Bajwa and is governed with the support and advice
edotco Torrecom Senior GM of Legal Affairs and Contracts
Warid Telecom of the TowerXchange “Inner Circle” – an
Areef Kassam David Meganck informal network of advisors
Director of Infrastructure Founder and COO Scott Coates
GSMA Mobile for Development Acsys CEO
Wireless Infrastructure Group © 2017 Site Seven Media Ltd. All rights reserved. Neither the
Ayman Al Adl Tilak Raj Dua whole nor any substantial part of this publication may be re-
Carlo Ramella
Director - TMT Director General COO, EI Towers produced, stored in a retrieval system, or transmitted by any
Standard Chartered Bank TAIPA and Chairman, Towertel means without the prior permission of Site Seven Media Ltd.
Dagan Kasavana Short extracts may be quoted if TowerXchange is cited as the
Dimitris Lioulias Alexander Chub
CEO GM of Strategy President source. TowerXchange is a trading name of Site Seven Media
Phoenix Tower International Saudi Telecom Company Russian Towers Ltd, registered in the UK. Company number 8293930.
XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 3

Empowering tomorrow’s connected world
effectively
cost-efficient
energizing
communities
empowering
communication
Connectivity is at the core of everything we do. Providing ﬁrst-of-its-kind regional accessibility,

our telecoms infrastructure reach enables us to touch communities and expand communication
businesses across Southeast Asia.
www.edotcogroup.com
Enabling connectivity for the future
TowerXchange’s analysis of the
Deutsche Funkturm
Cellnex 7,413 7,725
27,000
725 540 500
Germany
Spain
H2 2016 proved to be a busy time for European
towers, right up to the very end.
Italy
independent tower market in EuropeRTRS 16,000

First Tower Company 14,000
UK In September, Cellnex acquired Shere Group
Telxius 11,000 2,350 2,804 Turkey for €393mn, consolidating their position in the
INWIT 11,200 Ukraine
Europe’s 19 Arqiva
towercos 10,550
with >1,000 assets Netherlands (increasing their number of sites from
France
Germany
National Tower Company 10,400 261 to 725) and gaining a foothold of 540 towers
Deutsche Funkturm
Global Tower 7,500
27,000 Source:Republic
Czech
Spain TowerXchange
in the UK. American Tower, whose European
1,181
Cellnex 7,413 7,725 725 540 500
TDF 7,398 Ireland
Italy Germany
RTRS
MTS Towers 5,500
16,000
RussiaSpain operations have remained almost static during the
Deutsche Funkturm
First Tower Company 14,000
27,000 UK
American Tower
Telxius
Cellnex 2,197* 2,482*
11,000
7,413
2,350 2,804
7,725 725 540 500
Netherlands
TurkeyItaly
most recent period of European growth, announced
CETIN 4,800
RTRS 16,000
INWIT
EIFirst
Towers 3,200
Tower Company
11,200 Poland
Ukraine
UK in October that Dutch Pension Fund PGGM was
14,000
Arqiva 10,550
Rai Way 2,300
National Tower Company
Telxius 11,000 2,350 2,804 Denmark
FranceTurkey acquiring 49% of their European operations,
10,400
Russian Towers 2,300 INWIT
Global Tower 7,500
11,200
1,181
Slovakia
Czech Ukraine
Republic creating a joint venture ‘ATC Europe’.
Wireless Infrastructure Group 1,900 50 50
Arqiva 10,550
TDF 7,398 IrelandFrance
Finland
Vertical
National Tower1,600
Company 10,400
MTS Towers 5,500 Czech Republic
Kazakhstan
Russia
American Tower
Global Tower
5000
7,500
2,197* 2,482*10000
1,181
15000 20000 25000 30000 35000 In December, American Tower made good on
TDF 7,398 SerbiaIreland
Netherlands
CETIN 4,800
MTS Towers 5,500 Russia
the promises they’d been making and acquired
EI Towers 3,200 Austria
Poland
American Tower 2,197* 2,482*
Netherlands France’s hotly-contested FPS Towers for €697mn.
Rai Way 2,300
CETIN 4,800 Denmark
Greece
Russian Towers 2,300EI Towers 3,200 Poland
Slovakia
Lithuania In acquiring FPS’s ~2,400 French towers, American
Wireless Infrastructure Group 1,900 Rai 50
Way50
2,300 Denmark
Finland
Albania Tower have effectively doubled their footprint in
Vertical 1,600
Russian Towers 2,300
Wireless Infrastructure Group 5000

1,900 50 50 10000
CALA Slovakia
Kazakhstan Europe and have positioned themselves as clear
15000 20000 25000 30000 35000
Vertical 1,600
* Based on the assumption that announced deals will close in 2017 Serbia Finland competitors in the race to build a strong and
Kazakhstan
Austria international European tower portfolio. With two
Figure 1(b): Europe’s telecom and broadcast
5000 10000 15000
towercos
20000
with
25000
<1,000
30000
towers
35000
Serbia
Greece
1000 Austria independent towercos deploying serious capital on
Lithuania
Greece the continent, 2017 could be a very interesting year
800
Albania
Lithuania in European towers.
CALA
Albania
600
CALA
Of course, what’s also interesting about the
300 79
400 860 800
700
European market is that several things DIDN’T
1000
584
377
happen. Telefonica’s planned IPO of infrastructure
200 400 377 377
1000 300
800 200 187 180 156 150 140 47 40 40 33
arm Telxius didn’t happen, being pulled after weak
120 113 100 100 100 75 30
0
800 investor demand. In Turkey, market leading MNO
w ika ke
ed ers
t om
Ci m
ks
Te icom
ny
AS
fu her
ss
up
s
s
er /
k)
al
ita
m
t
E
a
d
600
op l
co ce
nn ib 2RN
m
ra
en
ite
w n
io
lc
e
CI
co
Lt
To un es
ce
or
gn
lis
co
Ce k
Turkcell postponed the IPO of their tower unit

pa
s
To nia
ro
ig
w
Pu Dig
Al llc
Fa
co
m
Ax
nt
nd isc
n
m
Em
C
le
Ac
be
m
gy
D
To
G
m
le
ce
Te
ia er
Ru ich
co
(O
hp Lo
g
Co
ic
Te
er
le
el
in
el
om
er
bl
re
600
hT
ar
nt
Global Tower at the eleventh hour, citing global

ic
ita H
ev
er
ns
300 79
w
er
ES
rv
oi
Sh
ok
400 860 800

ig
w
Ko
To
st
of
Se
H
To
di
nk
700
Ra
ig
e
Li
n
political instability and the risk of cyber attacks.

ic
Br
H
pe
300 79
ff
400 584
860 800
O
O
200 700 377 400 377 377

300 584
200 377 400 200 187 180 156 150 140 120 113 100 100 100 47 40 40 33 30
377 377 75
XX | TowerXchange
0 Issue 18 | www.towerxchange.com
300 www.towerxchange.com | TowerXchange Issue 18 | 5
200 187 180 156 150 140 47 40 40 33
ik ske
lti com
Ci m
30
ks
m
ny
AS
fu her
ss
up
s
as
er /
k)
al
ita
m
t
E
ea
d
l
om e
N
er
120 113 100 100 100 75

m
en
ite
n
io
lc
ac
CI
o
Lt
co
ce
or
gn
lis
co
tr
2R
nk
pa
s
ia
ro
ig
ow
ig
Ce
ec
Fa
co
Ax
c
pm
Em
0
en
l
Ac
be
m
is
gy
rn
D
D
el
G
m
el
le
YOUR
SIGNAL
STARTS
HERE.
®
TOWER OWNERSHIP | LEASING | SITE MANAGEMENT | SITE DEVELOPMENT | CONSTRUCTION
FLORIDA HEADQUARTERED.
INTERNATIONALLY CONNECTED.
Our clients depend on SBA to provide the wireless infrastructure that allows them to transmit the
signal to their customers. As their first choice provider of wireless infrastructure solutions, we are
continuously setting the standard for customer satisfaction by “Building Better Wireless”.
800.487.SITE sbasite.com
© 2016 SBA Communications Corporation. All Rights Reserved.

Rumours that Deutsche Telekom may be preparing Figure 2: Forecasted breakdown of ownership of Europe’s ~600,000
to IPO their very well established towerco Deutsche telecom tower and rooftop structures 2016-2020
Funkturm have also been quashed over the last few
weeks. In Russia, VimpelCom’s anticipated sale of
10,000 towers to an independent towerco has still 600,000
yet to be announced, despite the process having MNO Captive
500,000
been played out over several months. Rumour has it
Number of towers
that having audited their towers and created a stand JV infraco
400,000 275,397
alone towerco, VimpelCom are tempted to retain 290,397
control of the asset. 75,551
300,000 300,397 76,551 Operator-led
52,125 infraco
What does this mean for European towers? 200,000 378,797 348,897 66,070 52,125
Essentially, that it’s impossible to pick out the Independent
49,125 266,297
78,070 68,070 251,297 towerco
shape of European tower ownership to come. 100,000
When we last updated these figures, with three 67,125 49,125 184,778
MNO-led IPOs in the offing and rumours of more, 97,278
plus ATC seeming like Europe’s sleeping giant, we 75,867
speculated that the European tower market could
Q4’16 Q4’17 Q4’18 Q4’19 Q4’20
follow a more ‘Indian’ model, where giant joint
Source: TowerXchange
venture towerco Indus Towers remains 100% MNO
owned and where Bharti Airtel and Reliance retain expectations in terms of potential valuations, The current state of play in Europe
majority stakes in their own towercos. However, MNO-owned towercos reconfiguring to justify
with low lease rates in India and both co-locating the 16x EBITDA valuations which independent Let’s review the current state of the European tower
AND anchor tenants sharing discounts, the industry towercos such as Cellnex have been able to achieve industry country by country. A couple of caveats
is calibrated to serve the needs of the MNO as much or the proliferation of independent towercos and before you start reading: firstly, TowerXchange
as to create capital value. In Europe, where MNOs a reversion to a more straightforward sale and includes Russia, the CIS and former CIS States in
are under pressure to reduce debt and pour capex leaseback model remains to be seen. our definition of Europe. Secondly, our definition
into massive densification and fibre projects, control of a “tower” is slightly different in Europe – when
of their towerco isn’t enough - they also need to The roadmap is still being drafted for the European presenting tower counts, we are always interested
achieve solid valuations and release capital to fund tower industry and, insofar as anyone can define in sites and structures that can accommodate
these business critical projects. the destination, it remains a long drive! We’ll multiple tenants, and which towercos might
review our forecast again before the 2nd Annual consider investible. While our tower statistics on
In terms of European towercos, something has TowerXchange Meetup Europe on April 4-5 in emerging markets focus on ground based towers,
to give, and whether that’s MNOs lowering their London – we hope to see you there! in Europe we are equally interested in counting

One of Africa’s leading
independent telecom
tower companies.
HTA acquires, builds, and manages

wireless telecom infrastructure,
leasing it to mobile network operators
to deliver network efficiency and
quality performance across Ghana,
Tanzania, Republic of Congo and the
Democratic Republic of Congo.
Find out more about our business at

www.heliostowersafrica.com
Figure 3: breakdown of ownership of Europe’s ~600,000 telecom tower rooftop sites, but we exclude multi-tenant DAS,
and rooftop structures as at the end of Q3 2016 microcells and small cells from headline counts,
at least until a single small cell can be shared and
monetised to multiple tenants.
79,127
TowerXchange tower counts are the result of
qualitative market research and the aggregation
MNO captive
of our own and other research firms’ work – as
90,131 such they should be treated as estimates. We assert
JV infraco
copyright over data sourced to TowerXchange –
373,524 Operator-led infraco
you will need to request our permission to quote
our data and there may be a charge to do so.
58,600
Independent towerco
CIS
Over 140mn people live in the 11 countries
which make up the CIS, former CIS members
Source: TowerXchange and associate member block. The tower market
in this region is set to be ignited by the sale of
Estimated cell site count, Kazakhstan VimpelCom’s towers in the Ukraine, Kazakhstan,
Georgia, Armenia, Uzbekistan, Krygyzstan and
Tajikistan. Meanwhile, TeliaSonera’s professed
1,000 intent to exit Azerbaijan, Georgia, Kazakhstan,
1,500 Moldova and Tajikistan may create opportunities
Beeline (VimpelCom) towers for new entrant MNOs and towercos in those
650 Beeline (VimpelCom) rooftops etc countries.
Tele2+Altel
TowerXchange has identified three towercos
700 Kazakhtelecom active in the CIS so far, but we suspect there are
Kcell more. Logycom is Kazakhstan’s sole independent
2,000 Other structures used for telecom
towerco, with a contract to build 77 towers
for Altel. There are around 7,000 cell sites in
1,200 Kazakhstan, around 10% of which are owned by
fixed line incumbent Kazakhtelecom, and leased
Source: TowerXchange up to a tenancy ratio of ~2.5 at discount rates.

Site Management Software | One SaaS Platform
Accelerate colocation and reduce operating expenses Colocation Management
with Siterra, the leading site management software Asset Register
for tower companies. With this SaaS platform, you Operation & Maintenance
can manage the entire site lifecycle from construction BTS Project Management
to maintenance to decommission. Business Intelligence
Contact us for a demo at sales@accruent.com

Turkcell’s Global Towers has a Ukrainian What is the breakdown of the high sites used by the French telecom
subsidiary, UKRTower, which acquired 811 towers industry? And who owns them?
from Lifecell in February 2016, taking their tower
count to 1,181. There are a total of around 11,000 13
towers in the Ukraine. Ukraine headquartered 11 12 10
Eurasia Telecom has built and manages a total of
9
around 5,000 towers across the CIS, and is adding 14
tower ownership and leasing to their core turnkey 8
infrastructure business. 67
5
1
Czech Republic
With an ongoing project to decommission 35-40% of
4
the country’s parallel infrastructure, TowerXchange
estimate there are around 10,200 active cell sites
in the Czech Republic’s telecom network, of which 3
only around a quarter are ground based towers,
2
with the balance being rooftops and IBS.
CETIN (Česká Telekomunikační Infrastruktura),

an infraco carved out of O2, has 4,800 towers and
750 micro sites. CETIN’s business model includes
all the physical assets which used to belong to O2,
including active equipment and 38,000km of fibre,
Ground based towers Rooftops structures with telecom equipment
the MNO having been acquired by PPF and the 1. Orange 8,100 10. Rooftops sites sourced directly by MNOs 14,540
infrastructure business spun off. CETIN absorbs 2. SFR 5,300 11. Rooftop sites provided by TDF 301
O2’s RANsharing venture with T-Mobile, which 3. TDF 4,865 12. Rooftop sites provided by FPS Towers 159
operates under the MORAN model. 4. FPS/American Tower 2,482
5. Bouygues Telecom being sold to Cellnex 500 Rooftops without telecom equipment installed,
6. Bouygues Telecom 350 but for which a towerco has a commercialisation
Denmark
7. Free 350 agreement:
Infrastructure sharing is State mandated in
8. Other structures not belonging to towercos or 13. TDF 2,985
Denmark, where Telia and Telenor formed active MNOs 2,900 14. FPS Towers 20,000
infrastructure sharing joint venture TT-Network.
There are around 4,500 towers in Denmark, with co- 9. Other ground based structures 7,500
Sources: TowerXchange research, ANFR, FPS Towers, TDF
location management agreements managed through

KPR Consult. Falck operates a small towerco in the Estimated breakdown of ground based towers and rooftops in Germany
country with around 75 towers, while Teracom
operates the country’s broadcast towers.
There is little possibility of sale and leasebacks in
Denmark in the short term, but don’t discount the 8
possibility in the medium to long term.
4 5 Ground based towers:
1. Deutsche Funkturm 8,000
Finland 2. Vodafone 4,000
There are around 10,000 towers in Finland, around 3 3. Telxius 2,350
half of which are owned by incumbent operator 4. American Tower 2,197
Sonera, with the balance evenly distributed
1 Rooftops:
across the other MNOs Elisa and DNA. An active 5. Deutsche Funkturm 15,936
infrastructure sharing joint venture between 6. Omega Towers 7,700
Sonera and DNA increases the efficiency of 7. Vodafone 18,000
providing coverage to the sparsely populated 8. Telefónica 11,968
2 6
Northeastern region.
7
Digita operates Finland’s broadcast network, with
27 high masts and 480 smaller masts.
Source: TowerXchange presentation, TowerXchange and RBC Capital Markets data
France in this segment of the ecosystem. the first of which was for 230,000 towers at a
There are just under 25,000 ground based towers in valuation of €80mn and the subsequent tranche for
France, of which 58% remain operator-captive. The The biggest news in France for 2016 is American 270 towers for €697mn, giving them a good foothold
remainder are divided among three independent Tower’s acquisition of FPS for €697mn, gaining in the market and a solid anchor tenant.
towercos: broadcast-telecom hybrid TDF has 4,865 them a significant foothold in the market and
telecom towers, FPS Towers has 2,482, and Cellnex putting them into competition with French While there is fierce competition for subscribers
are in the process of buying into the French market incumbent tower owner TDF. FPS’s ambitious plans among France’s four MNOs, which has driven down
with an initial 230 tower sale and leaseback deal for the French market are expected to be capex- ARPU and tightened margins, there is a healthy
with Bouygues Telecom, rising to 500 towers. heavy over the next two to three years, and we will culture of infrastructure sharing, with almost 5,000
Network planners supplement their ground based watch TDF’s response to this agile competitor over MNO towers bilaterally shared, driving tenancy
tower network with sites on 7,500 other ground the coming months. ratios on ground based towers to an average of 1.5.
based structures and ~15,000 rooftops. TDF and FPS
currently provide 10% of those rooftops sites, but Meanwhile, Cellnex have fairly quietly acquired 500 Germany
both are positioning themselves to play a larger role towers from Bouygues Telecom in two transactions, The German tower market may be characterised

COST EFFECTIVE TOWER POWER
JET POWERED
COSTELECTRICITY
EFFECTIVE GENERATION
TOWER POWER
JET POWERED
tower power applications. ELECTRICITY
Bladon’s revolutionary GENERATION
patented microturbines, heat exchanger and
air bearing technologies
The Bladonharness
12kWthe power of a miniature
microturbine jet engine
genset to provide
(MTG) a compact
is a cost and
effective, clean
alternative
ultra-reliable alternative fortraditional
to the telecom tower
diesel power applications. Bladon’s revolutionary
generator.
12KW MICRO
patented microturbines, heat exchanger and air bearing technologies harness
the power of a miniature jet engine to provide a compact and ultra-reliable
$$$ alternative
LOWER COST to the traditional diesel generator.
OF OWNERSHIP
TURBINE
With service intervals of 1,000+ hours and no oil or liquid coolant required, the MTG needs
LOWER
fewer site visits. The MTG hasCOST OF OWNERSHIP
just one moving part giving it jet engine like reliability and longer
With
life. Other factors thatservice intervals
contribute of up
to overall lower to cost
total 8,000 hours (almost
of ownership a year)
are; superior and no oil or
part load
GENSETS
liquid coolant required, the MTG needs fewer site visits. The MTG has just one
moving
thus eliminating part
fuel theft, andgiving it jet
no reusable engine like reliability and longer life. Other factors
parts.
that contribute to overall lower total cost of ownership are; superior part load
effciency, ability to utilise blends of fuels that would otherwise damage a
COST EFFECTIVE & CLEAN regular diesel genset, thus eliminating fuel theft, and no reusable parts.
TOWER POWER
Traditional DG
Bladon MTG
Up to 70% lower Up to 60% Up to 30% less Traditio

maintenance Costs longer lifetime fuel costs Bladon
Up to 70% lower Up to 60% Up to 30% less

CLEAN AND EFFICIENT MULTI-FUEL POWER
maintenance Costs longer lifetime fuel costs
on a wide range of fuels, including green alternatives such as natural gas and biofuels as well
CLEAN & EFFICIENT MULTI-FUEL POWER
as diesel and kerosene.
Bladon MTG’s operate with very low emissions and are highly fuel-efficient.
Bladon gensets run on a wide range of fuels, including green alternatives such
COMPACT, LOW NOISE gas
as natural ANDand
VIBRATION FREE
biofuels as well as diesel and kerosene.
Bladon gensets compact footprint and low noise, vibration-free operation enable them to
be installed almost anywhere indoor, outdoor and rooftop - including in sensitive business or
COMPACT, LOW NOISE & VIBRATION FREE
residential locations.
Bladon gensets compact footprint and low noise, vibration-free operation
enable them to be installed almost anywhere indoor, outdoor and rooftop -
MULTI-MODE OPERATION
including in sensitive business or residential locations.
Use as primary power source, hybrid mode with batteries or renewable energy sources, or
backup power to the grid
MULTI-MODE OPERATION
WWW.BLADONJETS.COM Use as primary power source, hybrid mode with batteries or renewable
energy sources, or backup power to the grid.
ULTRA QUIET – CLEAN & GREEN – MINIMAL MAINTENANCE – FUEL FLEXIBILITY
© Bladon Jets – www.bladonjets.com MTG12 DATA SHEET
by slow growth, but it is entering a period of rapid made an acquisition in the shape of France’s FPS 12,000 site Greek market at present, tough economic
change. Towers. With both Deutsche Funkturm and Telxius conditions and the dominance of market leading
cooling on the idea of an IPO, it may be that there is Cosmote may prompt a sale and leaseback in the
Telefónica transferred 2,350 German towers into potential for American Tower to consolidate their medium term.
their towerco Telxius in a deal valued at €587mn. position in the German market in 2017.
After pulling their IPO due to low investor interest, Cosmote’s competitors Wind may have an appetite
Telefónica have refused to rule out a trade sale, Just 16,532 of Germany’s 70,136 cell sites are to monetise their towers, while the other MNO in
although the door to an IPO is not shut either. ground based towers – the rest are rooftops. The Greece Vodafone has less financial incentive. Joint
Meanwhile, Deutsche Telekom are gearing up investability of German rooftop sites remains venture infraco VICTUS Networks currently manages
to monetise their towerco Deutsche Funkturm, questionable: American Tower currently operates Vodafone Greece and Wind Hellas’ sites. There are
enthusiasm for an IPO is rumoured to have cooled only ground based towers, Telefónica transferred around 10,500 tenants on VICTUS Networks’ 7,000
after the Telxius and Global Tower IPOs failed to only their ground based towers to Telxius, while sites. Decommissioning could see VICTUS Networks’
fly, but a sale to a strategic investor could still be Telefónica has transferred 7,700 sites to Deutsche site count fall to 6,000 and the tenancy ratio rise
on the cards. Deutsche Funkturm operates over Funkturm (Omega Towers) with no financial accordingly.
27,000 sites in Germany, of which around 8,000 are compensation paid. Most of those 7,700 sites were
ground based towers with the rest being rooftops. rooftops, and as many as half of them could be Broadcast towerco Digea owns 156 towers in Greece.
Subsidiary Omega Towers manages 7,700 further decommissioned as they were duplicate sites from
sites (mostly rooftops) transferred from Telefónica Telefónica’s merger with KPN. Ireland
in July 2015. 60% of Ireland’s 4,000 cell sites sit in the hands of the
Deutsche Telekom and Vodafone each has around country’s three MNOs: Vodafone, Meteor and 3.
Deutsche Funkturm report that they are building 25-27,000 sites in total, whereas Telefónica has close The Irish market is still restructuring in the wake
“a significant number of new macro locations per to 39,000 – Telefónica plans to consolidate their of 3’s acquisition of O2. The consolidation realigned
year”; with three to four years of LTE rollout still to network to a similar size to their rivals. network sharing partnerships previously between
come, followed by 5G, there are drivers for modest Vodafone and 3 (NetShare) and between Meteor
organic growth. There are a total of around 23,000 co-locations and O2 (Mosaic), the latter of which remains in
in Germany, most being on Deutsche Funkturm place with 3 joining the alliance, putting downward
Having seen only negative organic growth since and American Tower’s ground based towers, with pressure on current and prospective future tenancy
they bought 2,031 towers from KPN in 2012, tenancy ratios estimated at 2.5 and 1.8 respectively. ratios.
American Tower’s German site count jumped by There are few co-locations on German rooftops
156 in Q216. Rumours that they were seeking third as demands for supplementary payments from With little prospect of sale and leasebacks in Ireland,
party investment turned out to be grounded, with landlords ruin the economics. the most likely source of tower transactions remains
Dutch pension fund PGGM paying €250mn for a consolidation among the ten independent tower
49% stake in their German operations, resulting Greece companies, broadcast operators and public sector
in a joint venture, ‘ATC Europe’ which has already While there are no independent towercos in the players.

Telecom Power Solutions from
Delta Electronics
Energy Efficient Products!
Telecom power systems secure telecommunication services in case of grid power interruptions and fluctuations
Delta’s power systems are designed for wireless broadband access and fixed-line applications, as well as
for Internet backbone and data centres. We provide a broad range of power systems and global services to
telecom operators, network manufacturers and integrators.
Find out more: www.deltapowersolutions.com
www.deltapowersolutions.com
Italy Who owns Ireland’s 4,000 towers? Source: TowerXchange
With the merger of 3 and WIND now announced,
and Iliad confirmed as a new entrant into the
400 377 3 + O2 (Hutchison)
Italian market, all eyes are on how this will play
out. Already, Iliad owner Xavier Niel, known as
Vodafone
the enfant terrible of the French telecoms sector, 377 Meteor (Eir)
is locked in a war of words with the incumbent 500 Towercom
operators, who fear the introduction of new
150 Shared Access
business models and aggressive price wars.
Although no set plan of action is in place for Italy’s 113* ESB Telecoms
infrastructure, it’s widely believed that Iliad’s 100 2RN (RTE)
requirements will ‘free up’ around 5,000 towers, 100 Cignal*
which may well come to market in the coming 800 70
CIE
50
months and which will be of interest to several 40
parties. Highpoint (Obelisk)
Hibernian (Britannia)
Currently, INWIT, Cellnex and EI Towers’ TowerTel 1,100 Wireless Infrastructure Group
lead the telecom tower market in Italy, where
Cellcom
towercos own just under half the total sites, and
*113 owned towers with additional ground lease income on 400 plots of land on which Cignal and 3rd party towers sit
where decommissioning may outstrip organic
growth in the coming years. Who owns Italy’s 47,218 telecom and broadcast sites?
Telecom Broadcast
TIM retains a 60% equity stake in INWIT, with the 2,000
balance having been floated on the Milan Stock
700 11,200
Exchange in June 2015, and had initiated a process INWIT
to sell some or all of their retained equity, with EI Vodafone
Towers and Cellnex (in partnership with Italy’s 2,600 2,300 2,300
Cellnex
leading infrastructure F2i) leading the race to
acquire the company. Hutchison
~7,000
Wind
The process to monetise INWIT further has been 11,400
TowerTel
halted, ostensibly because the TIM management EI Towers
team believes that several value adds have yet to Others
reach fruition and are not yet reflected in INWIT’s 7,725 Rai Way
valuation. Source: TowerXchange

In the last year INWIT has decommissioned around Estimated tower ownership and rooftop usage in The Netherlands
300 sites, and added 82 (including the acquisition
of three small towercos), bringing their Q216 site 12,173
count to 11,200. INWIT raised tenancy ratios by .08
to 1.67 over the same period. By the end of 2018,
INWIT forecasts driving tenancy ratios to around 1.9, 650 860 Open Tower Company
decommissioning over 1,000 sites, and building as Shere Group/Cellnex
many as 500 new sites, primarily for TIM’s 4G rollout.
Protelindo / Cellnex
The continent’s largest pan-European towerco, Other towercos (inc WIG)
Cellnex has rollup up several small towercos in Italy, 600 Vodafone/Liberty Global
but the lion’s share of their portfolio comes from
the acquisition of Wind’s towerco Galata, and their 460 T-Mobile
7,377 towers, for €693mn in 2015. At the end of Q316, Rooftops
Cellnex operated 7,725 sites in Italy, a net increase 200 261
of 17 sites in the last year, with build-to-suit slightly
outstripping decommissioning.
Both INWIT and Cellnex remain bullish about
the potential of small cells in Italy, highlighted by efficiencies through decommissioning – around When both of these deals are closed, Cellnex will
Cellnex’s acquisition of CommsCon for €18.65mn in 60% of Italy’s broadcast towers are in overlapping own 725 towers, or 23.9% of the macro towers
June 2016. locations. But it’s not that simple: the State remains in The Netherlands, where 1,781 (59%) of the
a critical stakeholder, and ownership and anti- country’s 3,031 ground based towers are already
Cellnex’s principal rival in the INWIT process had competitive regulations would need to be relaxed owned by towercos. Market leader Open Tower
been EI Towers, whose telecom-focused subsidiary for consolidation to be approved. Company has around 850 towers, plus access to
TowerTel has built and acquired a portfolio of 1,000 over 1,000 electricity pylons. UK headquartered
telecom towers with an aggregate EV of up to €55mn, The Netherlands Wireless Infrastructure Group is also present in The
~300 of which have been added through several Only 20% of The Netherlands’ 15,204 cell sites are Netherlands.
small acquisitions. macro cell sites, with the balance being rooftops,
DAS and small cells. KPN sold their towers in four tranches between
EI Towers continues to court a much bigger deal: 2008-12, while Vodafone and T-Mobile retain
the acquisition of Italy’s other broadcast towerco, Cellnex has reached an agreement to acquire around 1,250 towers between them. New entrant
RAIWAY, which owns around 2,300 towers, again Protelindo’s 261 Dutch towers for €109mn, and a fourth MNO Tele2 has few if any towers, preferring
with some MNO tenancies. Consolidation would further 464 as part of their deal with Shere Group to rely on co-location and a RANsharing deal with
represent another opportunity to create significant (there is no duplication between the two sites). T-Mobile.

Poland Mobile tower ownership in Portugal
There are around 22,000 telecom structures in the
Polish network, a little under half of which are 4,700
towers, with the rest being rooftops.
1,300
Poland has more subscribers per tower than the
majority of other countries in Europe, indicating MEO
both potential demand for more towers, and
Vodafone
indicating the extent of decommissioning 3,000
that has already taken place in the country. A NOS
balanced, competitive MNO market amplifies the
attractiveness of the Polish market to towercos. Alternate site typologies
2,500
T-Mobile and Orange share passive and active
infrastructure in Poland through 50-50 joint venture
NetWorkS! Initiated in 2011, the partnership Source: TowerXchange
was intended to last 15 years, but there has been

since rumors of a prospective sale and leaseback imperative for the country’s MNOs to monetise their
speculation that one or both party might wish to
by Portugal Telecom over two years ago. Little towers.
exit the venture and sell towers to a third party.
has been heard since Altice acquired PT in 2015.
While NetWorkS! operates around 13,000 towers,
However, Portugal has started to appear on the Russia
the assets remain on T-Mobile and Orange’s own
radar of one of Europe’s largest towercos – a market TowerXchange estimate there are around 42,700
balance sheets. Outside of the NetWorkS! venture,
as little as 2% of Poland’s towers are shared to watch! ground based towers and 75,000 rooftop structures
between multiple MNOs. across the vast Russian landscape. Each of Russia’s
Romania four MNOs is utilising tower company business
Alinda Capital Partners owned Emitel is the Romania hosts a competitive four MNO market, models, but in contrasting ways.
Polish broadcast towerco, operating 377 sites and with no independent towerco activity to date.
diversifying into telecom. Orange and Vodafone Romania operate a VimpelCom has put tower monetisation at the
joint venture infrastructure sharing company heart of a balance sheet restructuring plan, and is
Turnkey infrastructure provider ECS is leveraging called Netgrid Telecom (formerly Ovidu finalising the creation of ‘National Tower Company’,
new capital from CEE Equity Partners to move into Telecommunications). into which they have injected their ~10,400 Russian
tower ownership and leasing. towers, and which they had planned to monetise
Despite being one of the poorest countries in before the end of 2016 (however, this has not
Portugal Europe, ARPU is relatively high in Romania at materialised). MegaFon has carved out ‘First Tower
The Portuguese tower market has been dormant around €20, which means there is little financial Company’ with a view to a future sale to a strategic

Estimated breakdown of ground based towers and rooftops in Russia buyer. MTS has injected part of their portfolio, 5,500
towers, into ‘MTS Towers’ with a view to making the
9 towers available for co-location, but has declared
an intent to retain ownership of the venture.
7 8
6 Meanwhile, rumors persist that Tele2 Russia are
selling their ~8,500 towers.
1 Ground based towers:
1. First Tower Company (MegaFon) 14,000 Leading local towercos Russian Towers and Vertical,
5 2. National Tower Company (VimpelCom) 10,400 as well as the Russian Direct Investment Fund, are
3. MTS Towers 5,500
all expected to be prominent bidders as Russia’s
4. MTS retained towers 4,900
towers come to market. Russian Towers is also
5. Tele2 Russia 8,500
undergoing a period of sustained organic growth,
6. Russian Towers 2,300
4 growing from ~1,900 towers to ~2,300 in 2016, with
7. Vertical 1,600
2 a further 200 towers in the pipeline for early 2017.
8. Other independent towercos 1,000
3 9. Rooftops 75,000
Serbia
Managed service provider Konsing Group, which
Source: TowerXchange also owns a portfolio of 47 sites, counts all three
MNOs among their client base (Telekom Serbia,
Telenor and Telekom Austria).
Estimated ownership of Spain’s 48,997 telecom and broadcast sites
Slovakia
7,413 Broadcast towerco Towercom, which has around
12,500 584 700 sites, was acquired by Macquarie Infrastructure
Funds in 2013. Towercom turns over in excess of
Cellnex
€50mn annually and includes O2, T-Mobile and
Axion Orange among their customer base. Towercom
Orange completed the roll up of TBDS, RK Tower and
Telxius Rádiokomunikácie in 2008.
17,500
11,000 Vodafone
Spain
39% of the 48,997 broadcast and telecom towers
and rooftops in Spain are owned by towercos, led
by Telefónica’s new towerco Telxius and European

RoHS
COMPLIANT
Network Overview Site Status List Home Map Alarm List
Administrator
NETWORK
Online
OVERVIEW
Site Status Power Uptime Tenant Connections Per Site
Total number of sites: 100 Load disconnected: 3
100%
Low system voltage: 10 Priority load disconnected: 2 90% 800
80% 700
70%
120 600
60%
500
100 50%
40% 400
80
30% 300
60 20%
200
10%
40 100
0%
01-Dec
02-Dec
03-Dec
04-Dec
05-Dec
06-Dec
07-Dec
08-Dec
09-Dec
10-Dec
11-Dec
12-Dec
13-Dec
14-Dec
15-Dec
16-Dec
17-Dec
18-Dec
19-Dec
20-Dec
21-Dec
22-Dec
23-Dec
24-Dec
25-Dec
26-Dec
27-Dec
28-Dec
29-Dec
30-Dec
31-Dec
0
20
2015-01 2015-02 2015-03 2015-04 2015-05 2015-06 2015-07 2015-08 2015-09 2015-10 2015-11 2015-12
0 1 2 3 4
17/12/2015 00:00 17/12/2015 12:00 18/12/2015 00:00 18/12/2015 12:00
Priority load disconnected Load disconnected Normal operaon
Alarm Status Power Source Runtime Tenant Load Distribution

Information: 100 Error: 300 100%
Warning: 200 Fatal: 100

1200
90%
80% 1000
120 70%
60% 800
100
50%
600
80 40%
30% 400
60
20%
200
40 10%
0% 0
01-Dec
02-Dec
03-Dec
04-Dec
05-Dec
06-Dec
07-Dec
08-Dec
09-Dec
10-Dec
11-Dec
12-Dec
13-Dec
14-Dec
15-Dec
16-Dec
17-Dec
18-Dec
19-Dec
20-Dec
21-Dec
22-Dec
23-Dec
24-Dec
25-Dec
26-Dec
27-Dec
28-Dec
29-Dec
30-Dec
31-Dec
20 2015-01 2015-02 2015-03 2015-04 2015-05 2015-06 2015-07 2015-08 2015-09 2015-10 2015-11 2015-12
0
0-1500 1500-3000 3000-4500 4500-6000
17/12/2015 00:00 17/12/2015 12:00 18/12/2015 00:00 18/12/2015 12:00 Baery runme Solar runtime Grid runme Genset runme
System Status Diesel Consumption Tenancy Ratio

3
Off-line sites: 2% Genset start alarm: 2% 6000
2.5
Manual mode: 5% 5000
2
12% 4000
1.5
10%
3000
1
8%
2000
0.5
6%
1000
4% 0
0 1 2 3 4 5 6 7 8 9 10 11 12
01-Dec
02-Dec
03-Dec
04-Dec
05-Dec
06-Dec
07-Dec
08-Dec
09-Dec
10-Dec
11-Dec
12-Dec
13-Dec
14-Dec
15-Dec
16-Dec
17-Dec
18-Dec
19-Dec
20-Dec
21-Dec
22-Dec
23-Dec
24-Dec
25-Dec
26-Dec
27-Dec
28-Dec
29-Dec
30-Dec
31-Dec
2%
Average tenancy rao Mul tenant site tenancy rao
0%
17/12/2015 00:00 17/12/2015 04:48 17/12/2015 09:36 17/12/2015 14:24 17/12/2015 19:12 18/12/2015 00:00 18/12/2015 04:48 18/12/2015 09:36
Total fuel filled Total fuel lost Total consumed diesel
in www.flexenclosure.com/eSite
Who owns/operates the UK’s Figure four: Estimated tower and rooftop counts for selected markets in
38,500 active cell sites? Europe
Co-locations
Independent
Denmark Kazakhstan Czech Republic
towercos 7,000 10,200
4,500
14,500
Ireland Greece Nether- Poland UK Italy France Spain Germany Russia
4,000 12,000 lands 22,000 38,500 47,218 47,347 48,997 70,136 117,700
MBNL 15,204
CTIL
12,000 Portugal Finland
12,000 6,800
Ukraine
10,000 12,000
500 500
Shared
Source: TowerXchange Source: TowerXchange
market-maker Cellnex. One is headquartered and currently has a market cap in excess of €3.5bn. market, and what TEF will do with Telxius remains
in Madrid, the other Barcelona, so the battle for As of Q416, Cellnex operate 7,413 sites in Spain, to be seen.
tenancies could be as fierce as any El Classico! a net decrease of 15 sites year on year due to
Their home market of Spain contributes about decommissioning. Cellnex’s tenancy ratio in Spain AMP Capital has agreed a deal to acquire 100% of
65% of Cellnex’s EBITDA. Originally known as rose .06 in the same period to 1.92. Axion from current owners Antin Infrastructure.
Abertis Telecom, with a background in broadcast Axion operates 584 broadcast towers, with some
and transport infrastructure, the company Earlier this year, Telefónica transferred 11,000 telecom co-location, 70% of which are in Andalucía.
supplemented their domestic footprint through Spanish towers and rooftops to their towerco
the acquisition of 4,377 towers from Spain’s Telxius for an undisclosed sum ahead of ahead of Sweden
Telefónica and Yoigo. Cellnex was successfully their planned IPO, however, the IPO was scrapped There are no independent tower companies
listed on the Madrid stock exchange in May 2015 in October 2016 due to lack of interest in the in Sweden, largely because network sharing is

Cabinets Batteries Gensets Solar
WE ARE SHAPING POWER MANAGEMENT

ONE GREENPOLE STATION AT A TIME.
GreenPole provides turnkey hybrid power solutions for the telecom
industry, and distributes power related products such as gensets,
genset spare parts, batteries, solar street lights, solar aviation lights
and other solar related products and solutions in emerging markets. greenpole-ps.com
efficiently managed through three network sharing ground based towers among a portfolio of over the UK’s independent towercos, and site sharing
joint ventures. 23,000 sites. Of these macro towers, TowerXchange businesses in their own right. Their business
believes that Global Tower owns around 3,400 and models differ in that the tower assets are actually on
SUNAB is a 50-50 3G joint venture between Tele2 leases around 2,390 from Turkcell, for which they CTIL’s balance sheet, while MBNL is a management
and TeliaSonera which runs the MOCN RANsharing only receive revenue from co-locations. In addition company with the assets retained by the MNOs.
model; Net4Mobility, another 50-50 joint venture, they manage a portfolio of around 2,215 towers CTIL is a passive infrastructure sharing play, while
runs Telenor and Tele2’s combined 2G and 4G on behalf of Turkcell, for which they just receive MBNL’s model extends to active infrastructure and
network; and 3GIS is a joint venture running maintenance fees. transmission sharing.
Telenor and 3’s 3G network outside of Sweden’s
largest cities. Turkey is also home to one of the world’s largest When the merger between O2 and 3 was mooted,
government-owned universal service networks, it seemed that the realignment of partnerships
Teracom operates Sweden’s broadcast tower with over 1,100 RANshared base stations deployed might create a window to monetise one or both
network. There are a little over 10,000 sites in in rural areas. Turkey’s three MNOs take it in turns JV infracos, but in the aftermath of the EU vetoing
Sweden. to manage the rural network. consolidation, it’s very much business as usual in
the UK tower market. Not that business as usual
Turkey United Kingdom is uneventful: the UK is home to one of the largest
Turkcell, Turkey’s largest mobile network operator, The UK’s biggest tower news of Q3 is the sale of decommissioning programmes on the planet, while
announced plans to list their towers unit, Global Arcus-owned Shere Group to Cellnex for €393mn. CTIL and MBNL are also leading the rollout of 4G.
Tower, in April 2016. However in October 2016 With 540 sites in the UK, it’s not a sale which will Around 2,500 new sites (towers and co-locations)
Turkcell decided to postpone the IPO at the eleventh re-write the tower landscape in the UK, however it are expected to be added to UK networks in 2016.
hour, citing global political uncertainty and the is a toehold for Europe’s most acquisitive towerco The UK’s broadcast tower operator Arqiva has been
possibility of cyber attacks. TowerXchange believes in a market which could yield some very significant through many changes of identity and ownership
that Turkcell planned to list 25% of the business gains, were the opportunity to present itself. (BBC, Crown Castle, National Grid to name a few),
and was perhaps hoping for a more Cellnex-like and the 10,550 tower giant is rumoured to be
valuation multiple than was likely to be achieved. The UK has a tower market structure unlike any planning a £5bn sale, abandoning previous plans to
With Turkcell making ambitious plans to support other in the world. Independent towercos, headed list on the London Stock Exchange.
revenue growth through expansion into overseas by Arqiva and Wireless Infrastructure Group and
markets, an IPO or sale is certainly not off the Shere Group (recently acquired by Cellnex), own TowerXchange has not yet picked up any
agenda, however, and we believe there may 38% of the 38,500 active towers in the UK. The independent towerco activity in the following
be considerable value in Turkcell identifying a balance are contained within two joint venture European markets, thus they have yet to be studied
strategic partner who could support their expansion infracos: CTIL, which operates Vodafone and O2’s in detail by our team: Albania, Austria, Belarus,
plans. network (Telefónica), and MBNL, which performs a Belgium, Bosnia and Herzegovina, Bulgaria,
similar function for EE (now BT) and 3 (Hutchison). Estonia, Iceland, Latvia, Luxembourg, Macedonia,
Established in 2006, Global Tower has around 7,500 CTIL and MBNL are both the primary clients of Montenegro, Norway and Switzerland

European tower deals since 2008
Cost per
Year Country Seller Buyer Tower count Deal value € Deal structure
tower €
2016 France Antin/FPS American Tower 2482 697,000,000 280,821 Company acquisition
2016 UK & Netherlands Shere Group Cellnex 1004 393,000,000 391,434 Company acquisition
2016 France Bouygues Telecom Cellnex 230 80,000,000 347,826 SLB
2016 France Bouygues Telecom Cellnex 270 67,000,000 248,148 SLB
2016 Netherlands Protelindo Cellnex 261 109,000,000 417,624 Company acquisition
2016 Germany Telefonica Telxius 2350 587,000,000 249,787 SLB
2016 Ukraine Lifecell UkrTower 811 47,820,000 58,964 SLB
2016 Spain Telefonica Telxius 11000 SLB
2015 Ireland Coillte Cignal 113 Portfolio acquisition
2015 Germany Telefonica Deutsche Telecom/ Omega Towers 7700 Asset Transfer
2015 Italy Tecnorad EI Towers 134 17,000,000 126,866 Portfolio acquisition
2015 Italy Wind (VimpelCom) Cellnex 7377 693,000,000 93,941 SLB with 10% equity
2015 Italy TowerCo Cellnex 212 94,600,000 446,226 Company acquisition
2014 Spain Telefonica/Yoigo Cellnex 4277 385,000,000 90,016 SLB
2012 France Bouygues Telecom FPS Towers 2166 185,000,000 100,400 SLB with 15% equity
2012 Germany KPN American Tower 2031 393,000,000 193,501 SLB
2012 Netherlands KPN Protelindo 261 75,000,000 287,356 SLB
2012 Netherlands KPN Shere Group 460 115,000,000 250,000 SLB
2012 Spain Telefonica Cellnex 500 45,000,000 90,000 SLB
2010 Netherlands KPN Open Tower Company 500 SLB
2008 Netherlands KPN Open Tower Company 101 SLB
Totals / average 41,758 3,286,420,000 147,082


®
NorthStar ACE the future of energy storage management

TM
For more information visit www.northstarbattery.com

European heatmap
Legend
TowerXchange research has not revealed any infracos or

towercos to date
Towercos or infracos active in the market. No recent
transactions have taken place and none rumoured to take
place soon
Towercos or infracos active in the market. No current
transactions taking place but an attempted tower sale has
taken place in the last 3 years or there are unconfirmed
rumours of a deal in this market.
Towercos or infracos active in the market. Rumours of deals
confirmed in the market.
Towercos or infracos active in the market. Deals of significant
size have taken place in the last 5 years.
Towercos or infracos active in the market. Deals have taken
place in the last year and more imminent deals rumoured
Note: For the purposes of our European coverage, ‘Towerco’ describes an independent company which owns and operates passive infrastructure for commercial profit. ‘Infraco’ incorporates MNO joint venture
organisations and carve outs which serve more than one entity or market their towers commercially

HAVE YOU HEARD?
Inside Towers is your source for all things towers.

Delivering breaking & relevant news to wireless infrastructure professionals daily.
Claim your complimentary annual subscription ($199 value)

insidetowers.com/towerxchange
The American dream: American Tower In October 2016, it was believed that as many as ten
bidders were competing for FPS Towers, including
Cellnex, Europe’s leading home-grown towerco who
announces acquisition of FPS Towers have been on something of a buying spree in Europe
recently, and 3i, investors in the UK’s Wireless
American Tower to make first European acquisition in four years Infrastructure Group (WIG), whose intention
was to create a new model of European towerco
On 19 December 2016 American Tower platform. Although the remaining bidders were not
named, it is believed that other US towercos and
announced the acquisition of French FPS
infrastructure investors made up the majority of the
Towers for €697mn. The deal has held the interested parties and that in the final rounds the
attention of the European tower market bidding was between 3i/WIG, Cellnex and eventual
since the summer, when Antin Infrastructure winners American Tower. We’re keen to delve a
Partners announced their intention to find a little deeper into the events which ran up to this
deal, and speculate about what this might mean for
buyer for the entrepreneurial towerco. In this
all the parties involved.
editorial we will review what both FPS and
American Tower bring to the table, discuss Who are FPS and what was on offer?
some of the dynamics which influenced the
bidding process, and share some exclusive FPS Towers was formed in 2012 by Antin
Infrastructure Partners to acquire and manage
comment from American Tower as to their
2,051 towers acquired from Bouygues Telecom.
thoughts on the deal. Since then, their ambitious growth strategy led to
the acquisition of Loxel, a rooftop management
Keywords: Acquisition, American Tower, Anchor Tenant, Bouygues, Cellnex, Deal Structure, Editorial, organisation, in 2015, the lease up and growth of
their core portfolio to 2,482 towers, supplemented
Europe, Europe News, Exit Strategy, FPS, France, Germany, Infrastructure Funds, News, Rooftop, Sale &
by an innovative programme focused on securing
Leaseback, SBATDF, Tenancy Ratios, Wireless Infrastructure Group
hundreds of public and municipal structures used in
telecom networks.
Read this article to learn: FPS Towers was established to animate a French
< What FPS brought to the table tower market dominated by broadcast tower giant
< Why the acquisition was a good fit for American Tower TDF, and they have certainly disrupted the market
< The details of the deal and bidding process in several ways, by gaining toeholds in alternative
< Exclusive comment from American Tower on the deal site typologies across France.
FPS’ management team focused on securing

MAKE
YOUR
PLANS
TODAY!
FORT WORTH CONVENTION CENTER
February 27 - march 2
www.natehome.com
hundreds of public and municipal structures used What is the breakdown of the high sites used by the French telecom
in telecom networks. FPS have been able to secure industry? And who owns them?
these sites under a contractual term like a concession
under which they can attain a 30 year renewable 13
lease, with rights very close to those of a site owner. 11 12 10
Some of these public sites have to be tenaciously
and painstakingly acquired one by one, others can 9
14
be found aggregated in deals like one FPS reached
in December 2015 with highways operator APRR to
8
67
secure 300 sites. 5
1
By acquiring rooftop aggregator LOXEL in 2015, FPS 4
were able to offer up front payments to secure 20-30
year rooftop leases, and make them available for co-
location. This model has the potential to unlock huge
potential in the French market, however, as LOXEL’s 3
offering centres around brokering, rather than
2
control or management of rooftop sites, the extent
to which these contracts could transfer into a source
of recurring revenue will have been a key factor in
valuing this segment of the portfolio.
FPS positioned themselves as a towerco with a

foothold in both the rooftop and alternate site
markets, enabling them to form win-win-win Ground based towers Rooftops structures with telecom equipment
partnerships with their customers and landlords. 1. Orange 8,100 10. Rooftops sites sourced directly by MNOs 14,540
2. SFR 5,300 11. Rooftop sites provided by TDF 301
3. TDF 4,865 12. Rooftop sites provided by FPS Towers 159
In the midst of the FPS Towers sale process,
4. FPS Towers 2,482
Bouygues Telecom are believed to have brought to
5. Bouygues Telecom being sold to Cellnex 500 Rooftops without telecom equipment installed,
market ‘a couple of thousand’ rooftops. Bouygues’ 6. Bouygues Telecom 350 but for which a towerco has a commercialisation
established relationship with Cellnex (who have 7. Free 350 agreement:
acquired 500 of their macro towers in 2016 for a total 8. Other structures not belonging to towercos or 13. TDF 2,985
of €147mn), and TDF’s need to maintain the upper MNOs 2,900 14. FPS Towers 20,000
hand in the French market means these assets are
highly desirable. The fact they represent a chance to 9. Other ground based structures 7,500
Sources: TowerXchange research, ANFR, FPS Towers, TDF
acquire MNO rooftops, as opposed to FPS’ brokering

Viavi Knows
Wireless. Plan
As the wireless industry Manage Build

rapidly evolves, don’t just
keep up--stay ahead.
At Viavi, we’re constantly

innovating to bring you the
Monitor Certify
most complete and least
complex solutions for the
Activate
greatest value.
Mobile Network Lifecycle
Only Viavi provides the advanced tools

and intelligence you need at every step
of the network lifecycle to ensure you
get the most out of your investment.
Viavi Solutions
formerly Learn more at:
viavisolutions.com/wireless
Number of towers acquired by American Tower since 2012 one of the most coveted assets on the continent in a
competitive process.
50,000
The deal
40,000
Although speculation that the deal value could reach
€1bn was rife, American Tower’s price of €697mn
30,000 seems more in line with other recent European
valuations.
20,000 42,581
36,668 French newspaper Les Echos reported in August
that FPS was projecting a turnover of €70mn and
10,000 EBITDA of €45mn for 2016, and ATC’s own report on
the French market puts FPS’ Year One revenues at
2,197
6,450 ~€60mn with a gross margin of ~80%, bringing their
EBITDA to a similar €48mn for 2017. This would
Latin America Africa India Europe place their valuation at around 14.5-15.4x EBITDA,
perhaps not as high as some recent optimistic
offering, may have diminished the perceived value of time period, while only growing their European valuations might have guessed, but certainly a
this part of FPS’ portfolio, while offering bidders an portfolio by 166 towers. During this time Cellnex solid result given that FPS Towers’ owners Antin
alternate means of achieving scale in France. deployed just shy of €1.8bn to acquire 13,861 Infrastructure deployed just €205mn to acquire the
towers in Europe across five countries. core portfolio only four years ago.
How does the acquisition fit with American
Tower’s European strategy? In October 2016, after four years of minimal M&A Why did American Tower succeed in such a
activity in Europe, American Tower announced contested sale?
In 2012, American Tower acquired 2,031 towers the formation of a joint venture with Dutch
from KPN (now E-Plus) in Germany for €393mn, pension fund PGGM to form ‘ATC Europe’ with a Of the ten bidders for the FPS towers, American
increasing that number to 2,197 towers in the focus on pursuing telecommunications real estate Tower have succeeded in acquiring this popular
country over four years. When compared to investment opportunities in Europe. At the time French asset and seem to have achieved a
American Tower’s activity in the other markets there was some speculation as to whether this reasonable valuation. Of the other bidders we know
where they own assets, their investments in Europe indicated a readiness to engage more deeply with to have been involved in the process, Cellnex were
seemed remarkably small, given they invested the growing European tower market, or a desire to probably one of the favourites, having a toe hold in
around US$1.2bn in acquiring 6,450 towers in dilute ATC’s exposure to the slow moving German the French market already, and having rolled up
Africa, US$1.2bn in 42,581 towers in India and tower market. As it happens, it didn’t take long for two smaller European towercos already in the last
$8.9bn in 36,668 towers in Latin America during this ATC Europe to show their hand, acquiring possibly 12 months in Shere Group and Protelindo NV.

Tower sales and valuations in France since 2012
Number of Average cost EBITDA EBITDA
Year Seller Buyer Amount paid
towers per tower (€mns) x
2016 Antin Infrastructure Parners American Tower 2,482 697,000,000 280,821 45 15.4x
2015 ITAS TDF 420 100,000,000* 238,095
2014 Bouygues Cellnex 270 67,000,000 248,148
2013 Bouygues Cellnex 230 80,000,000 347,826
2012 TDF Brookfield 7,398* 3,600,000,000 N/A 358.8 10x
2011 Bouygues Telecom Antin Infrastructure Partners 2,166 205,000,000 111,346**
* Number of towers in France, not including international towers or non-tower assets Source: TowerXchange
**Adjusted to reflect 15% equity retained by Bouygues until 2015
On closer inspection, however, it would seem that And of course there are several opportunities on Viewpoint from Jonathan Dann, Managing
FPS’ EBITDA multiple can be interpreted several the horizon which could prove very attractive Director, RBC
ways, and that a substantial amount of capital indeed, including the Bouygues rooftops in
expenditure will need to be made over the next three France, Arqiva in the UK, Telxius in Spain and How does this compare to earlier (European)
years to support FPS’ rapid growth plans. As some Germany, Global Tower in Turkey, Ukraine and deals?
sources suggest that FPS’ EBITDA may be closer to Cyprus and Deutsche Funkturm in Germany.
€36mn, this would imply a multiple of 20.5x, which With some extremely significant portfolios in the Recently, European tower portfolios have changed
is substantially above the regional average. pipeline, it would seem sensible for Cellnex to hands at 15-17x EV/EBITDA; however, these have
keep their powder dry for the time being. been low growth and hence low capex/sales assets,
As Cellnex’s leverage is approaching their target implying <20x EV/OFCF (EBITDA-capex) for CPI type
level, an investment in FPS, which is likely to be growth rates.
ATC Europe, on the other hand, has access to
EBITDA-capex negative for the next three years,
cheap capital and a partner in PGGM who is
would have left them with very little wiggle room FPS is in a class of its own, it is expected to have
eager to invest in long term growth. The FPS
should a larger opportunity arise. As Jonathan a substantial capex program designed to grow its
acquisition fits nicely into their European customer base (occupied towers) materially by 2020
Dann, Managing Director at RBC states: ‘Current
forecasts for FPS are that annual FCF contribution narrative of stable cash flows from mature with revenues and EBITDA growing by multiples -
from France would have been negative for Cellnex Northern European markets, and a good return i.e. the buyer is paying <10x EV/EBITDA in 2020, but
if it was the acquirer, before becoming a substantial on investment story could play out in France current FCF is negative.
contributor beyond 2020. This would have severely with a much admired asset, which cements
reduced Cellnex’s ability to invest over the next two/ American Tower as a European player to be For FPS, American Tower represent a vastly
three years.’ reckoned with experienced counterparty with access to the

expertise and cheap capital they need to realise their management team, a group of smart and creative with long-term tenant lease contracts, a high
rapid growth plans. ATC’s operations in Germany professionals who made no secret of the fact they’d quality asset base from a structural and location
and joint venture with PGGM show they know the been to the US, seen how successful the model was perspective, and excellent relationships with the
European market well and are committed to growth and emulated it in the European market. It’s no mobile network operators.
in the region - something which sets them apart from wonder the asset appealed to US buyers, who found
other US towercos, who have expressed an interest the playbook accessible and easy to read. We believe we have an excellent opportunity
in European assets for some time, but as yet have not to combine ATC’s proven expertise in owning,
dipped their toes in the water. Cellnex’s unchallenged sweep across Europe has operating and investing in telecommunications
come to an end; American Tower has stepped assets with FPS’ deep knowledge of the local market
What does this mean for European towers? up to the plate and swung for the fences, but the and PGGM’s financial support to continue to grow
great news is that serious competition to build a this business in France over the long term. The
If we had doubts about American Tower’s intentions pan-continental portfolio will boost value for both valuation for the asset in light of all of these factors
towards the European market before, they’re allayed smaller towercos and MNOs who have been biding was attractive.
now. With this acquisition, American Tower is laying their time and deciding whether to divest their
the foundation for a strong European portfolio and assets. Europe’s tower market shows no signs of TowerXchange: Does this deal exemplify a
presenting a clear challenge to both Cellnex and slowing in 2017 slightly different investment criteria for ATC in
other international towercos with an eye on the partnership with PGGM in Europe?
European market: American Tower mean business. Exclusive comment from American Tower
In a European market with 45 towercos and just 13% American Tower: No, we are utilizing the same
of European towers in independent hands, there TowerXchange: Why France, why FPS, and why investment evaluation process that we have used for
remains huge scope for consolidation, acquisition now? years, with the same risk-adjusted hurdle rates. In
and asset transfer. addition, the transaction extends our partnership
American Tower: This was an attractive acquisition with PGGM and demonstrates the joint venture’s
The transaction is a good news story for European for us for a number of reasons. France is a wireless ability to find, evaluate and acquire what we believe
towers. Irrespective of which EBITDA number market with less 4G coverage than many other will be high-growth assets in Europe by combining
you believe, what it boils down to is the fact that European markets—just 25%. Because the regulator PGGM’s deep knowledge of the continent with ATC’s
Antin put €205mn on the table just under five has mandated that all mobile network operators extensive history of acquiring and operating tower
years ago, and turned it into almost €700mn by reach 98% 4G coverage by 2024, we believe this will assets globally.
reading the market and empowering a savvy help catalyze network investments going forward.
and entrepreneurial team. That team added Coupled with the recent 700 MHz spectrum auction TowerXchange: While the core assets in the FPS
value by leasing up the towers, such that value and significantly growing mobile data usage, we portfolio were 2,400 macro sites, the company
per tower increased over 250% in less than five expect considerable growth in revenues on the FPS are renowned for their interest in exploiting
years, from €111,346 to €280,821, an impressive tower assets. alternate site typologies, from rooftops to
return on investment which speaks volumes electricity transmission towers - do you see these
about the investibility of European towers right Furthermore, FPS has been a very well managed alternate site typologies remaining part of the
now. The achievement is also testament to the FPS independent tower operator since its inception, vision going forward?

American Tower: This was another part of the appeal
of the transaction, in addition to the high quality
nature of the tower portfolio. The FPS management See you at our future events!
team has done an excellent job of unlocking value
in the French telecommunications real estate space,
and part of that has been, and we believe will
continue to be, offerings that are complementary to
the core tower business. Meetup Meet up
We expect to continue evaluating these types of
alternative technologies and pursue them to the
Europe 2017 Americas 2017
extent they offer compelling returns that meet
our requirements as part of our overall value 4-5 April, 7-8 June,
proposition to our French carrier customers.
London Boca Raton
TowerXchange: Does American Tower, in
partnership with PGGM, have appetite for further
acquisitions in Europe?
American Tower: Yes, we welcome the opportunity

to build on our partnership with PGGM and Meetup Africa Meetup Asia
will continue to evaluate additional investment
opportunities in Europe and around the world,
utilizing our proven investment evaluation
& ME 2017 2017
methodology and acting only if the opportunities
meet our risk-adjusted return hurdle requirements
3-4 October, 12-13 December,
FPS Towers Chairman Frederic Zimer will be
Johannesburg Singapore
joining Cellnex, INWIT, WIG, CTIL and Russian
Towers on the CXO panel at the TowerXchange
Meetup Europe on 4-5 April 2017 at the Business
Design Centre, London. Visit
www.towerxchange.com/meetup/meetup-europe/ www.towerxchange.com
for more information.

Shere brilliance –
Cellnex have undertaken a series of growth
investments in Europe over the past two years,
deploying approximately €1.4bn. This means that
Cellnex’s new acquisition at present almost 40% of company revenues are

generated outside Spain. A solid asset, the Shere
Cellnex consolidate their position in Netherlands and enter the UK market Group deal puts the organisation in a strong position,
Cellnex CEO, Tobias Martinez stating that, “Once we
through acquisition of Arcus’ Shere Group complete the acquisition of Shere, will have a backlog
(contracted sales for the coming years) of € 8.4bn.”
In October 2016 Cellnex announced the
acquisition of 100% of Shere Group for Jack Colbourne, Partner at Arcus, lead asset manager
€393mn ($440.67mn), trebling their number and board member for Shere commented, “Arcus
personnel have been involved in Shere going right
of sites in the Netherlands from 261 to 725
back to its inception in 2004, and we have supported
through the addition of 464 Shere sites and
the same management team throughout that period
acquiring a small but healthy portfolio of 540 as the company grew by more than 10 times in terms
sites in the UK. Integrating Shere’s assets will of revenues and cashflow. We have played an active
provide estimated annualised revenues of role in shaping the direction of a company which
€29mn, two thirds of which are derived from operates within a niche infrastructure sector that is
both fast growing and constantly changing. We are
the Netherlands and a third from the UK.
extremely pleased with how Shere has developed
over our period of ownership.”
Keywords: Access Control, Acquisition,
Build-to-Suit, Business Model, DAS, Deal TowerXchange also put a few questions to Alfonso
Structure, Europe, Europe News, Europe Álvarez, International Business Manager at Cellnex,
Research, Market Entry, News, Small Cells, about the deal.
Alfonso Álvarez, International Business Manager, Cellnex
Tenancy Ratios, Valuation
TowerXchange: Congratulations on announcing
the agreement to acquire Shere Group. What did
Read this article to learn: you like about this company?
< Why Cellnex selected Shere Group as an acquisition target
< How the deal affects Cellnex’s position in key markets Alfonso Álvarez, International Business Manager,
< Operational management plans for the new acquisition Cellnex: A key driver in this acquisition has been the
< Cellnex’s opinión on small cell and DAS rollouts in their European markets ability to further consolidate Cellnex’s position in The
Netherlands, integrating a portfolio of assets which

densify our network of sites, does not overlap with Shere and a handful of smaller towercos. How do managing operations in the UK and The Netherlands
the assets being acquired from Protelindo and, last you anticipate the competitive dynamics playing and will become a key part of Cellnex’s international
but not least, it contributes with a high tenancy ratio out between those stakeholders? management team.
improving the overall portfolio’s quality.
Alfonso Álvarez, International Business Manager, TowerXchange: The MNOs, Arqiva and WIG have
Moreover, the fact that Shere Group involves as Cellnex: It is difficult to assess. The UK market is already rolled out DAS and small cells at some of
well a solid portfolio of greenfield as well as tower quite attractive as it is one with the highest level of the most obvious venues in the UK - how would
assets in the UK has been a positive externality that outsourced telecom infrastructure. The UK is the you characterise the maturity of the small cell
we assessed as a positive move as well and thus closest European market to the US benchmark. At rollout there and where do you see opportunities
reinforced the case for the acquisition. the same time it looks quite stable with CTIL and for Cellnex?
MBNL as strong MNO’s joint ventures controlling a
TowerXchange: This transaction sees Cellnex substantial portion of the tower market. Alfonso Álvarez, International Business Manager,
doubling down on your investment in The Cellnex: The DAS and small cells deployments
Netherlands - how much overlap is there For sure there is a space for consolidation among are still in their first steps and consistently their
between the Shere and the Protelindo towers? independent operators, but the key driver business models are evolving as well. What we know
And how does the addition of the Shere sites for Cellnex in the case of Shere has been the is that the opportunity is there for the independent
impact the tenancy mix and tenancy ratio of the consolidation in The Netherlands. Now we have a telco infrastructure operators as it seems reasonable
consolidated portfolio? foot as well in the UK, which offers as visibility of to think that multi-operator approaches will play a
the market and profiles us as a new actor. Beyond of role. This is valid for all European markets. What
Alfonso Álvarez, International Business Manager, this the whole market picture has not changed. we can expect in terms of market potential, speed of
Cellnex: The fact that there is no overlapping deployment and time to market of the upcoming LTE
between Shere and Protelindo assets in The TowerXchange: What can you tell us about your generation remains still open, as it will be a process
Netherlands has been featured as one of the operational management plans for the UK and implying as well this kind of turn around of the
drivers of this deal. As already underlined in the Netherlands - have local country managers been involved business models.
first question the addition improves both tenancy appointed? Will the Shere Group management
mix and ratio especially when we consider Cellnex team be transitioning to Cellnex and playing a TowerXchange: With CTIL making up around 34%
Netherlands’s assets as stand alone. In terms of role? of Shere’s UK business, what does the UK tenancy
consolidated portfolio it improves the tenancy ratio mix look like and how will it develop?
but its impact is less visible as it represents a small Alfonso Álvarez, International Business Manager,
piece of the whole Cellnex’s asset portfolio. Cellnex: We are right now at the beginning of the Alfonso Álvarez, International Business Manager,
integration process. As Cellnex’s footprint expands Cellnex: Tenancy ratio of towers deployed on
TowerXchange: The UK tower market is uniquely into new European markets the company does not existing Shere’s UK sites is 1.6x as it has been
structured with around a third of the towers each only integrate assets, but it integrates mainly talent, reported. Organic growth prospects will be
split between MNO joint ventures CTIL and MBNL market know how and management skills. So, monitored as in any other market in order to
and an independent sector led by Arqiva, WIG, yes, the Shere Group team will play a leading role improve key “productivity” indicators

The TowerXchange Viewpoint
Although the ‘closed doors’ nature of this deal meant it came as a surprise to the industry,
acquiring Shere Group seems a natural step for Europe’s most acquisitive towerco, Cellnex. Given
the size of their portfolios in Spain and Italy (7,413 and 7,725 towers respectively), Cellnex thrive
Meetup
in the position of key market leader and won’t be satisfied with a handful of towers in a market
unless it opens the door to a bigger opportunity.
Europe 2017
The first and most obvious advantage of this deal is that it allows Cellnex to become one of the 4-5 April, Business Design
biggest independent towercos in the Netherlands, a very stable and attractive European economy. Centre, London
Shere Group’s Dutch towers have a healthy tenancy ratio of 2.7x.
What does this mean for Cellnex’s remaining small toeholds? Well, their interest in Bouygues’
rooftops in France, which would boost their recently acquired 230 sites to just shy of 3,000
rooftops and towers, is public knowledge. In the UK they will own a portfolio of 540 sites, which
puts them in fifth position behind CTIL, MBNL, Arqiva and WIG, however prospective operator
consolidation and Arqiva’s plans for reducing debt mean that, although less of a quick win, the
potential to acquire a significant portfolio in one of Europe’s leading economies could be huge.
Cellnex and Arqiva are both at their heart telecom-broadcast towercos – the synergies are
obvious – could the Spanish firm be jockeying to make an offer the indebted Arqiva could not
refuse? Could the Cellnex balance sheet absorb another major acquisition without significant
restructuring? It’s interesting that Cellnex have focused on the amplification of their Dutch
presence in justifying this transaction: is their entry into the UK really only a fortunate by-product
of a Dutch-centric deal? Or are they bluffing? For Cellnex a small gamble on gaining influence in
the UK market could reap huge rewards
A unique networking opportunity with 200 leaders of the
European telecom and broadcast tower industry
Shere Group’s majority owners Arcus Infrastructure Partners exceeded their original return
targets through the exit www.towerxchange.com/meetups/meetup-europe

Europe News believed to be considering extending the reach of
its internal towerco Deutsche Funkturm, to manage
towers outside of Germany, including Austria,
A roundup of tower news across Europe Poland and The Netherlands. Deutsche Telekom
last month named Chief Technology Officer Bruno
announced last July which included the Jacobfeuerborn as Managing Director of Deutsche
incorporation of 230 towers for mobile telephony Funkturm.
transmission equipment into Cellnex France, in a
first phase which ended on 16 September 2016. In Germany: American Tower Corporation and PGGM
the second phase, Cellnex incorporates 270 towers announced entry into a definitive agreement to
involving an investment of €67mn in addition to form a new joint venture (ATC Europe), which
the €80mn in the first package of assets. Thus, the will focus on pursuing telecommunications real
cumulative investment in the acquisition of the estate investment opportunities in select European
500 towers amounts to €147mn. Bouygues is also countries. At closing, AMT will contribute its
believed to have brought around 2,000 rooftop sites German assets into ATC Europe and PGGM will
to market, which could well be of interest to Cellnex, acquire a 49% interest in ATC Europe. American
American Tower and TDF. Tower will retain operational control and day-to-
day oversight of ATC Europe.
Germany: Digital infrastructure minister Alexander
Dobrindt announced that Germany wants to Italy: INWIT, Telecom Italia’s tower unit, reported
become the first country to set up a comprehensive revenues of €83.9mn in the three months to 30
Czech Republic: Telecommunication company 5G network. “We want Germany to be the leading September, a 5.1% yoy rise, while the company’s
Ceska telekomunikacni infrastruktura (CETIN) has market for 5G and the first country that will have EBITDA was €41.7 million, up 15.2% yoy, with its
issued bonds worth up to EUR2bn (Kc54bn) in total a blanket 5G network,” Frankfurter Allgemeine net financial debt declining €21.4 million compared
and wants to use the money for investments in Zeitung quoted Dobrindt as saying. A five-point to the previous quarter at €60.9 million. INWIT’s
mobile networks development and faster Internet strategy paper prepared by the ministry calls for CEO Oscar Cicchetti said the results confirmed
connection. The euro bond programme in several all main transportation arteries and at least the 20 the solidity of the company’s strategic plan and
currencies was arranged by banks BNP Paribas, largest German cities to be fitted with 5G networks that it had achieved its EBITDA target of growth in
HSBC and PPF Banka and BNP Paribas, Citigroup, by 2025, with key decisions to be made by 2018. the low teens for the second consecutive quarter.
HSBC, ING, SG CIB and PPF Banka acted as the The company reiterated its forecast of a low teens
dealers. Germany: Deutsche Telekom AG has shelved plans growth in EBITDA up to 2018.
to sell its mobile phone towerco after a similar
France: Cellnex Telecom and Bouygues Telecom deal from Telefónica was scrapped in September, Italy: Cellnex has announced an agreement with
have closed the second phase of the agreement according to industry sources. The operator is Linkem, the fastest growing broadband and fixed

wireless service provider in Italy, to provide access The agreement will incorporate all 4G/LTE ready Stanley technology media & telecom conference
to approximately 8,000 sites for the roll-out of sites (including location, transmission capacity and in Barcelona that it had received interest from
Linkem’s LTE network. TowerXchange calculates the infrastructure environment of each city) into infrastructure funds and private equity in Telxius
that the deal, which Cellnex says will increase their the newly-shared network, providing customers since pulling the float and was in a stronger
tenancy ratio in Italy by around 5%, will roll out on with superior 4G/LTE coverage and service quality. position to strike a deal that created value. “Maybe
around 500 sites initially. there are some possibilities. Now we have adjusted
Alexander Komarov, CEO of Beeline Kazakhstan the dividend, we only do transactions that create
Gianluca Landolina, CEO of GalataSpA, a company said: “Beeline and Kcell will bring fourth- value,” he said. Apollo, Blackstone, KKR, Brookfield,
of the Cellnex Italy group said: “The agreement generation network infrastructure to millions Apax and CVCare all reported to have expressed an
with Linkem confirms Cellnex’s intention to of customers in Kazakhstan. This partnership interest in the assets.
become the partner of choice for the leading is a key step in Beeline’s transformation into an
telecom operators in Italy. Our goal is to support agile, digital operator that will help its customers Spain: AMP Capital has entered into an
our customers and provide them with increasingly navigate the new digital world.” agreement to acquire 100 per cent of Axion from
innovative services through our extensive network. Antin Infrastructure Partners. Axion provides
This agreement further strengthens Cellnex Norway: Telenor has sold 142.5 VimpelCom shares broadcasting, transport, site hosting and operation
position as the main independent tower operator in at a price of $.5 per share, reducing its holding and maintenance services to the radio, regional
Italy.” from 33% to 24.9%, representing the first stage television and telecommunications sectors with
in selling its entire holding. VimpelCom says it 70% of the business located in the Andalucia region
Kazakhstan: VimpelCom announced in August that will not receive any proceeds from the sale of the in Southern Spain.
their operator Beeline Kazakhstan had entered into shares and has also granted underwriters a 30-day
a network sharing agreement with Kcell for the option to purchase just over 21 million additional AMP Capital Global Infrastructure Fund Managing
joint deployment of 4G/LTE services in Kazakhstan. shares at the offering price. Telenor said it planned Partner Boe Pahari said: “Axion is a solid asset
to sell the stake after a controversy around bribery with a resilient business model. It is well placed
Yogesh Malik, Group Chief Technology Officer, in Uzbekistan, which it settled in February by to capture the huge growth opportunity in
VimpelCom, said: “Becoming asset-light is key to paying $795 million in the Netherlands (where telecommunications at a time when mobile
our strategy to transform our Group-wide network VimpelCom is registered) and the US network operators are increasingly looking to
into one that meets our needs as a digital operator outsource infrastructure to reduce cost and
of the future. Central to our network consolidation Russia: Tele2 is believed to be looking for a increase network coverage. Axion fits perfectly into
strategy is finding like-minded partners to work strategic partner to acquire their ~8,500 russian the strategy for our global infrastructure platform
with. The countrywide agreement with Kcell is the towers. Speculation revolves around whether a with its strong cash generation supported by a
latest in a series of network sharing milestones Tele2 or VimpelCom deal will close first. contracted business model. Axion has a unique
that will further enable VimpelCom to deliver new network of 584 sites and an established customer
digital services and improved network quality to Spain and UK: Telefónica Chief Strategy and base, making it an attractive acquisition on behalf
bring us closer to our customers.” Finance Officer Ángel Vilá told the Morgan of our investors.

Spain: Cellnex announced in October a nine month dispute for control of Turkey’s top mobile operator Telefónica has suffered a series of setbacks in its
EBITDA of €227mn, an increase of 18% from 2015 with equity partner Cukurova, run by Mehmet efforts to cut its €52.6bn ($59bn) in debt, including
and in line with forecasts. Revenues of €520mn and Emin Karamehmet, Turkcell’s founder and one regulatory opposition that blocked the sale of O2 to
net profits of €35mn are above analysts’ forecasts. of Turkey’s richest men, for almost ten years. A CK Hutchison Holdings Ltd. and the scrapped IPO of
Recent reports also suggest they have issued a deadline was set for 18 November for Cukurova its infrastructure unit Telxius in September, because
further bond in order to bolster their liquidity for to choose to either buy Fridman’s shares for $2.7 of weak investor demand.
further acquisitions. Cellnex are believed to have billion or sell its own stake to Fridman for $2.8
raised $335mn through the issuance and may billion but no declaration was made meaning that UK: Virgin Media announced an agreement to
now be aiming to consolidate their position in key the option of buying moves to Alfa. acquire Wi-Fi hotspot specialist Arqiva WiFi in a
markets, including The Netherlands. bid to boost its outdoor wireless network reach and
UK and Netherlands: Spain’s Cellnex has signed a connectivity for its customers. The deal will give
Switzerland: Swiss operator Sunrise deal with Arcus Infrastructure Partners to buy 100% Virgin Media access to 31,000 WiFi access points
Communications is believed to be bringing their
of UK-based Shere Group for €393mn. Shere Group across 6,500 locations, building on Virgin media’s
towers to market, in what would be the first
manages 1,004 telecom tower sites, of which 540 existing WiFi network, which includes 250 London
tower sale in the country. As one of Europe’s
are in the UK and 464 in The Netherlands. Cellnex Underground Stations.
most wealthy countries, with a stable economy,
expects the new acquisition to contribute revenues
Swiss towers will no doubt represent a popular
of around €29mn on an annual basis. The move “Virgin Media is a strong match for our customers
opportunity for European strategic buyers and
marks Cellnex’ first entry into the UK market and given its extensive experience of the WiFi market,
investors.
bolsters their Dutch portfolio following the towercos both in-home and outdoor. These new agreements
acquisition of Protelindo’s 261 towers in the country will enable both Virgin Media and Arqiva to
Turkey: Turkish mobile provider Turkcell has
earlier this year. leverage their respective strengths to deliver
postponed the IPO of its wireless infrastructure
innovative and compelling solutions to customers
division Global Tower. The operator said in a
UK: Telefónica is considering whether to set aside where the need for capacity and coverage is ever
statement that it was delaying the sale until
‘markets come to a more secure and stable state’, part of an initial public offering of UK mobile increasing,” said Nicolas Ott, managing director,
citing cyber-attacks against popular websites in operator O2 for individual investors instead of Telecoms and M2M at Arqiva.
late October as well as risks relating to the US purely institutional buyers to broaden the potential
presidential election. customer base for any sale, according to industry UK: Telecom tower firm Arqiva, which operates
rumours. more than 8,000 sites across the UK, is planning
Turkey: Alfa Group, controlled by Russian a £5bn sale, abandoning its previous intention to
billionaire Mikhail Fridman, could be in a position O2 Chief Executive Officer Mark Evans discussed list on the London Stock Exchange, according to
to take control of leading Turkish operator such a sale with the Sunday Telegraph, saying there reports. The process for the sale is not expected to
Turkcell after a dispute over shares with fellow would be “reasonable demand” from the company’s get underway until well into 2017, and probably
shareholder Cukurova. Alfa Group has been in a 25 million customers. won’t close until 2018

Tuesday 4 and Wednesday 5 April, Business Design Centre, London
Meetup Europe 2017

A unique networking opportunity with 200 leaders of the European telecom and broadcast tower industry
To discuss your participation, contact Annabelle on +44 7423 512588 or email amayhew@towerxchange.com
GOLD SPONSOR: Silver Sponsors: Bronze sponsors:
Confirmed speakers
< Sachit Ahuja, Vice President, Tillman Global Holdings < Christopher Ehrke, Partner, Arcus Infrastructure Partners
< Arthur Akopyan, Managing Director; Partner, UFG Asset Management < Paul Innes, Managing Director, Shere Group
< Jorge Alberto Jimenez, President, Axion < Thomas Jonell, CEO, National Towers (Part of Vimpelcom Russia)
< Nikos Babalis, Operations Director, MBNL < Henrik Kamstrup, Partner, KPR Consult
< Gaurav Bath, Managing Director, Global Communications Group, Citi < Tony Killarney, CEO, Towercom
Investment Banking < Murat Kuran, Non-Telco Services Sales and Business Development
< David Bernal Cantero, M&A Manager, Business Development Direction, Director, Global Tower
Cellnex < Cedric Lepolard, CFO, FPS Towers
< Brian Burns, Principal, Analysys Mason
< Alexandre Lucas, Executive Director, Goldman Sachs
< Egor Bykov, Head of Strategy, Vertical
< Tobias Martinez, CEO, Cellnex
< Alexander Chub, President, Russian Towers
< Alex Mestre, International Business & Marketing Director, Cellnex
< Oscar Cicchetti, CEO, INWIT
< Scott Coates, CEO, Wireless Infrastructure Group < Nihat Narin, CEO, Global Tower
< Malcolm Collins, CEO, CTIL < Òscar Pallrols, Director Innovation and Product Strategy, Cellnex
< Marco Cordoni, Senior Partner, Analysys Mason < Donal O’Shaughnessy, Chairman, Cignal
< Eric Crabtree, Chief Investment Officer, IFC < Nicolas Ott, Managing Director, Telecoms, Arqiva
< Paolo Crocetti, Director of Institutional Affairs, EI Towers < Sergey Plissak, Commercial Director, Logycom Group
< Colin Cunningham, Managing Director, Cignal < Carlo Ramella, Chairman, Towertel & COO, EI Towers
< Jonathan Dann, Managing Director, RBC < Frederic Zimer, Chairman, FPS Towers

TowerXchange Meetup Europe Agenda
London | April 4-5, 2017
Day One | Tuesday 4 April
8:00 Coffee and registration 12.00 Roundtables session 1 10:00 Vendor session: Access Control
AND Working Group: RMS and site surveillance
9.00 Opening presentation and TowerXchange 10:30 Coffee and networking
analysis 13.00 Networking lunch
< Kieron Osmotherly, CEO, TowerXchange 11:00 Panel discussion: what is a European tower
< Frances Rose, Head of Europe, TowerXchange 14:10 Roundtable session 2
worth?
AND Working Group: Tower Power in Europe
< David Bernal, Head of Business Development,
9:45 TowerXchange CXO panel: The unique Cellnex
15:10 Coffee and networking
European tower industry: the diversity of < Alexandre Lucas, Executive Director, Goldman
contracts, typologies and business models
15:40 Vendor Session: Managed services Sachs
< Malcolm Collins, CEO, CTIL
< Christopher Ehrke, Partner, Arcus Infrastructure
< Alex Mestre, Business Development and
16.05 Panel session: Integrating and optimising Partners
International Director, Cellnex
tower portfolios < Jonathan Dann, Managing Director, RBC
< Oscar Cicchetti, CEO, INWIT
< Tony Killarney, CEO, Towercom
< Scott Coates, CEO, Wireless Infrastructure Group
< Paolo Crocetti, Director of Institutional Affairs,
< Alexander Chub, President, Russian Towers 11:45 Roundtable session 3
EI Towers
< Frederic Zimer, Chairman, FPS Towers AND Working Group: Small Cells
< Egor Bykov, Head of Strategy, Vertical
< Cedric Lepolard, CFO, FPS Towers
10.30 Keynote Interview: An update from Tobias 12:45 Networking lunch
Martinez, CEO, Cellnex 17:05 End of day one and networking drinks
14:00 Roundtable session 4
10:50 Investor panel discussion: Creating and 19:30 TowerXchange optional dinner AND Small Cells Workshop - What do you need to
growing value in European towers
know?
< Sachit Ahuja, Vice President, Tillman Global Day Two | 5 April
Holdings
15:00 Coffee and networking
< Gaurav Bath, Managing Director, Global 8:30 Welcome coffee
Communications Group, Citi Investment
Banking 15:30 Panel Discussion: Operational efficiency and
9:00 Panel Discussion: small cells and 5G are
< Arthur Akopyan, Managing Director; Partner, coming - can your network be future-proofed? green credentials
UFG Asset Management < Òscar Pallrols, Director Innovation and Product < Senior speaker, Vodafone Procurement Company
< Eric Crabtree, Chief Investment Officer, IFC Strategy, Cellnex < Senior speaker, CTIL
< Nicolas Ott, Managing Director, Telecoms, Arqiva
11:30 Coffee and networking < Scott Coates, CEO, Wireless Infrastructure Group 16:30 End of Meetup

TowerXchange roundtables
Country-focussed roundtable topics: Strategic roundtable topics: < Creating an autonomous tower
< Integrating towers and rooftops into the community:
< Russia & CIS < Dissecting a European tower deal education, EMF and camouflage
< Contrasting tower valuations in Europe vs the rest < When and how to decommission sites
< UK of the world < Deploying capex to reduce opex
< France < Asset or cost? Capturing value in towers
< What next for MNO-backed towercos? Future networks roundtable topics:
< Italy
< RANsharing – costs, complexities implications
< Spain and implications for passive infrastructure sharing < Planning and creating a robust small cell network
< Can multi operator small cells work?
< Germany < Options for raising capital and refinancing
< What will be the implications of 5G and how can you
< Carve out or sell?
< Ireland prepare?
< DAS – a financially viable solution?
< Turkey Operational roundtable topics: < How to make money from rooftops
< Poland < Beyond backhaul: investing in fibre
< Operational efficiencies in developed markets < All-IP and the effect on network demands
< Netherlands < Site security and liability < Urban typology and serving growing populations
< Health and safety requirements for tower owners – < Bringing more structures to market through
< Scandinavia
< Remote monitoring to increase efficiency across partnerships with private and public agencies
< Portugal portfolios < The future of rural networks

TowerXchange’s analysis
As predicted, 2016 was hardly an eventful year
for the CALA telecom tower industry. With many
of the independent tower

countries facing internal economic difficulties and
dealing with foreign exchange challenges, the CALA
tower industry has been experiencing a slowdown
market in CALA
Estimated number of towers owned or managed by towercos in CALA
1,220 635
over the past couple of years and timid signs of
recovery are just showing in selected markets.
Estimated number of900towers18,851
*American Tower
owned or managed
3,773
by towercos
8,870
in485CALA
1,000**
Estimated number
Telxius 1,655 of towers owned or managed by towercos in CALA Unsurprisingly, attention has now shifted to new
Estimated number of towers owned1,220
or managed
635 by towercos in CALA
13,350
328
*American Tower
Telesites 14,708
18,851
216
3,773 8,870
dynamics and markets with Argentina attracting
1,220 635 485
SBA Communications
*American Tower
900 7,131 18,851 617 548 619 408 239 146 121 21
3,773 8,870
1,000**
485 new and existing BTS firms as well as its very first
Telxius 1,655 13,350
Grupo TorreSur
900
3286,500
1,000** Source: TowerXchange deal (more details to follow). And while just over a
Telxius 1,655 13,350 research, quarterly filings,
Telesites 328 14,708 216
5,000 10,000 15,000 20,000 25,000 30,000 35,000 site lists year ago expectations were high with regards to the
Telesites
1600 14,708 216
SBA Communications
32 40 7,131 617 548 619 408 239 146 121 21 potential wave of towerco to towerco consolidation,
SBA Communications 7,131 617 548 619 408 239 146 121 21
1400 138
Grupo TorreSur
79
6,500 the industry has witnessed only one deal of
Grupo
1200 TorreSur 6,500 this kind in 2016 with NMS selling its Mexican,
5,000 10,000 15,000 20,000 25,000 30,000 35,000
1600 1000
5,000 10,000 15,000 20,000 25,000 30,000 35,000
Colombian and Nicaraguan portfolios to Uniti
32 40
1600
32 40
591
Towers (formerly known as Summit LatAm).
1400 138
800 480
79
1400 138 1531
1200 600
79 1203
213 There is consensus among various executives
65
1200
1000 400
901 interviewed over the past few months that the
700 750 221 617 54
1000 591 690 400
500
100 industry isn’t likely to consolidate much further,
450 100
591 480 600 Dominican Republic
800 200
208
400
205
at least for now and this is particularly true in
200 202
800 1531 480 150 40 40 Ecuador
100 105 60 51 countries like Brazil, where the forex crisis is
600 1531 1203 Argentina
s
ni ras ne
Ce er r
ns
l
213
A
ex on er
ne er
Co ny r
ite
al
se el
a
Co il T C
e
na
ta
S
es
om
imposing even more discipline on listed entities

n e
er
a e
m
CS
da
ite
lin
CS
M
rt w
To l
tio
re tt
ni
i
M ati ow
ic al
rt w
** mp ow
rs
nt s
en
rr
i
S
hl
di
c)
na
a
Br *Q
TO
ec
Pa To
II
fa
65
ni
On
ys
Pa To
en
lu
To
or v
Unknown
do ig
in
An
rn T
Pa
Al
1203
(T nno
rr
U
600
Sk
So
**
B
H
an
nt
te ix
es
213
To
es
ti
az
es
de
te
In oen
rr
de
901
co
I
who aren’t likely to venture in any deal in the near

rr
rr
Si
**
To
es
**
65
An
le
To
Spain & Germany

To
Ph
lli
**
rr
Te
400
te
**
To
901 750
In
700 221 617 54

400
700 750
690
221 617
400
500
10054 future.
450 100
690
200 600 400 400 100 Dominican Republic
500 450 100
208 400 205
200 600 200 202 Dominican Republic
Ecuador
208
100
205
150
105 60 51
40 40 On a more positive note, these are the very few
200 202
150 40 40 Ecuador
Argentina
100 105 exciting events TowerXchange has tracked since the
as
s e
Pa To tne er
ns
l
60
SA
M ati oxwic nal r
Pa To tne er
** mp*oCwo ny r
te
al
or v se el
a
C
ne
ta
S
es
om
51
do ign ra n
er
rn Te io e
Co*i*l*T Cp we
am
da
ite
CS
in
M
IM
an Pa Tow
U Bra iltini T il
io
(T no re att
ni
Si
i
te ixM at ow
r w
ne er s
rt Cwe rs
en
OC
rr
i
l
r
re att c)
tiT sil ow
l
h
Br s *Q
t
d
ec
Argentina
lfa
ni
aOn
ys
ic aal To
az oMm To
C*e* er rten
an
c) I
To
In or l v
Unknown
a
dMoT ig
Co ny trin
As n
In oen ern x T
te T
naol
last issue of our Journal.

** (T niano
r
U
Sek
e
*
nAs
l
A
ex onP eor
II H
P
se el
omn
otar
Br *QC zil
eSsS
es
es
mes
dtie S
da*
n ne
r
itm
esr
a ne
eS
lin
ecea
t i
tio
Si
rt w
To s
Ph In en
n*t* s
enT
OdC
narr
rr
re
rrC
** a
cso
r
rw
nI
fa
rr d
ni
On
AnSi
e*n*
lu
PaTo
eTs
To
Unknown
o
in
kley
U
Too
ToAn
Al
Spain & Germany

U
Ph
So
rr
H
es ll
nt
o
TSe
es
m
rrnte
es
To
de
te
rr
de
ni
co
Year Country Seller Buyer Tower count Deal value US$ Cost per tower US$ Deal structure
rr
Si
To I
To
es
**
An
le
To
* American Tower’s Brazil count is pro rata to the closing of the last tranche of TIM Brasil towers Spain & Germany
lli
**
rr
Te
te
**
To
SBA Communications Argentina warms up

In
** 1,000 urban wireless

31% sites and 2,500km of fibre 2015 Ecuador Torresec 130 Portfolio acquisition
34%
*** QMC has a portfolio of 901 towers across Brazil, Mexico, Colombia
Crownand Puerto Rico
Castle 2015 Dominican Republic Amzak/Teletower Phoenix Tower 190 Company acquisition
**** Continental Towers owns a portfolio of ~690 towers, which their website claims are distributed
2015 across Mexico,
Brazil Dominican Republic,
T4U Jamaica,
Phoenix Tower 529 Company acquisition
Guatemala, El Salvador, Honduras, Nicaragua, Costa Rica, Panama, American Tower
Colombia and Peru 2015 Brazil T4U Phoenix Tower 529 Company acquisition
***** Innovattel/Torresec owns a portfolio of 500 towers across Puerto Rico, Colombia,
SBA Communications Ecuador, Argentina,
2014
Panama
Brazil
and Peru TIM American Tower This is hardly$1,200,000,000
6480 surprising news since ArgentinaSLBhas
$185,185
2014 Panama American Tower Phoenix Tower 60 Subsidiary acquisition
Verizon
2014 Brazil BR Towers American Tower 4630 $978,000,000 $211,231 Company acquisition
AT&T 2014 Brazil Oi SBA Communications 1641 $527,000,000 $321146
XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18SLB | 51
Miscellaneous 2013 Brazil Nextel American Tower 1940 $349,000,000 $179,897 SLB
4% 2013 Brazil Z-Sites American Tower 236 $129,000,000 $546,610 Company acquisition
Latest towerco findings in the CALA market been high on the agenda of tower executives for
quite some time now. But finally, TowerXchange is
able to report on the very first deal in the country as
Name Countries Focus
well as several new BTS entities.
Teletower Argentina Argentina BTS
With regards to BTS firms, we’ve recently added
Plata Tower Company Argentina BTS two new companies to the list of known entities
operating in the country. Namely, Plata Tower
Aplicanet Ecuador BTS Company, headed by Alex Sepehri-Nik (one of the
co-founders of Brazil Tower Company and Arqueiro
Telecom) and Teletower Argentina. TowerXchange
has already spoken with Alex regarding its
Selected estimated CALA tower counts Argentinian venture and the full interview can
be found later in this Journal. On the other hand,
Teletower Argentina is a “new finding” for us and
we’ve gathered that it’s a strategic alliance between
GSM Network Services, a local company involved
in site acquisition, and Teletower, which has been
involved in deployments across various CALA
countries including the Dominican Republic, Peru,
Colombia, Nicaragua and Mexico.
Chile Peru Caribbean Central Colombia Argentina Mexico Brazil
8,640 9,167 10,550 America 15,399 16,000 29,069 54,751 TowerXchange has recently tracked American
11,983 Tower’s very first deal in Argentina and we
could not be more excited! American Tower has
announced the acquisition of Comunicaciones
y Consumos, SA (CyCSA), an engineering firm
active in the local telecom industry. According to
the deal, AMT has acquired 1,000 urban wireless
sites, 2,500km of fibre optic network as well as the
rights to deploy telecom infrastructure in several
Estimated total towers in rest of South America: 17,900 (Venezuela, Ecuador, Bolivia, Paraguay, Uruguay, Surinam,
French Guiana and Guyana) municipalities.
With this deal, American Tower officially enters the

Source: TowerXchange Argentinean telecom sector and while there are still

* 1,000 urban wireless sites and 2,500km of fibre **American Tower acquisition of 4,630 BR
Major tower transactions in Latin America 2011/2016 Towers includes 2,530 towers plus 2,100 exclusive rights ***Totals and average exclude the
GTP / American Tower deal as it was US-centric
2016 Mexico, Colombia, Nicaragua NMS Uniti Towers 359 $65,000,000 $181,058 Portfolio acquisition
2016 Argentina Comunicaciones y Consumos American Tower 1,000* Company acquisition
2016 Dominican Republic Viva Phoenix Tower 545 Portfolio acquisition
2016 Peru Telefónica Telxius 900 Portfolio acquisition
2016 Chile Telefónica Telxius 328 $11,500,000 $35,061 Portfolio acquisition
2016 Brazil Telefónica Telxius 1655 $214,000,000 $129,305 Portfolio acquisition
2015 Ecuador Torresec SBA Communications 130 Portfolio acquisition
2015 Dominican Republic Amzak/Teletower Phoenix Tower 190 Company acquisition
2015 Brazil Algar Telecom Highline do Brasil 125 $16,000,000 $128,000 SLB
2015 Brazil T4U Phoenix Tower 529 Company acquisition
2014 Brazil TIM American Tower 6480 $1,200,000,000 $185,185 SLB
2014 Panama American Tower Phoenix Tower 60 Subsidiary acquisition
2014 Brazil BR Towers** American Tower 4630 $978,000,000 $211,231 Company acquisition
2014 Brazil Oi SBA Communications 1641 $527,000,000 $321146 SLB
2013 Brazil Nextel American Tower 1940 $349,000,000 $179,897 SLB
2013 Brazil Z-Sites American Tower 236 $129,000,000 $546,610 Company acquisition
2013 Brazil Oi SBA Communications 2007 $645,000,000 $321,375 SLB
2013 Brazil Nextel American Tower 2790 $413,000,000 $148,029 SLB
2013 Mexico Nextel American Tower 1666 $398,000,000 $238,896 SLB
2013 USA, Panama & Costa Rica GTP*** American Tower 15700 $4,800,000,000 $305,732 Company acquisition
2013 Brazil Oi BR Towers 2113 $251,000,000 $118,788 SLB
2013 Brazil Oi Grupo TorreSur 2113 $293,000,000 $138,665 SLB
2013 Brazil Telefónica American Tower 93 $18,000,000 $193,548 SLB
2013 Mexico Axtel American Tower 883 $250,000,000 $283,126 SLB
2013 Brazil Sitesharing BR Towers 100 Partial acquisition
2012 Peru Telefónica Torres Unidas 350 SLB
2012 Chile Telefónica Torres Unidas 400 SLB
2012 Brazil Telefónica SBA Communications 800 $178,000,000 $222,500 SLB
2012 Brazil Oi Grupo TorreSur 1208 $258,000,000 $213,576 SLB
2012 Brazil Telefónica BR Towers 1912 $252,000,000 $131,799 SLB
2012 Chile Telefónica American Tower 558 $96,000,000 $172,043 SLB
2011 Mexico Telefónica American Tower 1554 $323,000,000 $207,851 SLB
2011 Mexico Telefónica American Tower 584 $122,000,000 $208,904 SLB
2011 Colombia Telefónica American Tower 125 $18,000,000 $144,000 SLB
2011 Colombia Millicom/Tigo American Tower 2126 $182,000,000 $85,607 SLB
2011 Brazil Telefónica Grupo TorreSur 1358 $206,000,000 $151,694 SLB
2011 Brazil Sitesharing American Tower 666 $585,000,000 $878,378 Partial acquisition
Special thanks to Jonathan Atkin, Managing Director at RBC Totals / average 44,726 $8,353,000,000 $199,966 * 1,000 urban wireless sites
Capital Markets for his contribution and 2,500km of fibre

Who sold their towers in Central and South America? 80% and a higher tenancy ratio of 1.31x.
The existing portfolio of 359 sites includes about

194 ground based towers (54% of the entire
portfolio) and 165 rooftops (46%), while the
percentage of rooftops is expected to grow to 48%
once the sites under development are built (taking
the total portfolio up to 473 sites).
A new move in the Oi saga
TowerXchange has previously reported that

billionaire Naguib Sawiris was in talks with a
group of Oi’s bondholders to jointly present a
new restructuring plan for the carrier and on 19
December, the plan was eventually submitted.
According to the plan, Oi would raise US$1.25bn

as many as 16,000 towers in the hand of local MNOs estate throughout the United States and Mexico, in capital via an IPO while Sawiris would provide
and the potential for sale and leaseback (SLB) is still announced the purchase of 359 towers from NMS US$250mn. Additionally, the plan would require
compromised by practical issues such as taxation, for a total value of US$65mn. US$24.8bn of Oi’s debt to be swapped for 95%
TowerXchange believes we’ll soon see further of the carrier’s equity while the rest of the debt
movements by the likes of SBA Communications The towers are spread across Mexico, Colombia (US$5.8bn) would be exchanged for new bonds.
and maybe even Phoenix Tower International. and Nicaragua and have been acquired by CS&L’s
LatAm subsidiary, Uniti Towers (formerly known as Sawiris has recently stated that Oi would need
NMS-Uniti Towers deal Summit LatAm). In Mexico, Uniti Towers acquired to spend as much as US$11bn over the next five
205 sites (and 108 under development) with annual years in order to upgrade its network and stay
In the midst of a generally slow year, NMS defeated revenue of US$3.5mn, TCF margin around 54% competitive. Additionally, he announced that
all odds and sealed a deal with another towerco in and a tenancy ratio of 1.13x. In Colombia, the depending on the success of his plans, he would
what is effectively one of the very few tower deals towerco has bought 100 towers (and five under completely revamp Oi’s governance with a new
of 2016. development) with annual revenue of US$1.6mn, board of directors to include four independent
TCF margin around 52% and a tenancy ratio of members.
On 14 November 2016, CS&L, a U.S. based REIT 1.10x. Lastly, the deal included 54 existing sites and
which owns 4.2mn fibre strand miles (6.76mn km), one under development in Nicaragua, with annual For now, the plan is with Oi for review and it will
86 wireless towers, and other communications real revenue summing up to US$1.2mn, TCF margin at be then shared with the various judicial bodies

AMT, Centennial, IIMT, Balesia, Continental
Intelli Site, MTP, MX Towers,
Uniti Towers, QMC, Rent-A-
Continental
Tower, Telesites, Torrecom
PTI
Balesia, Continental, SBA, Torrecom
Balesia, Continental, SBA
Balesia, SBA, Torrecom AMT, AlfaSite, BTC, CSS, Centennial,

GTS, Highline, PTI, QMC, SBA, Skysites
AMT, Balesia, Catalina, PTI, SBA, TOCSA
Continental, Innovattel, SBA
AMT, ATP, Andinas, Centennial,

Golden Comunicaciones, Innovattel,
Uniti Towers, PTI, QMC, Unidas
Aplicanet, Balesia, Innovattel, SBA
American Tower, Innovattel, Plata Tower

AMT, ATP, Andinas, Balesia, Company, Teletower Argentina, Tower 3
Innovattel, NMS, Unidas
Legend
Towercos have acquired the majority of towers from carriers
Towercos have acquired a significant proportion of towers
AMT, Balesia, Unidas from carriers, but the majority remain carrier-owned.
Significant BTS towerco activity also present
Less SLB activity, but plenty of BTS towerco activity
Early stage market for BTS and/or SLB
Negligible towerco activity

Breakdown of ownership of CALA’s 164,207 telecom towers, Q4 2016 involved. TowerXchange will continue to report on
Oi and its path towards recovery.
Mexico
34834 American Tower
Telesites Shying away from Mexico is almost impossible.
SBA Communications TowerXchange is constantly drawn by its dynamics
and changing scenarios, even if we consider the
14924 Grupo TorreSur
tower market over populated.
83000 Telxius
9850
Other independent towercos The creation of Telesites, América Móvil’s spin-
6500 Operator-captive off, represents a new phase for the local industry
12216 with two towercos, Telesites and American Tower,
2883 leading the pack in the Build-to-Suit race thanks to
their alliances with respectively América Móvil and
AT&T.
Mexico - Estimated tower count 29,069
In spite of a relatively weak demand and a third
495 205 player - Telefónica - reluctant to commit to any
202 ~2000
208 growth plan and uncertain plans from AT&T,
400 Telesites
450 Telesites has managed to add over 2,800 sites to its
American Tower portfolio since its launch. And Telesites is already
Mexico Tower Partners expanding beyond Mexico with a portfolio of over
1531
IIMT 200 sites in Costa Rica. Market analysts have been
cautious at predicting site needs in Mexico and
Centennial
14,708 have forecasted no more than 5,000 additional
Torrecom
co-locations by 2020, a factor that could dampen
Intelli Site Solutions the tenancy ratio growth expectations of Telesites,
Other independent towercos including Conex American Tower and the wide array of middle
(QMC), and MX Towers market towercos including Mexico Tower Partners,
8870
Uniti Towers Torrecom, IIMT and Intelli Site Solutions.
Estimated MNO captive towers

With the sale of NMS’ portfolio to Uniti Towers,
Mexico is now home to a new entity with a U.S.
Source: TowerXchange legacy and TowerXchange hopes to speak to Uniti

Towers’ staff in the near future for some insights Costa Rica - Estimated tower count 3,163
into the towerco plans!
The government has recently announced the 450

winning consortium of the wholesale LTE 700MHz 619 SBA
network. The winner is the Altan consortium which
American Tower
was also the only group running for the deal since
the other consortium - Rivada Networks - was Continental Towers
disqualified and has since appealed the decision.
Telesites
The Altan consortium is led by three funds owned
485 PTI
by the World Bank, Morgan Stanley and Eugenio
Galdon of Grupo Multitel, a Spanish cable supplier.
~1000 TOCSA
According to the deal, Altan will obtain subsidised ICE

180
access to the 700MHz spectrum as well as a 20-year Claro
public-private partnership (PPP) to deploy as well 216
as operate the network which is expected to cost 105 138 Source: TowerXchange
approximately US$7bn.
Central America and the Caribbean

El Salvador - Estimated tower count 1,264
50
Belize has 359.6K connections and 99% penetration
rate as of Q4 2015 according to GSMA Intelligence.
239
With two carriers, DigiCell and Smart, and no active 250
~25 SBA
towercos to date, the country has a long way to
go to reach regional standards and our estimates Continental Towers
suggest there are approximately 70-80 towers in the
Tigo
national territory.
Claro
Costa Rica is the first country beyond Mexico where
Digicel
Telesites is pursuing its expansion beyond Mexico.
300 400 Telefónica
In fact, Claro has recently assigned a 300-tower
BTS project to the Mexican towerco. Telesites will
be the sixth towerco in this 3,163 tower market,
joining market leaders SBA and American Tower, Source: TowerXchange

Guatemala - Estimated tower count: 3,639 Continental Towers, TOCSA and recent entrants
PTI. Since liberalising the market back in 2008,
the Costa Rican market has grown into a stable
200 business environment with relatively good growth
617 potential and a modern regulatory system. In a
500 further attempt to improve the local telecom sector,
SBA
the Coordination Commission for the Installation or
221 Torrecom Expansion of Telecommunications Infrastructure
(CCIAIT) has recently presented its first Action Plan
~100 Continental Towers
for Telecoms Infrastructure which aims, among
Tigo other goals, at creating a record of all telecoms
infrastructure of the country, which would be the
Claro
first of this kind in the region.
Telefónica
Cuba had a population of 11.4mn and 3.3mn mobile
~2000 connections at the end of 2015, giving a mobile
penetration of just 29%, up 6% YOY. Over the past
twelve months, diplomatic relations between the
U.S. and Cuba have been reinstated and there have
Honduras - Estimated tower count: 1,200 been an increased ability to transact between the
two countries.
~200 TowerXchange is keeping a close eye on the island

in light of its untapped market and undisputed
potential to become a target of international
towercos. In terms of towers, Cuba holds
Operator captive towers approximately 500-700 sites which are currently
being shared by radio companies, TV stations and
Continental Towers ETECSA, which to date is the only operator active in
the country.
~1000
Innovattel/Torresec has recently participated to
Informática 2016, the IT and telecom forum held in
Havana, Cuba. Discussing with TowerXchange on
Source: TowerXchange the potential of the Cuban telecom industry to open

up to new MNOs and, as a result, to towercos, they Nicaragua - Estimated tower count: 1,025
commented that there’s still quite a way to go before
the Cuban government makes a move towards
50
liberalising the market. However, the change is
likely to happen sometime over the next couple of
years.
SBA
The Dominican Republic has been the target of 300 408
Torrecom
Phoenix Tower International which grew its local
portfolio from zero to 735 sites in less than a year. Uniti Towers
PTI has first acquired local towerco Teletower
Claro
Dominicana and its 190 towers and lately added
545 sites by closing a deal with Viva, the third Telefónica
carrier of the country, at the time owned by Trilogy
54
International Partners. Along with the transaction,
Trilogy sold Viva to local media company Telemicro 213
Group, owned by businessman Juan Ramon Gomez Source: TowerXchange
Diaz.
Panama - Estimated tower count: 1,567
At the end of 2013, the mobile industry became a
three-way game between Claro, Orange and Viva, 90
since Orange and Tricom were both acquired
by Altice, a cable and telecoms investor from 150
SBA
Luxembourg.
548 Continental Towers
Given the presence of four creditworthy tenants, it
PTI
is perhaps surprising that El Salvador is the least
penetrated tower market in Central America at Torres de Panama
17%. SBA Communications and Continental Towers Cable & Wireless
appear to be the only towercos active in El Salvador, 550
SBA having acquired the majority of Telefónica’s Claro
sites. ~100 Telefónica
79
Guatemala is a complex country with a very 60
competitive tower industry. SBA Communications, Source: TowerXchange

the inventory of available portfolios is scarce. In
Bolivia: fast facts fact, Telefónica has sold most of its assets to SBA
Communications, Claro retains approximately 300
Economy Fitch rating $$$$$$$ towers which could be transferred to Telesites in the
Poverty headcount BB/Stable
ratio 39.3% (2014) (July 2015)
$$$$$$$ future and the third operator Xinwei hasn’t started
operating yet in spite of its announcements this past
Population
10.8mn (Q4 2015)
$$$$$$$ January.
Foreign investments
Inflation 4.9% (2016E) US$2.1bn (2014) Panama holds its place in the regional tower
game since the acquisition by Phoenix Tower
International of 60 sites from American Tower.
Mobile sector Carriers SBA remain market leaders with smaller portfolios
held by Continental Towers and Torres de Panama.
According to GSMA Intelligence, Panama is a
98% SIM penetration
23.1% Entel
fast grower market in Central America with four
(Q4 2015) active carriers (Cable & Vision, Claro, Digicel and
49.6% Tigo Movistar), 148% penetration rate and 5.9mn mobile
connections.
Connections 106mn
30% Viva
The rest of the Caribbean has been very quiet in
(Q4 2015) terms of towerco activity. I believe that Cuba and
the Dominican Republic could represent interesting
Torrecom, Balesia and Continental all operate towerco, Balesia, which would be the second one starting points for towercos looking at entering
in the local market which is characterised by a to operate in the country in addition to Continental this highly fragmented collection of markets,
fairly strong regulatory environment and the Towers Corp. For now, there’s been little visibility and Phoenix Tower International with its recent
huge influence of local communities – Consejos on the local industry and its potential with around acquisitions and Innovattel with its eye on Cuba
Comunitarios de Desarrollo Urbano y Rural 20% towerco penetration and the two carriers seem ahead of the competition.
(COCODES) – in the approval of new deployments. – Tigo and Claro – still holding on to their tower
Local billionaire Mario Lopez owns substantial portfolios. Bolivia
equity in market leaders Tigo, and also owns most
of the land under their towers, which makes the Nicaragua is a country where the perceived Still a virgin market in terms of towerco
operator reluctant to participate in widespread operational and country risks may be higher penetration, Bolivia is a complex country to do
infrastructure sharing. than the actual ones. Four towercos including business in. However, with three active operators
SBA and Torrecom operate in the country and to all planning to make considerable investments to
Honduras might soon see the entrance of a second date, most of their activity is focused on BTS since upgrade their networks and enhance the quality

Colombia - Estimated tower count: 15,399 of their infrastructure, BTS firms could consider
making a move in the near future.
American Tower
1800 Centennial Specifically, dominant player Entel has recently
Torres Andinas announced a US$1bn five year investment plan
3773 which will focus mainly on enhancing the quality
Phoenix Tower International
2000 Other independent towercos including of mobile infrastructure and ensuring coverage
Innovattel, Continental Towers, Balesia, of rural communities. Tigo invested US$130mn to
65 Andean Tower Partners, Torres Unidas and expand its infrastructure across the country and
200 Viva committed to US$80mn in 2015.
40 Golden Comunicaciones
900 Uniti Towers
The Andean States
100 SBA
21 Estimated MNO captive towers
In just over a year, TowerXchange came across at
América Móvil Telefónica Millicom
least a dozen towercos operating in Colombia, the
6500
most recent of which is a joint venture between
Source: TowerXchange, Company reports, RBC Capital Markets estimates
Innova Capital Partners and Goldman Sachs, Golden
Comunicaciones. And SBA Communications has
Peru - Estimated tower count: 9,167 entered the country too and now owns 21 sites in
Telxius Colombia.
900 American Tower
Of the 15,399 towers in Colombia, 67% are still
2342 635 Torres Unidas in the hands of carriers with Claro owning
Torres Andinas approximately 6,500 sites and Telefónica 2,000.
600 NMS
100 Interestingly, both companies have created spin-offs
50 Innovattel and it’s yet to be seen whether their portfolios will
50 eventually be transferred to Telesites and Telxius,
32 Phoenix Tower international
hence reducing the chance of any further sale and
1358 Claro leaseback opportunity in the country.
Telefónica
2500 The announced 700MHz auction is yet to take place
600 Bitel in spite of being announced back in Q2 2015 and to
Entel date and local news outlets suggest that the process
Source: TowerXchange should be completed in the coming months. And

Chile - Estimated tower count: 8,640 the least penetrated tower markets in the region
with towercos owning 24% of sites. In Q1 2016,
121 10 Telefónica transferred 900 sites to Telxius and it
would be interesting to see if Claro follows the same
path and opens the door to Telesites in the country.
1220 American Tower
Torres Unidas Local sources still suggest that the country might
480 Telxius be up for big changes which could considerably
3000 reshape the dynamics of the tower industry. In
328 Other independent towercos fact, Peru could be the first country to regulate
~120 the towerco sector, hence reducing the freedom of
SBA
action of towercos in terms of prices, conditions and
Estimated MNO captive tower overall business strategy.
América Móvil Telefónica
2361 Peru’s Ministry of Transport and Communications
1000 Entel Chile Fourth MNO has called for an increase from their current 9,167
to 22,000 cell sites over the next three years, an
increase of almost 2.5x in tower stock. In order to
Source: TowerXchange, Company reports, RBC Capital Markets estimates ease the notoriously complex permitting regime, the
Congress passed Law N. 29022 back in 2015 which
while local carriers still perceive their towers as market considerably suppressed in light of introduced, among other things, the tacit approval
a competitive differentiator, the lack of a strong Claro’s dominant position. The recent acquisition of permit requests after thirty days from the initial
regulatory environment doesn’t necessarily favour of Innovattel/Torresec’s 130 towers by SBA demand.
the infrasharing model. Communications hints that the latter might be
A National Law designed to ease permitting in looking at developing its presence in the country Chile has seen its attractiveness to towercos
Colombia reportedly has not prevented local but to date, we are yet to see other towercos active considerably reduced as a result of Law No.
government from closing sites. And Tigo, Movistar in Ecuador. In fact, Torres Andinas has so far been 20.599, also known as the Towers Law, which
and ETB are sharing their 4G rollout, with roaming focusing on Peru and Colombia while Andean has suppressed the local BTS market with its
agreements in place, which will dampen tenancy Tower Partners is planning a market entry during onerous restrictions on building in saturated
demand. However Avantel and DirecTV, with the Q1 2017. or sensitive areas, its somewhat heavy handed
potential of AT&T investment represent significant attempt to mandate infrastructure sharing, and
upside to tenancy ratio models. Peru is one of the most interesting countries in the its requirements to invest in camouflage, at times
entire CALA landscape, and is a market which is compensating local communities.
Possibly the quietest of all Andean States, being heavily colonised by towercos. With a total
Ecuador has seen the development of its tower tower count just under 10,000 sites, it’s also one of However, the country still presents a certain degree

Brazil - Estimated tower count: 54,751 of opportunity for acquisitive towercos. In fact, of
its 8,640 towers, less than 2,000 are currently in the
4607
hands of towercos. It must be noted though that with
Telefónica and Claro both active in the country, the
American Tower possibilities for independent towercos to acquire
18851 SBA Communications assets are limited to Entel. In fact, Telefónica has
15000 already transferred its 328 sites to Telxius during
Grupo TorreSur Q1 2016, although it is not clear whether that figure
Telxius represents all Telefónica’s towers in the country.
Other independent towercos In 2015, Entel, Movistar and Claro all started using
Remaining big 4 operators the 700MHz frequency for their 4G LTE networks,
4607 following the 2014 spectrum auction which included
Other operators including Nextel, Sky Brasil,
with extra coverage obligations including connecting
7138 Algar Telecom, Sercomtel and ON Telecom 1,281 remote regions, leading BMI to project that
1655 6500
Chile’s carriers would need three to four times as
Source: TowerXchange many towers.
Brazilian independent towercos Interestingly, SBA Communications has reported

100 a tower count of 121 sites in Chile in Q3 2016 and
CSS TowerXchange will soon look for further insights into
750 Phoenix Tower do Brasil the towerco’s entrance in the country!
400
Brazil Tower Company
150 51 Brazil
40 Centennial
40 A deep recession combined with associated forex
700 Highline do Brasil
crisis and a less than rosy political landscape have
AlfaSite dragged Brazil back into the news for all the wrong
reasons. No more talks about BRICs, exploding GDPs,
Torres Online
generous investment in infrastructure for major
1000 Skysites sporting events, and a flourishing economy any
Telecom Torres more. But we must always keep in mind that Brazil
1203 needs thousands of towers to bring its network up
Allowance for other small towercos to par with other developed markets. With close to
Source: TowerXchange 5,000 subscribers per site, the potential for towercos

Paraguay baseline data (Q4 2015) Source: GSMA Intelligence
namely Millicom’s Tigo, Telecom Argentina’s
Personal, América Móvil’s Claro and state-
owned Copaco, trading as Vox, who are currently
Connections Population 116%
committing to considerable investments to upgrade
their networks, a scenario which might create the
7.7mn 6.7mn right conditions for towercos to make a move into
the country.
SIM penetration
Uruguay offers another enticing telecom landscape
Uruguay baseline data (Q4 2015) Source: GSMA Intelligence with state-owned Antel actively competing with
Movistar and Claro and could be another interesting
target for towercos looking at new markets to
Connections 159% colonise.
Population
5.5mn
3.4mn To date, TowerXchange is tracking one active
towerco in the country – Uruguay Torres – of which
SIM penetration
we have very little information.
to deploy hundreds of greenfield projects in the largest towerco in the Brazilian market.
country remains, but currently there is very little Argentina
new build going on in the country, with carriers In H2 2016, towercos reported a timid recovery
shying away from new projects and investments. and a slow return to “business as usual” with Last but not least, Argentina is the next big thing
In the midst of this challenging phase, the market new search rings being issued and a higher level and what a few months ago was just speculation
might be up for some fundamental restructuring of spending by the mobile network operators. As about its potential is now turning into action. In
with both TIM and Nextel reportedly being up for previously discussed though, the bankruptcy of Oi fact, while the new Government is pushing to
sale. And while consolidation among carriers seem further contributed to shaking up the market and put Argentina back on the map of international
more likely, the tower market is at a standstill, with TowerXchange doesn’t expect things to be solved relations, the country does present an ideal scenario
middle market towercos struggling to achieve an before the end of H1 2017. in terms of its telecom industry and cell site
exit that meets their investors’ ROIs expectations. densification needs.
Paraguay and Uruguay
Carveouts seem more in fashion than SLB these Local experts suggests that of the (less than)
days and Telxius – via its subsidiary Towerco Latam Paraguay and Uruguay are virgin markets but we 16,000 towers built in the country, as low as 12,000
Brasil – has already acquired 1,655 sites from are keeping an eye on their potential to open up to are actually active and with an average of 4,500
Telefónica. And the real game changer could be the tower industry. subscribers per site, Argentina needs as many as
América Móvil in the case it decides to transfer its 40,000 but at least 20,000 new sites in the near term,
8,500 towers to Telesites, hence creating the second Specifically, Paraguay is host to four operators, entailing investments of as much as US$3bn.

The country still presents many challenges for
Argentina: fast facts international businesses looking at making a move.
From inflation all the way to permitting, towercos
35% 32-33%:
US$7+ the market
willing to enter the market do need to juggle many
1,500-2,000 average share of each 140% challenges and contribute to the definition of rules
new sites needed ARPU of the three and regulations from scratch. But this could be a
per year 2016-2018 Income top MNOs positive factor for entrepreneurial towercos looking
tax rate at making their way in what could become the most
SIM penetration
1 $$$$ attractive new tower market in CALA.

21%
4:
US$9bn: Argentina’s new government is committed to
making the country an attractive destination for
the new expected combined
VAT international investors, and local authorities within
16,000
regulator MNOs investments
ENACOM in the next five years the telecom sector are currently engaging with
resulting TowerXchange to present Argentina and its market
existing towers
merge of $$$$
from the potential to the tower industry.
known BTS 1% in Argentina
firms active AFSCA
US$2.2bn: 1: deal sealed As previously discussed, the recent AMT deal with
in Argentina Wealth and Raised during the 2014 in the country CyCSA as well as the entrance of a couple of new
tax AFTIC 4G spectrum auction (AMT-CyCSA) in 2016 BTS firms into the country suggest that Argentina is
heating up fast. And TowerXchange hopes to report
on some exciting new developments in Argentinian
The evolution of the CALA telecom tower industry 2013-2016
towers in 2017!
Towers owned by Conclusions: CALA towercos reach 50%

Year Est. total towers Towerco penetration
towercos penetration
2013 140,000 46,011 32% It might not be the fastest growing tower industry
we analyse nor the most active in terms of deals but
2014 148,000 61,729 41%
the CALA tower market is still expanding! In fact,
thanks to the latest developments in terms of both
2015 156,000 69,850 44%
organic and inorganic growth, towercos now now
2016 to date 164,207 81,207 49% own almost half of CALA’s 164,380 towers. And with
several virgin markets such as Argentina offering
Source: TowerXchange plenty of opportunities for SLB - if and when the tax

regime allows it - and still over 80K sites in the hand
of carriers across the region, TowerXchange expects
to witness further expansions in the towerco model
Wednesday 7 and Thursday 8 June, Boca Raton Resort and Club, Boca Raton
from Mexico down!
What’s left to analyse is how much this level

of penetration will be dependent on carve-out
towercos such as Telxius and Telesites rather than
Meetup Americas 2017
on pure play independent entities. And for what A unique networking opportunity with 250 leaders of the CALA telecom tower industry
we can see, Telesites is a force to be reckoned with
thanks to its outstanding deployment track record
in Mexico and, more recently, Costa Rica. On the
other hand, Telxius, whose IPO has been cancelled
back in September, is yet to unfold its future plans
which could possibly include the divestment of
selected categories of assets.
One considerable wild card is represented by

Millicom who is reportedly considering divesting
the remainder of its passive infrastructure
portfolios (approximately 5,500/6,000 across
multiple markets). With operations across
Colombia, Guatemala, Honduras, El Salvador,
Paraguay and Bolivia, the potential divestment of its
assets could represent an additional opportunity in
already active markets as well as an entry card for To discuss your participation, contact Annabelle on +44 7423 512588 or email amayhew@towerxchange.com
entrepreneurial towercos looking at new ventures
in places like Paraguay and Bolivia (the latter Diamond sponsor: Silver Sponsors:
offering scale opportunities with Trilogy’s Viva
portfolio being up for sale too)
The fourth edition of the TowerXchange Meetup

Americas is taking place 7-8 June 2017 in Boca
Bronze Sponsors: Organised by:
Raton, Florida and further information can be
found on the TowerXchange website:
www.towerxchange.com/meetup/meetup-americas

CALA news
Brazil: TIM sells 66 towers to AMT
TIM Brasil has sold 66 towers to American Tower

A roundup of tower news across Central and Latin America for US$8mn in December as part of the 2014 deal.
To date, out of the original 6,481 towers that TIM
Mexico, Nicaragua and Colombia: Uniti Towers the Secretariat of Communications and Transport said it would sell to the towerco, 5,753 have been
acquires NMS towers in CALA (SCT) because it failed to include a band for MX$1bn. transferred for a total value of approximately
The Rivada Networks is now pursuing legal action US$800mn.
On 14 November 2016, CS&L, a U.S. based REIT against the disqualification.
which owns 4.2mn fibre strand miles (6.76mn km), Argentina: American Tower seals first deal in
86 wireless towers, and other communications real Mexico: IFETEL announces delay to 2017 for the Argentina
estate throughout the United States and Mexico, 2.5GHz auction
announced the purchase of 359 towers from NMS American Tower have purchased Comunicaciones
for a total value of US$65mn. The towers are spread The IFETEL announced that the planned 2.5GHz y Consumos, SA (CyCSA), acquiring 1000 urban
across Mexico, Colombia and Nicaragua and have band auction will be delayed until 2017. The auction wireless sites and 2,500km of fibre. Under the deal,
been acquired by CS&L’s LatAm subsidiary, Uniti was originally scheduled to take place before the American Tower will also have the right to deploy
Towers (formerly known as Summit LatAm). A more end of 2016. mobile infrastructure in various locations across the
detailed analysis of this transaction is featured later country. The deal value has not been made public,
in this Journal. Brazil: Oi tries to settle Anatel’s fines while however it is a strong signal that could allay fears
restructuring over who the end buyer of tower infrastructure in
Mexico: Altan group awarded Mexican wholesale the country might be, and with SBA Communications
mobile network deal Oi is in discussion to settle with Anatel the fines on the ground too, we suggest our members watch
(BRL11bn) imposed by Anatel. The plan is for Oi to this space as Argentina becomes an increasingly
The Altan group has been awarded the Mexican commit to investments. Schroeder, Oi’s CEO, added attractive proposition.
wholesale mobile network deal. According to the while speaking at an event that the company plans
deal, the network will cover 85% of the population. to conclude negotiations with its creditors before the Argentina: Nextel’s acquisition approved by
The awarded group is a consortium including end of Q2 2017. ENACOM
Mexican companies Megacable and Axtel and is
backed by Morgan Stanley Infrastructure and the Brazil: América Móvil interested in Oi ENACOM has approved several acquisitions made
IFC. by Nextel Argentina back in June 2016. Through
The CEO of América Móvil, Daniel Hajj, has those deals, Nextel has acquired six companies,
Mexico: Rivada starts legal battle against tender expressed his interest in acquiring some of Oi’s specifically Trixco, Callbi, Infotel, Skyonline de
disqualification operations in an interview with Valor Economico. In Argentina, Netizen and Eritown Corporation
the interview, he noted that “We are open to looking Argentina. Fibercomm, the seventh company
The Rivada Networks consortium has been at anything. I am very interested in participating in acquired by Nextel, has since had its licence
disqualified from the Mexican wholesale shared the consolidation in Brazil, but I don’t know how it revoked. Nextel will use the acquired spectrum to
network tender. The consortium got disqualified by will happen.” launch 4G LTE in the country.

Spotlight on Argentina: Will convergence in the Argentinian telecoms sector trigger tower divestments?
The new year in Argentina opened with a new decree, published on the 2nd The main telephone players including Telefónica, Telecom Argentina and Claro
January, aimed at attracting US$20bn in investment over four years. The will only be able to offer paid television starting in January 2018, according
Digital Argentina law has been adapted to allow cable TV companies to offer to the decree. TowerXchange understand that Telefónica are not taking this
telephony and internet services. Broadly speaking companies will no longer be news well, and are rumoured to be considering judicial action against the
barred from simultaneously providing cable TV, internet, fixed line and mobile government.
phone services. DirecTV will for example be allowed to sell internet services
while cable operator Cablevision SA gets the green light to enter the 4G mobile
Previously phone companies were at a disadvantage to cable operators, which
telephone market through its Nextel holdings.
can offer internet and television through the same fibre optic cable. Phone
companies need to improve their network cables in order to deliver television,
The first article of the decree, published in the government's official bulletin,
says the state will: "Implement the basic rules to achieve a greater degree of a fact that President Macri hopes will force them to invest in their neglected
convergence of networks and services under competitive conditions, promote infrastructure. TowerXchange wonders where this necessary capex will come
the deployment of next generation networks and the penetration of broadband from, and whether it might be time for the Argentinian telcos to spin out their
internet access throughout the national territory." tower infrastructure
Argentina: IFC agrees to US$400mn financing to development goals. It will help boost a sector that is internet sector where we see a significant growth
Telecom Personal fundamental to the country’s economic and social opportunity and opportunities for investments.”
growth. Expanding mobile broadband infrastructure
World Bank’s IFC has agreed to provide a US$400mn promotes productivity, and helps empower Argentina: ENACOM signs new telecom decree
six year financing package to Argentina’s operator entrepreneurs by providing digital services like
Telecom Personal to pursue the expansion of its mobile e-commerce.” A new decree (Decreto 1340/2016) has been signed
4G LTE network. For the IFC, this marks the largest by ENACOM and included in the Official Gazette
investment in the LatAm telecom sector. Argentina: Grupo Clarin lists its subsidiary on January 2. The decree includes new guidelines
for the telecom sector to boost competition and
Cablevision
new deployments. According to the decree, an
Telecom Personal’s CFO, Ignacio Moran, stated that
international spectrum tender will be held within
“This financing will enable us to continue investing Grupo Clarin has approved the listing of its
H1 of 2017.
in the latest technology to provide the best service to subsidiary Cablevision. According to the spin-off,
our 20mn mobile customers in Argentina, through Grupo Clarin will maintain all assets and liabilities Chile: WOM reaches 2mn subscribers
a platform that will make possible services for the of Cablevision. The Vice-Chairman of Grupo Clarin,
next decade.” Alejandro Urricelqui, noted that the split-up will WOM, the Chilean mobile network operator that
allow the Group “to better focus on the respective has taken over Nextel Chile, has achieved the 2mn
Dimitris Tsitsiragos, IFC’s VP for Global Client vision and strategy for each of our core businesses subscribers milestone in less than eighteen months
Services, noted that “This investment reflects … [Cablevision Holdings] will further benefit since starting operations. WOM is the brand behind
IFC’s commitment to support key private sector from being a stand-alone public company in the UK investment fund Novator who took over Nextel
players who significantly contribute to Argentina’s attractive telecommunications, cable television and Chile in January 2015

Wednesday 7 and Thursday 8 June, Boca Raton Resort and Club, Boca Raton
Meetup Americas 2017

A unique networking opportunity with 250 leaders of the CALA telecom tower industry
To discuss your participation, contact Annabelle on +44 7423 512588 or email amayhew@towerxchange.com
Diamond sponsor: Silver Sponsors: Bronze Sponsors: Organised by:

TowerXchange Meetup Americas – Agenda
Boca Raton | 7-8 June 2017
Day One | Wednesday 7 June Day Two |Thursday 8 June Early confirmed speakers include
08:00 Welcome coffee and registration < Manuel Aviles, President and CEO, Innovattel/
08:30 Morning coffee
Torresec
09:00 TowerXchange’s analysis of the past 12 < Kurt Bagwell, President – International,
09:00 One to one with Telesites: How to create a SBA Communications
months in the CALA industry
successful carve out and become a top performing < Juan Cueria, VP and COO, Innovattel/Torresec
09:30 Executive panel: What we’ve learned by towerco < Marc Ganzi, CEO, Digital Bridge Holdings
doing business in the U.S. and CALA < Fernando García Alvarez, Gerente de Construcción
e Infraestructura de Red, Entel Peru
09:45 Roundtable session III and technology
10:30 Networking coffee break < Edgar Geidans, Group CTO, Trilogy International
working group
Partners
11:00 Roundtable session I and technology < Dagan Kasavana, CEO, Phoenix Tower International
working group 10:45 Networking coffee break < Ross Manire, CEO, ExteNet Systems
< Eduardo Martins Pedro, COO, AlfaSite
12:00 Lunch 11:15 Panel: what happened during today’s < Olivier Puech, CEO LatAm, American Tower
technology working groups < Carlos Santiago Rodriguez Medina, Subdirector
13:30 Financial panel: Today’s CFO challenges Planificación y Control Económico, Eficiencias CAM,
under a lens Telefónica Móviles Centroamérica
11:30 Executive panel: Finding value in the < Maria Scotti, CEO, Torrecom
14:15 Roundtable session II and technology CALA Build-to-Suit market < Alex Sepehri-Nik, Founder and President, Plata
working group Tower Company
12:30 Lunch < José Sola, CEO, Mexico Tower Partners
15:15 Networking coffee break < Estrella Zaharia, CEO, Andean Tower Partners
< Senior representative, Telesites
14:00 Executive panel: Spotlight on inorganic
15:45 Panel: What happened during today’s
growth - what’s left to buy in CALA?
technology working groups
16:05 TowerXchange’s update on the Argentinian 15:00 Networking coffee break

market
15:30 TowerXchange’s summary of findings from
16:20 Executive panel: The opening of the the Meetup
Argentinian telecom tower market
17:15 Close of day one and drinks reception 16:00 Roundtable session IV
19:00 TowerXchange’s networking dinner (optional) 17:00 End of Meetup

TowerXchange’s analysis of the expansion), optimising towerco relations and
alternatives to sale and leaseback transactions took
centre stage at the event.
independent tower market in Africa Out in full force at the Meetup were the South
and the Middle East African players, MTN, Vodacom, Telkom and
Cell C. Following American Tower’s acquisition
of Eaton Towers and Cell C’s decision to rebuild
Figure 1: Estimated number of towers owned or managed by towercos in MEA their tower portfolio after a sale of its 1350 sites to
IHS Towers
American Tower in 2010, the shape of the tower
2409 2429 15389 1967 767
industry in the country is changing. Realising the
value in their infrastructure through the success
American Tower 2155 2309 1393 4729 1350* of the towerco business model, South Africa’s
MNOs are proactively pursuing co-locations on a
Helios Towers Africa
commercial basis, generating additional revenue
1793 787 3582 394 Source: TowerXchange
streams and functioning as as de facto towercos.
Unknown Country South Africa DRC Rwanda Whilst introducing a level of competition to South
Eaton Towers Uganda Nigeria Cote d’Ivoire Zambia
1200 1300 1200 700 600 Africa’s independent towercos, the level of new
Tanzania Ghana Cameroon Congo B
build projected will require the involvement of new
Kenya Burkina Faso Niger
MNO and towerco owned towers in order to meet
5000 10000 15000 20000 25000 demand.
*pending closure of Airtel transaction Source: TowerXchange
Operator-led towercos aren’t just emerging in
TowerXchange held their fourth Annual Meetup processes and alternative business models are South Africa but also across the rest of Africa. In
Africa and Middle East this last quarter, welcoming required in order to ensure that site uptime Kenya, Telkom Kenya are following Safaricom’s
over 300 leaders from the region’s tower industry continues to improve. lead in pursuing co-locations and in Zimbabwe,
to once again delve into the industry’s latest deals, Econet have created EcoTowers as the Zimbabwean
trends and issues. As the largest Meetup to date, one market segment government pushes forward legislation to mandate
with much higher representation in 2016 than infrastructure sharing in the country. The jury
Achievement of new operational efficiencies, deeper previous years were the region’s MNOs. Whilst is still out as to the efficacy of operator-led
infrastructure sharing and alternatives to and a handful of tower sales are still expected towercos, with towercos continuing to opine that
diversification of the towerco business model were (with processes underway in Kuwait, potential independence is key to agreeing and enforcing
top of discussions at this year’s Meetup. As margins divestments rumoured from Telkom Kenya and SLAs whilst some MNOs see value in retaining site
continue to be squeezed across the value chain Airtel Madagascar and an appetite amongst tier infrastructure, especially as the rollout of 4G and
amidst decreasing ARPU, new solutions, improved two MNOs to monetise their assets to fund network eventually 5G necessitates increased site density.

In Saudi Arabia, plans are moving forward with Whilst implementing active sharing across macro remains the renewable solution of choice for sub-
the joint venture between Saudi Telecom Company sites remains particularly challenging, especially Saharan Africa’s telecom sites, wind and fuel cell
and Mobily, both of which had initiated and then in instances where MNOs have divested their pilots are also underway by towercos in the region.
shelved plans to divest their towers in the first half tower portfolios, sharing of DAS networks is more
of 2016. Having established an initial three month straightforward. Shared DAS networks are gaining As well as upgrading the infrastructure on existing
agreement for the joint venture, this has now been an increasing amount of traction, with MNOs in sites, significant new build is still required in
extended as the operators continue to explore both Kenya and South Africa operating shared sub-Saharan Africa as LTE rollout necessitates
strategies to bring efficiencies to their combined networks for in-building solutions and observers increased site density and MNOs look to expand
network of over 25,000 towers. Significant parallel feeling shared DAS will become increasingly their geographic footprint. In Nigeria, MTN have
infrastructure exists in the country, and as such, common in the short term. announced the addition of 3,904 new sites by the
decommissioning is expected to be a significant end of 2017 as well as the addition of 3G and 4G
component of the joint venture and whilst Another area gaining increasing traction in sub- equipment to 7,345 existing sites and Nigeria’s other
Saharan Africa in particular is the ESCO business operators are expected to follow suit; in Angola the
additional efficiencies could be brought through
model with TowerXchange being made aware of two resident MNOs need to add a further 3,000 new
active infrastructure sharing, this is not currently
MNOs in the process of appointing ESCOs in Gabon, sites in order to improve coverage in the country
on the table.
Madagascar, Niger, Guinea and Chad. Whilst under and in Tanzania, the site count has almost doubled
consideration by some companies, the ESCO model in the past five years with significant new build still
Whilst active infrastructure sharing has yet to
is often less palatable to independent towercos who expected.
become commonplace across the MEA region, there
view energy provision as an important part of their
is growing appetite amongst MNOs to explore such
value proposition and an area where they are able In the Middle East, however, new site build is much
arrangements which many believe are where the
to make significant margins. Whilst TowerXchange more limited with decommissioning more likely to
greatest cost savings can be achieved. In North
forecast MNO ESCO agreements to continue to be a key focus for MNOs going forward. In Bahrain,
Africa, Orange, Tunisie Telecom and Ooredoo are
increase, the rise of towerco-ESCO arrangements is there are approximately 1500 sites in a market
exploring active sharing in Tunisia, with Ooredoo likely to be less forthcoming. that requires just 600; in Kuwait, tower sales from
also exploring an active sharing agreement with Zain and potentially the Kingdom’s other MNOs are
Djezzy in Algeria; whilst in East Africa Vodacom, Significant money is however being invested by expected to lead to a significant decommissioning
Tigo and Airtel have signed the region’s first towercos in upgrading their energy infrastructure. program by the acquiring party; and in Iran
RANsharing agreement in order to bring coverage With diesel theft being one of the biggest sources significant decommissioning is being undertaken
to rural areas more cost effectively. Whilst towercos of headache for towercos and MNOs, reducing by local towerco Fanasia with their latest project
have historically opposed RANsharing, seeing it as dependency on the fuel is seen as a key way to rationalising the number of sites in Iran’s second
a threat to their business model, there is growing curtail pilferage as well as opex costs. In Nigeria, largest city, Mashhad, from over 1,000 to 350. Whilst
acceptance that it will be inevitable and several IHS have invested around US$1bn in replacing transactions have been stop start in the MENA
are opening up discussions with active sharing ageing generators with solar-hybrid solutions, a region, observers feel that it is only a matter of
becoming an increasingly significant part of MLA move which is expected to lead to a saving of 500 time before the first deal will lead to a snowball
negotiations. litres of diesel per tower per month. Whilst solar effect. A towerco entering the market must however

Figure 2: MEA’s biggest tower transactions to date Source: TowerXchange
Tower Deal value Cost per

Year Country Seller Buyer Deal structure
count US$ tower US$
2016 Senegal* Expresso Telecom Al Karama Towers 450 SLB
2016 South Africa Eaton American Tower 300 Portfolio acquisition
2016 DRC Airtel HTA 950 SLB
2016 Nigeria* Hotspot IHS 160 Portfolio acquisition
2016 Tanzania* Airtel American Tower 1,350 $179,000,000 $123,593 SLB
2016 Nigeria HTN Towers IHS 1,211** Company acquisition
2015 Nigeria Etisalat IHS 555 SLB
2015 Egypt*** MobiNil Eaton 2,000 $131,150,000 $65,575 SLB
2014 Rwanda & Zambia Airtel IHS 1,113 $181,000,000 $162,624 SLB
2014 Nigeria Airtel American Tower 4,800 $1,050,000,000 $218,750 SLB
2014 Ghana, Burkina Faso, Kenya, Uganda & Niger**** Airtel Eaton 2,500 SLB
2014 Nigeria MTN IHS 9,151 $882,000,000 $196,700 Joint venture (IHS 49%, MTN 51%)
2014 Nigeria Etisalat IHS 2,136 $485,000,000 $227,060 SLB
2014 Congo B Airtel Helios 394 SLB
2014 Rwanda & Zambia MTN IHS 1,269 SLB
2013 Tanzania Vodacom Helios 1,149 $75,000,000 $87,616 SLB with direct investment in HTT+
2013 Kenya*** Telkom Kenya Eaton 1,000 MLL (Contract since cancelled)
2013 Cameroon & Cote d’Ivoire Orange IHS 2,000 MLL
2012 Cote d’Ivoire MTN IHS 931 $141,000,000 $151,450 SLB
2012 Cameroon MTN IHS 827 $143,000,000 $172,914 SLB
2012 Uganda Warid Eaton 400 SLB
2012 Uganda Orange Eaton 300 SLB
2011 Uganda MTN American Tower 1,000 $89,000,000 $174,510 Joint venture (AMT 51%, MTN 49%)
2010 Tanzania Millicom/Tigo Helios 1,020 $80,000,000 $130,719 Joint venture (HTA 60%, Millicom 40%)++
2010 DRC Millicom/Tigo Helios 729 $45,000,000 $102,881 Joint venture (HTA 60%, Millicom 40%)++
2010 Ghana MTN American Tower 1,876 $21,850,000 $228,375 Joint venture (AMT 51%, MTN 49%)
2010 South Africa Cell C American Tower 1,400+++ $200,000,000 $142,857 SLB with right to acquire 1800 more
2010 Nigeria Starcomms SWAP 407 $81,000,000 $199,017 SLB
2010 Ghana Vodafone Eaton 750 MLL
2010 Nigeria Visafone IHS 800 $67,000,000 $83,750 SLB
2010 Nigeria Multilinks HTN 400 MLL
2010 Ghana Millicom/Tigo Helios 750 $54,000,000 $120,000 Joint venture (HTA 60%, Millicom 40%)++
Totals / average 43,227 $4,141,650,000 $185,948
*Deal announced, not yet closed **Plus HTN’s managed service agreement governing 702 SWAP towers transferred to IHS ***Transaction subsequently cancelled **** Niger announced, not closed
+ Vodacom sold 100% of equity in towers but subscribed to acquire 24.5% interest in HTT ++Millicom restructured their equity into Helios’ operations into a 24% stake at group level, which Millicom is now looking
to monetise +++ Cell C included 1,400 existing towers plus the option to acquire up to 1,800 more to be constructed. Cost of 1400 towers only included here

Figure 3: African towerco footprints
Helios Towers Africa Madagascar Helios Towers Africa
Congo Brazzaville Eaton Towers TowerCo of Eaton Towers

DRC Niger Madagascar
Burkina American Tower
Zimbabwe
Faso IHS
Ghana Kenya so Econet
Safaricom Towers TowerCo of Madagascar
Tanzania towerco Namibia
PowerCom
Uganda PowerCom
Econet Towers
American Iran Fanasia

Tower Fanasia
Nigeria STC+Mobily JV
South
Africa Vodacom towerco, Telkom
Cameroon towerco, Cell C towerco,
Cote d’Ivoire Vodacom towerco
Rwanda Telkom towerco Atlas Towers and other
Cell C towerco Saudi Arabia
Zambia Atlas Towers
Other independent
independent towercos
STC+Mobily JV
IHS Towers towercos
Safaricom towerco
gear their business model to make money out questions at the Meetup focussed on what is in store and they must now be delivering on these to ensure
of decommissioning programmes as well as co- for not only Sub-Saharan Africa’s big four towercos growth expectations are met. Whilst there are
locations, with any build to suit contracts likely to but also the region’s smaller players. potential transactions the towercos would likely bid
be very limited. on (MTN’s South African towers being one notable
With the big four towercos present in the majority example), the towercos have walked away from
In light of alternatives to the towerco business of markets in which they want to enter, focus transactions in other markets where they are not
model, as well as the towerco consolidation that we has very much shifted to organic growth, opex yet present. Given the scale of the big four towercos,
have started to see in 2016 with IHS’s acquisition reduction and operational excellence. Their there are portfolios which they now view as too
of HTN Towers in Nigeria and American Tower’s business models surrounding portfolio acquisitions small or not additive to their business and so have
acquisition of Eaton Towers’ South African business, were built around securing co-locations on sites shied away from.

Figure 4: Estimated tower counts for selected countries in SSA
Gabon Rwanda Madagascar Namibia Angola Zimbabwe Senegal Uganda Cote DRC MozambiqueGhana Ethiopia Kenya Tanzania South Nigeria
1,000 1,300 1,600 2,000 2,500 2,700 3,350 3,485 d’Ivoire 4,350 4,400 5,983 6,600 6,600 7,686 Africa 27,675
3679 25,000
The lack of interest in such portfolios has created West African centric plan to scale to 35,000 towers that the company is gearing up for an IPO. Whilst
a niche for a new breed of towerco; one looking to in five years involves “non-traditional” sale and the towerco IPO market may currently be sub-
enter virgin territories through the acquisition of leaseback deals and and build to suit programmes. optimal, with Telefónica pulling their listing of
smaller or tier two MNO tower portfolios. One such Other local players are also emerging with October Telxius and Turkcell pulling their listing of Global
company is Al Karama Towers, the newly formed seeing Botswana’s Pula Towers being licenced as the Tower, focus of the privately owned towercos must
towerco which has reached agreement to acquire first independent towerco country and Antosc on soon shift to gearing up for some kind of liquidity
Expresso’s 450 sites in Senegal. With an appetite for track to become Angola’s first independent towerco. event. Moody’s rating of IHS’ opco in Nigeria gives
other tier two MNO portfolios in markets not yet some indication as to how the financial markets
touched by the big four, Al Karama Towers plans As to the future of the big four towercos, three of perceive emerging market towerco risk, from which
to lay the foundations for the independent towerco these are owned by private investors who will likely the towercos can draw conclusions on how their
business model in such geographies. Should the be looking for an exit in the next 18-24 months. valuations can be improved.
business model work, the company and/or its local Whilst Helios or Eaton could make attractive
opcos would make very attractive acquisition targets acquisition targets for American Tower or IHS (or In addition to how to strengthen towerco valuations,
should the big four look to enter at a later date. an international player looking to enter the region), one big question mark on the horizon is how
Another new entrant with multi-country aspirations IHS’ issuance of an US$800mn bond on the Irish the towerco business model needs to evolve
is Pan African Tower Company whose ambitious Stock Exchange has only further fueled speculation as the telecoms market matures. Sub-Saharan

Figure 5: Estimated number of towers in MENA that Helios Towers Africa are looking to exit
the Ghanaian market, with their business unit
reportedly up for sale (with both American Tower
and Eaton expected to have submitted bids) and
so further consolidation and reshuffling between
the big four looks set to be on the horizon.
Tunisia
Kuwait 7,000 TowerXchange also expect a number of new
Yemen
Lebanon 3,900 5,100 local towercos to continue come to light in new
2,000 territories, with business models built around
Qatar UAE UAE Iraq Morocco Algeria Egypt Saudi Iran
1,100 8,500 8,500 12,300 17,000 18,000 19,000 Arabia 38,000 built-to suit but with ambitions for inorganic
Bahrain Oman 32,800 growth. With a number of ESCO projects in the
1,700 Libya
3,200
5,000 Jordan
pipeline, these will become operational in 2017
5,900 and if results are positive we expect a number
of other ESCO projects to come to light within
the year; and TowerXchange forecast further
announcements around pilot projects for active
infrastructure sharing with this becoming a key
Source: Delta Partners data, TowerXchange presentation
focus for the region’s MNOs.
Africa’s towercos need only look to the more As 2016 draws to a close, TowerXchange look ahead Country Overviews
developed markets such as the US to see how their to 2017 and what we expect to be the major news
contemporaries are changing. The evolution to on the horizon. With Zain reportedly in exclusive Algeria
4G and ultimately 5G involves greater site density, negotiations on the sale of their Kuwaiti towers 2015 saw extensive investment in 3G network
small cells, DAS networks and the fibre backhaul to (reportedly with Towershare), and CEO Scott rollout across the country and with 4G licenses
support this. Already some towercos are starting to Gegenheimer informing local press that they have awarded to each of the country’s three MNOs
explore shared DAS solutions in sub-Saharan Africa narrowed down the number of bidders for their in early 2016, rollout plans are well underway.
and the more advanced are grappling with the Saudi towers to just two, TowerXchange forecast Djezzy, in which VimpelCom have a 49% stake
question of whether they should get into fibre. IHS 2017 will see the first Middle Eastern transaction and the Algerian government a 51% stake, have
have been the first of sub-Saharan Africa’s towercos announced in the first half of the year. With an appointed an executive to evaluate the sale of
to enter the fibre space, acquiring one of Nigeria’s emergence of buyers for MNO tower portfolios their 6,500 towers (in conjunction with processes
five infraco licences, but with the fibre business that would likely be overlooked by the big four in Pakistan and Bangladesh). The 51/49 rule,
more about selling capacity than space, and the towercos, TowerXchange expect a number of such limiting foreign investors to a minority stake
multiples of fibre companies not matching up to MNOs to start discussions on potential divestments, in investments in the country, coupled with
those of towercos, others are still uncertain how and particularly as the Al Karama Towers - Expresso the announcement of a RANsharing agreement
if they will follow suit. deal closes in Senegal. Rumours are abound between Djezzy and Ooredoo presents challenges

Figure 6: Ownership of Algeria’s ~18,000 towers Chad
Whilst Orange’s takeover of Airtel’s opcos in Burkina
Faso and Sierra Leone was completed in the last
quarter, their proposed takeover of Airtel Chad
collapsed at the start of this year. Prior to discussions
surrounding Orange’s takeover of their opco, Airtel
4,500 had agreed the sale of their towers to Helios Towers
7,500 Africa but the deal was subsequently cancelled as the
Djezzy regulatory regime was not conducive to the effective
operation of independent towercos.
Mobilis
Ooredoo Orange have now entered discussions with Millicom
regarding a takeover of Tigo in Chad (along with
subsidiaries in Senegal and Ghana). Millicom is
Chad’s largest operator with 53% of the market
6,000 share, followed by Airtel with 46% and State owned
Source: TowerXchange Sotel with less than 1%. With just 7.1mn subscribers
and an estimated 2,000 towers, Chad represents a
to an international towerco considering entering new sites in close proximity to existing ones, thus small market but one where dynamics may be set to
the market. necessitating infrastructure sharing in the country. change.
Antosc are Angola’s first independent towerco,
Angola currently in negotiations with the country’s MNOs Millicom have entered into an agreement with an
Angola has two MNOs, Unitel and Movicel with to expand their networks. ESCO to supply power to their sites in the country
Unitel having around about two thirds of the although details are yet to be publically released.
market share in terms of subscribers and Movicel Burkina Faso
the other third. Unitel has the larger portfolio Orange have completed the acquisition of Airtel’s Congo Brazzaville
of towers, possessing 1,700 sites and Movicel is local opco which had previously agreed the sale of Helios Towers Africa is the sole towerco in Congo
a relatively young network with just 800 sites. their ~500 tower strong portfolio to Eaton Towers Brazzaville, having closed a deal to acquire Airtel’s
In order to reach the level of coverage they are in the country. Airtel was the number two operator 394 towers, representing around 44% of the country’s
targeting, Unitel needs to add a further 1,000 in the country with a market share of around towers. Negotiations to sell Airtel’s Congolese opco to
sites and Movicel a further 2,000. There is a high 25%. Etisalat’s Onatel was the leading operator Orange recently lapsed, but MNO consolidation is not
degree of competition between the two operators in the market with Telecel the third operator. 3G a new phenomenon in Congo, Airtel having acquired
and as such, they have been reluctant to share was launched in the country in 2013 but mobile Warid’s operation in the country in 2014 vaulting
infrastructure in the past, however, in 2016 a new broadband penetration sits at just 7% in a country them over MTN to become market leaders. BinTel’s
law came into force, prohibiting the construction of of some 18.4mn. Azur are ranked a distant third.

Cote d’Ivoire and closed in three months will lead to the Orange, Vodacom and aggressive cut-price operator
While SWAP operates a handful of towers in the decommissioning of 150 duplicated sites, adding to Africell, who claimed to have 7mn subscribers
country, IHS holds a dominant position in the Cote Helios’s programme to reduce the level of parallel in DRC by the end of 2014. Africell leveraged co-
d’Ivoire tower market having acquired a total of infrastructure in the country (removing almost locations on over 200 Helios Towers DRC sites
~2,000 towers from market leaders MTN (under 10% of the country’s installed base). A 12 month to accelerate time to market, and the operator is
SLB) and Orange (MLL) in 2014. IHS owns more capex programme has already start to carry out the launching 3G. Smile plans to launch LTE in DRC in
than two thirds of the towers in the country and necessary site maintenance and upgrade work. 2016. Raga Sat has launched broadband services
provides a full tower+power service. According to leveraging O3b’s “fibre from the sky” MEO satellite
Orange, fuel represented 36% and the grid 64% of Helios is the sole towerco and has been delivering service.
the total energy cost in Cote d’Ivoire in 2015. reliable service and strong tenancy ratio growth in
the DRC since entering the market on the back of a SIM penetration is just 55% and although 3G was
The government has signed an MOU to start the US$45mn deal to acquire 729 towers from Millicom launched in 2012, mobile broadband penetration
process for the long awaited merger or fixed-line CI Tigo back in 2010 (Millicom originally retained remained at 7% in the DRC in Q4 2015*
Telecom and Orange’s mobile unit in the country. 40% equity in Helios Towers DRC which they then
Orange will hold a 69% stake in the new entity restructured into a 24% stake at group level - which Egypt
(versus the 85% and 51% stakes it has in the current Millicom is now seeking to monetise). Helios has In April last year, Eaton announced a US$131mn
mobile and fixed line businesses respectively). also built over 100 new towers in the country. acquisition of 2,000 MobiNil towers - an estimated
Number three MNO Moov was part of a package of third of the total owned by the opco (which was
assets transferred from Etisalat to Maroc Telecom. Helios Towers DRC provides full service rebranded to Orange following a 99% buyout by
tower+power. Grid power is reasonably reliable the company). The deal however was recently
After having had their mobile license revoked in in Kinshasa, but less reliable in Lubumbashi and cancelled with the Orange board failing to extend
April 2016 (along with MNO Comium) over poor Goma. Almost all sites outside these three cities are the long stop date for completion of the deal and
quality of service and unpaid taxes, LPTIC-backed off-grid and the delivered cost of diesel can be 2.5x with Orange also still missing some approvals
GreenN have been re-awarded their license by Cote more expensive in rural areas. from the regulator. It may still be likely that the
d’Ivoire’s regulator (ARTCI) taking the number of towers may return to the table, although changes
MNOs in the country back up to four. Infratel claims to have built over 800 rural sites for in management at both the local opco and head
Vodacom DRC. office level for Orange is likely to slow things
There are 24.5mn* mobile subscribers in Cote down. In a statement to TowerXchange, Eaton
d’Ivoire and mobile broadband penetration sits at With around 4,350 towers serving 48.75mn Towers’ CEO, Terry Rhodes stated that the company
36%*. connections, DRC has one of the highest number of remained committed to the Egyptian market “Eaton
SIMs per tower in the world at 11,207, illustrating Towers still regards Egypt as a market ready for
DRC the DRC’s huge growth potential. independent tower companies. The imminent roll
The sale of Airtel’s 950 towers to Helios Towers out of 4G, together with the economic and political
Africa has closed, further strengthening Helios’ Following Orange’s recent acquisition of Tigo changes which have made US dollars very scarce
position in the market. The transaction, signed there are four leading MNOs in the market; Airtel, mean the operators will be under financial and

operational pressure to expand their networks. It other country in MENA (4,690 versus the regional market leader Gabon Telecom (owned by Maroc
would be enormously beneficial for this expansion average of around 2,500), illustrating potential for Telecom) and number three operator Moov (owned
to share infrastructure.” new tower builds. by Maroc Telecom’s parent company, Etisalat). The
merger will give the new entity 55% of the market
In August, the board of fixed-line incumbent, Grid connections for Egyptian tower sites are share. Azur (BinTel) is the country’s fourth MNO.
Telecom Egypt gave its final approval for plans to slow and expensive, so DGs are widely used – the Oil and Gas wealth partly accounts for Gabon’s
buy a 4G license and as such, the fixed line player business case for renewables may be boosted if regional high GNI/capita of US$10,000 which has
becomes Egypt’s newest mobile network operator. fuel subsidies, which currently mean diesel is resulted in the country’s 162%* SIM penetration
around a fifth the cost of other African markets, rate.
The Egyptian regulator, NTRA, had offered licenses are reduced.
to the three resident MNOs, Orange, Etisalat and Ghana
Vodafone, but each expressed concerns regarding Local tower manufacturer / service provider HOI- Eaton are adding Airtel’s Ghanaian towers to the
the amount of spectrum being made available in the MEA operates a network of around 60 towers in 750 Vodafone towers they are managing with
auctions, as well as the regulator’s stipulation that a Egypt, with a vision to scale to 300 by 2018. HOI- license to lease. There are three major towercos
portion of the 4G license fees be paid in US dollars. MEA’s tenancy ratio is already approaching 1.5. active in Ghana, which have been snapping up
tenancies for over three years. Back in 2010, Helios
After having initially rejected the offer from the Gabon Towers Africa set up a joint venture towerco with
NTRA, the country’s three MNOs have since reached Airtel’s efforts to monetise their towers in Gabon Millicom Tigo as minority partners, to which 750
an agreement with the regulator with both Orange never made much headway, so all the country’s towers were transferred. Shortly afterward Eaton
and Etisalat acquiring 10MHz of frequencies and towers remain MNO captive for the time being. Towers closed their deal with Vodafone Ghana,
Vodafone acquiring 5MHz of frequencies. The three then American Tower set up another joint venture
MNOs now join fixed-line incumbent Telecom Egypt Airtel is deploying LTE, but mobile broadband with MTN to which 1,876 towers were transferred.
as 4G spectrum holders in the country. penetration was still negligible in Gabon at the ATC Ghana now markets 2,146 Ghanaian towers,
end of 2014. Whilst the electricity grid in the main representing around a third of the country’s tower
The NTRA is reportedly in talks with international cities is okay, the grid is much less extensive in stock.
operators regarding the 4G licenses, with Kuwaiti- more rural areas leading to 30-35% of the country’s
based Zain having reportedly expressed an interest ~1,000 sites being off-grid. Energy Vision have All of Ghana’s towercos now provide a full
in the license. signed the first real ESCO contract in Africa with service tower+power. With strict permitting and
one of Gabon’s MNOs, offering power on a fixed environmental policies in Ghana, it’s tough to get
With SIM penetration of 101%* and mobile monthly price with no upfront capex. The project new towers built and towercos expect less than
broadband penetration of 42%*, plus an established encompasses a full solar hybrid system with CDC 100 new structures to go up in 2016. However, this
culture of infrastructure sharing in the country, the batteries and will cover 150 off-grid sites, with a amplifies appetites for co-location: tenancy ratios in
potential for towerco profitability is good in Egypt. view to extend this to sites on unreliable grid. Ghana are already around two.
While 3G coverage is currently fairly extensive
Egypt still has more SIMs per tower than any The regulator has approved the merger between With much competition between towercos in the

market, Helios’s Ghana unit and its 787 towers are mobile broadband penetration from 24% to 30%* in 500 sites to its portfolio although rumours are
reportedly up for sale with first bids now in for the Ghana between Q4 2014 and Q4 2015. circulating that a tower sale is in the pipeline.
business unit. American Tower and Eaton Towers
are both believed to have bid for the portfolio which Iran Safaricom has a dominant position in Kenya with
could sell for up to US$150mn, based on recent With 38,000 towers, three nationwide operators MCI, a 65.2% subscriber market share. Airtel has 16.6%,
transaction values. The sale would enable Helios MTN-Irancell and Rightel and little infrastructure Orange (Telkom Kenya) 13.2% and new entrant
Towers Africa to focus on their three other markets sharing to date, Iranian towerco Fanasia is working Equitel has 5.1%, according to CAK statistics for Q2
where they are currently the sole towerco present in partnership with municipalities to reduce the 2016.
(until American Tower close the acquisition of level of parallel infrastructure in the country. The
Airtel’s 1350 sites in Tanzania). towerco has completed one project in trade free Kenya has ~6,600 towers, grossly insufficient for
zone, Kish Island reducing 110 towers to 27, has a a country of 46mn people and with a land area of
American Tower is partnering with Energize the second project underway in Mashhad, Iran’s second 570,000 sq km. SIM penetration is just 80%* with
Chain to provide vaccine refrigeration at a further largest city (with the goal of reducing 1,000 towers plenty of room for mobile broadband growth, at
50 cell sites, in addition to the 35 at which these life- to 350) and is in discussions with several other 18%* penetration at Q4 2015. Safaricom launched
saving systems have been installed. LTE at the end of 2014.
municipalities.
MTN leads a crowded market for operators, Kuwait

Kenya
followed by Vodafone, Tigo, Airtel and Glo, with the Market leaders Zain are in the process of divesting
Eaton Towers are integrating 1,200 towers recently
regulator considering revoking Expresso’s operating 1,600 towers in the country with Towershare
acquired from Airtel Kenya into their portfolio.
license. MTN Group is planning selling a 35% stake reportedly in exclusive negotiations with the
Eaton is the sole independent towerco in Kenya
in its unit in Ghana in a bid to meet the terms and operator. A high degree of parallel infrastructure
and has long coveted the market, having secured
conditions for the award of its 15-year 4G licence exists in the country, with infrastructure sharing
an MLL deal with Orange that was soon cancelled
last year, that 35% of the business is divested to to date having been limited between Zain and the
after a change in strategic direction by the operator,
Ghanaian investors. country’s other two MNOs Ooredoo and STC. The
which culminated in the announcement of the sale
entrance of a towerco through the acquisition of
The devaluation of the Ghanaian Cedi, compounded of Orange’s 70% stake in Telkom Kenya to Helios
Zain’s towers and potentially those of other MNOs is
by deregulation of fuel prices, led to spiralling opex Investment Partners (which was completed this last expected to lead to significant decommissioning in
costs and crippling fuel shortages in 2015. Every quarter). the country.
industry was affected, and towercos struggled to
achieve SLAs, while EBITDA margins suffered. Eaton’s number one issue: how to engage with Madagascar
However, Ghana’s towercos have developed Safaricom as a tenant and as a de facto competitor TELMA, Orange and Airtel operate in the
dynamic processes able to get ahead of fuel - Safaricom’s Wholesale team leases 800 of their Madagascan market with ISP Gulfsat Madagascar
shortages. 4,000 towers to other MNOs at attractive rates (operating as Blueline) having become the country’s
Telkom Kenya is also pursuing a similar strategy newest MNO. In spite of tough economic conditions,
SIM penetration rose from 113% to 121%* and on its towers and is the process of adding a further the government has a key focus on improving

connectivity in the country, with SIM penetration Malawi operators to share infrastructure in rural areas to
standing at just 31%* and mobile broadband Eaton’s deal to acquire Airtel’s towers in Malawi meet the country’s universal service access goals, a
penetration 19%* at the end of 2015. was cancelled in late 2015, and at present it doesn’t country where 68% of the population lives in rural
look like the towers will be brought back to market. areas.
TELMA is in the process of rolling out 4G and optical Mobile services are among the most expensive in
fibre in the country, with Orange expected to follow Africa in Malawi, contributing to SIM penetration State-owned mCel has long standing debts and has
suit by the end of 2016. of just 38%*, and mobile broadband penetration appointed Barclays to oversee the sale of its ~1,000
of 15%*. The end of 2015 saw a third MNO, Lacell, towers in order to reduce leverage. In July of this
Towerco of Madagascar (TOM), initially spun out being awarded a license in the country which is year, it was announced that mCel would be merged
of TELMA but now an independent towerco in it’s hoped to increase competition, lowering prices and with fixed line incumbent TDM to create a single
own right, operates a portfolio of 900 sites in the increase service quality. more sustainable entity. In addition to their own
country (approximately 55% of the total towers in towers, mCel use TDM’s network and it is not yet
the country), having added several hundred towers Mozambique clear how the sale of mCel’s towers will be affected
in 2015-16 through both the deployment of new The entrance of a third MNO Movitel back in 2012 by the merger.
sites for operators and through the acquisition
caused a radical shakeup of the telecoms sector with
of the towers as part of the liquidation process of There has also been speculation of a potential tower
the operator rapidly deploying their network and
failed MNO, Madamobile. In 2017, TOM plan to add sale at Movitel although a formal process has not
securing 49% of the mobile subscriber market share
another 150 sites, taking their total to over 1000 been announced. Rumour has it that the entrance
by the end of 2015.
sites in the country. of Movitel into the market was part of a government
plan to expand network infrastructure and then sell
The country has an estimated 3,000 foundation-
With Airtel having divested their towers in the vast the assets. If this were the case, the decision to sell
based towers, supplemented by an additional 1,800
majority of markets in which it operates, there may be more likely to come from FRELIMO than
guyed masts (primarily owned by Movitel). Fibre
have been unconfirmed rumours that the MNO is Viettel.
rollout to the tower has been relatively extensive,
in discussion with a number of parties regarding
resulting in microwave backhaul dishes being
a potential tower sale. Airtel have also reportedly As to who the likely bidders would be in a
agreed a contract with QTE for the company to removed from sites, thus freeing them up for
Mozambique tower sale from either mCel or
provide power under the ESCO model. further active equipment.
Movitel, it is not yet clear - the talks don’t appear to
have attracted the interest of the continent’s leading
The operational challenge of operating a distributed Infrastructure sharing in the country has been
towercos.
tower network, particularly during the rainy season limited, with a just an estimated 50 towers
is not for the feint hearted, and with significant being shared between mCel and Vodacom. In late 2013, a domestic company, TowerCo
energy challenges in the country, TOM has been The government passed a first reading of a bill Mozambique, tried and failed to set up towerco
extensively evaluating a number of different energy mandating infrastructure sharing in November operations in the country. It is thought that the
options including a pilot of a wind project in the 2015, however talks appear of have stalled. The company was unable to reach an agreement
country. government has however been putting pressure on on lease rates with mCel and Vodacom and as

Figure seven: Estimated tower ownership in Nigeria facility license category to regulate a designated
infrastructure provider in the country.
550 IHS own and BTS towers
IHS towers acquired from MTN Whilst the country’s electricity grid is extensive,
2,575
IHS towers acquired from Etisalat the power crisis hitting Southern Africa has
6,000 IHS towers acquired from HTN
had a knock on effect on Namibia and as such,
the operators are exploring alternative energy
SWAP Telecoms & Technology (management and
strategies as a means as protecting against risk to
marketing agreement transferred to IHS following HTN
the site uptime.
200 acquisition)
500 8,850
700 Hotspot Networks (sale to IHS announced, not closed) Namibia has 2.8mn* mobile subscriptions and SIM
160 American Tower Assets acquired from Airtel penetration rate of 114%*
BCTek
4,716 Communication Towers Nigeria Niger
Other small Nigerian towercos Eaton Towers have recently closed the acquisition
2,671 Globacom of Airtel’s sites in the country, with the towerco
1,211 now set to face a challenging energy logistics
702 NATCOM Source: TowerXchange
scenario, low population density, and sub US$5
such, talks were disbanded. We have yet to hear Namibia’s first dedicated infrastructure player. ARPU. Airtel has recently secured a 3G license in
rumours of any other domestic players forming in Managing a portfolio of 300 towers, the company Niger where it competes with Orange, SahelCom
Mozambique. has ambitions to integrate further assets into its and Moov (recently sold by Etisalat to Maroc
portfolio and in the long term plans to bring solar Telecom). SahelCom is set to merged with national
There are 19.2mn* mobile connections in to its sites to make use of the country’s abundant state owned fixed line incumbent Sonitel in a bid to
Mozambique with SIM penetration sitting at 68% sunshine. The company has tenancies from all three combat competition from the other operators in the
and mobile broadband penetration at 34%*. operators in the market as well as a number of non- market.
traditional tenants.
Namibia SIM penetration is just 34%* in Niger, and mobile
The Namibian mobile market has been dominated The Communications Regulatory Authority broadband penetration 2%*.
by two government owned MNOs: MTC and Telecom of Namibia has proposed a new regulation
Namibia, although the entrance of privately held pertaining to mandatory infrastructure sharing Maroc Telecom saw impressive growth in their
Paratus following an overhaul of the country’s where operators will no longer be allowed to set subscriber base, with wireless numbers increasing
telecoms regulation has introduced a new level of up new infrastructure where there are existing by 68% to 1.1mn.
competition. sites. An announcement from the regulator is
expected imminently regarding the legislation. Nigeria
PowerCom, owned by MNO Telecom Namibia, is The government have also introduced a network Nigeria is a benchmark tower market for many

reasons. It’s the largest mobile market in SSA, new towers as well as the addition of approximately of Youth and ICT to build a nationwide LTE network.
with 154.3mn* connections among a population 2,000 tenancies to existing sites. IHS have announced that they are assessing solar
of 184.6mn*. It’s the oldest growth independent farm opportunities in Rwanda that could potentially
towerco market in Africa; towercos have been In order to fund the build to suit program supply power to the national grid in the first ‘energy
building towers in Nigeria since 2006. Almost half and refinance the debt taken on following the swap’ model to be used in Africa.
of SSA’s towerco-owned towers are in Nigeria, acquisition of HTN Towers earlier this year, IHS’
and over US$2.5bn has been spent by towercos to Nigerian subsidiary has issued a US$800mn high SIM penetration in Rwanda rose from 61% to 75%*
acquire 79% of Nigeria’s towers. Towercos have yield corporate bond which was listed on the Irish with mobile broadband rising from 28% to 35%*
proved their ability to deliver 99.9% uptime in Stock Exchange with a high level of appetite from between Q4 2014 and Q4 2015.
challenging grid conditions in Nigeria. Nigeria is investors.
not just a benchmark for African towers, it’s proof Saudi Arabia
of the efficacy of the independent towerco model in Nigerian cell site energy efficiency programmes Number one and number two operators in the
are also becoming a benchmark for the rest of market, Saudi Telecom Company and Mobily had
any emerging market.
Africa, with battery hybrids widely deployed and been looking at a sale of their sites earlier in the
solar being added, particularly in the north of the year, but have instead announced a pilot study into
American Tower entered the Nigerian market
country. IHS’ “Big Five” project in the country is the formation of a joint venture to manage the two
in 2014 following an acquisition of Airtel’s 4,700
one major initiative designed to replace power MNO’s towers. The pilot, originally scheduled for
towers, whilst IHS acquired the portfolios of
generation systems on 15,000 sites with cleaner, a three month period has recently been extended
Etisalat and MTN in the same year.
more efficient solutions. IHS have selected five with suggestions that the MNOs plan to bring in
companies to each upgrade a portfolio of 2,500- outside equity investment into the venture in the
Competition for BTS opportunities is increasing
3,000 sites, thus enabling the towerco to benchmark future. Saudi Telecom Company have a portfolio of
among Nigeria’s towercos. Most commentators
different technologies and identify the most efficient 16,400 sites in the country, whilst Mobily have 9,600;
agree Nigeria needs to double the country’s
and effective energy solution for its largest market. it is not yet however clear how many towers will be
current stock of towers and despite market leader involved in the joint venture.
MTN’s financial challenges as a result of the NCC’s Rwanda
fine, MTN have announced they are to more than IHS has acquired both Airtel’s and MTN’s Rwandan Meanwhile, number three operator Zain are
double 2015’s capex spend this year, citing figures towers, building an additional 34 towers in 2014 progressing ahead with the sale of their 7,776
of ZAR11.1bn. Such spend covers an extensive and an estimated 50 towers in 2015. TowerXchange towers with CEO Scott Gegenheimer telling
network rollout which includes the addition of estimate there are around 1,300 towers in Rwanda, Arabianbusiness.com that it had narrowed down
3G and 4G infrastructure to 7,345 existing towers of which IHS own 767. offers to two prospective bidders and expected
as well as the addition of 3,904 new sites by the the transaction to close in the first half of 2017.
end of 2017. As part of this, IHS (with whom MTN Rwanda is home to three tier one MNOs, so has no It had been reported that Zain may look to sell
have a joint venture governing 9,038 sites in the shortage of credit worthy tenants. MTN leads the their towers to the STC-Mobily joint venture and
country) are known to have been awarded a build- market, followed by Tigo and Airtel. Korea Telecom similarly, Towershare had also been rumoured to be
to-suit program involving the addition of 1,650 secured a joint venture with the Rwandan Ministry one of the front runners in the transaction.

Figure eight: Estimated tower ownership in Saudi Arabia towers previously but talks failed. Tigo possess a
tower portfolio of 800 sites, which represents an
interesting acquisition target for Senegal’s first
towerco to bolster their portfolio.
6,800
Sonatel is the only operator to possess a 4G
license in the country but Tigo and Expresso have
STC expressed a strong interest in securing licenses,
16,400 with the sale of Expresso’s towers designed to raise
Mobily capital for such a license.
Zain
9,600 The government is set to award further universal
service licenses, following in the footsteps of Hayo
which provides coverage in the Matam region, and
is on the cusp of awarding two or three ISP licenses.
Source: TowerXchange These licensed players represent additional
prospective tenants for a towerco in the market.
A number of international parties and local towers to newly formed towerco, Al Karama Towers.
investors had expressed an interest in both the Zain The sale and leaseback transaction also includes There have been reports that a joint venture
and Mobily processes, the latter of which reached first right of refusal on new build for Expresso, with between South Korea’s SK Telecom and Middle
advanced stages before being cancelled. the operator planning to add an additional 200- Eastern firm CKG Group has applied for a fourth
250 sites in the next twelve months as part of the MNO license in the country, in a bid to access
In addition to the interest from international regulatory mandate for MNOs to increase coverage Senegal’s nascent LTE market.
towercos in the Saudi market, TowerXchange has to underserved areas of the country.
been made aware of a handful of Saudi tower There are 14.6mn* mobile subscriptions in Senegal
builders who are starting to retain portfolios of sites There is a high level of parallel infrastructure in and a SIM penetration rate of 96%*. Mobile
with a view to securing co-locations. In the major Senegal as infrastructure sharing in the country broadband penetration has increased 64% YoY to
metropoles of Riyadh and Jeddah there has been has been limited, things have however started to 14%*.
some infrastructure sharing to meet growing data change. Tigo and Expresso currently share 45 sites
usage, however infrastructure sharing beyond this in the country and there is strong expectation that South Africa
been limited, with estimates suggesting that fewer this will increase with the formation of the new Towercos have struggled to get a foothold in
than 2% of sites have multiple tenants. towerco. the South African market since Cell C sold their
portfolio to American Tower back in 2010 and the
Senegal Sonatel (in which Orange has a controlling stake) MNO has recently announced that they plan to build
Expresso Telecom has agreed the sale of their 450 had reportedly looked into a sale of its 2,100 approximately 600-800 towers each year for the

next four to five years, in order to develop their own The biggest news in the South African tower Sierra Leone
portfolio once again with a view to commercialising market this year is American Tower’s acquisition Orange has completed the takeover of Airtel’s opco
its sites. of Eaton Towers’ portfolio of 300 towers. “Eaton in Sierra Leone in partnership with its Senegal
Towers’ strategy in South Africa was to establish a based subsidiary, Sontel. Significant investment is
Telkom, who’s towers had previously been the build-to-suit presence and then scale up by buying underway in the 3G infrastructure in the country,
subject of speculation, have similarly developed a substantial portfolio of towers from one of the providing an attractive growth opportunity.
a passive infrastructure team to actively pursue operators,” said Eaton Towers CEO Terry Rhodes in
co-locations on their sites and Vodacom’s passive an exclusive TowerXchange interview. “However, With four MNOs, the country has a 4.5mn* mobile
infrastructure co-location strategy is well the operators in South Africa have not given this subscribers and a SIM penetration rate of 76%*.
established, with the operator having recently opportunity, and they still own over 90% of the Mobile broadband penetration sits at 23%, up 36%
developed a platform on which other frequency total towers. We have outperformed American YoY.*
holders can view available space on Vodacom sites. Tower in South Africa over the last few years but The market represents an attractive growth
our operation is about 1% of the total South African opportunity with significant investments in rolling
market, so when American Tower approached us it out 3G infrastructure in the country.
After a turbulent year for MTN following their
made sense to sell,” added Eaton’s Rhodes. American
record fine from the Nigerian Communications
Tower’s acquisition is thought to have been more Tanzania
Commission (reduced from $5.2bn to $1.7bn), the
about Eaton’s pipeline of 1,000 new sites than their Helios Towers Tanzania (HTT) owns around 3,582
South African company have appointed a new
existing ones. of Tanzania’s ~9,200 towers, acquired in a US$75mn
senior management team with a new CEO and
deal with Vodacom in 2013 and a US$80mn deal
new head and deputy head of M&A appointed. The
South Africa’s smaller towercos have benefited from with Millicom-Tigo in 2010 for 1,149 and 1,020
operator are yet to give any clues as to whether
the acquisition, consolidating their number one and towers respectively. The company has built a
a sale of their 9,000 tower strong South African
number two competitors in the market. With lower further 1,413 sites in the country. Millicom recently
portfolio could be back on the cards to offset the
overheads, they have outperformed American Tower restructured their equity stakes in HTA’s local
fine but with their CEO hailing from Vodafone (who in the build-to suit market in South Africa and what’s towercos to acquire a 24% stake in HTA’s parent
have traditionally chosen to retain their passive more, with a moratorium on the use of American company. Millicom are now looking to exit that
infrastructure) we don’t expect any quick decisions, Tower’s sites by Vodacom (due to their high lease investment. In order to fund further infrastructure
with the listing of MTN Nigeria on the stock rates), have also received healthy co-locations. expansion in the country, Helios Towers Tanzania
exchange being the first step to raise the necessary has just secured a US$95mn loan facility with
$1.7bn. MTN have invested over R16bn (US$1.1bn) MNOs in the market have come out with bullish Standard Bank.
in their South African network since January 2014, forecasts for new infrastructure with even the hard
including the addition of 1,300 new sites, as well as hit MTN increasing their infrastructure spend 50% American Tower are in the process of entering the
adding 400 3G sites and 4 000 LTE sites to existing on previously forecasted numbers. With such a level Tanzanian market following the announcement
infrastructure. According to acting CTO, Babak of new build required, both towercos and MNOs will that agreement had been reached to acquire Airtel’s
Fouladi, the operator plans to add a further 1,450 need to play an important role in reaching these 1,350 sites. The closure of that deal has been held
sites in 2017. numbers. up by a ruling in June 2016 in which Tanzania’s

National Assembly ordered all telecom companies increased demand - after this they will extend of MTN’s Zambian 719 towers, which supplemented
in country to float a 25% stake on the Dar es Salaam coverage to other major cities in the country. by new build gives them 1,967 towers in this this
Stock Exchange (DSE). There are 40.4mn* mobile connections in Tanzania ~2,300 tower market. Capital constrained Zamtel is
as of December 2015, up 26% on 2014 figures. the third of three MNOs, although the government
Vodacom and Tigo are supplementing their network Mobile broadband penetration sits at 30%*. is a fourth player in Zambia’s tower market through
in anticipation of aggressive competition from the first of 400 towers to be built by Huawei, funded
new market entrants Viettel, which launched on Uganda by the Universal Service Fund.
October 2015 under the Halotel brand. Viettel has Eaton Towers has added Airtel’s Ugandan towers
3,000 new towers in the air or under construction, to the 700 towers they acquired from Orange and The government issued an ultimatum to the
and has begun co-locating, having leveraged 1,000 Warid back in 2012. Airtel since acquired Warid, country’s three operators, MTN, Airtel and Zamtel,
HTT sites. Expect Halotel’s site count to approach while Orange sold out to Africell. Uganda remains in October 2015 to improve their service or face the
8,000 by this time next year, including colocations. ripe for further in-market consolidation, with seven introduction of a new operator in the market.
Zantel (acquired by Millicom from Etisalat), Smart, licensed MNOs. American Tower is also active in
Smile and TTCL complete the MNO landscape in Uganda, where they have a joint venture with MTN Whilst speculation had been circulated that
Tanzania, which lends itself to co-location as each and currently market 1,393 towers. TowerXchange Vodafone had been awarded a fourth operator
of Tanzania’s four main MNOs is dominant in a estimate there are a little over 4,000 tenancies on license by the Zambia Information and
different region of the country, providing a strong 3,485 towers in Uganda, suggesting an average Communications Technology Authority, the
incentive for co-location to accelerate nationwide tenancy ratio just under 1.2. Expect this number regulator issued an announcement stressing that
coverage. The sheer scale of Tanzania amplifies to rise driven by the enthusiasm of new entrant this was not the case with Vodafone being limited to
maintenance costs, which can be as high as MNO Africell, which operates an asset-light model internet services.
US$7,000 per annum – ten times the cost in the US. and prefers to co-locate rather than build thus
accelerating time to market. The devlauation of the Zambian Kwacha, down
In terms of power, over 70% of Tanzania’s sites over 40% versus the USD in the last year, has hit all
are on grid and Helios Towers have introduced Organised crime compounds the effect of stakeholders in Zambian telecoms hard.
a limited gainsharing programme to incentivise administrative fuel theft in Uganda, making site
tenants to migrate to low power, outdoor solutions hardening a priority for towercos. SIM penetration is 72%* in Zambia, and mobile
in a bid to curb opex. broadband penetration 16%*. ARPU is low: in the
SIM penetration is just 72%* in Uganda, with multi- US$2-3 range.
In July 2016, it was announced that each of the SIMing meaning actual penetration is under 50%*.
three main MNOs have entered into a RANsharing Mobile broadband penetration is low with only 13% Zimbabwe
agreement to improve coverage in rural areas. of the population having a smartphone. There are an estimated 2,700 towers in Zimbabwe,
of which market leader Econet owns around 1,385.
TTCL have announced they plan to add an Zambia The government of Zimbabwe has gazetted new
additional 50 LTE sites in Dar Es Salaam (taking IHS have acquired the towers of market leaders regulations which give the country’s regulator
their total LTE site count in the city to 75) due to Airtel Zambia to supplement their 2014 acquisition the Postal and Telecommunications Authority

TowerXchange MEA tower transaction heat map of Zimbabwe (POTRAZ) the power to compel the
country’s three MNOs to share their infrastructure.
Econet Wireless who have invested over US$1.2mn
on network rollouts in the past five years and who
own over half of the country’s towers, have been
against the move, arguing that it unfairly benefits
state-backed competitors NetOne and Telecel. The
government argues that reducing capex spend
through the sharing of existing infrastructure will
BAHRAIN
ultimately lead to reduced costs for the consumer.

In anticipation of such regulation, Econet Wireless
has created a dedicated infrastructure unit,
EcoTowers whilst fixed line incumbent, TelOne has
pooled its network equipment with other fixed line
1
players with a view to extending infrastructure to
MNOs in the market.
2
3 out ESCO Econet Power,
Econet has also carved
who report that grid conditions have improved in
4
Zimbabwe, with downtime reduced to an average of
5 hours per day. That hasn’t
ten to closer than three
stopped Econet from seeking to instill hybrid and
renewable power on 6650, rising to as many as 1,000,
of their cell sites.
Investment in any segment of the Zimbabwean

economy may be on pause given the cash crisis
Legend
caused by the reintroduction of a domestic
Towerco activity but no further deals expected currency, after Zimbabwe had halted hyper-
Unconfirmed rumours of a potential tower deal inflation by using the US-dollar since 2009.
in the last 3 years
Confirmed potential tower deal Zimbabwe has 12.8mn connections and 81% SIM
At least one tower deal has closed but no more penetration, with mobile broadband standing at
expected 26%*
At least one tower deal has closed and more
expected Source: TowerXchange (*Source: GSMA Intelligence, Q4, 2015)

MEA News
Egypt: Vodafone, Orange and Etisalat join
Telecom Egypt as 4G spectrum holders
A roundup of tower news across SSA and MENA After having failed to reach an agreement on
terms with Egypt’s National Telecommunications
Botswana regulator, making it the first independent Regulatory Authority (NTRA), September saw the
towerco in the country. Botswana has 3.2mn mobile country’s three incumbent MNOs Orange, Etisalat
connections in a market with three MNOs. and Vodafone reject the regulator’s offer to apply
for 4G-suitable spectrum. The MNOs have since
Cote d’Ivoire: Cote d’Ivoire reconfigures to a four reached an agreement with the regulator with both
player market with the award of a new operating Orange and Etisalat acquiring 10MHz of frequencies
license to Libyan backed LPP and Vodafone acquiring 5MHz of frequencies. The
three MNOs now join fixed-line incumbent Telecom
After having revoked the operating licenses of Egypt as 4G spectrum holders in the country, where
GreenN, Comium, Cafe Mobile and Warid Telecom in mobile broadband penetration sits at 42%
April 2016, the Cote d’ivorian regulator (ARTCI) has
awarded a new license to Libyan owned LPP. Whilst Ghana: NCA trigger regulatory processes to annul
little presence of LPP on the ground has been seen Expresso’s operating license
Bahrain: Regulator issues RFP to examine the by market insiders, observers suspect that GreenN
rationalisation of the Kingdom’s towers may be involved in the company. The new MNO With significant liquidity challenges and having
will absorb the 450-500 towers previously owned by failed to secure investment to fund their operations,
The Telecommunications Regulatory Authority the four MNOs who had their licenses revoked. LPP Expresso Ghana had just 106,975 mobile voice
of Bahrain has issued an RFP to find a partner join Orange, MTN and Moov to make up the Cote subscribers and 42,746 mobile data subscribers
to organise the Kingdom’s telecom sites. The d’Ivoire’s MNO market. (0.29% and 0.22% of the country’s total voice and
country, with 3.1mn mobile connections (GSMA data subscribers) at August 2016 (NCA). Expresso’s
Intelligence) has 1500 towers, in a market which DRC, Liberia: Orange consolidate acquisitions of inactivity has created a deficit in revenue targets
estimates suggest requires just 400. Similar to other Liberia’s Cellcom and the DRC’s Tigo for the government and the regulator and as such,
Middle Eastern markets, a high degree of parallel Ghana’s regulator, the National Communications
infrastructure exists with MNOs (in this case Orange’s acquisitions Cellcom in Liberia and Tigo Authority has triggered processes to annul the
Batelco, Zain and Saudi Telecom Company owned in the Democratic Republic of the Congo were MNO’s operating license.
Viva) having historically been reluctant to share fully consolidated into the MNO’s business by the
infrastructure. end of September. The operator expects the two Ghana: Helios’ 787 towers up for sale?
subsidiaries it has acquired from the Bharti Airtel
Botswana: Botswana’s first towerco licensed group in Burkina Faso and Sierra Leone to be There have been unconfirmed rumours that Helios
consolidated in the 4th quarter. The company now Towers Africa is looking to sell its 787 Ghanaian
Pula Towers has been granted a license by the has a presence in 21 countries in the MEA region. towers, with American Tower and Eaton Towers

reportedly having submitting bids. Helios the Iranian firm in rolling out its network mobile broadband penetration sits at just 19%
entered the Ghanaian market in 2010, forming infrastructure and expanding its fixed and mobile (GSMA Intelligence).
a joint venture towerco with Millicom, into internet services. HiWEB who will now also
which 750 sites were transferred (Millicom have provide fixed and mobile services to Vodafone’s Nigeria: MTN announce extensive network rollout
subsequently restructured their 40% stake in the multinational corporate clients in Iran, is a key
opco to a 24% stake at group level, which the MNO candidate to acquire one of the country’s new MTN Nigeria have announced an extensive network
is now looking to monetise). American Tower and MVNO licenses. International economic sanctions rollout which includes the addition of 3G and 4G
Eaton Towers boast larger portfolios (2155 and were lifted on Iran in January of this year, infrastructure to 7,345 existing towers as well as
1200 sites respectively) in Ghana and with strict prompting interest from international telecoms the addition of 3,904 new sites by the end of 2017.
permitting regulations making its tough to get community. As part of this, IHS (with whom MTN have a joint
new towers built, the Helios portfolio presents an venture governing 9,038 sites in the country) are
attractive opportunity to expand their asset base Kuwait, Saudi Arabia: Zain move forward with known to have been awarded a build-to-suit program
in the country. tower sale negotiations involving the addition of 1,650 new towers as well
as the addition of approximately 2,000 tenancies to
Ghana, Uganda, Kenya, Burkina Faso, Niger: Zain are progressing ahead with the negotiations to existing sites.
Standard Chartered Private Equity to exit Eaton sell their 6,800 Saudi and 1,600 Kuwaiti towers with
CEO Scott Gegenheimer telling Arabianbusiness. Nigeria: IHS issue a US$800mn high yield
Minority shareholder, Standard Chartered Private com that it had narrowed down offers to two corporate bond
Equity SCPE) is reportedly looking to exit its prospective bidders and expected the transaction
investment in Eaton Towers. The firm joined to close in the first half of this year. A consortium IHS’ subsidiary, IHS Netherlands Holdco B.V. which
Capital Group Private Markets (Eaton’s original comprised of TASC and AcwaPower are believed owns 100% of IHS Nigeria Ltd and 100% of IHS
and controlling shareholder) along with Ethos to be amongst the frontrunners in Saudi, with Towers NG Limited (formerly known as HTN Towers)
Private Equity in April 2015 as part of Eaton’s Towershare reportedly in exclusive negotiations issued a US$800mn high yield corporate bond which
latest round of fund raising. Two French funds with the MNO in Kuwait. was listed on the Irish Stock Exchange. The bond has
have are rumoured to have expressed an interest a 2021 maturity and offers a 9.5% coupon. The funds
in SCPE’s shares in the towerco. Madagascar: Orange expecting to launch 4G by will be used to refinance the debt of IHS Towers
the end of 2016 NG (formerly known as HTN Towers, which IHS
Iran: Vodafone signs partner market deal and acquired earlier this year) as well as refinance some
Orange enters discussions with MCI Orange are expected to launch 4G services before of the IHS Nigeria’s opco level debt and fund the
the end of the year, joining market leader TELMA build of 1,650 new towers as part of MTN Nigeria’s
Orange are the latest international MNO to who are in the process of rolling out 4G and rollout plans.
enter into talks with leading Iranian operator, optical fibre across the country. Orange, who are
MCI to acquire a stake in the company which also continuing to invest in 3G deployment in the Nigeria: NCC announces their intent to auction
holds around 43% market share in the country. country, are reportedly in talks with TELMA to five remaining infraco licences
Meanwhile, Vodafone has signed a partnership make use of their optical fibre network to support
agreement with Iranian ISP HiWeb to assist their 4G network deployment, in a market where The Nigerian Communication Commission has

announced their intent to auction the five Swaziland being the sole operator in the market Tanzania: Local listing requirements holding up
remaining regional infrastructure company having acquired a license back in 1998. There are Airtel’s tower sale to American Tower
(infraco) licences, which allow for the deployment currently just under a million mobile subscribers
of fibre-optic backbone under the Open Access in a population of 1.3mn in the country (GSMA The sale of Airtel’s 1350 Tanzanian sites to
Model. IHS and MainOne Cable secured the first Intelligence). American Tower which was announced in March is
two infraco licences for the North Central and Lagos yet to close. In June of this year, Tanzania’s National
State Zones respectively. Saudi Arabia: Saudi Telecom Company and Assembly ordered all telecom companies in country
Mobily extend JV towerco study to float a 25% stake on the Dar es Salaam Stock
Oman: Regulator issues an Information Exchange (DSE), an order which would also apply
Memorandum on third MNO license application Saudi Telecom Company and Mobily have extended to American Tower and thus significantly alter the
process their initial three month agreement to study the economics of the transaction. Negotiations are still
formation of a joint venture to manage the two ongoing in the country.
The Telecommunications Regulatory Authority
companies’ tower portfolios. The two MNOs had
(TRA) of Oman has issued an Information Zimbabwe: New regulations gazetted to compel
initially initiated and then abandoned tower sales
Memorandum (IM) explaining the pre-qualification operators to share infrastructure
in 2016, with management concerns over the
criteria and application process to obtain the third
lack of a counterparty with local expertise cited
MNO operating licence in the Sultanate. The TRA The government of Zimbabwe has gazetted new
amongst the reasons. Whilst the number of towers
is keen to increase competition in the country regulations which give the country’s regulator
to be included in a potential joint venture has yet
where Omantel and Ooredoo are the two resident the Postal and Telecommunications Authority
to be decided, the combined portfolios total over
MNOs, joined by MVNOs FRiENDi mobile and Renna of Zimbabwe (POTRAZ) the power to compel the
25,000 towers. Whilst the joint venture is part of
Mobile. The regulator had previously urged service country’s three MNOs to share their infrastructure.
a move to bring greater efficiencies to the two
providers to improve quality of service and bring Econet Wireless who have invested over US$1.2mn
down costs following an increase in complaints networks, active sharing is not included in the
on network rollouts in the past five years and who
from consumers. current plans. own 1380 of the country’s 2700 towers, have been
against the move, arguing that it unfairly benefits
Swaziland: Four companies apply for new mobile South Africa: Wireless Business Solutions agree state-backed competitors NetOne and Telecel. The
license to use 500 Vodacom sites government argues that reducing capex spend
through the sharing of existing infrastructure will
The Swaziland Communications Commission has Wireless Business Solutions (WBS), the parent ultimately lead to reduced costs for the consumer.
revealed that four companies have submitted bids company of ISP iBurst, have signed an agreement In anticipation of such regulation, Econet Wireless
to obtain the new mobile licence being auctioned with Vodacom South Africa, whereby under which has created a dedicated infrastructure unit,
in the country, with Viettel Group, Orange-backed WBS will use Vodacom’s high sites. TechCentral EcoTowers whilst fixed line incumbent, TelOne has
Mauritius Telecom and locally owned Swazi Mobile writes that the WBS is expected to have 500 sites pooled its network equipment with other fixed line
and Data Net being the named parties. The Swazi active on Vodacom facilities by March 2017, with players with a view to extending infrastructure to
telecoms sector is currently a monopoly with MTN that number set to reach 5,000 by 2020. MNOs in the market

What’s new?
5th Annual TowerXchange < Higher number of concurrent roundtables creating more
intimate discussion groups
Meetup Africa & Middle East < Bigger audience of engineering and maintenance
contractors leading procurement decisions
< Independent towerco VIP discussion group: how does the
3 - 4 October 2017, towerco business model need to diversify and adapt?
Sandton Convention Centre, Johannesburg < Future networks: prepare your business model for the
advent of 4G and eventually 5G
The 2016 Meetup SOLD OUT weeks ahead of time, necessitating increased < Extended energy and monitoring system working groups
capacity to accommodate the number of requests to join. For 2017 we have driving excellence forward
taken on a bigger space and look forward to some exciting new features. < Larger exhibition showcasing a broader spectrum of
products and services
Diamond Silver sponsors: Bronze sponsors:

sponsor:
TowerXchange’s analysis of the the need for MNOs raise capital to fund spectrum
and rollout. The sale of Reliance Infratel to
independent tower market in Asia

Brookfield Asset Management and the continued
rumours of other companies looking to restructure
their balance sheets suggests that MNOs may look to
monetise their tower assets or restructure stakes in
Selected Asian tower market size comparisons, Q2 2016 operator-led towercos.
Vietnam
Last but not least, the Indonesian market continues
Pakistan 70,000
Sri Bangladesh 40,704 to scale and mature; Protelindo’s acquisition of
Lanka Myanmar Philippines 29,693
Afghanistan 16,300
5,897
7,000 12,030 2,500 towers from XL earlier this year brings
Nepal Indonesia Japan India China towerco penetration in this market to 64%, while
86,322 220,000 457,597 1,750,000
6,000 the likes of Balitower and STP are driving the rollout
Laos Cambodia Australia
7,374 9,250 Malaysia of thousands of infill sites.
15,000 South
22,117
Korea Thailand
30,000 52,483 The regulatory environment for towercos and
Asian tower markets with <5,000 assets infrastructure sharing varies from mature tower
markets such as India and Indonesia where
the regulatory regime is well established, to
regulatory environments still drafting policy, where
New Zealand PNG Singapore Brunei Rest of Bhutan independent towercos are a relatively new business
4,000 1,500 1,000 500 Oceania 100
400 model. This was explored in-depth at the regulatory
workshop held after the TowerXchange Meetup Asia
2016 and hosted by the IFC.
2,183,800 of Asia’s 2,842,851 towers are owned or and leaseback transaction rumoured to be imminent Afghanistan: An average of 500 towers are added
operated by towercos, representing 77% of the total in Pakistan, Asia continues its transition to becoming to the Afghan tower network every year, which
inventory of assets. a shared infrastructure market. totalled 5,897 towers in mid 2015. While Roshan,
Etisalat and MTN all retain their towers, all have
The transition to the tower sharing model continues The overall shape of the market is being driven in been linked with prospective tower divestitures /
apace in Asia, from companies like edotco and particular by China’s continuing adoption of the outsourcing in recent years, with AWCC going so far
OCK Group with their appetite for international towerco model; this will be covered in depth in our as to carve out ~1,500 towers into their subsidiary
expansion, to the towerco consolidation taking new dedicated coverage of the Chinese market. In towerco, Frontier Tower Solutions. There are
place in Myanmar. With the country’s maiden sale the Indian market, the push towards 4G is driving over 20mn subscribers and with upwards of 90%

population coverage in Afghanistan. Most rural sites Afghanistan tower counts, 2002-15 Source: MCIT, Afghanistan
are off grid, and even many urban and suburban.
Afghan calendar year Western calendar year Tower count
Australia: Axicom (formerly Crown Castle), 1393 2014-15 5897
Broadcast Australia and a handful of smaller
1392 2013-14 5383
independent towercos own around 2,500 towers in
1391 2012-13 5005
the 15,000 tower Australian market. The majority
1390 2011-12 4350
of towers are owned by Telstra, with Optus and
1389 2010-11 3977
Vodafone playing catchup, particularly in rural
areas. In urban areas Vodafone and Optus share 1388 2009-10 3184
RAN. A further 1,800 towers have been recently 1387 2008-9 2736
erected by nbn, the government owned new 1386 2007-8 2091
broadband network, while a handful of government 1385 2006-7 1067
agencies and small local wireless operators and ISPs 1384 2005-6 567
represent a further 2,000 between them. Ground 1383 2004-5 311
based towers, primarily used for rural coverage, 1382 2003-4 89
are supplemented by around 20,000 rooftop sites, 1381 2002-3 0
although not all of these are occupied.
Estimated site count for Australia
Bangladesh: edotco operates a network of 7,993
20,000 rooftops Ground based towers
towers, the majority of which were transferred from
Axiata’s Bangladeshi opco Robi. As Robi and Airtel
1800 Axicom
~2,000
merge, edotco are studying which of over 3,000 Broadcast Australia
Airtel sites they wish to absorb into their portfolio. ~400 620
~300 80 Other independent developers
Meanwhile, parent company VimpelCom are nbn
~1,800
preparing Bangalink’s towers for sale, with a Telstra
portfolio set to be optimised through ongoing
Vodafone
consolidation of sites duplicated by the edotco
portfolio.
Optus
Others: government agencies, local wireless
~8,000
The Bangladesh Telecommunication Regulatory operators and ISPs
Commission drafted a tower license framework
for industry consultation in 2016, resulting in

Tower deals in Asia 2008-2016 (excluding carve-outs) Source: TowerXchange
2016 Myanmar SMI Shining Star 100 $12,707,000 $127,070 Company acquisition
2016 India Reliance Brookfield 43,379 $1,700,000,000 $76,842 Acquiring 51% controlling stake
2016 Vietnam VNI OCK Group 1,938 $50,000,000 $25,800 Company acquisition
2016 Indonesia XL Axiata Protelindo 2,500 $250,000,000 $100,000 SLB
2016 India Viom Networks American Tower 42,200 $1,180,000,000 $76,540 Acquiring 51% controlling stake
2015 Myanmar Digicel MTC edotco 1,250 $221,000,000 $176,000 Acquiring 75% controlling stake
2015* Australia Crown Castle MIRA-led consortium 1,772 $1,600,000,000 $902,934 Company acquisition
2015 India KEC International American Tower 381 $13,000,000 $34,121 Company acquisition
2014 Malaysia KJS YTL Power Int’l 309 $15,000,000 $48,544 Company acquisition
2014 Indonesia XL Axiata STP 3500 $460,000,000 $131,429 SLB
2013 Indonesia Hutchison STP 300 $68,000,000 $226,667 SLB
2012 Indonesia Hutchison Protelindo 503 SLB
2012 Indonesia PT Central Investindo Protelindo 152 Company acquisition
2012 Indonesia Indosat Tower Bersama 2500 $519,000,000 $207,600 SLB
2011 Indonesia Infratel Tower Bersama 595 Company acquisition
2010 India Essar Telecom Infrastructure American Tower 4450 $432,000,000 $97,079 SLB
2010 Indonesia Hutchison Protelindo 1482 $165,900,000 $111,943 SLB
2010 India Aircel GTL Infrastructure 17500 $1,800,000,000 $102,857 SLB
2009 India Viom Networks QTIL 18000 $2,407,000,000 $133,722 Company acquisition
2009 India Transcend Infrastructure American Tower 327 $23,000,000 $70,336 Company acquisition
2009 India XCEL Telecom American Tower 1730 $170,000,000 $98,266 Company acquisition
2008 Indonesia Bakrie STP 543 $34,000,000 $62,615 SLB
2008 Indonesia Hutchison Protelindo 3692 $500,000,000 $135,428 SLB
*Crown Castle Australia (now Axicom) transaction excluded from

Totals / average 149,103 $15,303,940,333 $93,811
totals and averages as it not a natural comp for the other S and SE
Asian transactions

strong suggestions that restrictions on foreign Estimated tower count for Bangladesh
direct investment be lifted, and that more than
two towerco licenses be issued, particularly since a
State-led towerco has been mooted as one potential 4,100
licensee. edotco Bangladesh currently operates 7,800
under a statement of non-objection. Grameenphone
Banglalink
TowerXchange estimate there are just under 3,800 edotco
30,000 towers in Bangladesh, with around 1,000
new towers added per year. Cell site autonomy is a Airtel
concern, particularly during monsoon season. Teletalk, CityCell and non-traditional MNOs
Sources: TowerXchange research, edotco, Hardiman
Cambodia: With a crowded operator market of 7,993 6,000 Telecommunications
seven operators serving a population of 15.5mn, and
a regulator that supports infrastructure sharing,
there is continued potential for the 9,250 site tower
market in Cambodia to grow.
India: 69% of India’s 457,597 towers are owned and and Vodafone. Idea and the other shareholders
operated by towercos, a figure which will rise to in Indus Towers are rumored to be considering
There has been an influx of Chinese operators and
83% when the BSNL towerco is inaugurated. inviting third party equity investors to participate
vendors prepared to invest heavily in this market.
Reliance Communications has signed a binding in the 120,000+ tower venture. Meanwhile Bharti
Challenges still remain including 20% of sites being
pact with Brookfield Infrastructure Group to sell Airtel are reportedly considering releasing further
off-grid and the risk of landmines in the more
a majority in the company’s tower unit, Reliance equity in their towerco, Bharti Infratel.
remote areas.
Infratel (now Towercom) for US$1.7bn. Brookfield
edotco operates a portfolio of 1,950 towers in will acquire a 51% share in the company which There are rumours that TowerVision, an
Cambodia. Local tower builder Cam Towerlink is owns approximately 45,000 towers. independent towerco with 8,400 towers owned by
also in the process of setting up operations as a a group of international investors, may be up for
towerco, and has secured its first contract to build There are indications that other transactions in the sale. Potential buyers could include Bharti Infratel,
towers around the Angkor Wat temple UNESCO Indian market may be imminent: Idea Cellular is Brookfield, Tillman Global Holdings or American
World Heritage complex. Some operators in this planning on monetising its tower assets to release Tower, who have all indicated an appetite to acquire
market, such as Mfone, have fallen victim to the capital for investment in 4G. Idea Cellular owns further assets in India. Ascend Telecom could also
intense competition and price wars leaving some around 11,000 captive towers via a wholly owned attract bids for their 5,200 towers.
infrastructure assets abandoned. arm Idea Cellular Infrastructure Services (ICISL).
It also has 16% stake in Indus Towers, Aditya Birla GTL Infrastructure has initiated a process to auction
China: Now covered in China FAQs Telecom’s telecom tower joint venture with Airtel the company and its assets by as early as February

Tower ownership in India in 2016 Sources: TowerXchange Research, TAIPA, PwC tier two cities. In the near term, the 4G rollout
is expected to have a marginal impact on the
Indus Towers profitability of Indian towercos, whilst the majority
314 American Tower
10,000 of BTS are added through ‘loading’ - the addition of
15,000
5,000 Towercom (formerly RITL) a second set of antenna by an existing tenant - but
8,000 120,739
Bharti Infratel when 4G rollout progresses to adding infill sites for
densification, expect to see a significant increase in
14,421 GTL Infrastructure
tower cash flow.
IDEA Cellular Infrastructure Services
25,000 Tower Vision
Bharti Infratel reported an increase in tower count
Ascend by 4,813 towers over Q2 2016, including their stake
Saurava Towers in Indus Towers. Bharti Infratel’s market cap was
57,987
BSNL then Rs 729.55bn, and EBITDA for FY15-16 stood at
65,000 Reliance Jio Rs 5,403 Crore, an 8% YOY increase.
Reliance
BSNL has received “in-principle” approval to carve
Vodafone India
out its estimated 65,000 towers into a separate
55 45,000 Bharti Airtel
5,200 towerco which could be valued up to US$3bn. A
8,400 27,839 MTNL government working group has been formed to
11,000 38,642 MTS develop a capital and organisational structure for
Others the new entity, though the process may take some
time. Analysts are excited by the potential of these
2017. The auction is to be led by EY, and will entail in the country, and CEO James Taiclet has gone on towers coming to market as many are in prime
the conversion of debt into equity. record recently saying that the company would be locations with considerable tenancy ratio growth
interested in acquiring more towers in India. potential, having not been proactively marketed
Valuations in the Indian tower market were MNO consolidation has resumed with the before. BSNL has leased out 6,505 of its towers to
recalibrated last year and a new benchmark recent merger between Aircel and Reliance other telecom operators, suggesting a tenancy ratio
established by American Tower’s acquisition of Communications. Further rational consolidation around 1.1x. Out of the 6,505 spaces that it has
Viom Networks, their 42,200 towers and almost is welcomed by towercos who would prefer to see rented out, Bharti Airtel accounted for 2,251 slots.
100,000 tenancies, generating a valuation of spectrum holdings consolidated into four or five It was followed by Reliance Jio with 1,440 slots and
US$3.3bn. American Tower has acquired a 51% companies with the capital to rollout. With India’s Idea and Vodafone with just above 900 towers each.
controlling ownership interest with Tata Group 3G overlay around half finished and expected to
and several private equity groups retaining a reach 95% coverage in the next 18-24 months, Reliance Jio has led the rollout of 4G and has opted
stake. American Tower now owns 57,987 towers the 4G rollout has already started in tier one and to self-deploy as many as half the sites in their

network, including constructing over 25,000 new Estimated tower count for Indonesia Source: TowerXchange
structures, most of which are micro sites.
Towerco-owned
6,938 Mitratel
15,167 3,423 1,000
Indonesia: Indonesia remains one of the most 1,012
Tower Bersama
mature tower markets in the world, with solid 719 Protelindo
tenancy ratios, excellent organic growth, and strong STP
4,510
500 IBS Tower
market caps boasted by three major towercos;
KIN
Protelindo (15,167 towers), Tower Bersama (11,553) 3,000 Persadasokka Tama
and STP (6,938). IBS Tower, KIN, Centratama 11,553
Centratama Menara
(formerly known as Retower), Persada Sokka Tama Balitower
and Balitower also have some scale in Indonesia. Gihon
18,000 Others
8,000 Operator-captive
There have been rumours that IBS Tower, which
Telkom + Telkomsel
has some ownership links with its number one
8,500 XL
tenant Smartfren, could be coming to market. 4,000 Indosat
Indonesia’s towercos build 3,000-5,000 towers,
rooftops and infill sites per year, tenancy ratio Protelindo and Tower Bersama are holding firm have tailed off, and why tower count data is so
growth compares favorably to many other global against downward pressure on lease rates, which hard to find – readers should consider our estimate
tower markets, with around 0.13 tenants added per are believed to average around US$1,200 in a very rough guide. Japan is famous for having
tower per year. Indonesia. the fewest number of subscribers per tower in
the world – reportedly around 500 – suggesting
XL Axiata has completed the sale of 2,500 Meanwhile, the new battleground for competition a staggering tower count of around 220,000 for
telecommunication towers to Protelindo for 3.56 between Indonesia’s towercos seems to be a nation of 127mn people and a landmass of
trillion rupiah (US$250mn) in cash. XL signed a microcells and fibre, as illustrated by Protelindo’s just 378,000 sq km. LTE was launched as long
deal to leaseback most of the towers for ten years. acquisition of iForte. STP also has substantial fibre ago as 2011 by former State owned monopoly
and microcell portfolios after its acquisition of NTT DOCOMO and in 2012 by the nation’s other
The future of Telkom-owned Mitratel and their fibre company Bit, while Balitower have also added MNOs, SoftBank and KDDI (au). DOCOMO has
~8,000 towers remains uncertain with the substantial stock of smaller sites to their portfolio. already started rolling out LTE-A. Japan’s three
cancellation of the proposed share-swap acquisition leading MNOs are believed to have each added
of Mitratel by Tower Bersama at the behest of the Japan: Japan is one of the most sophisticated up to 30,000 microcells and small cells as infill
commissioner. Telkom still has a further 18,000 mobile markets in the world. Yet towers are still sites. TowerXchange understand several tower
towers on their balance sheet, of which 13,000 seen as a source of competitive differentiation, companies are trying to establish themselves in the
could potentially be sold at an unspecified point in which perhaps explains why initial interest in Japanese market, but that their penetration remains
the future. carving out a towerco a few years ago seems to negligible.

Estimated tower count for Laos Laos: The 7,473 towers in Laos all remain operator-
captive, but there are possible opportunities to
acquire towers from all but the market leading MNO:
423
Unitel has 4,000 towers, and is a 51-49% joint venture
1,950 between the State and Viettel. The State also owns
1,100
51% of number two operator LTC, whose co-investor
LTC Shenington Investments may seek an exit. 100% State
Unitel owned MNO ETL is heavily indebted and needs cash
for 4G rollout, while VimpelCom has long sought to
ETL exit Beeline Laos, whose towers could potentially be
Beeline (VimpelCom) monetised by an acquirer.
Malaysia: Towercos own 31% of Malaysia’s towers,

4,000 led by edotco’s 3,717 towers carved out of Celcom
Source: TowerXchange / Axiata. A further 3,200 towers are owned by 14
different State-backed and other independent
towercos, while turnkey infrastructure provider
Estimated tower count for Malaysia OCK Group which owns 133 sites in this market.
There are around 22,117 towers now in Malaysia,

edotco 3,717
representing almost exactly 2,000 mobile subscribers
DiGi 3,400 per tower. edotco aims to increase their Malaysian
Maxis 3,800 tower count by around 1,000 in 2016, although
many new sites will be ‘special structures’ such as
Telekom Malaysia 1,000
lamp posts. A new ground based tower in Malaysia
State backed towercos 3,200 costs around RM300,000 (US$69,000).Around 1,000
5,000 new towers went up in 2015, with Celcom building
YTL
through edotco and Maxis and DiGi building their
OCK 133 own – although DiGi has since signed a collaboration
Unaccounted for agreement with edotco which includes co-location
1,876
and new BTS sites. The State-backed towercos
1,000 2,000 3,000 4,000 5,000 also continued to expand, including through over
2,000 rural sites supported by Malaysia’s Universal
Source: TowerXchange Service Provision Fund. It has been estimated that

Estimated total number of sites in each Myanmar MNOs network an additional 8,000 structures may be needed in
Malaysia for 4G, although much of that demand will
(inclusive of co-locations)
be met by microcells, lamp-poles, DAS and IBS.
Myanmar: There are currently 12,030 towers

in Myanmar, unequally spread across seven
5,300
towercos and two operator stakeholders - MPT has
6,900 Telenor around 3,600 towers, while fourth operator Viettel
Ooredoo may utilise consortium partner Star Holdings
Corporation’s ~300 towers, which were previously
MPT
utilised by MECtel. TowerXchange has heard varying
4,300 reports about Viettel’s appetite to build versus
co-locate: some say the network will be two third
co-located, one third self-deployed, others say the
reverse. An eighth towerco could emerge as the
Breakdown of ownership of the 12,030 towers TowerXchange estimates fourth operator launches.
have been built to date in Myanmar
At this point build orders and volumes have slowed
3500
down compared to the initial launch period.
3000 Myanmar’s MNOs have been forced to self-deploy
a few hundred rooftop sites as the rental fees rise
2500 beyond the a level compatible with the towerco
business model.
2000
3600
1500 TowerXchange would divide the Myanmar towerco
2500 ecosystem into three categories: existing towercos
1000 1800 of scale – IGT, Apollo and edotco; newer towercos
1250 1250 competing on price – EFT and OCK; and towercos
500 200 200 seeking an exit – PAMEL and MIG. In October, Hong-
530 300 100 300 Kong based Shining Star International acquired MIG
0
for US$12.7mn, making it the first transaction of the
T
PT
CK
IG
te -
llo
co
EL
or
o
T
EC el
EF
o
IG
M
en
ot
year – and second overall in the Myanmar tower

M iett
ed
l
o
O
Ap
ed
PA
or
Te
industry. This effectively leaves PAMEL alone in the

O
Independent towerco towers MNO captive towers Source: TowerXchange third category.

Estimated tower count for The Philippines Tenancy ratios are generally healthy, in the 1.35-1.9
range, averaging around 1.5.
Even in major cities, grid power is unreliable, and

in rural areas often non-existent, so Myanmar’s
towers typically have robust backup power systems.
Lithium batteries are now being tested and solar
7,300 Globe Smart
integration will also be explored. Ooredoo’s dalliance
with retaining power assets is now behind them, so
9,000
all new towers are built on a tower+power business
model.
Nepal: Axiata Group has closed the acquisition of

a majority stake in Nepalese market leader Ncell
from TeliaSonera, in a deal believed to be worth
US$1.365bn. There have been no tower deals in
Towerco penetration in Asia now and forecast for Q417
Nepal to date, but this move by the Axiata Group may
100 Current penetration
pave the way for Axiata’s towerco edotco to enter the
Forecast, Q4 2017
market in the near future.
80
83% New Zealand: There are early signs of a nascent
tower industry emerging in New Zealand, where
70% 65%
Spark and Vodafone New Zealand have substantial
60
but ageing tower networks, newer entrants 2degrees
100% have leveraged co-location where possible while
building a few hundred towers. 2degrees may have
40
68% 53% an appetite to sell their towers and partner with a
64% 65% 34% 34% 34%
towerco on BTS. Parallel infrastructure is substantial,
23% while the need for improved rural coverage,
20
31% 31% 30% particularly on the South Island where tourist and
26% 26%
21% 18% agribusiness drive demand, has prompted the
3%
government’s Rural Broadband Initiative to invest
in over 100 towers. A total of around 4,000 ground
ar
lia
nd
sh
m
a
ka
a
n
di
si
di
si
in
ta
m
na
de
an
la
ay
ne
In
bo
Ch
is
tr
based towers are supplemented by around 7,000

n
ai
et
la
iL
k
al
do
ya
Pa
Th
Au
Vi
ng
M
Sr
Ca
M
In
rooftop sites, primarily used in the larger cities.

Ba

Pakistan: The merger between VimpelCom Estimated tower ownership in Thailand
(Mobilink), Global Telecom Holdings, Warid
Telecom Pakistan and Bank Alfalah is now 800
5,000 1,500
complete, creating a new combined entity with
around 14,500 towers serving 45 million customers.
11,000 Proposed DTAC-CAT towerco
DTAC towers built outside concession
An unnamed towerco is believed to be in exclusive
negotiations for the newly combined tower AIS disputed towers built under CAT concession
12,000
portfolios of Mobilink and Warid which, after AIS disputed towers built under TOT concession
decommissioning overlapping sites, will consist of AIS towers built outside concession
around 13,000 sites. Parent company VimpelCom 12,183 DIF (formerly TRUEIF)
is rumoured to be seeking close to US$1bn for the
True disputed towers built under CAT concession
tower assets with the value boosted by the fact that
10,000
Mobilink has been leasing out their towers at a
commercial rate for the last five years, achieving Source: AEC Advisory and TowerXchange
a tenancy ratio of around 1.25. Etisalat’s Ufone

are also believed to have commenced a process to structure - a cosy duopoly between Globe and phenomenal, largely as a function of the geography
monetise their Pakistani towers. Smart, neither of which urgently needs to of the country: a maintenance visit to a remote
raise capital - means towercos are unlikely to tower can require a flight, a boat and a donkey ride
The towercos currently active in active in Pakistan prioritise the country, despite its scale (over up a mountain! This has resulted in substantial
include edotco, which operates 13,000km of fibre 100mn subscribers). A reportedly burdensome outsourcing to managed services subcontractors. To
in the country; Towershare, which has around tax regime, compounded by complex permitting counteract the opex challenge, both Globe (which
800 towers at present; and AWAL Telecom, which processes, further disincentivises investment in The has an estimated 7,300 towers) and Smart (9,000)
recently announced a BTS contract with Mobilink. Philippines by international towercos. are currently investing in substantial network
modernisation programmes, including the upgrade
#2 MNO Telenor has recently reached an agreement The prospective entry of SMC as a third MNO, in a of backup power solutions.
with China Mobile Pakistan (Zong) to share their joint venture with Aussie giants Telstra, recently
fibre-optic network assets, and the two operators faltered, although SMC are reportedly in dialogue South Korea: According to GSMA Intelligence,
were engaged in a landmark RANsharing trial, the with Telenor in a renewed attempt to enter the SIM penetration was at 113% among a population
first in Pakistan. market. The new Philippine government may look of 50.4mn in Q4 2015. South Korea boasts one
more favorably on increasing competition than the of the most sophisticated telecommunications
Philippines: There are currently no independent previous incumbent. infrastructures in the world, cultivating an
tower companies in The Philippines. The glass insatiable demand for high speed mobile
ceiling on tenancy ratios created by the market Operational costs in The Philippines are broadband among its citizens. Mobile broadband

penetration in South Korea is above 99% and fibre Transfer) concessions that are now expiring. by DTAC outside the concession for 3G usage. True’s
has been widely deployed. South Korea is a three Thailand’s three commercial MNOs were due non-concession towers sit on DIF’s balance sheet…
operator market featuring SK Telecom, KT and to transfer 2G infrastructure back to SOEs CAT It all gets very confusing!
LG Uplus, while the Ministry of Science, ICT and and TOT. The 2G equipment has little value,
Future Planning (MSIP) has announced intention but of course the towers do. CAT, which ran the The steady lease-up of DIF’s towers is a good
to license a fourth MNO. South Korea was the first concessions for the 850 and 1800MHz bands, failed sign, but there is little progress towards any joint
market in the world to migrate the majority of users to reach an agreement with majority stakeholder ventures. With one auction for 900MHz spectrum
to LTE, with LTE-A rollout now well under way. DTAC to create a 49-51% JV towerco, into which cancelled after the successful bidder Jasmin failed
TowerXchange are starting to pick up the first faint 11,000 disputed towers were to be injected. to pay its first installment, a re-auction was held
signals that towerco activity may be emerging in Negotiations to create a prospective 12,000 tower in which AIS was the only bidder. The Thai market
South Korea. JV towerco between AIS and TOT, which ran the continues to be complex and unpredictable; this
900MHz concession, were called off late in 2015, but and the 49% FDI limit may deter some investors.
Sri Lanka: edotco had a tenancy ratio of 2.13x at the process has resumed with the recent creation of
the end of Q116 on the 2,144 towers they manage a committee to pave the way for the creation of the Vietnam: Vietnam’s largest independent towerco
for Dialog. High levels of bilateral sharing means joint venture. SEATH, with 1,938 sites (mostly guyed mast towers)
tenancy ratios are closer to two than one all over is to acquired by Malaysia’s OCK Group for around
Sri Lanka. Sri Lanka is now mostly covered with CAT and TOT have started to discuss an informal US$50mn. OCK may seek to consolidate other
3G, and 4G is driving need for cell site densification. partnership without a merger, and may consolidate members of a fragmented group of around 30 local
Dialog and Mobitel hold all of the 4G spectrum, and some of their similar core businesses to remain towercos who between them own ~10,000 towers.
any other players that want to offer this will need competitive in the post-concession era. At the same Alcazar Capital and ASEAN Towers’ Vietnamese
to engage in RANsharing. There are around 7,500 time, AIS and TOT are expected to sign a contract subsidiary Golden Towers’ has around 350
towers in the country. signalling the launch of a joint-trial commercial towers in the country, and may also be engaged
service on the state agency’s 2.1GHz spectrum. in consolidating existing independently owned
Bharti Airtel had been rumored to be looking into TowerXchange estimate there are 52,483 towers in towers in Vietnam. Meanwhile the restructuring of
selling its 2,500 towers, but seems to have cooled on Thailand, of which 12,183 sit on the balance sheet of Vietnam’s Ministry owned #2 and #3 ranked MNOs
the idea. DIF, formerly TRUEGIF, a towerco created by True MobiFone and VNPT seems as far off as ever, limited
Corp and SCB Asset Management and successfully the chances that a decent sized sale and leaseback
Bharti Airtel had been rumored to be looking into listed on the Thai stock exchange. DIF has little opportunity could come to market in the mid-term.
selling its 2,500 towers, but seems to have cooled on debt, a high leverage ceiling, and an appetite 4G spectrum in the 2.3 and 2.6 GHz bands, together
the idea. to consolidate more Thai towers – especially if with refarmed 900MHz spectrum, is expected to be
True reduces their shareholding to increase the auctioned in 2016. To date, towers have not been
Thailand: Thailand has a tower market unlike perceived independence of the entity. widely shared in Vietnam, hence considerable
any other in the world! Ownership of towers is parallel infrastructure with an estimated 70,000
in dispute as a function of BOT (Build-Operate- A further 10,000 towers were built by AIS and 800 towers in the country

Asia heatmap
MYANMAR
Legend
TowerXchange research has not revealed any infracos or towercos to date
Towercos or infracos active in the market. No recent transactions have taken
place and none rumoured to take place soon
Towercos or infracos active in the market. No current transactions taking
place but an attempted tower sale has taken place in the last 3 years or there
are unconfirmed rumours of a deal in this market.
Towercos or infracos active in the market. Rumours of deals confirmed in the
market.
Towercos or infracos active in the market. Deals of significant size have taken
place in the last 5 years.
Towercos or infracos active in the market. Deals have taken place in the last
year and more imminent deals rumoured
Note: Russia is covered under Europe; we estimate it to have a 5% towerco penetration and we expect it to be a growth market

China tower market FAQs Market context
What are current levels of mobile / SIM

Up to 275,000 new towers built in 2016 as China races to meet 4G coverage and
penetration and ARPU?
drive its infrastructure-sharing mandate
According to data released by the Ministry of
China is home to the world’s largest towerco China Tower Industry and Information (MIIT), as of the end
Corporation (CTC), as well as a fragmented but good-sized ecosystem of August 2016, there are 1.309bn mobile phone
of 200+ independent towercos. The State-owned enterprise subscribers in China. This represents 95% SIM
and towerco giant has kicked into high gear in the past 16-18 penetration.
months, tackling significant build demands from the three MNOs,
streamlining operations, and driving supply chain transparency Blended ARPU figures from the three operators
range from CNY ¥47-60.
through its unique procurement platform. CTC remains eager and
committed to IPO in Q4 2017. Read on for your one-stop shop on the
What is the status of China’s 4G rollout?
Christie Liu, Head of Asia shape of the exciting Chinese tower marketplace.
In the first half of 2016, China Mobile added over
Keywords: 4G, Air Conditioning, ARPU, Asia, Asset Register, Bankability, Batteries, Best of TowerXchange, 200,000 4G base stations, increasing its total to
Build-to-Suit, Carve Out, China, China Mobile, China Telecom, China Tower Corporation, CTC, China 1.32mn. During the same period, China Unicom
Unicom, Construction, Country Risk, Debt Finance, Exit Strategy, General Office of the State Council, grew its network by 216,000, for a total of 600,000 4G
Guodong, IBS, Infrastructure Sharing, Lease Rates, Leasing & Permitting, Liu Aili, Market Forecasts, Market
base stations.
Overview, Masts & Towers, Ministry of Industry and Information Technology, MIIT, Miteno, Myanmar
Infrastructure Group, MIG, New Market Entrant, O&M, On-grid, Operator-led JV, Outdoor Equipment,
China Telecom’s basic 4G coverage is expected to be
Pass-Through, Procurement, Regulation, Research, RMS, Rooftop, State-owned Assets Supervision and
complete by year-end, with a target of 340,000 for
Administration Commission of the State Council, SASAC, State Administration for Industry and Commerce
2016, growing its total to 850,000.
of the People’s Republic of China, SAIC, Shelters, Shining Star International Holdings Limited, Stakeholder
Buy-in, Sun Kanmin, Tax, Tenancy Ratios, Tong Jilu, Tower Count, Towercos, TowerXchange Research,
All in all, China has a network of over 2mn 4G base
Transfer Assets, Valuation
stations.
Read this article to learn: What is the number of 4G customers in China?

< What is China Tower Corporation, how does it operate, and what does it own?
< Lease rates for China Tower and independent towercos As of 30 September 2016, China Mobile reported
< Growth opportunities and regulatory landscape 481mn 4G customers, while China Unicom has
< Valuation benchmarks, tenancy ratios, and investibility approximately 89mn 4G subscribers and China
Telecom at approximately 107mn.

How many new towers were built in China in ARPU for China’s three MNOs (CNY/user/month)
2016?
China Mobile China Unicom China Telecom
For context, prior to CTC, there were approximately
1 January to 30 September, 2016 60.0 46.7 56.0
1.38mn towers built by the three operators over 30
years between 1985 to 2014. 2015 59.6 40.8 54.1
It was reported that asset transfers of roughly Approximate tower ownership in China by operator 2014E
1.5mn towers happened around the end of 2015 and
beginning of 2016.
By September 2016, CTC was quoting roughly

388,000
1.63mn towers, with estimates to get up to 1.7-1.8mn
by year-end. China Mobile
752,000 China Telecom
As such, CTC build volume for the year would be
between 200-300,000 towers. China Unicom
246,000 Total = 1,386,000
In terms of independent towerco output, estimates
would be in the range of 20-30,000.
How many towers are in China and who owns

them? China Tower Corporation tower counts by year
China Tower Corporation will own between 1.7-

2014, Pre-CTC 1.38mn
1.8mn towers by the end of 2016.
The roughly 200+ third-party towercos will own 2015 1.5mn

approximately 40-50,000. We now know of one
towerco with towers in the five-digit count, with at 2016 1.75mn (est)
least three others in the four-digit count.
2017 1.9mn (est)

What is the future growth of Chinese towers?
CTC still has a lot of building to do, including plans to 0.5mn 1.0mn 1.5mn 2.0mn

China Tower Corporation coverage of subway and high speed lines acres of land and CNY ¥50bn of investment.
As of September 2016 Completed Under construction Total One of the goals of CTC is to improve the customer
experience from, in some cases, a few hundred KB
Subway 195km 631km 3,800km
per second, to as much as 20MB per second once 4G
High speed 1,208km 5,653km 15,000km is fully deployed.
provide coverage on the 56 subway lines and 59 of the tower growth will be dependent upon the operators’ CTC is also seen as a mechanism for reducing
high-speed train lines within the next three years. demands. the gap between competing MNOs by providing
China Unicom and China Telecom with access to
CTC has also developed strategic partnerships with Major cities will need more infill sites to provide the China Mobile’s vast tower network, enabling them
22 provinces and autonomous regions to better density needed for heavy data need. More light-pole to accelerate and catch up their 4G rollout. If 4G
integrate network planning and construction integrated tower designs that are sleeker, smaller, coverage were complete, using VoLTE could enable
into local planning, as many are keen to drive and faster to deploy will likely play a role, as well as refarming of valuable spectrum.
economic development through enhanced mobile microcell and small cell.
and broadband coverage. Reportedly the new The formation of CTC not only allows China
arrangements have been better compared to what What is the vision behind creating China Tower to accelerate 4G rollout, but also enable the
operators were dealing with in the past. This Corporation? implementation of the country’s mobile broadband
theoretically paves the way for faster and more build network strategy.
out. With the approval of the General Office of the State
Council (国务院) and led by State-owned Assets The creation of CTC is also a reform of sorts, to drive
There is some speculation that within three year’s Supervision and Administration Commission of the efficiency and inject new energy into the industry.
time tower construction could slow down in China. State Council (SASAC, 国资委) and the Ministry of
The standards for 5G are yet to be defined and many Industry and Information Technology (MIIT, 工信部), Opportunities to diversify CTC into other shared
commentators have indicated that 4G is more than the joint venture was formed to promote a culture of infrastructure, and the sheer scale of the business,
enough for the general mobile consumer. Generally infrastructure sharing in China. Also referred to as means the vision is less to create the world’s largest
5G would mean higher site density and smaller “co-build, co-share.” and most valuable towerco, but to create one of the
equipment mounted at lower heights. world’s largest and most valuable infrastructure
CTC was formally created on 15 July, 2014 to companies.
On the independent side, one source estimates that consolidate and share existing towers, to construct
there could still be 50,000 to 100,000 towers available shared additional towers, and to save land and tower Does CTC also own assets beyond the macro
to build given the size of the country. resources. network, such as rooftops, IBS, DAS and
transmission infrastructure?
The need for macro towers will decrease over time In 2015 alone, compared to MNOs own build, CTC
as major coverage projects get completed. Ultimately, was able to realise savings of 265,000 sites, 13,000 CTC has absorbed most, if not all, China’s legacy

towers, monopoles, and rooftops. There is an Shareholders in China Tower Company
appreciation at CTC that the co-construction
and sharing model can extend beyond towers to China Reform
transmission infrastructure, but that does not Corporation
seem to have been incorporated yet. 6%
IBS are widely deployed in China, but there are China China Mobile
China
not many DAS. Telecom Mobile 38%
China Unicom
27.9%
We did hear of one towerco with a substantial China Telecom
streetlamp project in one of China’s major cities – China Reform Corporation
they called them “information poles” and spoke of
how they were supporting the Smart City vision. China Unicom
28.1%
Does China Tower Corporation only own and
lease up the towers, or do they undertake O&M
too? While the Ministry of Industry and Information We’ve been able to identify one other board member
Technology (MIIT) defines policy, CTC is effectively Sun Kanmin (孙康敏) who is an executive with China
CTC is responsible for the construction, operation, answerable to SASAC, the State-owned Assets Telecom. CTC does not wish to disclose the identities
and maintenance of towers. Having said this, given Supervision and Administration Commission. of the rest of its board members at this time.
engineering design, construction, and the likes are
also included as service categories on the online What is the governance structure of CTC? This governance structure is unlike the past, where
procurement platform, it would be reasonable to more company members would also be part of
expect a certain level of sub-contracting of O&M. There are currently nine members total on the the board, and was created specifically to avoid
board. inefficiency and abuse of power.
Who are the principal stakeholders in China
Tower Corporation – who are they answerable Mr. Liu Aili (刘爱力) is the Chairman of the board. What is the organisational structure of CTC?
to? He is also the Executive Director and Vice President
of China Mobile, principally in charge of planning There are 15 business units/departments within
China Mobile is the largest stakeholder of CTC and construction, network operation, and business CTC, including management, construction and
at 38%, while China Unicom and China Telecom support. maintenance, finance, human resources, business
own 28.1% and 27.9% respectively. China Reform partnerships, operations and development, audit,
Corporation, likened to a sovereign wealth fund Mr. Tong Jilu (佟吉禄) is the General Manager of CTC telecommunications technology research institute,
with a particular focus on reforming State-owned and the only board member formally employed information technology research institute, and
Enterprises, owns the remaining 6%. within the organisation. more.

There are three levels of CTC management: long as they hold a valid manufacturing license in companies are often more energised and faster to
Headquarters in Beijing, provincial branches, and China (for product providers), are registered with market,” said one interviewee.
city/municipal offices. In total, there are 377 branch the State Administration for Industry and Commerce
offices across the country. of the People’s Republic of China (SAIC), and meets In other instances it seems the independent
successful third-party audit. towercos simply undercut CTC, as a function of
How is the financial performance of CTC? lower management costs. On still other occasions
A lot of smaller players are not on the platform for it seems that independent tower companies might
For the first half of 2016, CTC owed CNY ¥150bn one reason or another, but instead work through have better local site hunters, and are able to
(US$22bn), with a negative profit margin of 4.6%. those that are and act as sub-contractors; this type leverage relationships with MNO network planners
of partnership arrangement could provide a point of at provincial or municipality level to secure direct
Revenue for 2016 is estimated to be in the range of access into CTC as well for international vendors. orders.
CNY ¥60-64bn (US$8.9-9.5bn).
For further details, please refer to our article “What “CTC has a scale advantage from the legacy towers,
How and what does CTC buy? and how China Tower Corporate buys.” but no significant advantage when competing for
new BTS contracts,” said one interviewee.
The Tower Online Platform officially launched in Does CTC have some kind of right of first refusal
the summer of 2015, one year after the creation of to build new towers for the three State-owned “In some provinces the carriers are more open to
CTC. As of 5 September, 2016, there are 723 suppliers MNOs? new entrants as they don’t feel it’s in their interests
officially registered in the system, with 74% having to have a monopolistic towerco, whereas in other
been shortlisted and 58% having successfully Some sources told us that all build to suit (BTS) provinces CTC are more entrenched,” said another
received purchase orders; spending also reached CNY processes were supposed to be open. Other sources interviewee.
¥26bn. told us that the official structure of the Chinese
tower market is that the MNOs are no longer A Right of First Refusal type arrangement isn’t
The platform was created to increase supply chain building their own towers, and all the work is being necessarily the primary risk to the independent
transparency and efficiency, allowing CTC staff to see undertaken by CTC. While MNO builds have more sector’s organic growth potential. Rather it’s the
who made a purchase, from which manufacturer, at or less halted, the reality is that CTC currently lacks relationships and economics that may affect a
what costs, plus comments and ratings on product the capacity to meet 100% of MNO demand, which in towerco’s ability to survive and thrive. Towercos
quality, delivery, service, et cetera. a practical sense means in some cases third parties with good connections to local government and/
are contracted to build sites which are then are or operators will continue to secure projects and
It hosts 27 major supplier and five service categories, transferred to CTC’s balance sheet. tenants. From there it’s having the cash flow to
including the likes of tower, air conditioning, shelter, maintain day-to-day operations and financing to
battery, iDAS, engineering design, construction, and In other instances it seems that the independent continue building. New builds are now subject to
more. towerco steps in as a fallback option if CTC lacks the lease rate benchmarks set out by CTC, resulting
the capacity, or gets too bogged down in process, to in a more challenging environment compared to the
Suppliers can register on the platform for free, as meet MNO demands on time. “China’s private tower past.

Is it easy to get a new tower built? TowerXchange has encountered some independent
“
towercos with tenancy ratios in excess of 2.
While China’s citizens once welcomed towers
and coverage, radiophobia and NIMBYism (not in What is the typical capital outlay for a new tower
my back yard) now exist in China. To combat the in China?
former, CTC has relied on a more concerted and
In early 2017 CTC announced
integrated effort from the government, operators, that they had a tenancy ratio of Of course much depends on the nature of the
and media to propagate educational messaging
around radiation, comparing tower emissions to
common household appliances. One supplier has
also mentioned having to move fast in getting a
1.4 (expressed in China as 40%),
including a tenancy ratio of 1.7
on new build towers
“ structure, but the average seems to be in a CNY ¥250-
350,000 (US$37-51,800) range.
What would be the impact of consolidation from

tower up and/or disguising the tower as some other
three to two MNOs?
unrelated light pole or billboard. Towercos who
have good local government relations can often
Consolidation from three MNOs to two would
circumvent the issue also, as they are building with For example, the “Urban Flower” sits at 25m,
certainly lower the glass ceiling on prospective
their approval and support. can be integrated with lightning for the city and
tenancy ratios in China, and would be value
incorporate CTC’s logo and branding. It also has a
destructive to both CTC and independent towercos.
In general though the environment in China is 40m tower suited for stadiums, large public spaces,
conducive and favourable to tower building: there et cetera, that can be a landmark structure with LED
While there has been rumor of MNO consolidation,
is a mature steel and metal processing industry; lights at the top. There is also a more simple and
the government’s current strategy appears to be to
the grid is reliable and stable so downtime is sleek multi-purpose tower meant to be integrated
accelerate China Unicom and China Telecom’s 4G
insignificant, reducing opex; and the vendor with street lighting, sensors, data, and analysis.
rollout by providing access to China Mobile’s towers,
network is strong having supplied 1mn+ base
stations already. Fibre is also used for backhaul so Around two thirds of China’s sites are GBTs (Ground and in doing so start to even out the competitive
there is seldom need to accommodate microwave Based Towers – mostly monopoles), the other third imbalance.
dishes. are rooftops.
If the creation of CTC does not have the desired
What is the mix of GBTs versus rooftops in China, What are CTC’s tenancy ratios? effect in terms of competitive rebalancing, only then
and how has CTC affected tower design? would the issue of MNO consolidation return to the
In early 2017 CTC announced that they had a agenda.
CTC has standardised tower designs, reportedly tenancy ratio of 1.4 (expressed in China as 40%),
from 1,000 down to 155 (each design at different including a tenancy ratio of 1.7 on new build towers. The scope of a China Unicom-China Telecom merger
heights would represent one). CTC also made an would likely be limited to their wireless businesses,
effort to introduce designs of different aesthetics, In the independent sector, average tenancy given that a combined entity would have 80-90%
functions, and heights to suit various environments. ratio for towers are around 1.2 to 1.5, although share of the wireline market.

Are there any significant “non-traditional Telecommunications Infrastructure Co- It was also confirmed there is an escalator, “an
tenants” on China’s telecom towers? construction and Sharing Office” have the right inflation adjustment factor” which is common in
to define the pricing of lease rates? tower agreement contracts.
The usual mix of MVNO, enterprise industrial
communications equipment, traffic monitoring, No. In July 2016 CTC finalised its leasing and What type of co-sharing discounts are available
first responder networks and Wi-Fi equipment are pricing agreements with China Mobile, China for operators through CTC?
all prospective additional tenants. CTC has made Telecom, and China Unicom, which essentially
repeated mentions of business diversification and set the marketplace benchmark. The formula On new towers, a 20% discount will be applied for
innovation to include the likes of billboard ads, offers deeps discounts for co-location and covers sites shared by two lessees and a 30% discount for
sensors, weather monitoring, et cetera, so the acquired towers, newly constructed towers, indoor those shared among three lessees, with the first
opportunities are there given the size of its network. distribution systems, transmission products, and sole occupier (“anchor tenant”) benefitting from
service products. a further 5% discount. When it comes to site cost
Is there any prospect of active infrastructure and electricity, a co-sharing discount of 40% will be
sharing in China? This has put pressure on the independent towercos applied for two lessees and 50% for three lessees.
who can’t charge more than what CTC is charging, Again, the anchor tenant would enjoy an additional
The only infrastructure sharing agreement of scale especially for new towers, unless they are in highly 5% discount.
in China before CTC was China Telecom and China coveted locations. All pricing on previously signed
Unicom’s deep collaboration to improve economics contracts are still being honoured. For further details, please see our article “The
in low utilisation, remote areas. To date, the two implications of China Tower Corporation pricing.”
operators are said to be actively sharing 600,000 4G So while no government body or agency per se has
base stations and 14,500km of fibre transmission defined lease rates, CTC has markedly influenced What is the status of rural coverage in China?
network. industry pricing.
Despite the huge land area, rural coverage in
Regulation What is the pricing formula used by CTC? China may be better even than the US; even in
low population density areas of Tibet you will see
Are China’s independent towercos licensed? The formula to be used for “newly-added coverage signs.
telecommunications towers” is:
No, there is no licensing regime for towercos in How are tower companies taxed?
China, and no immediate prospect of a licensing Product price = base price × (1 – co-sharing discount
regime being introduced. One towerco recently rate 1) + (site cost + electricity input cost) × (1 – co- There was no reported special tax status for tower
confirmed this again based on notification from and sharing discount rate 2) companies in China.
communications with MIIT.
Base price = (standardised construction cost × (1 China fully implemented its VAT reform on 1 May
Does the Ministry of Industry and Information + impairment rate) + maintenance expense) × (1 + 2016 and replaced all business tax with the value-
Technology (MIIT), regulator or “National cost markup rate) useful lives of depreciation added tax (VAT).

The construction services sector’s new applicable “The MIIT, SASAC or the province vii. Sign exclusivity agreement with the third
VAT is 11% (general) and 3% (small-scale). telecommunication authorities will severely punish parties in the construction of telecommunications
the three basic telecom carriers, if the following infrastructure (including leasing)”
In terms of the sale and importation of goods, logistic behaviors were found. Basing on severity such
services, modern services, transportation, repair punishment could be recommended to upper Clause vii. above calls attention to the fact that
and processing services, asset leasing, the standard level unit to fire the related management. Such MNOs would appear to not have permission to
applicable rate is 17%, and 13% for some products. dismissed staff shall not be engaged within three sign exclusive agreements with third parties
years. (towercos), suggesting a degree of limitation on
State-owned enterprises have sometimes been deep build to suit partnerships.
affording special tax treatment, enabling them i. Without the approval of the provincial
to consolidate. There was no clear indication yet coordination agencies, construct towers and other Who owns the land under Chinese towers
whether this might apply to CTC. ancillary facilities, as well as IBS in public transport and on what basis is tenure granted to
and construction of buildings and other key areas infrastructure firms to build towers on that
Is document number 586 (2014) the latest land?
regulation governing co-construction and ii. Without the consent of the provincial
sharing? Is it now fully enforced? coordination agencies, refuse to open sharing when All land in China belongs to the government, but
the existing telecommunications infrastructure is “Land Use Rights” can be secured for a 15-year
This is the most recent document, and it has suitable for sharing term for industrial use, usually at a reasonable
been fully implemented. But document 586 is an cost. As renewal fees cannot be defined up front,
agreement not a regulation. It was proposed by iii. Without the approval of the provincial there is some exposure to risk of lease escalations
the MIIT and agreed with China’s three MNOs to coordination agencies, build parallel infrastructure when renewing after 15 years, but in general it
improve resource utilisation; reducing occupation was felt that escalations would be fair in a market
of land and improving the appearance of the iv. Independently build new infrastructure when where a State-owned Entity was dominant.
landscape. joint construction should be carried out
Above ground level, the telecom structures
A couple of excerpts from document 586 (please v. Violation of requirement of infrastructure themselves belonged to China’s MNOs and now
forgive any translation imperfections): sharing in key areas (key areas including key public belong to CTC, or they belong to the independent
“From January 1, 2015, in principle, the three basic transportation sites, key buildings, scenic parks and towerco.
telecom carriers shall no longer build towers and other places identified by local communications
other base facilities themselves, as well as IBS in administration, and inter-province key fiber Land lease fees could also differ from region to
subways, railways, highways, airports, railway cable construction, and the domestic extension of region, project by project. One towerco mentioned
stations and other public transportation key sites international transmission) not having to pay land fees in one city but paying
and large venues and multi-owner commercial by usage square footage in another. But this could
buildings, government office buildings and other key vi. Violate national standards on optical fiber “To- be more the case for street/highway projects,
sites.” Home” construction where lighting is incorporated into the tower.

China tower market end FY15 China tower market end FY16 China tower market forecast end FY17
20,000 45,000 80,000
1.3% 2.5% 4%
1,500,000 1,750,000 1,900,000

98.7% 97.5% 96.0%
CTC Independent Source: TowerXchange
How complete is the paperwork on China’s tower, the towerco would be compensated. In this with five to ten towercos in each of China’s 31
towers? particular case, the land belongs to the government, Provinces. There are currently 200+ towercos in
for public use. China.
It was widely acknowledged that not all the towers
in China, whether CTC or independently owned, had The permit follows, No. 40 of the Urban and Rural A lot of the independent towercos thrive on having
a complete set of licensing, permitting and leasing Planning Act, which grants construction rights. strong local government and/or operator relations,
paperwork. It appears to vary depending on the enabling them to build quicker than State-owned CTC.
local government and project. Independent tower market
At the end of 2014, China may have had as few as
We know of one region where the towerco has Who are the independent tower companies in 10-20 independent towercos owning ~5,000 towers.
a full set of papers stamped by the authorities, China? How much market share do they have? By the end of 2015, those numbers had increased
from meeting minutes with city planning officials How fast are they growing and what is the top to ~20,000 towers among as many as 200 towercos.
outlining project requirements, to construction end for their potential market share? Independent towercos built ~10% of China’s
permit, construction plan, et cetera. This was new towers in 2015, a proportion which bullish
described as “a tower’s most complete legal process With the exception of four or five towercos with commentators feel could reach 30% within a year.
and best protection.” This also means should the quadruple digit tower counts, China’s independent
government for whatever reason takes down a towerco market is highly fragmented and localised, It is axiomatic to say, but readers must be reminded

of the sheer scale of China; an independent tower One source suggested that Chinese towers with an a combined CNY ¥91.9bn (US$13.5bn) in cash. At
sector can still thrive even with less than 2% market average tenancy ratio of 1.5 were changing hands this phase, valuations were thought to be around
share. At the beginning of 2016 TowerXchange have for an average of CNY ¥450-500,000 each (US$65- CNY ¥214-230bn (US$32-34bn). In 2015 when China
spoken to a few bullish tower industry leaders who 70,000 each). Another source put the figure at CNY Reform Corporation injected cash for 6% share, this
feel the glass ceiling on the scale of the independent ¥700,000 (US$100,000) with a tenancy ratio of 2.0. A was valued around CNY ¥203bn (US$30bn). And now
tower sector in China could be as high as 20% within third source suggested a 51% stake in a portfolio of CTC is driving towards an IPO by the end of 2017,
five years – that could represent 400,000 towers, the several hundred towers with a tenancy ratio above reportedly with hopes to be valued at above CNY
equivalent scale of the entire tower market in the 2.0 had been acquired at a valuation again of CNY ¥270bn (US$40bn).
European Union! ¥700,000 (US$100,000) per tower.
All in all, while it may appear that the MNOs were
While there are independent towercos active in Guodong, which is probably China’s largest under-compensated for their towers, they also got
China’s largest cities, Shanghai, Beijing, Tianjin, independent tower company secured a CNY ¥700mn equity in CTC that can then be “cashed in” when the
Guangzhou and Shenzhen, perhaps the highest (US$100mn) investment reportedly at a high teens world’s largest towerco IPOs.
penetration of independent towers can be found valuation they were very proud of.
in Provincial capitals, tier two and tier three Is China Tower Corporation a potential buyer of
cities in some of which TowerXchange has heard The transfer of China Mobile, China Unicom and independent tower companies’ towers?
unconfirmed reports that independent towercos China Telecom’s towers to CTC reportedly yielded
have a market share significantly in excess of 50%. an average of just US$22,000 per site, significantly At one point CTC were believed to have made an
below replacement cost. But an asset transfer offer to acquire Chinese towers at ~US$80,000 each.
However, a reality check is required now that CTC between entities all fundamentally State-owned Whether that valuation is still current remains
is in the full swing of tower building and leasing (and owned by each other) is a poor valuation unclear, and whether such a valuation may be
(it’s only really been operational since 2015), and benchmark. The low acquisition cost reflects the attractive to current owners depends on tenancy
perhaps flexing its muscle a bit. There are some depreciation of an inventory of ten plus year old ratio, TCF, and uniqueness of location.
reports of negative consequences for MNO staff towers, towers which were built to gain market
that gave contracts to independent towercos, and share and with less of a view toward longevity and At this point however, multiple sources have
reports of delays in payments to towercos. But structural capacity, so significant improvement confirmed CTC has not acquired any independent
there are still opportunities for smart and strategic capex will be required. The low price point also towercos or their assets.
towercos. While major coverage projects will likely reflects the mixed bag of assets being transferred,
be concluded in the next three to five years and less inclusive of everything from substantial ground There has been much talk of monopoly since the
new macro towers will be needed, difficult sites based towers, a great many monopoles, rooftops, creation of CTC, though our sources believe the Party
will always exist and the independents have the and even small Wi-Fi offload sites. is keen to encourage competition, and currently
flexibility to get the job done. CTC and the independent sector co-exist to serve the
What’s important to note also is that China Telecom market place.
Are there any valuation benchmarks set by received only equity as part of the deal, while China
towerco financing or tower sales? Mobile and China Unicom received both equity and Chairman of the Board at CTC, and China Mobile
XX | TowerXchange Asia Dossier 2016 | www.towerxchange.com/meetups/meetup-asia www.towerxchange.com/meetups/meetup-asia | TowerXchange Asia Dossier 2016 | 113
executive, Liu Aili has also publicly acknowledged being taken on the independent tower sector, firms such as the Silk Road Fund and the Asian
the presence of independent towercos. “CTC is not appreciating the positive role of market forces in Infrastructure Investment Bank.
the exclusive provider of towers in China, there are setting a fair lease price, and appreciating that
200+ third-party companies building and operating the supplementary capacity and hunger of an We know of two independent Chinese towercos that
towers. Therefore CTC will be rejected by the market independent tower sector could accelerate the have been actively exploring the overseas market.
if it doesn’t deliver on low costs, good service, and achievement of the Ministry’s ultimate goals: For example, in October 2016, it was announced
competitive rental prices,” he said. to support efficient sharing of resources, and to Hong Kong-based Shining Star International
accelerate the rollout and adoption of 4G. Holdings Limited acquired Myanmar Infrastructure
While tower acquisitions are not completely out Group (MIG) for US$12.7mn. Shining Star’s business
of the picture, at this time, CTC is wholly focused “China is progressing and promoting spans real estate, hotel, tourism, education, property
on integrating assets and new builds to meet the entrepreneurship,” said one interviewee, with management, and more.
operator’s demands and prepare itself for an IPO in reference to the risk of asset seizure. “The China
2017. Dream as proposed by President Xi is built on an What are typical lease rates and terms in China?
open, competitive market.”
Is there a risk of State Nationalisation of Lease rates are a complicated formula based on
independent towers? Again, there has been public acknowledgement of height and weight of equipment, desirability of
the 200+ independent towercos and their role in location et cetera. At the beginning of year, most
Some sort of compulsory purchase order of building and operating towers, and providing value interviewees agreed that a range of CNY ¥4,500-
independently owned towers, at an unfavorable to the marketplace overall. 6,000 pcm was common (US$665-885). The lowest
valuation, or independent towercos simply we heard was CNY ¥3,500 pcm (US$515) in less
finding CTC building towers adjacent to theirs, Our sources also indicate that operators in some developed cities, rising to CNY ¥11,000 pcm in
is the Armageddon scenario for Chinese tower regions are quite friendly and favourable towards (US$1,625) on high rental cost sites in major cities.
entrepreneurs and their investors. independent towercos, as they are perceived to be
more efficient, provide faster service, and more However, the creation of CTC and the finalisation of
It must be acknowledged that nationalisation nimble in negotiating with local stakeholders. the pricing formula in July 2016 have put downward
of assets is a risk hanging over several thriving pressing pressure on the market.
independent tower markets in other nations. Is that Do China’s tower companies have much appetite
risk present in China? Yes. Did it seem like that was for International opportunities? On the independent side, rates are now between
a concern whilst the independent sector had a single CNY ¥2,300 pcm (US$340) to CNY ¥5,400 pcm
digit market share? No. China’s tower sector seems largely pre-occupied (US$800). Again, desirable and highly coveted sites
with their huge and changing domestic market. can still yield good rates. We were also told that
The impression TowerXchange got from the MIIT However, for the handful of Chinese towercos with the rate could also sometimes be higher if no one
was that, while their initial vision for CTC was appetite for opportunities overseas, capital may responds to an RFP.
to create a State-owned ‘natural monopoly’ to be accessed for opportunities within the ‘One Belt,
maximise efficiency, a pragmatic view was now One Road’ footprint through associated investment CTC lease rates are significantly lower than

anywhere else in the world, with estimates around U.S. versus China macro tower build economics
CNY ¥26,000 per tower on an annual basis or CNY
¥2,166 pcm (US$320). This figure is surprisingly low One tenant US Two tenants US One tenant China Two tenants China
and suggests a business model calibrated in favour of
Construction costs $275,000 - $44,000 -
the MNOs. Since the summer, another industry report
came out suggesting per tower leasing fee of around Tenant revenue $20,000 $50,000 $4,500 $7,200
CNY ¥3,900 pcm (US$575) for CTC in 2015, and CNY Opex $12,000 $13,000 $2,600 $3,000
¥3,000 pcm (US$445) for 2016.
Gross margin $8,000 $37,000 $1,900 $4,200
Like India, when additional tenants are added Gross margin % 40% 74% 42% 58%
to Chinese towers, existing tenants’ leases are
ROI 3% 13% 4.3% 9.5%
discounted.
Source: US illustration drawn from an American Tower presentation, June 2015; does not reflect any American Tower financial data.
China data from TowerXchange, based on our own research and reviewing the models of Goldman Sachs and others
Lease terms are typically 10+10 years.
MHz license and owns most of China’s broadcast companies in particular struggle with the fact that
Down payments for new sites have been reduced towers. TowerXchange have not yet been able to towers are not securable.
to a single year since the advent of CTC, adversely ascertain if these towers are offered for co-location
affecting independent towerco cash flows. by China’s MNOs. State and provincial level investment funds may not
be inclined to invest in entities which compete with
How do the economics of a single tower in China Investment State-owned CTC.
compare to the USA?
How can early stage towercos in China access Please explain the latest rules regarding foreign
See “U.S. versus China macro tower build economics.” capital? ownership of, or investment in, communications
Note that when an additional tenant is added, lease infrastructure?
rates are discounted for both the new and original China offers a challenging path to scale for local
tenant in China. This is not the case in the US. tower entrepreneurs. Raising debt from Provincial TowerXchange understand, but have been unable
financial institutions is complex, time consuming, to confirm, that passive infrastructure is not
We must emphasise that you must treat this table and expensive. While private, domestic investment considered a sensitive asset class, so FDI may be
with a pinch of sale – China data is averaged based on is gradually becoming more available to debt- possible into Chinese joint ventures, particularly
multiple sources but all sources are subjective. funded infrastructure firms with contracted long those in free trade areas, or through VIEs. We have
term cash flows, like towercos, Chinese capital heard unconfirmed reports of one foreign investor
Who owns China’s broadcast towers are MNOs co- markets have historically been predisposed to invest acquiring a 51% stake in a towerco.
locating on them too? only in profitable companies, at the expense of
business models like telecom towers that naturally An interested investor called attention to the
China Broadcasting and Media Group has the 700 lend themselves to a degree of leverage. Small tower VIE (Variable Interest Equity) structure, which

enables foreign investors to invest in sensitive the domestically listed entity, releasing capital at an stock exchange can only accept investment in CNY,
infrastructure, do investors still need to use this agreed exchange rate. meaning foreign investors would have to exit at the
or is more direct investment now permitted given time of listing, or setup a new entity. More recently
the recognition that passive infrastructure is less What are the potential exit strategies for it seems that qualified international investors can
sensitive? investors in Chinese towers? invest in companies listed on the Shanghai Stock
Exchange.
One TowerXchange source defined VIE as a As in any market, exit strategies tend to focus on
mechanism for foreign direct investment in China potential IPO or trade sale. There is one listed tower company on the Shenzhen
via an international holding company, a WOFE Stock Exchange, Beijing Miteno Communication
(Wholly Owned Foreign Enterprise), in which USD, CTC may be a prospective trade sale counterpart, Technology Company Limited (300038), with at least
EUR or other currency could be invested, which although management is very much focused on one planning to list in Shanghai in 2016. It should be
could be registered in the Caymans, Delaware et new builds and improving operations in its bid to
noted that there is approximately a two-year wait to
cetera, and which could be listed on the NASDAQ or IPO in Q42017. At least one of the Indonesian tower
list on the Shanghai Stock Exchange.
other international stock exchange. companies is believed to have an appetite to invest
in China, while TowerXchange has learned of two
While the Shanghai Stock Exchange opens access
The VIE structure was apparently first used in this domestic rollup plays.
primarily to domestic investors, a listing, or dual
sector over 20 years ago to facilitate investment in
listing, on the Hong Kong Stock Exchange offers
China Unicom, with subsequent VIE investments in Could a major international strategic investor be
more exposure to international liquidity and
Alibaba, Tencent and Baidu. interested in acquiring Chinese towers? Probably
an increased level of transparency with which
not at the current scale of the independent market,
international investors are more comfortable. Most
A critical question when leveraging a WOFE to where the largest independent towerco just hit five-
of China’s large infrastructure entities are listed in
invest in China is where the IP sits, at holding digits tower count this year. But if an independent
Hong Kong.
company or local subsidiary level? If the latter, towerco could build or rollup 30-50,000 towers,
international investors could be exposed to risk. they may attract interest from some of the more
acquisitive international towercos. Most stakeholders TowerXchange spoke to assumed
“A VIE would be a viable but suboptimal route to a better valuation would be achieved on the
investing in a Chinese tower company,” said one When considering exit through IPO, the perception Shanghai Stock Exchange (“the P/E multiple in
interviewee. “Yes you can do it, but it may adversely remains that Chinese companies need three years Shanghai might be 30-50x compared to 10x in Hong
affect valuation.” of profitable trading history to list as an A-share Kong”), but there are precedents where higher
on the Shanghai Stock Exchange. There was some valuations were realised in Hong Kong (e.g. in the
What would foreign investors options be to suggestion that unprofitable companies might soon insurance industry), while the current appetite
repatriate capital? be allowed to list, but apparently that potential of international investors for towers as an asset
reform will not take place imminently. class, and the valuation of natural comps, may also
In the event a foreign investor was seeking exit from contribute to a potential healthy valuation of a tower
a listing entity, they might seek to sell their equity to Some sources suggested that entities listed on that company on the Hong Kong stock.

Will it be possible to invest in CTC? Is there a
plan to list China Tower Corporation on the stock
market in future?
It’s been made clear that CTC is driving towards

an IPO by the end of 2017 as a means of repaying
China’s three MNOs the full value of injected legacy
assets.
Speculation continues as to whether CTC will

list domestically as an A-share or open up to
international investment through a Hong Kong
listing. The lease and pricing formula announcement
in July and subsequent estimates on lease rates that Source: China Tower Corporation
are much lower than expected may suggest a leaning China has one of the world’s most reliable electicity RMS is deployed on some, not all cell sites. CTC is
towards the A-share option. However at this time, it grids. Unlike most countries, its supply exceeds considering making RMS a National standard.
remains inconclusive. demand.
Who is responsible for site modernisation and air
One analyst suggested around 30% of the equity in What backup power solutions are typically on conditioning, towercos or MNOs?
CTC could be floated. cell sites? Are towercos or MNOs responsible for
them? CTC is responsible for shelters and air conditioning.
Power
Towercos provide backup battery banks, typically While most new sites are built with outdoor
Are power costs passed through from China with 4-8 hours float. Most batteries are lead-acid. equipment, few legacy sites have been modernised
Tower Corporation to the MNOs? There are very few backup DGs. with, for example, free cooling.
According to the finalised pricing formula in July CTC is also recycling the battery from electric Is there distributed renewal energy in China?
2016, electricity input cost is part of the “product vehicles for site usage. Compared to lead-acid
price,” aka lease rate to the operators. It is to be batteries, they are described as withstanding up to In September 2016 CTC reported having 10,177 solar
priced on a lump sum or itemised basis. 60 degrees Celsius versus 35 degrees, is half the size and wind generation sites across the country, with
and weight, and rechargeable up to no less than 500 annual capacity of 120mn kwH.
What proportion of the cell sites are on-grid, on times versus 300 times.
unreliable grids or off grid? There is also news that CTC has plans to deploy
Are remote monitoring systems typically solar on a large scale in line with the government’s
Almost all sites are on-grid. Multiple sources confirm deployed on cell sites? objectives in reducing carbon emissions

Asia News
Cambodia: edotco to serve as exclusive agents of
Xinwei
Summary of tower industry news across Asia edotco has consolidated their position as the leading
towerco in Cambodia by signing an exclusive agent
“The deployment of these wind turbines is part agreement with Chinese operator Xinwei, adding
of our proof of concepts in renewable energy. It over 500 towers to the 2,500 site portfolio edotco is
is an important step in our initiative to enable marketing for co-location in the country.
continuous connectivity through innovative
and sustainable means, while reducing carbon edotco has been providing co-location services to
footprint at the same time,” said Darryll Sinnappa, Xinwei since their launch in Cambodia in 2013.
Managing Director of edotco Bangladesh. “Initiated Xinwei previously had aspirations to start their
three months ago, the wind turbine project is now own towerco in the country, having acquired 1,000
producing an average of 12.11 kWh per day. We towers from Khmer Unified Network Communicate
intend to deploy wind turbines in all off-grid sites (KUNC) in December 2015.
in coastal areas, where the solution is feasible
subject to wind speed and towers structure. Plans China: China Tower Corporation reaches tenancy
ratio of 1.4
are afoot to deploy another ten wind turbines in
Bangladesh: edotco raising their stake in their
the year 2017.”
Bangladesh opco By the end of 2016 CTC’s portfolio grew to
approximately 1.7mn towers, representing roughly
Bangladesh: VimpelCom to bring Bangalink
The Bangladesh Telecommunications Regulatory 200,000 new builds in the last year. Recently CTC’s
towers back to market
Commission (BTRC) has approved Axiata’s plans to chairman of the board, Liu Aili (刘爱力) noted that
alter the shareholding structure of its operations in tower sharing on new towers is around 1.7, while
VimpelCom is preparing to bring their ~6,000
Bangladesh. Axiata’s towerco edotco will buy back in some areas, tenancy ratio is as high as 1.91. On
Bangalink towers back to market for sale and
31.01% of shares in edotco Bangladesh from sister average, since the formation of CTC in July 2014,
company Robi Axiata, which currently holds a 51% leaseback, as the tower industry steps up efforts tenancy ratio is 1.4 for all towers. Note tenancy ratio
stake in the tower unit. edotco will hold 80.01%, to lobby the BTRC for a more favorable licensing in China is often expressed in percentages, thus the
while Robi will retain 19.99%. environment. The Bangladeshi regulator had figures above were originally quoted as 70%, 91%
issued a draft tower license framework which and 40% respectively.
Bangladesh: edotco installs two wind turbines would both restrict foreign direct investment,
and limit the market to two towercos, moves that China: China Tower Corporation issues tenders
edotco Bangladesh has installed two wind turbines would suppress interest in the Bangalink towers
at Shah Porir Dwip of Teknaf and Cox’s Bazar while hindering the operations of edotco, which Through its Tower Online Platform, CTC has
to support the need for power in remote coastal operates just under 8,000 of Bangladesh’s ~30,000 posted notice for the fifth round of tower products,
regions of Bangladesh. towers. including monopole and non-monopole, with

a submission timeline between 8 January to 13 announced a partnership with Baidu on mobile India: RCOM and Aircel merge
January, 2017. Similarly, the second round of tender internet, artificial intelligence, and more.
for shelter products is open from 6 January to 16 The merger between Reliance Communications
January. In addition, CTC has also posted tenders China: Goldman Sachs values China Tower (RCOM) and Aircel has created a US$5bn 50-50
for various products and services across provinces Corporation at 10x joint venture, with RCOM’s previous consolidation
on another website, seeking contractors for target MTS (Sistema) retaining a minority stake in
everything from site identification and evaluation, China Tower Corporation’s (CTC) revenue by year- RCCOM. The merged entity will hold just under 20%
to site power connection, and remote monitoring end 2016 is projected to be CNY ¥60.6bn, growing to of India’s allocated spectrum, will have just under
services. CNY ¥71.8bn in the next year, according to a report 200mn customers, and around 10% revenue share
released by Goldman Sachs Global Investment of the mobile market. The deal will help RCOM cut
China: MNOs need independent towercos to Research in September. The firm believes despite its debt by more than 40% (US$3bn).
fulfill demand a loss in 2Q2016 due to interest expense, CTC’s
EBITDA margin is robust and will reach 52% at the India: Anil Ambani describes RCOM and Reliance
All three Chinese MNOs put out orders to the end of 2016, and 55% in 2017. “In line with Chinese
Jio ‘virtual merged’
independent towercos in January 2017 as CTC telco stocks’ 30% discount to global peers, we
remains unable to keep up with build demand. applied a 30% discount to global towers’ 2017E EV/
Reliance Communications Chairman Anil Ambani
EBITDA of 14.1X to arrive at 10X 2017E EV/EBITDA
said his Reliance Communications (RCOM) has
China: Mixed-ownership reform pilot involving as our valuation metric for China Tower,” said the
achieved a “virtual merger” with his brother
China Unicom parent company pending approval report.
Mukesh Ambani’s Reliance Jio. With RCOM also
merging with Aircel, the combined entity will be
China United Network, the parent company of India: Brookfield to acquire majority stake in
among the top operators in 12 circles and will pass
China Unicom has been selected by the National Reliance Infratel, now named Towercom
the one million mark in terms of 4G subscribers.
Development and Reform Commission to
participate in a mixed-ownership reform pilot. Five After many years of rumoured sale, Reliance
other State-owned enterprises were also chosen. Communications (RCOM), India’s #4 MNO, has India: Rumours of Idea Cellular-Vodafone India
Industry analysts believe this could inject new signed a binding agreement with serial tower merger
domestic strategic investors into the organization investors Brookfield for the sale of ~45,000
and thereby reduce some state ownership. Internet- towers and related infrastructure for Rs 110bn Idea Cellular have denied rumours voiced by CNBC-
related and private enterprises such as Baidu, (US$1.64bn). The deal is to be structured to create TV18 that India’s #3 operator is exploring a merger
Alibaba, and Tencent were suggested as potential to an SPV named Towercom, in which Brookfield with #2 Vodafone. While a merged entity would
candidates. Another iteration of the reform could would own 51% and RCOM 49%. breach 50% market share limits in several circles,
be stock-based compensation to better incentivise and may be compelled to return some spectrum to
management and employees. There is also potential In December 2015 RCOM signed a non-binding government, Morgan Stanley analysts suggested that
in giving management more autonomy, though agreement with Tillman Global Holdings, backed the merger would could make the industry would
control would be expected to remain in the hands by TPG, but the deal fell apart when due diligence become even more competitive in the long term,
of the State. In the mean time, China Unicom also revealed a substantial valuation gap. enabling the restructuring of costs.

While towercos are generally bullish about MNO the Channai Networks sites, the portfolio could be “India has been the most preferred destination for
consolidation putting more spectrum into the of interest to RCOM, and their towerco subsidiary investment in the tower sector in the Asia. Since
hands of MNOs with capital to invest in their Towercom (formerly Reliance Infratel). 2008, seven out of the top 20 deals in Asia in tower
network, the consolidation of #2 and #3 MNOs sector have originated in India,” Sunil Kanoria
could put a significant number of tenancies at India: Reliance Jio signs 25,000 tenancies President ASSOCHAM said.
risk when the lease agreements wound down.
However, this risk would be somewhat mitigated The Economic Times reports that Reliance Jio has India: Bharti Infratel net profit up 31% year on
by the rational sharing environment already taken 14,000 tenancies with Indus Towers, securing year in Q216
existant between Idea and Vodafone, which are a 1% discount on leases where Jio is the second
both partners in Indus Towers. tenant, 5,000 towers with American Tower, securing Benchmark listed Indian towerco Bharti Infratel’s
a 12.5% rebate when using currently vacant towers, Q216 consolidated revenues grew 8% YOY, while
India: GTL seeks to restructure its balance and 6,000 tenancies with GTL. EBITDA rose 10% to Rs 1,454 crores, representing
sheet an operating margin of 44%. Bharti Infratel’s tower
count rose to 89,791, inclusive of their 42% share in
Lenders to GTL Infrastructure, which owns almost India: Reliance Jio intends to build a further Indus Towers, while their tenancy ratio reached 2.21.
30,000 towers in India, have accepted a proposal 45,000 towers to support their 4G rollout Tenancy ratio growth was described by analysts as
to convert some part of the towerco’s debt into “muted”, reflecting that initial 4G rollout was being
equity under the Reserve Bank of India’s (RBI’s) Reliance Jio has bucked the trend in India of facilitated by “loading” (adding 4G equipment to
strategic debt restructuring scheme, which allows contracting towercos to build new sites, opting existing 2G and 3G towers), rather than through the
lenders to a company to pick up a controlling stake instead to build 25,000 of their own towers, many of addition of tenancies on new towers.
by converting a part of the debt owed to them which are lightweight, single tenant monopoles for
into equity. This in turn may facilitate the exit infill. According to news agency PTI, the operator During the quarter, Bharti Infratel completed a share
of GTL Founder, Manoj Tirodkar, who is seeking has since told the Telecom Minister that it intends to buyback for Rs 2,000 crores, while a consortium led
to restructure the balance sheet of GTL Ltd. GTL install a further 45,000 new towers. by the company was awarded the Bhopal Smart City
Infrastructure owns almost 30,000 towers in India project.
but has a value less than 10% of the value realised India: ASSOCHAM forecasts tenancy ratios in
when Viom Networks (42,200 towers) was sold to India to reach 2.9 by 2020 India: Larsen & Toubro to implement Nagpur
American Tower. smart city project
A KPMG study commissioned by the Associated
TowerXchange understands that in order to Chambers of Commerce India (Assocham) forecasts Larsen & Toubro subsidiary Smart World and
facilitate a sale, GTL Infrastructure may be split that the average tenancy ratio on India’s towers is Communication will lay 1,200km of fibre, sett
into high value and distressed assets, with most expected to increase from 1.95 in March 2015 to up 136 Wi-Fi hotspots, and establish 100 digital
of the value contained within subsidiary Chennai 2.9 by March 2020, driven by mobile broadband interactive kiosks while developing surveillance
Networks, which holds the ~17,500 towers rollout. Net tower additions were significantly systems. “After Jaipur, this is the most significant
acquired from Aircel in 2010 for US$1.8bn. With higher in 2014-15, at about 6,300, compared to 3,200 step in the country’s journey towards establishing
Aircel representing the lion’s share of revenue on in 2013-14. smart cities and we are delighted to be participating

in transforming Nagpur into one,” said SN Blackstone, KKR, the Canadian Pension Plan “We are open to discussions with any potential
Subrahmanyan, Deputy Managing Director and Investment Board and Brookfield have all been sellers,” American Tower Chairman and CEO
President, Larsen & Toubro. linked with the opportunity in the Economic Times, James Taiclet told the Economic Times. American
which suggests as much of 40% of equity could be Tower recently completed the acquisition of a 51%
India: BSNL complete world’s largest solar tower up for grabs, valued at around US$4bn. Investors controlling stake in Viom Networks, expanding their
installation ahead of schedule will also be interested in using Bharti Infratel as a Indian tower count to 57,987.
means of accessing India’s largest towerco Indus
Key partners VNL and HFCL have helped BSNL In the same interview Taiclet explained that tower
Towers, in which Bharti Infratel owns a 42% stake.
complete installation of 2,199 solar powered towers valuations in India were typically lower than
across ten Indian states. The project, which was worldwide (11-12x compared to 19-20x worldwide)
India: Idea Cellular seeks to divest stakes in
part of efforts to strengthen security mechanism because of the differing contract structure in India.
Indus Towers and in its captive towerco
to combat left wing extremist insurgents, was For example, in India existing tenants benefit from
conceived of by the Department of Telecom and discounted lease rates when a new tenant is added,
funded by the USOF. Idea Cellular is reportedly seeking to raise US$2.2-
while “loading” is subject to only a relatively small
2.7bn by monetising both its captive towerco and
fee – “amendment revenue”, which is essentially the
India: BSNL investing US$375mn in 20,000 new its stake in Indus Towers. The Economic Times
equivalent in the U.S., can add the value of another
base stations reports that BAML has been mandated to find a
tenancy to a U.S. contract.
buyer. Infrastructure Services Limited (ICISL) is a
BSNL’s US$375mn infrastructure expansion 100% owned subsidiary of Idea Cellular. The captive
India: Delhi’s dispute with the tower industry to
programme is targeting the installation of 20,000 towerco reportedly owns anything from 9,600 to
be resolved by mediation
new base transceiver stations with a view to 11,000 towers. Idea also owns 16% of Indus Towers
improving service quality. The majority of the through Aditya Birla Telecom Limited (ABTL), which
The ugly battle between Delhi’s three municipal
sites will be installed in the second half of BSNL’s in turn is 16-30% (reports vary) owned by serial
financial year. corporations and India’s towercos and MNOs will
tower investors Providence Equity.
have to be settled by mediation. Tower industry
India: Leading infrastructure investors stakeholders accused the municipalities of hiking
In related news, VC Circle reports that Providence installation fees 5x, while the municipalities claim
interested in stake in Bharti Infratel
Equity is seeking to swap it’s holding in ABTL for a the 4,668 new sites installed since (more than half
direct stake in Indus Towers. Delhi’s fleet) have are illegal – and almost 1,000 sites
Bharti Airtel is exploring the sale of a significant
stake in their towerco Bharti Infratel, which is have been sealed, exacerbating quality of service
currently 72% owned by the operator, with the India: American Tower interested in more challenges in the city.
balance held by public shareholders. In a statement acquisitions in India
to the Bombay stock exchange, Bharti Airtel had India: Indian tower industry gets a ‘shot clock’
said: “the board of directors at its meeting held on With tens of thousands of Indian towers still
October 25 has authorized a committee of directors potentially up for grabs in M&A, American Tower India’s telecom department will issue a new set of
to evaluate options for monetization of a significant still has an appetite to supplement their footprint in rights of way rules on November 15 2016, providing
stake in Infratel.” the country. a framework for settling permitting disputes in a

time-bound manner. The framework resembles Axiata plans to retain a majority stake for the to achieve the government’s target of 95% broadband
the ‘shot clock’ (named after the time limit to shoot foreseeable future. The deal means edotco is unlikely penetration by 2020.
in basketball) which was credited with easing to IPO before 2018-19. At the Q416, edotco owned
permitting and build in the U.S. 17,054 towers, and managed over 8,100 more, across “Although this is an ambitious target, with hard
five Asia countries. The cash injection will be used to work and continuous strong support from the state
In India MNOs or towercos will pay a one time both bring Axiata debts below 2.5x, and to support government we are confident of delivering this
administrative fee of Rs 10,000 to apply for a site M&A by edotco. objective,” said Deputy Chairman Datuk Syed Ahmad
(Rs 1,000 per kilometre of fibre). If the request Alwee Alsree in The Borneo Post, while revealing
originates with a local authority, a 30 day limit is Malaysia: edotco plans to add 10,000 towers in 3-5 that he hoped half the money for the network
applied for submission of the plan, with a 90 day years investment would come from government, half from
limit for the completion of works. If the authority Sacofa.
fails to respond within 60 days, permission will be edotco plans to scale to over 25,000 towers through
deemed granted. organic and inorganic growth as Axiata drives the Myanmar: New CEO to lead MPT-KGSM joint
business toward an IPO, which could take place in venture
Indonesia: Tower Bersama to buyback US$115mn 2018.
in shares Toshitake Amamiya has been named as the new
Malaysia: edotco to provide 25 LoRa network sites CEO for MPT-KGSM, replacing Takashi Nagashima
Indonesia’s second largest towerco Tower Bersama to support IoT who led the business since its formation in July
has commenced a share buyback. “The company 2014. Amamiya was most recently managing KDDI’s
can execute the buyback using internal funds,” said edotco will provide 25 sites for low-power, long- business clients’ portfolios worldwide and has held
finance director Helmy Yusman Santoso. Santoso range wireless protocol (LoRa) networks in executive roles across various units and countries,
added that the move would erase the treasury Malaysia’s Klang Valley, supporting Axiata and including being the CEO of the Advanced Business
stock, making the company;s capital structure more Atilze’s IoT services. “The efficiencies and seamless Development Division and the General Manager of
efficient. connectivity that can be achieved by leveraging Consumer Business Strategy Division between 2005
our wide infrastructure coverage and regional and 2016 with the organisation in Japan. Amamiya
Malaysia: edotco secures record US$600mn footprint will enable breakthrough applications to be also spent over seven years in South America,
investment implemented,” said edotco’s Wan Zainal Adileen Wan overseeing the operations of wireless network
Puteh. operator Hola Paraguay S.A., which KDDI previously
Axiata and it’s subsidiary edotco announced a had part-ownership of, as its COO from 1998 to 2004.
record US$600mn primary and secondary equity Malaysia: Sacofa calls for RM1bn investment to
private placement deal with Innovation Network of help Sarawak achieve 95% broadband penetration Myanmar: License formally awarded to
Japan (INCJ) and sovereign wealth fund Khazanah. Myanmar’s fourth telco; no launch until 2018
Under the transaction transaction, which attracted State-backed towerco Sacofa, which has 1,000 towers
substantial interest, INCJ secured an undisclosed and 10,000km of fibre in Sarawak, has called for The Ministry of Transport and Communication
number of primary shares for US$400mn, while RM1bn (US$225mn) to be invested into the State’s in Myanmar formally awarded a license to the
Khazanah secured secondary shares for US$200mn. infrastructure to progress from current levels of 53% country’s fourth operator on 12 January. Led by

Vietnam-based Viettel, a consortium of 11 local sports, and tourism businesses in China, Myanmar, October came and went without much fanfare for
companies, plus a subsidiary of military-run and south-east Asia in general. the operators. Telenor and MPT initially showed
Myanmar Economic Corporation called Star High interest, but at the end withdrew their applications.
Public Company, the new firm goes by Myanmar Myanmar: Incumbent fourth operator Viettel to Ooredoo never applied in the first place as it was
National Tele & Communications (MNTC). The invest up to $2bn over five years waiting for the 1800MHz auction, expected to take
brand name under which the telco will offer its place in the first quarter of 2017. All three MNOs
services remain unknown. It is reported that while Tower and tenancy growth are on the horizon in
are looking to expand their coverage via the lower
SIM cards could be issued later in the year, services Myanmar as Vietnam’s Viettel will enter the market
frequencies.
would not be launched until 2018. MNTC paid as the fourth operator through a consortium.
$300mn for the license, which has a 15-year term. Licensing is still underway, with completion
Myanmar: Data services key to Telenor’s future
expected at the end of 2016 and operations
business growth
Myanmar: OCK orders 80 eSites from beginning early 2017. Viettel is said to own a 49%
Flexenclosure for Myanmar stake in the venture, with 23% belonging to a
consortium of 11 local companies, and 28% by Star Telenor Myanmar will shift to focus on growing
Myanmar’s newest towerco OCK has ordered 80 High Public, which is backed by Myanmar Economic its data services with existing customers as “super
eSites from Flexenclosure, which already has Corporation (MEC). hyper growth has flattened,” said CEO Lars Erik
installed over 1,200 eSites in the country for two Tellmann in an interview with Reuters. Telenor is
other towercos. The eSites are fully integrated Myanmar: 4G services now offered by all three currently the number two MNO in the country with
hybrid power systems, complete with batteries operators 18 million subscribers. The company has a network
and gensets. Flexenclosure has full turnkey of 6,800 towers, with plans for an additional 3,200
responsibility for system manufacturing, supply, State-owned Myanmar Post and by the end of 2018.
delivery, installation and final commissioning. Telecommunications (MPT) began a soft launch of
Telenor is the anchor tenant on OCK’s sites. 4G LTE service in October, available in six locations Myanmar: Yoma sells 12.5% stake in edotco for
in Yangon and two in Nay Pyi Taw. Out of the three US$35mn
Myanmar: MIG sells for US$12.7mn to Hong operators in the country, MPT was the last to the
Kong’s Shining Star International game, with Ooredoo leading the pack in May and
Axiata Group Berhard, the Malaysia-based operator
Telenor following closely in July. MPT, with backing
and parent company of edotco, has excersied a
After months of speculation, it was formally from Japan’s KDDI has indicated it plans to invest
call option to increase its stake in Myanmar from
announced in October that Singapore Myanmar US$2bn over the next ten years to further extend
75% to 87.5%. The additional 12.5% stake was
Investco (SMI) sold all of its shares in Myanmar its network across the country and provide high-
Infrastructure Group (MIG) to Hong Kong-based quality services. purchased for US$35mn from Yoma Strategic
Shining Star International Limited Corporation. The Holding Ltd., who will retain the remaining
deal is reportedly around US$12.7mn. The Shining Myanmar: Operators looking to bid on 1800MHz 12.5% interest in edotco Myanmar. “Our original
Star Group is a well-established group within China/ spectrum auction in 2017 investment of US$20 million has now grown to
Hong Kong, focusing primarily on real estate, hotel US$70 million, of which half is being sold,” said
and property management, education, healthcare, Myanmar’s 2600MHz spectrum auction on 17 Melvyn Pun, Chief Executive at Yoma, as quoted in

Singapore’s The Strait Times. The transaction was
reported in early November.
Thailand: TOT tower joint venture with AIS may

See you at our future events!
be back on
State owned operator and concession-holder TOT

has resumed consideration of setting up a tower
joint venture with Advanced Info Service (AIS) as
Meetup Meet up
Europe 2017
the two companies seek to settle their build-operate-
transfer concession dispute under which TOT
claims AIS’s 2G towers were due to be handed over
Americas 2017
last year. The mooted plan would reportedly put
5,000 TOT and 13,000 AIS towers into a joint venture 4-5 April, 7-8 June,
newco, in which AIS would own a slightly larger London Boca Raton
stake.
Vietnam: OCK remain confident of closing

delayed SEATH acquisition
Current owners VNI have delayed the US$50mn

sale of 100% of Southeast Asia Telecommunications
Holdings (SEATH) to OCK, a managed service
Meetup Africa Meetup Asia
provider-turned towerco. The three subsidiaries
of SEATH own a combined 1,938 towers, making it & ME 2017 2017
Vietnam’s largest independent towerco. Originally
targeted to close in October, regulatory complexities 3-4 October, 12-13 December,
mean the acquisition is now expected to close in
December. Johannesburg Singapore
OCK is targeting reaching a total of 3,000 towers
across the ASEAN region by end of 2016, including
the company’s presence in Malaysia, launch
in Myanmar and acquisition in Vietnam. The www.towerxchange.com
acquisition will be funded by cash in hand and
bank debt, OCK said

Tower Xchange
Industry Awards 2016 Winners

For over four years TowerXchange have been tracking and covering excellence in telecom towers – from landmark tower transactions
and the formation and growth of new tower companies to improving the uptime on sites through the adoption of improved processes and
technologies.
To recognise such achievements, we were pleased to announce our inaugural industry awards, presented at this year’s TowerXchange
Meetup Africa & Middle East. Over 50 nominations were received for the eight categories set in this year’s awards with a special lifetime
achievement award also being presented.
MNO passive infrastructure team of the year Tower transaction of the year
Shah Faisal Safdar Khattak, Manager, Network Sharing, Telenor Pakistan Gulfraz Quyyum, Head of Telecoms, MEA, Citi
Winner: Telenor Pakistan Winner: IHS Towers – MTN Nigeria, advised by Citi
Judges comments: Telenor Pakistan have pioneered RANsharing and promoted Judges comments: IHS leveraged an innovative deal structure to close the
passive site sharing, saving US$1.6mn, and fibre sharing, saving US$5mn per largest, most impactful tower transaction in the history of African towers
year while maintaining 99% network availability
Highly commended: IHS Towers – HTN Towers
Highly commended: Indosat Ooredoo Highly commended: IHS Towers – Hotspot Network Ltd
Highly commended: Vodacom South Africa in conjunction with Vodafone Highly commended: Helios Towers Africa – Airtel (DRC)
Procurement Company Highly commended: OPIC investment into Apollo Towers Myanmar
124 | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 125

Most innovative towerco of the year Operational efficiency solution of the year (non-energy)
Hossein Khodayari, CEO, Fanasia
Joint winner: Fanasia

Judges comments: Fanasia have developed a landmark
decommissioning and revenue sharing business model in Iran
Joint winner: FPS Towers

Judges comments: FPS Towers have pioneered the professionalisation
of alternative site typologies in France
Highly commended: IHS Towers

Highly commended: Towershare
William John Turner, Manager, Strategic Technologies, Vodacom
BTS towerco of the year Winner: Vodacom Drone Site Survey Project
Judges comments: A commendable focus on HSE led Vodacom to research develop
and rollout pioneering drone site surveys, eliminating the need for physical site
climbing and accelerating site surveys
Highly commended:Towershare’s Asset Management Platform

Highly commended: Helios Tower Tanzania’s Operational Excellence programme
Highly commended: Netis Ghana
Highly commended: Infozech’s Remote Operating Centre
Nathan Foster, Managing Director, Atlas Tower
Highly commended: Siterra, an Accruent Product
Winner: Atlas Tower Highly commended: Sagemcom
Judges comments: Atlas Tower have achieved an impressive organic Highly commended: Acsys
growth rate unsurpassed anywhere in sub-Saharan Africa Highly commended:: Tarantula

Green initiative of the year
Huawei’s energy team Rocco Incardona, Area Manager, Ascot Industrial
Joint winner: Huawei’s combined solar energy, high efficiency converter and unique cooling system
Judges comments: Huawei have designed an holistic approach to energy efficiency combining modular renewables, a 98% efficient rectifier and enhance
cooling systems
Joint winner: Ascot and IHS Towers’ replacement of 2400 diesel generators with solar-hybrid systems
Judges comments: Ascot have replaced diesel generators running 23/7 at 2400 IHS sites with solar hybrid units yielding a 76% reduction in carbon emissions
Joint winner: Bharti Infratel’s Zero Emission Network

Judges comments: Bharti Infratel have run a landmark energy efficiency initiative greening 38% of their portfolio of 33,750 sites
Highly commended: IPS’s EXERON system to reduce diesel usage

Highly commended: Apollo Solar, Camusat and Orange’s 100% solar solution
Highly commended: Towerco of Madagascar and WIND-IT combine solar PV and wind
Highly commended: Emerson Network Power’s solar hybrid solution in East Africa

Excellence in procurement Lifetime achievement award
Edward van Kuijk, Director Global SCM Sales & Marketing,

Vodafone Procurement Company
Winner: Vodafone Procurement Company

SCM Sales & Marketing, Vodafone Procurement Company
Judges comments: Vodafone Procurement Company unlocks the expertise

and experience of Vodafone’s collective supply chain management wisdom
Chuck Green, Executive Chairman, Helios Towers Africa
with an holistic set of services tailored to meet the needs of towercos
Chuck Green, Executive Chairman, Helios Towers Africa
Site upgrade project of the year
TowerXchange’s comments: The lifetime achievement award was presented
to someone without whom there would be no African tower industry -
and no TowerXchange! Chuck has been a visionary and spokesperson for
the tower industry since it’s inception, and we are proud to recognise his
unique contribution.
Our congratulations to all of the winners and shortlisted entries in the

inaugural TowerXchange Industry Awards. The calibre of the entrants
speaks volumes as to all the hard work that operators, towercos and
Winner: Indosat Ooredoo Jaguar Project in Java the supply chain are doing to improve the management of passive
Judges comments: Upgrading 3000 sites, Indosat Ooredoo’s Jaguar Project infrastructure in an industry whose margins are being increasingly
(Radio Access Modernisation) undertook extensive tower strengthening and squeezed. We would like to thank all of our entrants and judges for the
ground rectification in record time contributions to the awards!

INVITATION
INVITATION
Saturday 18th of March 2017 – Eiffel Tower – 4 pm
Saturday 18th of March 2017 – Eiffel Tower – 4 pm
FPSTOWERCO
FPS TOWERCOCHALLENGE
CHALLENGE
Asofficial
As officialpartner
partnerof of
thethe Verticale
Verticale de lade la Tour
Tour Eiffel®,
Eiffel®,
FPS
FPSTowers
Towersinvites
invitesyouyou
to the second
to the FPS TowerCo's
second FPS TowerCo's
Challenge
Challengestarting
startingat at
4 pm
4 pm Saturday
on on the 18
Saturday the of
th
18March 2017 2017
th of March
in theEiffel
in the EiffelTower.
Tower.This event
This eventorganized within
organized the Partners
within the Partners
Race will bring together 20 participants, each representing a
Race will bring together 20 participants, each representing a
Tower Company.
Tower Company.
A cocktail will be served after the race on the top floor of the
A cocktail will be Paris
Hotel Pullman served after
Eiffel the race
Tower, whereonrunners
the topand
floor of the
Hotel will
supporters Pullman
share Paris Eiffel Tower,
their emotions wherethe
and reward runners and
winners.
supporters will share their emotions and reward the winners.
Please register now by contacting Gautier Verrier

at (+33)146164924 / verticale.paris@fpstowers.fr
Please register now by contacting Gautier Verrier
at (+33)146164924 / verticale.paris@fpstowers.fr
Crédit photo: ©EcoTrail_Organisation

Global coverage:
Global features
We follow the famous towerco league table with a comparison of
international towerco business models against the ‘original’ U.S.
blue print, concluding that “all towercos are not created equal”.
We study the rise of the operator-led towerco and speculate

about the reasons for the cancelled Telxius IPO. The value of any
towerco is captured in it’s contracts, a topic addressed by the team
at Vinson & Elkins.
We report on two critical presentations from the recent

TowerXchange Meetup Asia: edotco CEO Suresh Sidhu on how
towercos should navigate emerging headwinds, while Energize
the Chain appeal to towercos and MNOs to co-locate vaccine
fridges at their cell sites.
We conclude with our cover story drawing on insights from

Ericsson, Arqiva, Analysys Mason, ExteNet Systems and 4Site to
consider new site typologies and business models for 5G.
Don’t miss:
131 Towerco league table
136 All towercos ≠
145 The rise of the operator-led towerco
151 Why the Telxius IPO was cancelled
155 How to structure MLAs and SLAs
158 How towercos should navigate headwinds
161 Your towers can save lives
165 5G and small cells special feature

TowerXchange now tracks 249 towercos and infracos who between them
own 68% of the world’s 4,041,789 investible towers and rooftops
Rank Towerco Count Country count/countries Updated Rank Towerco Count Country count/countries Updated
1 China Tower Company 1,700,000 1 - China Q416 15 RTRS 16,000 1- Russia Q116
2 American Tower* 146,380 14 - Brazil, Chile, Colombia, Costa Q416 16 Protelindo 15,167 1- Indonesia Q316
Rica, Germany, Ghana, India,
17 Guodong 15,000 1 - China Q416
Mexico, Nigeria, Peru, South
Africa, Tanzania, Uganda, USA 18 Telesites 14,924 2 - Costa Rica, Mexico Q316
3 Indus Towers 120,739 1 - India Q216 19 First Tower Company 14,000 1- Russia Q116
4 Towercom 45,000 1 - India Q416 20 NetWorkS! 13,000 1 - Poland Q116
(formerly Reliance Infratel) 21 DIF 12,183 1- Thailand Q215
5 Crown Castle 40,085 1 - USA Q116 22 CTIL 12,000 1- UK Q116
6 Bharti Infratel 38,642 1 - India Q216 22 MBNL 12,000 1 - UK Q116
7 Deutsche Funkturm 31,636 1 - Germany Q116 24 Tower Bersama 11,553 1- Indonesia Q316
GTL Infrastructure 27,839 1 - India Q115 25 INWIT 11,200 1- Italy Q116

8
11 - Brazil, Canada, Chile, 26 Idea Cellular 11,000 1- India Q416
9 SBA Communications 26,711 Colombia, Costa Rica, Ecuador, El
Q316
Salvador, Guatemala, Nicaragua, Infrastructure Services
Panama, USA
IHS Towers 22,961 5- Cameroon, Ivory Coast, Q416 27 Arqiva 10,550 1- UK Q215
10
Nigeria, Rwanda, Zambia 28 National Tower Company 10,400 1- Russia Q116
29 Global Tower / UkrTower 8,681 2 - Turkey, Ukraine Q116

11 STC-Mobily joint venture 22,000 1 - Saudi Arabia Q316
30 Tower Vision 8,400 1- India Q314
12 edotco 17,054 6 - Bangladesh, Cambodia, Q316
Malaysia, Myanmar, Pakistan,
Sri Lanka 31 Mitratel 8,000 1- Indonesia Q316
32 TDF 7,398 1- France Q216

13 Cellnex 16,903 5 - France, Italy, Q416
Netherlands, Spain, UK 33 Victus Networks 7,000 1- Greece Q116
34 STP 6,938 1 - Indonesia Q215

14 Telxius 16,233 5- Brazil, Chile, Germany, Q116
Peru, Spain 35 Helios Towers Africa 6,556 4- Congo B, DRC, Ghana, Tanzania Q316
*American Tower count includes announced but not yet closed acquisition of 1,350 towers in Tanzania

36 Grupo TorreSur 6,500 1 - Brazil Q116 63 InSite Wireless Group 1,500 5 - Australia, Canada, Puerto Q316
37 MTS Towers 5,500 1 - Russia Q116 Rico, US Virgin Islands, USA
38 AT&T Towers 5,281 1- USA Q216 64 Varsity Wireless 1,286 1 - USA Q116
39 Ascend Telecom 5,200 1- India Q316 65 Pan Asia Majestic Eagle 1,250 1 - Myanmar Q116
40 Eaton Towers 5,000 5 - Burkina Faso, Ghana, Q416 66 Cell Site Solutions 1,203 1 - Brazil Q315
Kenya, Niger, Uganda 67 Torres Unidas 1,080 3 - Chile, Colombia, Peru Q115
41 CETIN 4,800 1- Czech Republic Q116 68 Persada Sokka Tama 1,012 1 - Indonesia Q415
42 Balitower 4,510 1- Indonesia Q316 69 Komet Infra Nusantara (KIN) 1,000 1 - Indonesia Q415
43 Miteno 4,500 1- China Q316 69 Sacofa 1,000 1 - Malaysia Q414
44 US Cellular Towers 4,207 1- USA Q116 71 QMC Telecom 901 4 - Brazil, Colombia, Mexico, Puerto Rico Q315
45 Vertical Bridge 3,700 1- USA Q116 72 Open Tower Company 860 1 - Netherlands Q116
46 IBS Tower 3,423 1 - Indonesia Q416 73 České Radiokomunikace 800 1 - Czech Republic Q414
47 EI Towers 3,200 1- Italy Q116 73 Towershare 800 1 - Pakistan Q116
48 ASEAN Towers 2,750 2 - Myanmar, Vietnam Q316 75 TowerCo of Madagascar 780 1 - Madagascar Q215
(IGT + Golden Towers) 76 Brazil Tower Company 750 1 - Brazil Q216
49 FPS Towers 2,641 1 - France Q316 77 Centratama Menara 719 1 - Indonesia Q216
50 TT-Network 2,500 1 - Denmark Q115 Indonesia (formerly Retower)
51 Phoenix Tower International 2,359 6 - Brazil, Colombia, Costa Rica, Q316 78 SWAP Telecoms & Technologies 702 1 - Nigeria Q315
Dominican Republic, Panama, USA 79 BCTek 700 1 - Nigeria Q414
52 Russian Towers 2,300 1 - Russia Q416 79 Towercom 700 1 - Slovakia Q116
52 Rai Way 2,300 1 - Italy Q315 81 Continental Towers 690 11 - Colombia, Costa Rica, Dominican Q414
Republic, El Salvador, Guatemala, Honduras,
54 OCK Group 2,121 3 - Malaysia, Myanmar, Vietnam Q316 Jamaica, Mexico, Nicaragua, Panama, Peru
55 Wireless Infrastructure Group 2,000 3 - Ireland, Netherlands, UK Q116 82 Torrecom 642 3 - Guatemala, Mexico, Nicaragua Q316
56 T-Mobile Towers 1,823 1 - USA Q116 83 Diamond Communications 637 1 - USA Q216
57 Apollo Towers 1,800 1 - Myanmar Q316 84 Broadcast Australia 620 1 - Australia Q115
57 Sinonetstone 1,800 1 - China Q116 85 HighTel 600 2 - Italy, Albania Q416
59 Axicom 1,772 1 - Australia Q115 86 Axion 584 1 - Spain Q416
60 Vertical 1,600 1 - Russia Q415 87 Centennial Towers 565 3 - Brazil, Colombia, Mexico Q414
61 Mexico Tower Partners 1,531 1- Mexico Q116 88 Andean Tower Partners 555 2 - Colombia, Peru Q116
62 Frontier Tower Solutions 1,500 1- Afghanistan Q216 89 Tower Ventures 548 1 - USA Q216

90 Industrial Communications 513 1 - USA Q216 118 Intelli Site Solutions 202 1- Mexico Q316
91 Highline do Brasil 500 1 - Brazil Q315 119 Infra Quest 201 1- Malaysia Q314
91 Innovattel (Torresec) 500 6 - Argentina, Colombia, Ecuador, Q116 120 Branch Communication 200 1 - USA Q116
Panama, Peru, Puerto Rico Senno Telecom 200 1 - China
120 Q315
93 CTI Towers 493 1 - USA Q216 120 Vertel 200 1 - Australia Q316
94 Grain Management 487 1 - USA Q216 120 Yiked Bina 200 1 - Malaysia Q314
95 Touch Matrix 460 1 - Malaysia Q214 124 Digita 187 1 - Finland Q116
96 Al Karama Towers 450 1 - Senegal Q316 124 TowerCo 187 1 - USA Q216
97 IIMT 450 1 - Mexico Q116 126 Pegasus Tower 173 1 - USA Q414
98 Sprint Sites USA 420 1 - USA Q216 127 Hotspot Networks 160 1 - Nigeria Q116
99 Towercom 400 1 - Ireland Q415 128 Digea 156 1 - Greece Q216
100 Shared Access 394 2 - Ireland, UK Q316 129 2RN 150 1 - Ireland Q415
101 Emitel 377 1 - Poland Q414 129 AlfaSite 150 1 - Brazil Q116
101 ESB Telecoms 377 1 - Ireland Q415 129 Perak Integrated Networks 150 1 - Malaysia Q314
103 Uniti Towers 359 3 - Colombia, Mexico, Q117 132 Skyway Towers 147 1 - USA Q216
(formerly Summit LatAm) Nicaragua 133 Day Wireless Systems 143 1 - USA Q216
104 NMS 350 2 - Peru, other CALA Q316 134 Communication Enhancement 140 1 - USA Q216
105 D’harmoni 346 1 - Malaysia Q314 134 Hibernian / Britannia Towers 140 2 - Ireland, UK Q415
105 Subcarrier Communications 346 1 - USA Q216 136 Asia Space 137 1 - Malaysia Q314
107 Central States Tower 318 1 - USA Q116 137 Q Towers 120 1 - China Q116
108 KJS 309 1 - Malaysia Q314 137 Service Telecom 120 1 - Russia Q415
109 Eco Friendly Towers 300 1 - Myanmar Q216 139 Desabina 118 1 - Malaysia Q314
109 Link Development 300 1 - Russia Q116 140 Cignal 113 1 - Ireland Q116
109 PowerCom 300 1 - Namibia Q316 141 TOCSA 105 1 - Costa Rica Q414
109 Torres Andinas 300 2 - Colombia, Peru Q116 142 Municipal Communications 102 1 - USA Q216
113 Common Tower 260 1 - Malaysia Q314 143 CIE 100 1 - Ireland Q116
114 Hovarth Communications 254 1 - USA Q216 143 Myanmar Infrastructure Group (MIG) 100 1 - Myanmar Q216
115 Atlas Towers 250 2 - South Africa, USA Q416 145 Melaka ICT Holdings 95 1 - Malaysia Q314
116 K2 Towers 227 1 - USA Q216 146 CS&L 86 2 - Mexico, USA Q316
117 Sentech 220 1 - South Africa Q216 147 Badger Towers 84 1 - USA Q216

Rank Towerco Count Countries Updated Rank Towerco Count Countries Updated
148 Performance Development Group 82 1 - USA Q216 177 St. Charles Tower 34 1 - USA Q216
149 Falck 75 1 - Denmark Q414 179 Alticom 33 1 - Netherlands Q315
149 Clearview Tower Company 67 1 - USA Q216 180 Telcentras 30 1 - Latvia Q416
151 Aplicanet 60 1 - Ecuador Q416 180 AB Telecenters 30 1 - Lithuania Q316
151 HOI-MEA 60 1 - Egypt Q116 180 ForeSite 30 1 - USA Q216
151 Torres de Panama 60 1 - Panama Q315 183 MidAmerica Towers 29 1 - USA Q216
154 ComSites West 56 1 - USA Q216 184 Fanasia 27 1 - Iran Q116
155 Saurava Towers 55 1 - India Q116 184 TowerCom 27 1 - USA Q216
156 Logycom Group 53 1 - Kazakhstan Q316 186 Highpoint Tower Technology 25 1 - USA Q216
157 Torre Online 51 1 - Brazil Q414 187 Blue Sky Towers 24 1 - South Africa Q216
158 HIGHPOINT (Obelisk) 50 1 - Ireland Q415 188 Prime Tower Development 24 1 - USA Q216
159 Sanyuan Tec 50 1 - China Q315 188 Wireless Properties 24 1 - USA Q216
160 Tower Sites Inc 49 1 - USA Q216 190 Levira 22 1 - Estonia Q316
161 Questar InfoComm 48 1 - USA Q216 191 Arcadia Towers 21 1 - USA Q316
162 Konsing Group 47 1 - Serbia Q116 191 Hayes Towers 21 1 - USA Q216
162 Wireless Asset Group 47 1 - USA Q216 193 Shared Towers LLC 19 1 - USA Q216
164 Eagle Towers 45 1 - South Africa Q315 194 Clear Signal Towers 15 1 - USA Q216
164 ERS Tower Services 45 1 - USA Q216 195 Datapath Tower 14 1 - USA Q216
166 Mauna Towers 44 1 - USA Q216 196 Pro High Site Communication 11 1 - South Africa Q215
167 Bay Communications 43 1 - USA Q216 197 Horizon Tower 10 1 - USA Q216
168 Cellcom 40 1 - Ireland Q116
168 Skysites 40 1 - Brazil Q316 Newer towercos
168 Telecom Torres 40 1 - Brazil Q414 ACES, Saudi Arabia Plata Tower Company, Argentina
Antosc, Angola Pula Towers, Botswana
171 RG Towers 39 1 - USA Q216
AWAL Telecom, Pakistan Quippo Telecom, Global (except India)
171 Stout & Company 38 1 - USA Q216 Camtowerlink, Cambodia Rent-A-Tower, Mexico
Telava Wireless 38 Q216 Catalina Inc, Costa Rica Secured Towers, Nigeria
172 1 - USA
Cumii, Pan-African Square1 Infrastructure, Chile,
172 TowerKing 38 1 - USA Q216 ECS, Poland Myanmar, Nigeria, South Africa
175 Dogwood Towers 37 1 - USA Q316 EuroTower, Pan-European Staghorn Infrastructure, USA
Infratel, South Africa Teletower Argentina, Argentina
176 Telecom Tower Group 36 1 - USA Q216 MENA Towers, Ivory Coast, Pakistan, Tower One Wireless, Colombia
177 MidAtlantic Tower 34 1 - USA Q216 UAE Uruguay Torres, Uruguay

Meet the towerco CXOs, their investors and their
Towercos with undisclosed counts
partners at your next TowerXchange Meetup!
Netgrid Telecom, Romania
3GIS, Sweden
TowerXchange Meetup Europe 2017
Net4Mobility, Sweden April 4-5, London
Mosaic, Ireland
Antenna Hungaria, Hungary TowerXchange Meetup Americas 2017
SUNAB, Sweden June 7-8, Boca Raton, FL
Undisclosed Mexican Towerco, Mexico
Azerconnect, Azerbaijan
TowerXchange Meetup Africa & Middle East 2017
Communication Towers Nigeria, Nigeria
CenturyLink, USA
October 3-4, Johannesburg
Mobilitie, USA
52 Eight, USA TowerXchange Meetup Asia 2017
Nova Towers, USA December 12-13, Singapore
Media Broadcast, Germany
MX Towers, Mexico For agenda information and to register, visit:
TowerCast, France www.towerxchange.com/meetups/
Heartland Tower, USA
Norkring, Belgium, Norway TowerXchange tower count research methodology
Capital Telecom, USA
TowerXchange’s famous global towerco league table provides a simple comparison of
APC Towers, USA
the scale of towercos by tower count. We have derived tower counts for the category’s
Teracom, Denmark, Sweden
18 listed entities from quarterly statements, where available, while the other counts are
Balesia, Colombia, Ecuador, El Salvador, Guatemala, Peru
drawn from qualitative market research. Smaller towerco’s count may be updated less
Message Center Management, USA
frequently, while we have offer no guarantee that the counts they provide are accurate:
RTP, Portugal
we ask for a count of complete macro and rooftop towers marketed for co-location,
TASC Towers, Jordan, Lebanon, UAE
but inevitably some towercos inflate their tower count by including works in progress,
OiV, Croatia
neutral host DAS, lamp-posts and other special structures. As such, TowerXchange’s
Radiocom, Romania
tower count should be considered estimates.
Swisscom, Switzerland
ETB, Serbia As the product of proprietary market research, TowerXchange asserts copyright over
Tarpon Towers, USA this table and the data listed herein. If you want to use data in your own analysis, you
Golden Comunicaciones, Colombia need to request our permission.
Shared Networks Tanzania, Tanzania
Telecommunications Partners, Peru If you wish to suggest a correction, please email Kieron Osmotherly at
kosmotherly@towerxchange.com

All towercos ≠
Towercos have varying appetites to expand their
footprint into new international markets, and as we
look at the evolution and localisation of the towerco
Business model diversity increases as the tower industry spreads worldwide business model to meet the specific needs of those
international markets, there is one inescapable
Thanks to RBC Capital Markets for inviting TowerXchange back to conclusion: all towercos are not created equal.
provide the opening keynote address at their 2nd Annual Global There is a world of difference between the U.S. blue
Towers Investor Day. With the event bringing together some of the print and the schematics of towercos in Central
leading institutional investors and the management and IR teams and Latin America, Africa, Asia and Europe. In this
of current and prospectively future listed towercos, TowerXchange article we highlight the commonalities and focus
took the opportunity to contrast the nuances of the tower company on the differences to put some context around
investments in this $192bn asset class.
business model as it has evolved across the world. The highlights
of our presentation, with data updated through Q4 2016, are
Why are towercos so important?
presented in this article.
A business model first conceived in the U.S. in the
Keywords: Africa, American Tower, Americas, Asia, Bankability, Best mid to late 1990s, independent towercos now own
of TowerXchange, Bharti Infratel, Business Model, Carve Out, Cellnex, and operate 68% of the world’s 4.04mn telecom
China, China Tower Company, Crown Castle, Decommissioning, towers and investible rooftop structures.
Energy, Europe, Global Tower, IHS, IPO, India, Indonesia, Indus
Towers, Infraco, Infrastructure Sharing, Insights, Investment, Lease The model is elegant in its simplicity. On an MNO’s
Rates, MLA, Middle East, Multi-Region, Operator-Led JV, Protelindo, balance sheet a tower is a depreciating asset built
RBC Capital Markets, Rooftops, SBA Communications, STP, Sale & to serve one internal customer. On a towerco’s
Leaseback, Telesites, Telxius, Tower Counts, Towerco Consolidation, balance sheet a tower is a potential source of long
By Kieron Osmotherly, Founder & CEO,
TowerXchange Towercos, Transfer Assets, USA, Valuation term recurring revenue from multiple investment
grade customers. Investors buy in to this now
proven proposition and, recognising the separation
Read this article to learn: of relatively safe haven infrastructure from retail
< What are the drivers of towerco valuation? risk, reward towercos with valuations in the 11-22x
< How do towerco business models internationally compare with the U.S., and how does that affect range – 3-6x typical MNO valuations, creating an
their value drivers? incentive to re-engineer balance sheets, transfer
< Contrasting the business models of independent and operator-led towercos towers from MNOs to towercos, and transform
< Opportunities for towercos to extend their growth narrative: inorganic growth versus diversification towers from cost centres into profit centres.
< The world’s 18 listed towercos and 7 other towercos that could IPO
I’m going to steal a story from an advisor to an

investor in one of the first tower sale and leaseback Figure one: global towerco business model variation summary
deals in the late 90’s. The CEO of the investor, who
had arrived a little late for a meeting to discuss the
deal, was reading the documentation to catch up
on the detail of the transaction. As the towerco and CALA extension: Asia’s native towercos:
MNO thrashed out the detail, the CEO flipped to the
towerco revenue model, leaned in to his Associate replicated, evolved... sold out? same same but different
and whispered: “This is how much money we make
with one tenant on the tower?”
“Yes,” replied the Associate. Gold standard

The investor’s CEO turned the page. Africa’s powercos: Europe:
new complexities, new value creation deviates from standard structures,
“And this is how much money we make with two?” business models
“Yes,” replied the Associate.
balance sheets – but it has not always been possible Indonesia’s largest towerco, Protelindo. Again most
“Buy as many of these as you can!” Concluded the to follow the same roadmap in international of the towers which can be bought by towercos,
CEO of the investor. markets. have been bought by towercos in Indonesia.
Variations from the U.S. “gold standard” The closest resemblences to the U.S. model are to be Most emerging market towercos, in Sub Saharan
found South of the border in Latin and particularly Africa and Southern and Southeast Asia, provide
The independent towerco market in the U.S. is Central America, where the Master Lease power as a service as well as telecom structures,
unlike any anywhere else in the world, creating a Agreements which underpin towerco business
exposing this formerly real estate-centric business
gold standard in terms of investibility which may be models were copied from the U.S. However, there
model to the complexities of challenging energy
impossible to replicate in international markets. are finite remaining opportunities for large scale
logistics.
growth in the CALA tower markets, with the
Towercos played a central role in the U.S. catching exception of Argentina.
up and surpassing the capacity and quality of Meanwhile in the new European tower market,
mobile networks in much of the rest of the world. Indonesia is another tower market where the we see a lot more variety in both site typology and
Towercos built much of the U.S. network, and North towerco business model is relatively similar to in towerco business model, particularly in over-
American MNOs are almost uniquely dependent the U.S. Michael Gearon, one of the forefathers built markets where as much value may be created
on towercos. U.S. towerco contracts, lease rates and of American Tower’s CALA business, brought the through decommissioning parallel infrastructure as
escalators capture tremendous value on towerco U.S. blue print with him as one of the founders of through building new sites.

Figure two: Who owns the ~150,000 towers in the U.S.? A closer look at the U.S. tower market
Figure two illustrates what investors in the

mature U.S. tower market are used to seeing: a big
~27,000 red, independent towerco-led ecosystem. North
American telecom infrastructure is dominated
MNO captive by three publicly listed towerco giants; American
7,524 Tower, SBA Communications and Crown Castle,
Operator-led with a couple of rollup plays consolidating a few
thousand further towers, and a long tail of almost
JV infracos (0) 100 independent developers.
115,161 Independent towercos

AT&T, T-Mobile and Sprint have sold the majority
of their towers, but retain a total of 7,524 towers
within captive, operator-led towercos. Together U.S.
Source: TowerXchange, Q416 independent and operator-led towercos own 82% of
the investible towers and rooftops in the country.
Figure three: Breakdown of ownership of the world’s 4,041,062 The fragmentation and localisation of the
investible towers and rooftops towerco model
14.5% The picture is quite different globally though, with

pure play independent towercos, again shown
in red in figure three, owning only 14.5% of the
towers. More than half the world’s towers are
MNO captive held by operator-led towercos; towercos that are
themselves majority owned by MNOs. Admittedly
32.1% Operator-led the figures are someone distorted by the sheer scale
of China Tower Company and Indus Towers with
51.4%
JV infracos over 1.7mn and 120,000 towers respectively.
Independent towercos Just under a third of the towers and investible

rooftops, almost 1.3mn, are still owned by MNOs,
but relatively few of these remaining captive towers
2%
Source: TowerXchange, Q416 are acquirable through conventional sale and

Figure four: Average cost per tower comparison Source: TowerXchange sheets of MNOs who have less imperative to raise
cash. However, opportunities to create efficiencies
Capital deployed Average cost per through decommissioning of parallel infrastructure
Region Timeframe Total sold*
US$bn tower have resulted in the creation of entities like Fanasia
U.S. 2008-15 50,701 $24.6bn $485,198 in Iraq and the STC-Mobily joint venture infraco in
Saudi Arabia.
CALA 2011-16 43,726 $8.4bn $199,966
But what really distorts the global map is China,
Europe 2012-16 40,484 $3.2bn $151,843
where the transfer of all 1.7mn MNO towers to
Indonesia 2008-16 15,767 $2.0bn $137,555 China Tower Company, which remains 94% owned
by those carriers and thus itself represents 82% of
Africa 2010-16 43,978 $3.9bn $132,156 the world’s operator-led towers.
India I 2009-12 42,007 $4.9bn $115,028

Average cost per tower comparison
India II 2013-16 42,381 $3.3bn $77,804
Before I dig into the detail of the structural
*Total sold includes transactions where the quantity was disclosed but the deal value was not disclosed to TowerXchange, capital deployed
includes only known deal values, the tower counts from which are excluded from the formula to calculate average cost per tower differences between tower markets, let me
preface by calling attention to an important fact:
leaseback transactions – at least, not if towercos and Southeast Asia (excluding India), although
the differences in towerco business models are
comply with the international investment thesis TowerXchange foresee more tower transactions
reflected in valuations.
they’ve used to date. here than any other region in the coming 12-18
months.
Cost per tower (see figure four) is a pretty savage
So how does tower ownership break down
valuation, not taking into account lease rate, term
regionally? There’s also deal flow to come in Europe, where
62% of towers remain operator captive, but or escalators, but with the opacity of most tower
India has twice as many towers held by operator-led where a number of tower portfolios retained on transactions it’s difficult to elicit a superior and
towercos, such as Indus Towers and Bharti Infratel, MNO balance sheets, and operator-led carve out consistent set of metrics.
as pureplay independent towers. The dominance of towercos, could be monetised. M&A is in part driven
operator-led towercos has created a business model by the acquisitiveness of Cellnex and the renewed You’re unlikely to get change from half a million
where the value created by infrastructure sharing is European appetite of American Tower after the bucks for a decent U.S. tower these days – a
shared more liberally between MNOs and towercos restructuring of ATC Europe as a joint venture with premium driven by scarcity, zoning restrictions
in India – we’ll explain the detail later. Dutch pension fund PGGM. creating barriers for entry, and high capex costs.
71.5% of towers remain on MNO balance sheets in There is a nascent tower market in the Middle East, We think valuations are peaking in CALA at around
the relatively immature tower markets of Southern where almost all towers remain on the balance 40% of U.S. levels, while European towers have

Figure five: At a glance business model comparisons Source: TowerXchange
US standard
Lease rate USD Lease-up GBTs vs alternates Op’l simplicity Amendment Decommissioning Maturity
MLAs
USA $2,000
CALA $800-1,100
India $550
Indonesia $1,200
China $320-600
S & SE Asia $700-1,800
Africa $1,500-1,800
Europe $1,000-1,900
been changing hands for an average of around hands for around US$115,000. With deal flow rate for the region, or range where there is wide
US$150,000 each. resuming in India after a nearly four year hiatus, variance within the region.
valuations have fallen by more than 30%, albeit
Fierce competition for sale and leasebacks in in a more rational MNO market: towers in India Lease up: the one factor in common with every
Indonesia is keeping valuations at a little over are settling into valuations around US$75-80,000 regional variation on the towerco business
US$130,000, around double replacement cost, which each, and the consistency of terms, including lease model is a focus on creating value by leasing
in turn fuels healthy organic growth. Average cost pricing, means we are unlikely to see significant up towers to multiple tenants.
per tower is similar in Africa, where the tower variation from that number as 4G continues to drive
transaction deal pipeline is slowing, with just a consolidation in the Indian tower market. GBTs (ground based towers) vs alternates:
handful of Airtel towers left to sell, and some mid- compares the mix of site typologies within typical
level operators’ towers coming to market in Kenya, At a glance business model comparisons towerco portfolios, ranging from 4/4 quadrants,
Senegal and Mozambique. reflecting that a significant majority of sites are
Figure five provides a simplified comparison of GBTs, 3/4 a smaller majority of sites are GBTs, 2/4
Meanwhile India demonstrates the impact of different facets of the towerco business model. about half and half, 1/4 indicates that the majority
market restructuring: before 122 MNO licenses of sites are non-GBTs, such as in Europe where the
were cancelled in 2012, towers were changing Lease rate: presents an estimated average lease majority of cell sites are rooftops and alternate site

typologies (water towers, church spires, billboards Reviewing figure five, the first row illustrates The CALA tower market really took off in the last
and other street furniture). the gold standard: everything in the U.S. is how eight years, with a wave of sale and leasebacks,
tower investors might want it to be. Telecom and an independent developer segment evolving in
U.S. standard MLAs: simplified comparison of infrastructure consists primarily of high structural parallel.
typical MLA structure with the MLA structure found capacity, ground based towers, and towercos
in the oldest tower market, the U.S. operate a low operational complexity, “steel and Recently lease rates in CALA have come under
grass” model providing just the structure and downward pressure, with the impact on margins
Op’l (operational) simplicity: the more quadrants, the real estate. A strong Master Lease Agreement compounded by forex devaluations and rising
the simpler the business model. 4/4 quadrants defines a healthy lease rate, averaging around land costs. Independent developers are often
indicates a pure ‘steel and grass’, real estate US$2,000, often with fixed escalators that have been undercutting the U.S. publics, slowing their organic
oriented model. Complexity typically originates running for as many as 20+ years in what has been growth prospects. Lease rate discounting and
from energy logistics or particularly challenging a low inflation environment. Amendment revenue deviation from standard MLA terms has been
operational circumstances. has been another significant value driver for U.S. so dramatic on the part of some independent
towercos, while zoning regulations mean there is developers that some may be uninvestible by the
Amendment: indicates whether towercos derive
minimal parallel infrastructure, so minimal need U.S. publics.
‘amendment’ revenue when an existing tenant
for decommissioning. The downside? The U.S. tower
pays another tenancy fee for overlaying a new
industry is mature, so there are finite remaining With half of CALA’s towers on towerco books, but
technology. For example, amendment revenue is a
growth opportunities. Hence American Tower and with América Móvil and Telefónica launching their
significant value driver in the Americas, whereas
SBA pursuing international opportunities, while own operator-led towercos in the last 18 months,
in India amendment (there known as “loading”)
Crown Castle diversifies into fibre and small cells. the continent is almost sold out, notwithstanding
derives only a modest one-off execution fee.
a few virgin markets (Argentina, Cuba) and
So if you can only invest so much in the U.S., how the prospective rollup of the aforementioned
Decommissioning: indicates the degree of value
do international markets compare? independent developers, who own 12,216 of the
creation potential through the decommissioning
of parallel infrastructure. Decommissioning is region’s 164,207 towers.
where towercos acquire two towers in overlapping Let’s look at the CALA region. Since shortly
locations, break the lease and dismantle or ‘moth after the turn of the millennium, U.S. towercos Meanwhile in Asia a native tower industry with
ball’ one tower, and consolidate tenancies onto have extended their footprints into Central and an entirely different genetic code was evolving.
the other. 4/4 quadrants indicates the highest level Latin America, initially using the same contract There are a handful of towercos evolving to broadly
of opportunity for decommissioning, down to 1/4 templates as in the U.S. in Central America, but replicate the U.S. blue print – especially those in
representing the lowest. gradually evolving – for example ground rent was Indonesia. And there is some commonality in
a pass through in much of South America, which India among the many entities now rolled up into
Maturity: sums up the maturity of the tower market meant towercos had less direct relationships with American Tower India, but even these independent
in terms of longevity and how established and landlords, although this is changing. Pricing is often towercos tend to conform to the lease pricing
consistent contract structures and business models pre-agreed in South America, with escalators CPI and contractual terms set out by the majority of
are. linked, which again differs from the U.S. operator-led towercos – and it is these operator-led

towercos that largely define the unique Asian tower unique market with huge volumes of new build. effectively kick-started by Cellnex and their
market structure. With lease prices reportedly as low as US$320-600 insatiable appetite to rollup European towers
the question remains whether, in the run up to IPO – Cellnex entered three new countries in the
Vodafone, Idea Cellular and Bharti Airtel’s joint anticipated in late 2017, China Tower Company second half of 2016! The European towerco
venture Indus Towers, and their close cousins can transform itself into a highly investible profit business model deviates significantly from the U.S.
Bharti Infratel, remain majority owned by MNOs. centre, like its Western counterparts, or whether blueprint because the network topology differs so
While 28% of Bharti Infratel is already owned by the indebted towerco is destined to be a cost centre, significantly. While the majority of U.S. sites on
public shareholders, both they and Indus Towers enhancing the value of its parents China Mobile, American Tower, SBA and Crown Castle’s balance
may see investment by third parties in 2017. The China Unicom and China Telecom, who between sheets are ground based towers, in Europe almost
genetic code of operator-led towercos generally them own 94% equity. all urban and many suburban sites are rooftops
leaves them predisposed toward a more equitable – as much as 60% of Europe’s 600,000 cell sites
share of value creation across balance sheets; lease The operator-led towercos of Asia generally have a are rooftops and other alternate site typologies.
prices are generally lower, “amendment revenue” symbiotic relationship with their parent and tenant This brings the landlords into play as greater
or “loading” is sometimes treated very differently. MNOs which enables them, among other things, to stakeholders, and European landlords are savvy,
In India, when a new tenant is added to a tower, position themselves to take a leadership position in often demanding supplementary rent with the
the original tenant enjoys a 20% discount on their the creation of Smart Cities and the implementation addition of a second tenant, which significantly
lease rate, with a 30% discount for a third tenant, of heterogeneous networks. recalibrates the model.
and India has even introduced parity in lease price
escalation to ensure anchor tenants pay the same as As the ‘Big Four’ towercos who dominate the SSA Contract structures vary across Europe. In some
new tenants. tower market mature toward consolidation or IPO, markets amendment revenue can be generated
the investment community needs to be cognizant much like the U.S., while in other markets an
When reviewing Asia, edotco merits special of the unique hybrid towerco-powerco business anchor tenant has retained substantial reserve
mention. While the carve-out towerco remains model in Africa. Outside of South Africa, which space effectively nullifying potential amendment
majority owned by Axiata, and thus is classified more closely resembles the U.S. ‘steel and grass’ revenue.
by TowerXchange as operator-led, edotco recently business model, towercos in Africa are as much
raised US$600mn by selling undisclosed stakes to energy logistics businesses as they are real estate Europe is simply a much more mature, built-out
INCJ and to Axiata’s majority investor Khazanah. companies. This has implications both bad and – in fact over-built – network, and investors are
edotco seeks to draw from the ‘best of both worlds’ good: one, they are more complex, more exposed always keen to seek evidence that larger scale
– driving value and efficiency under independent to the vagaries of fluctuating oil prices and forex; decommissioning plays can generate returns within
towerco-like commercial terms, yet with a deep but two they have another means of creating and an optimal two to three year timescale.
appreciation of their clients’ perspective, drawing capturing value – in fact the towercos in both Africa
upon edotco’s own heritage as a carve out from an and Asia are smartly deploying capex to reduce Seeking to extend the global tower industry
MNO. energy opex and improve their margins. growth narrative
China stands apart from our analysis of Asia as a And finally to the new European tower market, With 68% of the world’s towers on the books of one

“
zone, whether it be by allowing an MNO to retain
a significant stake in a joint venture (as IHS did in
Nigeria, where MTN retained a non-controlling
51% equity stake), or requiring bidders to entertain
opportunities in markets with foreign direct
investment limits, like Algeria and Bangladesh.
With the USA effectively sold out, just a handful of portfolios left up
for grabs in India, with the majority of tier one MNO towers in Africa TowerXchange see an increasing proportion of
sold, and with Telesites and Telxius reducing the chance of acquiring
América Móvil or Telefónica towers in CALA, how can listed and other
acquisitive towercos extend their growth narrative?
“ future transactions being towerco-on-towerco
consolidations, which has driven valuations in
Europe and Africa for example, but it has been
precisely the listed towercos’ refusal to pay a
premium for independent developer towers that
has effectively stalled deal flow in CALA.
Diversification: how do the economics compare?

type of towerco or another, there are obviously Private towercos can sometimes be more flexible
reducing inorganic growth opportunities, and and agile than the U.S. publics, who have been
If towercos are running out of ground based towers
one must remember that towercos do no want very disciplined buyers to date: they have their
to buy, they can always diversify into the provision
all the towers. Parallel infrastructure may have investment thesis and they stick to it. The publics
of other assets and services.
limited value as any need for infill sites may be have the discipline to walk away from a deal if they
offset by the cost of decommissioning duplicate don’t like the terms or valuation, giving rise to the
The economics of alternate site typologies varies
sites – so in some markets only one or two of the growth of private towercos like IHS, Helios Towers
as a function of the contractual relationship with
three-plus tower portfolios may be investible. The Africa and Eaton Towers in Africa; Phoenix Tower
the asset owner. For example, a towerco can make
attractiveness of buy and leasebacks with so-called International, Group TorreSur and Digital Bridge
tier two MNOs is further reduced as no-one wants in the Americas, and a host of private towercos a small margin from aggregating privately owned
to do a tower deal with an anchor tenant who can’t in Myanmar. Some of these private towercos can rooftops for MNOs, or they can acquire rights very
pay their bills. achieve scale rolling up tower portfolios that are similar to an owner and derive a similar margin as
lesser priorities for listed towerco giants, a strategy they do from a macro tower. For example, American
With the USA effectively sold out, just a handful often predicated upon an eventual sale to one Tower recently announced a deal to acquire
of portfolios left up for grabs in India, with the of those listed giants once the assets have been innovative French towerco FPS, which had acquired
majority of tier one MNO towers in Africa sold, ‘cleaned up’ (structures or permitting improved et rooftop management firm LOXEL with access to
and with Telesites and Telxius reducing the chance cetera). 20,000 rooftops, and which had struck deals with
of acquiring América Móvil or Telefónica towers highway infrastructure provider APRR and the
in CALA, how can listed and other acquisitive Further sale and leaseback opportunities may electricity transmission tower operation subsidiary
towercos extend their growth narrative? require that bidders move outside their comfort of EDF for 300 and 76,000 sites respectively.

In the U.S. we’ve seen Crown Castle, American explored by the majority of towercos, and there strategic sale seems equally likely. Deustche
Tower and Digital Bridge bet big on small cells may be merit in focusing on core competencies. Telekom continue to consider whether to list,
and DAS, a strategy replicated by Cellnex, INWIT, TowerXchange offer one simple conclusion: we like sell or retain the 31,000+ sites they own within
Wireless Infrastructure Group and Arqiva in to see towercos committing to diversify into small Deutsche Funkturm. And Telefónica and Turkcell
Europe, and by the Indonesian towercos. Small cells, cells, or committing to focus on their core business could reconsider listing their operator-led towercos
and their larger cousins microcells, lamp posts and of macro sites. Any towerco that dabbles half- (Telxius and Global Tower respectively) in a more
DAS, provide infill solutions that will be particularly heartedly may quickly find themselves overtaken by receptive market. Meanwhile, the need to raise
important to realise the LTE experience, to enable competitors in the land-grab for the heterogeneous capital for 4G could see further major transactions
Smart Cities and the IoT, and for 5G. TowerXchange network layer. in the Indian Tower market.
are increasingly convinced that the majority of such
sites will be provisioned to multiple operators by What’s next? Conclusion
towercos and specialist independent distributed
network operators, rather than being self-deployed There are 18 listed towercos worldwide (American After spending five years of contrasting
for the usage of a single MNO. Tower, Balitower, Bharti Infratel, Cellnex, Crown
international tower markets to the U.S. for investors
Castle, DIF, EI Towers, GTL, IBS, INWIT, Miteno,
more familiar with the ‘oldest growth’ North
While there’s enough DNA in common with the OCK, Protelindo, RAIWAY, SBA, STP, Telesites and
American tower market, it has become increasingly
tower business for small cells to be a natural Tower Bersama). With the cancellation of Telxius
clear to me that we may never see tower investment
diversification for towercos, new skills in active and Global Tower IPOs, and with U.S. towercos
opportunities to match the ‘gold standard’ seen
network management are required, the business taking a valuation hit with the country’s surprise
in the U.S. North America’s tower networks were
can be more SG&A heavy, and the ecosystem is election result, 2016 hasn’t been the best year for
largely built by towercos, U.S. carriers are uniquely
more fragmented than for macro cells. To drive towerco equities, although it certainly hasn’t seen
dependent on towercos, and the calibration of lease
a small cells business to scale, one has to build the carnage witnessed in 2002 when the technology
rates and escalators in the country has created
relationships one municipality and one landlord at bubble burst and investors misdiagnosed towercos
highly investible infrastructure asset class.
a time. as tech rather than infrastructure plays, taking
American Tower, Crown Castle and SBA down to
We have also seen towercos diversify into fibre; penny stocks and taking some of their competitors The often-subtle differences between international
it’s a big part of Crown Castle’s current strategy out of business. tower markets and towerco business models
in the U.S.; Protelindo, STP and Balitower own create new value drivers, but that doesn’t mean
significant fibre assets in Indonesia; and fibre may 2017-18 should be better years for listed towercos we think international tower markets are less
be a big part of IHS’s future in Nigeria. Even the and for towerco IPOs. China Tower Company are investible; valuations both of equities and in
private towercos are looking at fibre: for example, driving toward an IPO at the end of 2017, edotco private transactions reflect the premium value of
Brazil’s third largest independent developer Brazil may follow in 2018. IHS increasingly looks too big U.S. towers, and the relative value of international
Tower Company has spun off a subsidiary Arqueiro for a U.S. public to digest – they may follow their assets.
Telecom. US$800mn bond with an IPO in the next couple
of years. Arqiva could utilise the public markets All towercos, and all international tower markets,
Ultimately, small cells and fibre are yet to be to restructure their balance sheet, although a are not created equal

The rise of the operator-led
The drivers behind the carve-out of operator-led
towercos
towerco While the efficient consolidation of parallel

infrastructure, co-building and the acceleration
Which are the leading carve-out, operator controlled towercos, and will of rollouts incentivise infrastructure sharing, the
main driver for MNOs to carve out towercos is more
they be monetised? strategic than operational.
68% of the world’s 4.04mn cell sites are now owned and operated
On an MNO balance sheet a telecom tower is
by specialist towercos and infracos rather than MNOs, but half
a depreciating asset serving the needs of one
the world’s cell sites are owned by towercos and infracos that customer. Take that same tower asset and transfer it
are themselves majority-owned by MNOs. While that statistic to a towerco balance sheet and it becomes a source
is somewhat distorted by the huge operator-led towercos of of long term, recurring revenue from a growing
China (China Tower Company) and India (Indus Towers, Bharti number of credit worthy tenants. That same tower
Infratel), the last couple of years in the tower industry have been asset also benefits from the towerco’s renewed
By Kieron Osmotherly, Founder & characterised by an increasing global predilection by MNOs to focus on creating efficiencies and scale in passive
CEO, TowerXchange carve out and retain control of their towercos. infrastructure management. The capital markets
recognise the fundamental difference in business
Keywords: Active Infrasharing, Anchor Tenant, Asset Register, Bankability, Bharti Infratel, Brookfield, model, and appreciate the separation of telecom
Business Model, CTC, CTIL, Capacity Enhancements, Carve Out, China Tower Company, Deal Structure, infrastructure from retail risk, thus a tower on
Deutsche Funkturm, Due Diligence, edotco, First Tower Company, Global Tower, INWIT, IPO, Idea Cellular an MNO balance sheet might be valued at 3-6x,
Infrastructure Services, Indus Towers, Infraco, Infrastructure Funds, Infrastructure Sharing, Insights, whereas on a towerco balance sheet it might be
Lease Rates, MBNL, MLA, MNOs, MTS Towers, Mitratel, Mobily, Multi-Region, National Tower Company, valued at 12-22x.
NetWorkS!, New Market Entrant, Novation of Leases, Operator-Led JV, RANsharing, Reliance Infratel, STC,
Sale & Leaseback, Site Surveys, Telefónica, Telesites, Telxius, Tenancy Ratios, Towercom, Towercos, Transfer This relative valuation arbitrage has also been
Assets, Valuation, Victus Networks, VimpelCom the driver for the sale and leaseback of operators’
towers, but in 2016 only 6,295 towers were sold and
leased back by MNOs worldwide, whereas in the
Read this article to learn: same year new operator-led towercos were carved
< Which are the world’s newest and largest operator-led towercos and infracos? out and retained by MNOs representing a total of
< What have been the drivers for MNOs to carve out and keep towers? 1,761,357 towers. Again, that statistic is distorted
< Will MNOs monetise these towercos? How? When? by China Tower Company, which represents
< Ten critical considerations when carving out a towerco 1.7mn, but even excluding CTC, carved out towers
outnumbered sold and leased back towers by

The world’s top 21 MNO-led towercos and joint venture infracos (by site count) Source: TowerXchange, Q416
Towerco Country(s) Owner(s) Site count Monetisation

Q416
China Tower China China Mobile 38%, China Unicom 28.1%, 1,700,000 Expected to IPO in late 2017
Company China Telecom 27.9%, China Reform
Corporation 6%
Indus Towers India 42% Bharti Infratel, 42% Vodafone India, 145,996 Recent speculation suggests one or
16% Idea Cellular more shareholders may monetise
their stake
Towercom India RCOM 96%, 6 PE and hedge fund investors 4% ~45,000 Signed binding term sheet to sell to
(formerly Reliance Infratel) Brookfield in December 2016
Bharti Infratel India Bharti Airtel 72%, public shareholders 28% 38,642 Board approved monetisation of a
“significant stake” on 25 October 2016
Deutsche Funkturm Germany Unclear but believed to be 100% owned by 31,636 Plans to monetise reportedly shelved
Deutsche Telekom after Telxius IPO cancelled
Unnamed STC-Mobily Saudi Arabia Ownership structure yet to be announced ~22,000 STC and Mobily cancelled a sale and
joint venture infraco leaseback process to pilot a joint
venture infraco
edotco Bangladesh, Cambodia, Axiata, INCJ, Khazanah 17,054 In December 2016 Axiata announced
Malaysia, Myanmar, owned, the divestment of undisclosed stakes
Pakistan, Sri Lanka over 25,000 in edotco to Innovation Network Corp
including of Japan and Khazanah for US$400mn
managed and US$200mn respectively. Unlikely to
IPO before 2018
Telxius Brazil, Chile, Germany, Telefónica 100% 16,233 IPO cancelled in Q316
Peru, Spain
Telesites Mexico, Costa Rica América Móvil 58.5%, public shareholders 14,924 Listed at the end of 2015
41.5%
First Tower Russia Unclear but believed to be 100% owned by 14,000 Carved out with a view to future
Company MegaFon trade sale
NetWorkS! Poland T-Mobile 50%, Orange 50% 13,000 Speculation suggests NetWorkS!
could be sold although Orange and
T-Mobile retain asset ownership

The world’s top 21 MNO-led towercos and joint venture infracos (by site count) Source: TowerXchange, Q416
Towerco Country(s) Owner(s) Site count Monetisation

Q416
DIF Thailand 18-33% True, 67-82% Unit Holders 12,183 Listed at the end of 2013
CTIL UK Vodafone 50%, Telefónica 50% 12,000 Tower assets have been transferred
to the CTIL balance sheet. VF and
TEF may have differing appetite to
monetise
MBNL UK EE (BT) 50%, Three 50% 12,000 EE and Three retain asset ownership,
but JV includes active as well as
passive infrastructure
INWIT Italy Telecom Italia 60%, Institutional Funds 36%, 11,200 Previously explored trade sale, TIM
Individuals 4% now appear committed to retain
controlling stake
Idea Cellular India Unclear but believed to be 100% owned by 11,000 Reportedly hired advisors to explore
Infrastructure Idea Cellular monetisation
Services
National Tower Russia Unclear but believed to be 100% owned by 10,400 Carved out with a view to future trade
Company VimpelCom sale
Global Tower / Turkey, Ukraine, Unclear but believed to be 100% owned by 8,681 Cancelled IPO in 2016
UkrTower Belarus, Cyprus Turkcell
Mitratel Indonesia Unclear but believed to be 100% owned by ~8,000 Telkom agreed to transfer Mitratel
Telkom Indonesia to Tower Bersama in an innovative
share swap agreement until the deal
was cancelled in 2015
Victus Networks Greece Vodafone Greece 50%, Wind Hellas ~7,000 Network sharing joint venture
(VimpelCom) 50% encompassing towers and RAN. No
apparent plan to moentise
MTS Towers Russia Unclear but believed to be 100% owned by 5,500 MTS carved out around half of their
MTS towers into MTS Towers, but claims to
have no plans to monetise

almost 10:1, thanks to the creation of Telxius, Who owns and operates the world’s 4.04mn cell sites?
Telesites, First Tower Company, National Tower
Company, MTS Towers and Powercom in Namibia.
585,139
Will MNOs eventually monetise their carve-out
towercos?
While many MNO-led towercos are carved out MNO captive

as a first step toward monetisation of the assets,
either through sale to a strategic buyer such as 1,296,600 Operator-led
American Tower or Cellnex, or by selling a stake
to an infrastructure investor or pension fund, an JV infracos
increasingly proportion are monetised through IPO, 2,077,223
while some MNOs are choosing to retain a majority Independent towercos
stake their carve-out towercos.
The main incentive to monetise towers?

Restructuring balance sheets – many MNOs are 82,100 Source: TowerXchange, Q416
seeking to reduce with growing debts amidst
shrinking margins and pressure to prop up their
own share prices with dividends. operator-captive towercos trace their origins Macro economic factors made 2016 a tough year
to government or regulatory pressure. China to IPO any business successfully, and the tower
The main incentive for MNOs to retain a majority mandating the co-construction and sharing of business suffered it’s own setbacks with the
stake in a carve out towerco? Control. telecoms infrastructure forced the carve-out of cancellation of operator-led towerco IPOs in Spain
China Mobile, China Unicom and China Telecom’s by Telefónica (Telxius) and in Turkey by Turkcell
Consider this example: Telecom Italia Mobile (TIM) towers to China Tower Company, while regulatory (Global Tower).
carved out towerco INWIT, then listed a 36% stake pressure to ease the competitive dominance of
in on the Milan stock exchange in 2015, raising Telcel in Mexico was a major driver behind the Combined with traditional overvaluation, political
€780mn. TIM then entered negotiations to sell carve out of Telesites. Telesites has already listed, and economic uncertainty in 2016 knocked the
their controlling stake in INWIT, but stepped back China Tower Company seem set on a path to IPO in confidence of entrepreneurs and investors which
from the deal when the gap between the value they late 2017. harmed IPO prospects in every sector. However the
ascribed to retaining control was not reflected in outlook for 2017 is more positive. Equity indices are
the premium offered by prospective buyers. So are the vast majority of those 2,077,223 operator- at an all time high in many markets, and volatility
led towerco towers destined to be sold to trade has fallen, both of which are positive signals that
Rather than being created to relieve debt, some buyers, or monetised through IPO? 2017 could be a good year for IPOs. The strong

momentum from Q4, where IPO activity rose by tower-industry veteran Chuck Green, now Executive much of the infrastructure gap, Mobilink took the
25% compared to Q3, is another positive sign. Chairman of Helios Towers Africa. It refers to the opportunity to create an internal towerco profit
practice of MNOs retaining a minority stake in their centre in 2011, and began leasing up their towers
What does this mean for the tower business? tower assets during a sale and leaseback, piggy at a commercial rate, achieving a tenancy ratio
TowerXchange expect 2017-18 to be better years backing on the value being added as a towerco of 1.25. Now ~9,000 Mobilink towers are set to be
for towerco IPOs, not least because some high enhances and leases up the towers. If the towerco sold, potentially for as much as US$1bn, as part
quality towercos are maturing toward their next business model is a good idea, it’s a good idea to of VimpelCom’s tower monetisation programme.
major liquidity event: we could see China Tower, keep some ‘skin in the game’ to avoid looking like a Significant tower cash flow has been added,
Arqiva, IHS, edotco and Guodong come to market schmuck! enhancing the value of the asset.
in the next two years, while Telxius, Global Tower
and Deutsche Funkturm could reconsider IPOs in a An increasing number of MNOs are behaving like It’s all happening in Russia
more receptive climate. towercos by leasing space on their towers to their
peers on a commercial basis. “Internal towercos” VimpelCom may be playing out a similar strategy in
In 2016 TMT, Industrials and Healthcare were the such as those run by Safaricom in Kenya, where their home market of Russia. VimpelCom has carved
top three sectors for IPO. It is more than likely that the wholesale department is leasing space on 800 out 10,400 towers into National Tower Company,
TMT will be the main sector coming to the equity of their 4,000 towers, and Vodacom in South Africa, and appointed CEO Thomas Jonell, former CTO of
markets in 2017. EY say they “expect some unicorns which reportedly has a tenancy ratio of 1.8, are not Eaton Towers, to tidy up the asset register and add
in the US, and this may drive some other big tech included in our total of operator-led towerco sites. value to the assets prior to monetisation.
IPOs in other regions”.
Vodacom’s internal towerco is one part of a larger Competitors MegaFon may be following a similar
‘Schmuck equity’ and in-house towercos story in South Africa where many of the local strategy with their carve out of 14,000 towers into
opcos have become disenchanted with lease rates First Tower Company. Meanwhile, MTS has carved
Our sizing of the operator-led towerco segment offered by the country’s leading towerco, prompting out around half their towers into MTS Towers,
does not capture the whole picture. MNOs also some to boycott further co-locations, whilst at least although their CEO claims to have no interest in
have significant stakes in several independent three of the four major MNOs, the aforementioned monetising the asset – only in creating a new profit
towercos, ranging from Millicom’s ‘schmuck equity’ Vodacom, Telkom and Cell C, have formed “internal centre as Russia’s culture of infrastructure sharing
stake in Helios Towers Africa, from which they are towercos” and are leasing their sites to each other. takes root. Russia’s fourth MNO, Tele2, are taking a
reportedly seeking to exit; Tata retaining 34.5% of contrasting approach seeking the sale and leaseback
the former Viom Networks, acquired by American We’re hoping to soon have a success story of their towers, although rumour suggests they may
Tower India in 2016; to MTN’s stakes in joint illustrating the monetisation of an ‘internal prefer a manage with license to lease deal structure
venture towercos with American Tower in Ghana towerco’. First movers Mobilink, part of the in which they retain ownership and partner with a
and Uganda and with IHS in Nigeria (in which MTN VimpelCom family, have the biggest tower towerco to lease up the assets.
retained 49%, 49% and 51% respectively). network in Pakistan, which they were reluctant to
share whilst it remained a source of competitive Beyond direct ownership, TowerXchange are aware
‘Schmuck equity’ is a term we first heard used by advantage. Recognising that other MNOs had closed of an increasing number of MNOs with an appetite

to invest in towercos – and that appetite more
often than not extends beyond the MNO’s
Ten critical considerations when carving out a towerco
existing footprint. It makes sense of course – 1. Hire people with experience running a towerco. A towerco is a fundamentally different business from the
it’s an asset class MNOs understand. property / network management department of an MNO. It’s not just about managing towers; it’s about selling
space.
Conclusion 2. Your asset register almost certainly is not accurate enough to optimally facilitate co-location sales, nor to
survive the rigorous analysis of due diligence during monetisation. Appoint a specialist company to audit and
In some (not all) tower markets, MNO tenants improve your asset register – you’ll be surprised how much capacity can be found in your tower network (and
have vociferously and publicly complained how much more equipment there is on your sites than you might have been aware of!)
about towerco lease rates and escalators
3. Get all the permits for all your towers.
and the pressure they put on the MNO’s
operating margins, firing angry letters at their 4. Consider converting bilateral swaps to commercial leases, even if it means paying tax.
landlords. But in many cases those same MNOs
5. Get your towers professionally monitored. Especially if the grid is unreliable (or if some sites are off grid),
negotiated a higher lease rate to maximise if you can’t professionally measure the performance of the energy equipment on your towers, you can’t
cash released when they sold the towers, or professionally manage the energy equipment on your towers.
secured a discounted new build based on a
6. Deferring maintenance is a bad idea. If you plan to carve out and lease up or monetise your towers, it might
healthy lease rate. Towercos are deploying
seem like a good time to postpone non-critical maintenance, but these towers are going to be the life-blood of the
capital to build and acquire towers with a long
towerco – look after them!
horizon to achieve a return on capital invested
– sometimes as long as 20 years. In very few 7. Don’t retain any more reserve space than is absolutely necessary. Too many operator-led towerco’s parent
other industries will you find a business MNOs reserve far more space than they need in the short term – that space could be converted into recurring
partner pricing based on a 20 year ROI. If it revenue from another client. Take more space when you need it, but don’t reserve it up front.
were a better deal to build not rent, MNOs 8. Draft the Master Lease Agreement (MLA) with extreme care – better still, appoint a law firm with experience
would build not rent. of drafting these documents – all the value is captured in the MLA. ‘Most favoured nation’ clauses guaranteeing
your parent MNO the best lease rate could limit a towerco’s ability to negotiate bulk deals. Restrictions limiting
MNOs should be less anxious about how competitors’ access to strategic sites directly harm valuations. And provisions allowing RANsharing can be
profitable the tower business is, and focus tremendously value destructive; include them if you must, but draft them with great care.
their efforts on partnering with, and 9. Consider buying the land under your most valuable towers. This enhances margins and protects you against
participating in, the tower industry. Carve the dual threats of escalating lease costs and ground lease aggregators.
out, keep and lease up your towers; carve out
and monetise; sell and leaseback – whatever 10. If you’re going to list your carve out towerco, don’t rush it. It takes time to change mind sets and to think
like a towerco, it takes time to clean up your asset register, it takes time to upgrade structures to accommodate
MNOs do with their towers, any tower retained
multiple tenants – and most of all, there is often “pent up demand” for tenancies on your towers – give yourself
captive on an operator balance sheet and not
a year, preferably two, before IPO – your towers will be more valuable if you take time to lease them up and to
being offered for commercial co-location is an
professionalise management. If you need cash sooner, sell and leaseback
underexploited asset

Why the Telxius IPO
It’s no secret that Telefónica has been increasingly
keen to restructure their balance sheet, relieve
debts in excess of €50bn, and raise capital for
was cancelled dividends to prop up their valuation. With their

effort to raise capital through the proposed sale of
TowerXchange seeks to derive lessons learned from the cancelled IPO O2 in the UK to Hutchison blocked by the European
Commission, Telefónica brought forward plans to
of Telefónica’s towerco
monetise a 40% stake in infrastructure carve out
Telxius, which had been inaugurated in February
Investors were underwhelmed by
2016.
the package of infrastructure assets
Telefónica brought to market and, Telefónica bundled 31,000km of subsea cable, plus
despite a downward recalibration all 11,000 of their towers in Spain and a selected
of valuation, ultimately rejected the 2,350 of an estimated 14,318 sites in Germany. The
proposition. What specifically did package of European towers was supplemented by
they not like about Telxius, what 1,655 towers in Brazil, 849 in Peru, and 328 from
Chile.
lessons can be learned, and what next
for Telefónica’s towers?
Why did investors balk at Telefónica’s €3-3.75bn
valuation of Telxius?
Keywords: Americas, Americas
Insights, Bankability, Carve Out, One obvious concern voiced by investors
Europe, Europe Insights, Exit Strategy, TowerXchange has spoken to was the challenge
Global Tower, IPO, Insights, Investment, valuing the subsea cable component of Telxius, from
MLA, Rooftop, Tax, Telefónica, Telesites, which 60% of the infraco’s revenues were derived.
Telxius, Towercos, Turkcell, Valuation Investors are simply less familiar with subsea cable
By Kieron Osmotherly, Founder & CEO, TowerXchange
businesses, and what comps there were suggested
a valuation around 7x, less than half the multiple
Read this article to learn: Telefónica hoped their towers were worth.
< Why demand from investors proved inadequate
< What assets were included, and excluded, from Telxius If Telefónica were to monetise a consolidated
< What Telefónica might do next subsea and tower business, would the valuation
< Transferrable lessons learned discount necessitated by the cable element bring the
tower valuation significantly below the multiple a

Timeline of the creation and cancellation of Telxius
Pre March 2015 March 2015 Sept 2015 Oct 2015 Dec 2015 Jan 2016 Jan 2016
Telefónica’s net debt Telefónica reaches CFO Angel Vila The European Bloomberg reports Ofcom’s Sharon White News circulates that
more than doubles over an agreement with hints at a potential Commission launches Telefónica to be meets EU Competition Telefónica is carving out
the course of a decade Hutchison to sell monetisation of an investigation considering a carve out Commissioner Margrethe its ~11,000 Spanish towers
following numerous UK O2 business for Telefónica’s towers Hutchison’s takeover of “60,000 towers” into Vestager to urge her to into new infrastructure
acquisitions across Europe £10.25bn to help tackle in his Q3 investor of O2 an infrastructure unit block the O2 takeover unit, “Wireless Towers”
and Latin America escalating debt presentation
Feb 2016 March 2016 March 2016 April 2016 April 2016 April 2016 April 2016 May 2016 June 2016 Sept 2016 Oct 2016
Telefónica announces the creation Movistar Chile Telefónica Telefónica Speculation Telefónica Reports EC blocks July IPO date Telefonica Telxius IPO
of Telxius saying it will initially announces Peru Brasil mounting that Deutschland circulate that Hutchison’s postponed plan to cancelled
consist of about 15,000 phone the sale of announces announces the EC will block announces Telefónica takeover of following list 40% of after
towers and an international 328 towers the sale of the sale of Hutchison’s the sale of plans to list O2 market Telxius on inadequate
submarine-cable network covering to Telxius for 849 towers to 1,655 towers takeover of O2 2,350 towers Telxius on the uncertainty October 3 to demand
31,000 kilometers with more CLP7.85bn Telxius to Telxius for as the deadline to Telxius for Madrid Stock created by raise up to from
assets being included gradually (€10.4mn) BRL760mn for their review €587mn Exchange in Brexit vote €1.5bn investors
over coming months. Telefónica’s (€192.6mn) approaches early July
~11,000 Spanish towers are known
to be included. Alberto Horcajo is
announced as CEO
company like Cellnex might pay for just the towers was retaining some towers yet bundling others into Another concern: why were so few LatAm towers
in a sale and leaseback? Telxius; were strategic, high value towers being transferred to Telxius? TowerXchange feel there is
retained on the MNO’s balance sheet? We think not justification in excluding Argentinian towers from
And what value did Telefónica place on retaining - the 11,968 sites Telefónica retained in Germany Telxius as the depreciation of the assets, combined
control? Evidently a gap emerged between what were mostly (perhaps entirely) rooftops rather than with devaluation of the local currency, and an
Telefónica thought the business was worth and the ground based towers, and rooftops are notoriously unfavorable tax regime, makes the monetisation of
value the capital markets would ascribe it. difficult to co-locate at good margins in Germany towers difficult in the immediate term; meanwhile
Some investors cited a concern as to why Telefónica due to landlord demands. the government stake in Telefónica’s operations in

Brazilian towers are relatively small and lack the
Transferrable lessons learned from the cancelled Telxius IPO structural capacity to accommodate heavy lease up.
If MNOs want to carve out towers, retain a investment proposition from a pureplay Finally, the Telxius IPO looked hasty. Global comps
controlling stake yet utilise the capital markets independent towerco. Cellnex and American suggest it takes one to two years for new carve out
to release some capital, they should allow at Tower are imperfect valuation benchmarks. towercos to tidy up their asset register, identify
least 18-24 months to establish their modus The valuation of a towerco is a function of the and upgrade (where necessary) sites where there
operandi and to prove the concept. Telxius investibility of it’s MSA, and if the MSA grants might be pent up demand, and to prove their ability
follows an underwhelming debut of America favourable terms to a controlling-interest to lease up sites and sweat the assets. Telxius was
Movil’s towerco Telesites at the turn of the year, retaining parent MNO, such as preferential lease simply not given long enough to prove its worth as
but both ventures might have elicited a more rates, most favoured nation clauses, RANsharing an independent entity.
favourable response from the capital markets provisions or substantial reserve space, then
had management teams been bedded in, with valuations should rightly be downwardly What Telefónica might do next
the first wave of improvement capex deployed adjusted.
and the sites proactively marketed for a couple of So what next for Telefónica’s towers?
quarters, enabling would-be investors to quantify MNOs often seem to be tempted to bundle a
pent-up demand for co-location. variety of infrastructure assets into these carve While it might be tempting to fall back on the
outs to maximise scale. If you’re creating, but security that the IPO was the victim of macro-
Telefónica were not alone in having to cancel not monetising, a newco infraco you can put economics (Brexit and the surprise US election
the IPO of a carve-out towerco in 2016. Turkcell anything you want in the package. But bear in result combined to undermine investor confidence
suffered the same fate. With 20:20 hindsight it mind that there are hundreds of investors with in equities across every sector), TowerXchange
can be easy to blame investment bankers for a taste for towers, who are comfortable valuing don’t think that is the sole explanation. The towerco
inflated valuations, but the fact remains that passive infrastructure, and who currently value it asset class remains in vogue, and investors would
an operator-led towerco is a very different highly. Why dilute the premium product? have welcomed a viable multi-country independent
towerco platform to compete with Cellnex in
Colombia likely precluded the inclusion of those prospective future sale to a strategic. And a strategic consolidating European towers. With a different
towers. could not buy Telxius at full value if all the contracts package of assets, and a revised MSA, Telxius may
would need renegotiating. have found the capital markets more receptive.
Ultimately the value of any towerco is a sum of the
value of their contracts and, among other concerns, Tower industry insiders were quick to point out Telxius still looks like a good play in the long
the Telxius MSA required that all contracts be that most of Telefónica’s Brazilian towers had been term; tidy it up and lease up the assets for a year,
renegotiated if Telefónica’s stake fell below a certain offered to towercos in their sale and leaseback reengineer the MSA – if investor sentiment towards
percentage. Even if Telefónica intended to retain a transactions, and only remained on Telefónica’s Argentina continues to improve (particularly if the
majority stake, valuation benchmarks against other books as a result of being swapped for better sites. government responds to pressure to ease certain
public towercos are less meaningful if there is no One simple illustration of this: many of Telxius’ taxation conditions adversely affecting tower

Stop press: Telefónica in discussion to
sell minority stake in Telxius to one of
several funds - report
On the eve of publishing this Journal, El

Economista broke a story that several
investment funds were in negotiation to
acquire a substantial yet minority stake
in Telxius, including usual suspects KKR,
Brookfield and Blackstone, as well as Apax
and CVC. Telefónica evidently wishes to retain
control. A valuation of €1.3bn for 40% equity
has been mooted
valuations), maybe add the Argentinian towers. If

there are other ground based towers in Germany
that could be included, they should be included.
Consider extracting the submarine cable business
but, if it is to remain in the bundle, perhaps focus
on investor education to help them get more
comfortable with the mash-up.
Visit the TowerXchange.com website
Telxius could reboot their IPO in 2017-18 and list
successfully for a similar valuation which they < Access to the “Internet of People” in the global tower < A comprehensive archive of TowerXchange’s
sought in October 2016. Telefónica has appointed a industry – a trust web of over 35,000 decision makers interviews and analyses, searchable by topic, country,
in telecom and broadcast infrastructure company or grouped by category (e.g. interviews or
capable management team at Telxius – I for one am
how to guides)
glad we’ll have the opportunity to see how they can
< Independent analysis and commentaries on the
add value before the asset is monetised. < The latest news and registration information about
prospects for tower transactions in selected countries
TowerXchange’s Meetups.
In the meantime, if Telefónica needs to raise some < The latest industry emerging market tower industry
cash, there will be no shortage of independent
towercos queueing up to cash in their Spanish,
news – BEFORE it’s published in the TowerXchange
Journal, accessible 24/7 from desktop, tablet or mobile Tower Xchange
German, Peruvian, Chilean or Argentinian towers!

How to structure MLAs and SLAs TowerXchange: Please can you introduce Vinson
& Elkins’ expertise in the tower industry. What
have you advised on and with what types of
to effectively avoid future disputes clients have you worked with?
Expert advice from leading law firm in the tower sector, Vinson & Elkins Rob Patterson, Partner, Vinson & Elkins: Vinson
& Elkins has extensive experience in the tower
sector, advising clients across the globe on both
Vinson & Elkins are one of the most
transactional and dispute work.
experienced law firms in the tower
industry, having advised clients on some Our clients include public and private companies
of the most complex cases in more than (from startups to well-established businesses),
twelve African countries and a number mobile network operators, tower companies and
of jurisdictions in the Middle East and investors. We help them with tower acquisitions,
Southeast Asia. TowerXchange speak co-location, master lease, build-to-suit, management
to Vinson & Elkins’ team to obtain their services and marketing arrangements and all
aspects of their businesses all over the world.
expert advice on structuring transactions
and designing MLAs and SLAs that avoid
Ahmed el-Gaili, Partner, Vinson & Elkins: The
Rob Patterson, Partner, Vinson & Elkins, Ahmed el-Gaili, Partner, Vinson & the creation of frictions and disputes over matters we advise on include acquisitions and
Elkins, and Natalie Lamb, Senior Associate, Vinson & Elkins
the course of the long-term agreement. disposals of tower portfolios (often by way of sale
and leaseback transaction), equity investments
Keywords: Active Infrasharing, Africa, Africa & ME, Anchor Tenant, Co-locations, Deal Structure, Energy, into tower businesses, debt financings, set up and
day-to-day running of commercial and operational
Infrastructure Sharing, Lawyers & Advisors, Lease Rates, Leasing & Permitting, Middle East, MLA,
contracts and the resolution of disputes. We have
MNOs, Novation of Leases, Regulation, Risk, Sale & Leaseback, SLA, Towercos, Valuation, Vinson &
advised on some of the most complex and high
Elkins, Who’s Who
value tower-related transactions and cases in
high growth markets to date – including in more
than twelve African countries and a number of
Read this article to learn: jurisdictions in the Middle East and Southeast Asia.
< Vinson & Elkins’ experience advising clients in the tower industry
< Key considerations in designing an MLA to avoid disputes down the line Natalie Lamb, Senior Associate, Vinson & Elkins: We
< How to treat RAN sharing in an MLA to protect both parties understand the regulatory, political and commercial
< Strategies for towercos to mitigate the risk posed by tenants with lower credit ratings issues that arise and the legal issues facing our
< Trends in SLAs and how to design fair agreements that improve site operations and uptime international clients doing business in this sector
and in these regions.

“
TowerXchange: We’ve have seen examples terminated. The operator will therefore want to
of tower transactions where an operator has ensure at the outset that the towerco commits to full
been unhappy with the long term contract compliance with ground leases, prompt rectification
that has been put in place following a deal. of any breaches and timely renewals of expiring
When designing a Master Lease Agreement ground lease agreements. If it is too easy for a
(MLA), what terms do both parties need to be towerco to terminate a ground lease and substitute
particularly careful of that can have a negative the tower for another location, the operator will not The days when a towerco would
impact on the attractiveness of a contract in the have adequately protected its most valuable asset.
long run? Conversely, towercos will want to be mindful that
seek to prohibit RAN sharing
they have autonomy on the management of their in an MLA are numbered (if
Ahmed el-Gaili, Partner, Vinson & Elkins: The ground lease portfolios, are not subject to undue not over). The status of the law
lengthy duration of the MLA makes it particularly interference from their anchor tenants (which could
important for the parties to resolve any natural undermine their independence) and maintain the and regulation around RAN
tensions between them at the outset to everybody’s ability to move tenants from troublesome sites in sharing does vary tremendously
satisfaction. exceptional circumstances. Balancing these rights
by geography; to take the
and obligations from day one is important for the
extremes, in some markets it is
Rob Patterson, Partner, Vinson & Elkins: For
perhaps 10-20 years or more, the MLA will define
the operator’s rights and the towerco’s obligations
in terms of space and capacity on the towers. The
operator will look to ensure sufficient flexibility to
MLA to remain attractive to both parties throughout
its long lifetime.
TowerXchange: RAN sharing is becoming an

increasingly hot topic globally but can have a
mandated and in others it is not
yet legally permitted
“
deploy and maintain its equipment and provide the significant impact on towerco revenues. How
best possible service to its customers. The towerco should potential RAN sharing agreements that
will be focussed on maintaining sufficient control to could arise be treated in designing MLAs?
maximise co-location opportunities and sufficient and it is therefore important to provide as much
independence to attract other tenants. If these Ahmed el-Gaili, Partner, Vinson & Elkins: The days certainty as possible as to how these arrangements
needs are not suitably balanced in the MLA, both when a towerco would seek to prohibit RAN sharing will work at the outset of the MLA (which should
parties could encounter difficulties and seek to in an MLA are numbered (if not over). The status help to mitigate uncertainty and disagreement
renegotiate the terms of the MLA. of the law and regulation around RAN sharing down the line).
does vary tremendously by geography; to take
Natalie Lamb, Senior Associate, Vinson & the extremes, in some markets it is mandated and Natalie Lamb, Senior Associate, Vinson & Elkins:
Elkins: One good example is renewal of ground in others it is not yet legally permitted. There is, While there are no hard and fast rules on how to
leases. Even a tower with perfect uptime is of however, a likelihood that RAN sharing will be treat RAN sharing in the MLA and establishing how
limited value to an operator if the ground lease for implemented more extensively in a significant to compensate the towerco for loss of revenue or
the land or rooftop on which the tower sits is easily number of markets in the short to medium term opportunity is complex and deal specific, emerging

trends include use of a fee-based model (perhaps still free itself of liabilities associated with the day- business over the term of the MLA). Towercos will
with fees agreed at the outset or alternatively linked to-day running of the sites and would benefit from want reclassification to be limited or, for example,
to the market at the time of the sharing). Parties can a low lease rate. The towerco would acquire the for overall percentages of site classes remain
consider increasing the fees beyond predetermined towers cheaply and would have a more manageable constant. Otherwise they could find themselves
limits, e.g. if instances of RAN sharing or quantity of credit risk from the anchor tenant. having to provide “critical site” service levels to all
equipment shared are exceeded. Distinctions can or almost all towers.
be made between sharers which are already tenants Ahmed el-Gaili, Partner, Vinson & Elkins: Another
on the tower and other third parties. possibility, which could also apply to co-location Ahmed el-Gaili, Partner, Vinson & Elkins: One
agreements as well as tower transactions, would consideration that parties need to keep in mind is
Rob Patterson, Partner, Vinson & Elkins: The be to have the operator’s parent company provide that performance of the SLA will often be contingent
parties should also consider whether and how a guarantee of the lease payments. This would of on the state of the towers upon transfer. A towerco
the requirements should change if RAN sharing course depend on whether the parent company had might not be expected to radically improve
becomes mandated by law or by the regulator. a higher credit rating. The towerco might also look performance on the sites on day one if, for example,
to ask for payment of rent in advance rather than the towers and related equipment are not up to
TowerXchange: There is an appetite amongst in arrears and/or a regular payment period and industry standard at the time of transfer. In these
tier 2 operators in sub-Saharan Africa to divest prompt settlement of invoices. instances, the parties should consider whether a
assets but their lower credit rating and thus transition period might apply.
suitability as an anchor tenant have made TowerXchange: In speaking to operators and
the deals less attractive to towercos. How can towercos we see a move towards creating service Rob Patterson, Partner, Vinson & Elkins: We
towercos best protect themselves against future level agreements that not only compensate have seen a move toward additionally rewarding
financial challenges in both tower transactions failures but also reward good performance. the towerco if service levels are consistently
and co-location agreements with such parties? What are key things contractually that both exceeded although SLA trends, like most
parties need to be aware of in creating service contractual provisions in these transactions,
Rob Patterson, Partner, Vinson & Elkins: Towercos level agreements and how have you seen things will vary significantly from jurisdiction to
in a tower transaction might consider staging change? jurisdiction. Another noticeable recent change to
payment of the purchase price for such towers over SLAs in certain jurisdictions has been an increasing
time, perhaps allowing for set off of outstanding Natalie Lamb, Senior Associate, Vinson & Elkins: focus on the measurement of power usage and
consideration against liabilities of the tenant Operators will often want different service improving energy efficiency. If, for example, not
which may arise, e.g. unpaid rent. In sale and levels to apply to different towers. For example, all sites have smart meters, we commonly see
leaseback transactions, the consideration paid for particularly critical towers or hub sites might the parties commit to a glide path of smart meter
the towers normally correlates with the lease rate require faster response and repair times or higher installation. Parties will often also consider how to
agreed between the parties (i.e. the higher the uptime commitments. We therefore typically see share in any gain where sites become more energy
consideration, the higher the lease rate). So a deal different classes of sites provided for in the SLA efficient or less reliant on fossil fuels – this requires
could be negotiated where there is a low purchase with some flexibility for the operator to reclassify a certain amount of future proofing and is perhaps
price but also a low lease rate. The operator would between classes (allowing for developments in their a subject for another day!

Suresh Sidhu on how towercos Sidhu opened his speech by identifying three
concurrent forces which are “creating headwinds”
against the traditional towerco business model,
should navigate emerging headwinds namely the financial and operational threats
to MNOs and their way of doing business, OTT
edotco’s CEO on the threats to the towerco business model, and how to overcome them players entering the infrastructure industry and
testing new connectivity and data solutions; and
During the 3rd annual TowerXchange the transformation and evolution of the network
Meetup Asia, edotco’s CEO Suresh architecture.
Sidhu, took centre stage and gave
an inspirational keynote speech on Three threats to the towerco business model
the changing dynamics of the tower
industry by analysing, and proposing The threat to traditional MNO business model is
responses to, three main threats to its clear to everyone. In fact, while data demand is
traditional business model: pressure indeed growing and growing fast, this increase
on MNO margins, new entrants such as hasn’t been sufficient to counterbalance the decline
Google, Facebook and SpaceX poised to in voice revenue. Sidhu showed the YoY results
enter the infrastructure space, and the of two operators who managed to considerably
transformation of network architecture increase their data revenue and yet failed to achieve
particularly at the heterogeneous positive EBITDA results due to plunging voice
network layer. revenue. And as MNOs face a continuous decline in
their profit margins, and in some cases mounting
Keywords: 3G, 4G, 5G, Asia, Business debts, towercos are forced to redesign the way they
Model, C-Level Perspective, DAS, price their leases to remain attractive partners.
EBITDA, Editorial, edotco, IBS, Infraco,
Market Overview, Operational If the original mission of the towerco business
Excellence, Regulation, Rooftop, Small model is to deal with assets embedded in the
Suresh Sidhu, CEO, edotco Cells, Towercos ground, Sidhu noted that this might not be the
case anymore due to the entrance of various new
(and challenging) business channels in the mix. He
Read this article to learn: referred to OTT players who are now engaged in
< The three key threats to the traditional towerco business model testing ways to deliver data via alternative platforms
< How can towercos counteract the headwinds and stay on top of their game? such as Google’s Project Loon, Facebook’s Aquila
< The evolution from invisible steel and grass organisations to key partners with a strong corporate culture and SpaceX’s satellite network. These solutions will
< Expand, Optimise, Innovate and Automate to succeed pose a real threat to traditional towercos if and
when they become available in the market.

In terms of network architecture, Sidhu highlighted YoY revenue drops due to voice revenue crisis
that our generation will live through the 2G switch-
off as MNOs will be forced to free up and re-farm Operator 1 Operator 2
frequencies for 4G and 5G. This change will have YTD ‘15 YTD ‘16 YoY % YTD ‘15 YTD ‘16 YoY %
an impact not only on the ways MNOs deliver their
services but also on how infrastructure companies Total Revenue US$mn 1,271 1,145 -10% 501 496 -1%
live without a base-load of 2G kit. And although Voice Revenue US$mn 943 763 -19% 452 433 -4%
the switch-off of 2G keeps getting delayed, it is
something we’ll witness in the mid-term future. Data Revenue US$mn 328 381 16% 48 63 30%
EBITDA US$mn 520 435 -16% 190 168 -11%
The evolution of network architecture is
particularly crucial these days due to the demand
EBITDA % 41% 38% -2.9pp 38% 34% -4.0pp
for high throughput which is pushing networks Source: edotco keynote presentation, TowerXchange Meetup Asia 2016
to move towards the heterogeneous network

architectures where macro-sites serve as coverage
solutions and micro-sites such as small cells and
DAS are utilised to increase capacity and site
density.
How can towercos stay competitive?
The question for towercos is how they can position

themselves to be ready for those changes that might
not happen but would certainly have an impact on
the world they operate in. And while the key is to
embrace changes this might not always be as easy
as it seems.
In Sidhu’s words “towercos will have to navigate

headwinds by using the right tailwinds” and this
will require towercos to engage in new ways of
doing business and move to a more comprehensive
infrastructure company mindset. edotco’s portfolio,
for example, is formed 45% ground based towers,
45% by rooftops and 10% by in-building solutions
and other shared products such as BTS hotels. Sidhu Source: edotco keynote presentation, TowerXchange Meetup Asia 2016

Source: edotco keynote presentation, TowerXchange Meetup Asia 2016 Source: edotco keynote presentation, TowerXchange Meetup Asia 2016
noted how this mixed composition of alternate site Sidhu outlined the towerco model for tomorrow which force towercos to redefine their role in
typologies was the way forward. by referencing to the four key streams of activities today’s industry. In today’s world, the adoption of
companies should focus on, namely expanding their heterogeneous network solutions as well as the
Other strategies to adapt to change include the offering, optimising services (with much emphasis creation of new cooperative channels with MNOs
expansion of services offered. For example, to on energy), innovating by embracing heterogeneous might not be optional.
incorporate dealing with complex permitting issues network architecture solutions, and automating
and other regulatory obligations, or embracing operations such as RMS and the asset lifecycle
Additionally, towercos might need to look beyond
new technologies, moving towards leaner and management.
the traditional steel and grass model and work
greener operations, solidifying one’s position
towards adding visibility to their business by
especially in key markets and ensuring to stay agile Conclusions
also by building economies of skills. The latter engaging with regulators as well as working on
point refers to the need for towercos to create an Sidhu offered an inspirational speech on the creating a stronger internal culture. In fact, as noted
internal culture that promotes engagement and skill opportunities for towercos to expand beyond by Sidhu, while edotco’s history originated due
enhancement and to forge a productive workforce their traditional mindset into new - challenging to the need to consolidate passive infrastructure
rich in both local and group-wide knowledge, - territories. This shift might not be optional as across multiple portfolios, the company is now
which should enable talented people to transfer tech giants make their way into the infrastructure moving towards innovation and a virtually infinite
experiences cross-country. universe and test satellite-enabled ways to connect expansion of services

Your towers can save lives
One of the things of which I’m most proud is that
four babies have been born to the TowerXchange
team within the five years since I started the
Cell sites located beyond the electricity grid uniquely positioned to complete company, including my own son Joshua. To say
the vaccine ‘cold chain’ we’re a family friendly company would be an
understatement: our Team Strategic Retreats come
Millions of children die every year from readily preventable complete with childcare and nappy bins!
diseases. Energize the Chain would like to use your towers to
prevent many of those unnecessary deaths. How? In order to be So when ‘Energize the Chain’ approached us with a
proposition to leverage the world’s 4mn cell towers,
effective, vaccines need to be kept cool, and using refrigerators
particularly the ~300,000 beyond the reach of the
powered and connected to monitoring systems by your cell
electricity grid, to enable the child vaccinations in
towers would be a great way to complete the ‘cold chain.’ Econet developing markets, TowerXchange wanted to do all
is already saving children’s lives by doing this in Zimbabwe, we could to help.
and American Tower will add fridges to 85 cell sites in Ghana.
This isn’t just a great corporate social responsibility and I’m a pragmatist at heart. With any innovation, no
community relations opportunity for MNOs and towercos, it’s an matter how it tears at the heart-strings, the first thing
ethical obligation for all tower owners to give this opportunity I ask is “how proven is this in the field?” So when
we learned that Energize the Chain had already
appropriate consideration.
issued over half a million vaccines through 312 cell
sites at which their refrigerators were co-located in
Keywords: Africa, Africa & ME Insights, American Tower, Asia, Zimbabwe, and that similar solutions were being
Asia Insights, Bangladesh, Best of TowerXchange, Business Case, rolled out at 85 sites owned by American Tower in
Community Power, Corporate Social Responsibility, Econet Ghana, we quickly realised this was something we
Wireless, Energize the Chain, Ghana, India, Insights, MNOs, wanted to advocate to all cell tower owners.
Dr. Harvey Rubin, Founder and Director,
Myanmar, Off-Grid, Pakistan, Towercos, Unreliable Grid, Zimbabwe
Energize the Chain TowerXchange invited Energize the Chain Founder
and Director Dr. Harvey Rubin to explain his
proposition at the recent TowerXchange Meetup Asia
Read this article to learn:
in Singapore. Here’s some of the highlights of what
< A win-win proposition: why you need to consider co-locating vaccine fridges at your cell sites he said.
< How this idea has been proven by Econet Wireless in Zimbabwe
< How this idea will be extended in Ghana by American Tower “As many as three million children under the age of
< What are the operational requirements? five die or get very sick every year from diseases that
< What you should do next to start saving children’s lives you can easily prevent by a vaccine,” Harvey told
TowerXchange.

“
Econet Wireless partners with Energize the Chain
to provide more than 500,000 vaccine doses to
children in Zimbabwe
In September 2010 Harvey and his colleague Alice

In our business, we build the technical platforms that make an impact on
Conant wrote a paper in the New Scientist suggesting
people’s lives, because we believe that technology has to have a positive
impact on people. So we believe in the human face of our technologies. One
such face is Energize the Chain: the vaccine project – Douglas Mboweni,
CEO, Econet Wireless Zimbabwe
“ co-locating vaccines refrigerators with cell towers
in remote areas. Thanks to that paper, Energize the
Chain was invited to give talks about this all over the
world. Harvey gave one of these talks in Mombasa
in Kenya, and sitting in the audience was one of
the Senior Engineers of Econet Wireless, Bernard
Fernandes, and he told Harvey: “This is something
“When you’re trying to deliver vaccines for are toilet bowls. MNOs and towercos are expanding we can do. This is something we have to do. This
preventable child killer diseases like pneumococcal mobile phone coverage deeper and deeper into rural is our Corporate Social Responsibility. We want to
pneumonia, tetanus, measles, whooping cough, areas – often beyond the reach of the grid.” contribute to giving good healthcare to the people of
rotavirus, polio and diphtheria to remote villages Zimbabwe.”
beyond the reach of good grid power, one of the “Ministries of Health around the world make the
primary challenges is ‘completing the cold chain’ – expansion of vaccines coverage a priority, often So Econet went out and did it. Econet’s Energize
keeping vaccines cool from the point of manufacture beyond the reach of the grid – there is an obvious the Chain programme now has fridges at 312 sites
to the point where they’re administered to the child. opportunity to create a public private partnership all over Zimbabwe, and over two years they’ve
Vaccines typically need to be stored within a 2-8°C between MNOs, towercos and Ministries of Health to provided more than 500,000 vaccines for the kids.
“
range – exposure to higher or lower temperatures co-locate vaccines refrigerators at cell towers.”
risks denaturing the vaccines, rendering them
useless,” continued Harvey. “TowerXchange readers will be familiar with the
challenge of energy poverty around the world. More
“The telecom and tower industry is solving a similar than 3.5bn people lack access to reliable electricity In our industry, rightly so, we’re
problem: providing reliable energy to connect – that’s more than half the world’s population.
concerned about saving capex,
communities beyond the reach of good grid power.” There is no reliable grid power to power vaccines
“How about we work together to solve these parallel

challenges?”
refrigeration in remote areas in developing markets.
Your tower network infrastructure generates
excess power, which can be diverted to help local
communities. Energize the Chain, and our partners
saving opex, but isn’t it great
saving lives too? Young lives
- Bernard Fernandes, CTO,
Econet Wireless Global
“
Harvey continued: “There are more mobile phones like USAID and GAVI, would like to work with
in the world than there are toothbrushes. There you and your local Ministry of Health to co-locate
are more mobile phones in the world than there vaccine fridges at some of your cell sites.”

Educational outcomes improve - healthy children
have better school attendance and learn more
effectively, increasing financial security and social
and economic advancement.
Women are empowered - vaccination leads to a

reduction of child mortality rates, resulting in
families choosing to have fewer children.
Economic growth is promoted - healthier workers

have better attendance rates, higher productivity,
are more energetic, and mentally robust. The
reduction in missed days at work particularly
impacts women, who are often tasked with caring
for sick children.
Vaccines promote equity - vaccine-preventable

diseases disproportionately impact the
disadvantaged.
Therefore, we at Energize the Chain firmly believe

that in our collaboration with the MNOs and
towercos we have a solution to a major problem that
is scalable, sustainable, environmentally friendly
with a powerful social and economic impact.
Energize the Chain exists to provide vaccines for the from vaccinations amount to tens of billions of U.S. American Tower are saving children’s lives
“fifth child”- referring to the one in five children in dollars. Ministries of Health can invest these savings
the world who live predominantly in remote regions into other areas of need, thus establishing a more The world’s largest independent tower company
and who do not receive adequate vaccinations and robust overall healthcare system. American Tower needs no introduction within
consequently either die or become severely ill. the pages of this Journal. So when you learn that
There is improved community health: vaccination American Tower has partnered with Energize
Our primary goal is healthier children, however programmes form the basis of village-operated the Chain in Ghana, you can take that as an
there is a tremendous ripple effect that can derive primary health care activities providing the endorsement of this vision from the highest levels of
from our work at Energize the Chain. The savings opportunity to deliver other primary care services. the tower industry.

“
What Energize the Chain would like to
do with your cell site
Energize the Chain would like to install a

Energize the Chain, and their partners Econet and American Tower, are
0.43kW vaccine refrigerator, typically on a
saving children’s lives by co-locating vaccines fridges at almost 400 cell 2mx1.5mx0.4m plinth, in a shelter either inside
sites in Zimbabwe and Ghana. As an industry we could be ‘Energizing the or outside your cell site compound. This is not
Chain’ and immunising millions of kids from hundreds of thousands of cell a cheap domestic fridge, but a purpose built
sites. Let’s Energize the Chain all over sub-Saharan Africa. Let’s take this to piece of equipment costing over US$3,000.
India, Myanmar, Bangladesh, Pakistan and other countries in Asia where Access can be controlled by mechatronic locks
such as those manufactured by Acsys, with door
electrification, and immunisation, remain a challenge. This is a win-win for
the tower industry: we save lives and we build closer relationships with our
customers and communities. Please contact Harvey today and ask how YOU
can help – Kieron Osmotherly, Founder and CEO, TowerXchange
“ and temperature monitors installed by remote
monitoring system market leaders
Introducing Dr. Harvey Rubin,

Founder and Director of Energize the
Chain
American Tower has been in Ghana since forming a towercos with remote sites. Energize the Chain want
joint venture towerco with anchor tenants MTN in to assess those sites, carefully build GIS maps of the Harvey is a Professor of Medicine with a
2010, and the company now operates over a third of cell towers and the health centres, and build models secondary appointment as Professor of
the country’s ~6,000 cell sites. of how many miles it takes to deliver vaccines to the Computer Sciences at the University of
local communities, and then work out from which Pennsylvania. The NIH, NSF, DARPA and the
American Tower, Energize the Chain and USAID sites they can make the most impact. Global Alliance for TB Drug Discovery have
collaborated to initially co-locate vaccine fridges funded his research in infectious diseases,
at 30 remote cell sites in Volta, and in the Upper Vaccines save lives. Energize the Chain can leverage resulting in more than 90 peer-reviewed
East and Upper West regions of Ghana – regions your towers to keep vaccines cool and to save more papers. He served on national and international
notoriously difficult to reach due to poor quality lives. Your cell towers to save lives. scientific review panels including the NIH, NSF,
roads, and where keeping vaccines cool had been a NASA Intelligent Systems Program, DARPA, and
real problem. The initial 30 sites will be followed by Please will you help Energize the Chain save The Medical Research Council, South Africa.
a further 55 sites. hundreds of thousands of children’s lives? He was a member of the U.S. National Science
Advisory Board for Biosecurity and the Dept. of
What YOU should do next For more information please visit the Energize Defense/National Academy of Sciences Biological
the Chain webpage www.energizethechain.org or
Cooperative Threat Reduction Program
Energize the Chain want to hear from MNOs and email Dr. Rubin at rubinh@upenn.edu

Back to the future
TowerXchange: What’s your vision for 2020?
Where do you think we will be with 4G/LTE+/5G
rollouts?
A macro-level summary of how 5G, IoT and new technologies will affect the
shape of telecom infrastructure Ezio Zerbini, GCU Telecom Italia CTO, Ericsson:
Ericsson’s vision is that in 2020, society will start to
As one of the leading players in the become fully networked with connectivity not only
5G technology ‘arms race’ currently on mobiles and devices but appliances at home
underway, Ericsson have a unique too. 2020 will be a time of 5G, Internet of Things
perspective on the potential of the and everything Cloud.
5G
next generation of telecoms and how
it will be rolled out. TowerXchange In the context of this trend, we see 5G as the true
picked the brains of Ezio Zerbini, enabler for industrial transformation; think, for
a vastly experienced CTO within example, of new manufacturing capabilities which
Ericsson’s Italian telecoms unit, about would be enabled by networked robotics, and
how he sees this new technology which are not possible with today’s technologies.
rolling out, and what it means for
tower owners. One of the highlights of 5G is the decrease of
latency, as some of these new applications require
Keywords: 3G, 4G, 5G, Capex, DAS, a latency below 10 milliseconds. This is the ‘magic
EBITDA, Ericsson, Europe, IBS, threshold’ where a robot, a car or an application
Infrastructure Sharing, Investment, can be comparable – and as reliable – to a
IoT, LTE, Market Forecasts, Market human. We think that 2020 will be just the first
Overview, New License, Regulation, rollout of machine type communications critical
Small Cells, Urban vs Rural, Valuation, applications, but this will eventually move to
Who’s Who consumer markets too, such as robots at home for
domestic activities.
Read this article to learn: For the first time, the new generation of technology
< The vision for 5G 2020 and beyond will not render the previous one redundant,
< Potential applications for 5G, both in the near and long term so 4G will remain and the new generation will
< How well current network topology will serve future needs incorporate the previous one completely. Capacity
will migrate onto the new 5G network but the
< The stakeholder mix and how it will change over the next few years
‘nervous system’ will remain on 4G. 5G will be
< What towercos need to do now to prepare for 5G rollout
mostly implemented using small cells in between

existing 4G systems. Towercos will play a big role challenge due to the fragmented market and lack of will be successful, and the more you can cooperate
in running 4G networks and 5G small cells too. I scale. the more relevant your capability will be.
believe much of the 5G rollout will be managed
by other business entities rather than operators: 5G will be a boost of existing service and will cover TowerXchange: How will towercos need to adapt
towercos, private companies and so on. some areas as a high capacity and low latency to meet the changing needs of their clients?
network. But only in some selected areas, it won’t
Another application that will come later but will be continuous coverage. It will completely change Ezio Zerbini, GCU Telecom Italia CTO, Ericsson:
be improved is fixed wireless access; mobile the networks and infrastructure so towercos need They need to acquire assets, make joint ventures
networks will have capacity to compete with indoor to be smart and get the right assets in place as soon and have a multi-operator approach. Operators
fibre wiring. FTTB structure will be the main as possible. today need to have complete and dense coverage
infrastructure, meanwhile 5G will cope with the of 4G systems. It will be the nervous system of the
offering of indoor wiring type solutions. There’s a TowerXchange: What are the challenges which future. Fibre assets need to be acquired as most of
battle between fibre and WiFi that will be solved operators and towercos face in current small the fibre assets are already in place, there’s no room
by 5G; 5G small cells are a hybrid indoor/outdoor cell deployments? Do you see these challenges to roll out much more.
solution able to cope with the last 100m of the last getting easier or more complex as time goes on?
mile. Governments need to understand that areas not
Ezio Zerbini, GCU Telecom Italia CTO, Ericsson: You covered by 5G will lose all relevance from an
5G also has the advantage to ensure zero time to need to get assets. Close the discussions, get assets industrial point of view, so they need to push the
market – as soon as you subscribe in the shop your every day. different stakeholders to accelerate it.
service can be switched on immediately.
TowerXchange: Could you give us an overview 5G is based on technologies that were developed in
TowerXchange: How do you see small cells being of the stakeholders who will need to work military applications. I am referring to phase array
deployed currently? Do you think operators together for 5G rollout? How do you see their radars, they can focus microwave beams onto a
and towercos are giving sufficient headroom to relationships changing over time? target, they can move or rotate the beam and follow
planning for future networks in their current the target without any mechanical movement.
rollouts? Ezio Zerbini, GCU Telecom Italia CTO, Ericsson: Using the beam technology, you can concentrate the
Stakeholders are the towercos, operators and RF power and you can go through walls and cross
Ezio Zerbini, GCU Telecom Italia CTO, Ericsson: municipalities, so they can share opex and the in-building loss which today is a barrier to use
I think more capabilities and people need to be negotiate. Of course this is a skill set towercos are high-frequency spectrum. You can use spectrum
dedicated to network planning. Operators need to used to employing. you can’t use at all today. The other key point is the
replicate the clusters without reinventing the wheel size of antennae. 5G is a technology which enables
every time; things are so complex in this business so The relationship will change completely. The higher spectrum bands for mobile applications
you need to have blueprint replication capabilities. focus will no longer be on business to business and increase the bandwidth. The plan is to disguise
Some operators in the US and Asia have started relationships but on strategic partnership relations. these antennae in streetlamps and you won’t even
to adapt to this reality, but in Europe it’s still a 5G will force cooperation. Any kind of cooperation see them

The knowns and unknowns
TowerXchange: What is Arqiva’s understanding
of 5G, what will it look like and when will it be
about 5G rollout
rolled out in the Europe?
Nicolas Ott, Managing Director, Telecoms and

Arqiva’s Nicolas Ott explains how the telecoms sector is set to see a radical shakeup M2M, Arqiva: There is currently a lot of work being
done in Europe, Asia and the USA in regards to 5G,
Mobile phones have come a long way since the 2G days of plain although it seems a lot of companies are going for
voice and txtspk. Two successive generations of technology a later timetable than was initially anticipated. We
have revolutionised the way we interact with our phones, with will see 4.5G or 4.9G rolled out probably around
content and with the world around us. However, as the dawn of 2019/2020 (or maybe 2018 for ambitious MNOs) and
5G breaks first light on the horizon, it seems this next generation then from 2020 to 2024 there’ll be a significant take
will create the biggest changes of all. There’s only one problem up of full 5G. In terms of how big of a change it will
– no one is really sure what those changes will be. What we be for the existing mobile networks, no-one can
know – the spectrum requirements, basic infrastructure needs really be sure for the time being but the equipment
and possibilities, is balanced by a huge number of unknowns makers are investing a lot of energy in this and
– how it will be delivered, what consumer take-up will be and some MNOs are responding very positively - even if
who will emerge from the 5G evolution at the top of the pile. other MNOs would have preferred more time.
For infrastructure owners, the need to deploy capex in order
to capitalize on this wealth of opportunity is clear. However, There’s a lot being said about 5G right now –
information about the exact way to maximize that expenditure ultrafast broadband, one millisecond latency,
is thin on the ground. We spoke to Nicolas Ott, MD of Arqiva’s fixed wireless access, internet of things. It’s being
Nicolas Ott, MD Telecoms, Arqiva
telecoms business, about how he sees 5G playing out. heralded as the mother of all solutions but it’s
unlikely that all of these promises will be delivered.
Keywords: 4G, Arqiva, Co-locations, Densification, Europe, First Mover Advantage, Infrastructure However of those promises you can be almost
Sharing, On-Grid, Rooftop, Small Cells, Towercos, Urban vs Rural, UK certain that ultrafast mobile broadband and
probably improved latency will.
Read this article to learn: With ultrafast wireless broadband you still need a
< When 5G will roll out in Europe lot of spectrum. In the recent past the focus was on
< The promises being made about 5G and which are realistic low frequency spectrum bands; 5G will need very
< How governments and business needs to respond to the 5G opportunity high frequency bands, the radius around macro
< What needs to happen for the UK to be prepared for 5G rollout and small cells will shrink dramatically, therefore
< How the stakeholders in telecoms and content will need to evolve to capitalise on 5G developments densification of small cells will potentially be
massive.

We see two types of evolution: in rural areas
“
we’ll see a macro site densification – so will
decommissioning stop? Will we go back to
densification of sites? Is 5G capable of being a
turning point in the tower industry? This all
depends on the technology.
When you go into a dense urban area, it’s an

opportunity for small cells or micro cells. The
The radius for a small cell is typically around 250 metres so when you
look at the example of London you might need as many as 500,000
small cells
“
radius for a small cell is typically around 250 metres
so when you look at the example of London you
might need as many as 500,000 small cells. The only
company currently rolling out small cells in London
is Arqiva; whilst I’m not able to give you the exact working with Ofcom in the UK to explain the from an operator’s marketing point of view you’ll
amount of small cells that need to be added, what positive implications of 5G as the government also need to rollout in semi-urban areas, at least to
I can tell you is that it us a big jump from current needs to take bold decisions now to allow 5G to differentiate from competitors. Think about one of
figures; It’s a very interesting opportunity. flourish in future. With Brexit the mobile networks the applications that 5G is expected to help deliver,
will be critical in deciding what kind of country the driverless car – you won’t want to switch it off
A vision could be that every lamppost in urban we want to live in – it will be a huge contributor to when you get outside of the M25. So we believe that
areas will have a small cell and be connected to wealth. a successful 5G roll-out requires a combination of
fibre in five to seven years if this rolls out as we both Government “will” and commercial ambition.
expect. If 5G is mostly delivered by high-frequency TowerXchange: Do you feel the 5G rollout will
spectrum bands, the indoor coverage will be be driven more by commercial or governmental TowerXchange: How does the structure of the
interrupted so indoor systems will be even more impetus? industry need to change in order to facilitate 5G
important. Indoor DAS has benefits for landlords, rollout?
operators and towercos, so an elegant resolution Nicolas Ott, Managing Director, Telecoms and
needs to be found to the debate around who pays in M2M, Arqiva: We’ll need 5G in both rural areas Nicolas Ott, Managing Director, Telecoms and M2M,
order to achieve effective mass roll out. and urban high density areas. I don’t think Arqiva: The regulator must take another look at
we can allow a massive digital divide to take further consolidation; some of the MNOs may not
You could almost use the word revolution to place. 5G is going to revolutionise the way that have the ability to invest in 5G otherwise and as
describe what 5G might allow vs. 4G. It will be we communicate and do business and it is not such, the rural areas in that country would suffer.
transformational and you’ll see a wider divide acceptable from a political standpoint to exclude Which countries will fail and which will succeed
between the winners and the losers after it’s the rural population from this. The pressure put on also depends on their ability to provide 5G in rural
happened. As a towerco we see it as a great MPs when there is not sufficient mobile coverage areas. If consolidation is necessary to achieve this
opportunity and we’re very excited about it. We’re in their constituency is already enormous. Also then it must be considered.

Duplicating sets of towers in rural areas is TowerXchange: Can you tell us a little more Arqiva: We have to acknowledge that all the MNOs
counterproductive. We need to create an about 5G Fixed Wireless Access and how it could are still investing a lot of time and resources
economically compelling solution to densify in be rolled out on a larger scale? in finalising their 4G rollouts; It’s normal and
rural areas and reduce, if not eliminate, duplicated right for them to do this. I’m pretty sure 5G is on
passive infrastructure. Nicolas Ott, Managing Director, Telecoms and M2M, their agenda but 4G rollout is on the top of the
Arqiva: A good example is to look at Verizon that pile. The mobile industry works in cycles so as
TowerXchange: With a potentially huge shift has publicised that they will trial 28GHz with 5G they come to the end they need to start thinking
in the way communications are run, do you for fixed wireless access. It appears that they are about what’s the next technology they need to
envisage new players entering the market and considering two trials; one in an urban setting and consider. The time between 4G and 5G is smaller
how will relationships change between towercos, one in a rural area. than it was between 3G and 4G, though, so there
operators and other stakeholders? is acceleration going on. They’re starting to think
The company wishes to retire their copper network hard about what it means in terms of customer
Nicolas Ott, Managing Director, Telecoms and M2M, and replace it with fibre and the argument is that
experience and what they need in terms of
Arqiva: Things will change a lot. For example, some in many cases for the last few hundred metres
network. What does 1 millisecond of latency mean
big international mobile groups are considering you may be better off using a 28GHz fixed wireless
from a customer point of view? People are talking
buying film studios to have access to their own broadband access rather than laying fibre. I say
about it being used for surgery – if I was going to
content, the OTT players are taking an ever more ‘may’ as it’s very early days. If it was to be successful
have remote surgery I’d rather prefer it was done
important role in the value chain and the car however, it could have very useful applications. In
through fibre than a mobile network. You have
industry is starting to be influenced by Apple or the UK, for example, the government is investing
to start with your customers; it’s a bit of a catch
Google for driverless cars. It’s very hard to assess a lot in rolling out fibre to rural areas; 28GHz
22 but over the next few years we’ll see what that
who will be the winners or the losers, but you can might provide an extra lever to provide 5G to the
looks like. Some will do early trials which will
see the internet players are changing, the battle for countryside. It is probably not the whole answer but
be very telling. MNOs also can’t predict what the
premium content is raging more than ever while it certainly could be a part of the solution.
at same time many are struggling with returns on equipment will do. There won’t be answers for at
capital employed. We are using that spectrum today for small cell least a couple of years.
backhaul and we’re studying what Verizon are
More consolidation will take place, horizontally as saying. Considering the current speed of broadband The crucial point however is whether, in the end,
well as vertically. In Europe we’re just not seeing in the UK it’s very compelling. the MNOs can monetise 5G. If they can’t, there’ll
the big groups like you do in US or Asia. To be be a huge wave of investment with no additional
honest I don’t know if that’s a risk or opportunity TowerXchange: To what extent do you think revenues. 5G needs to be monetised and the
but there’s a growing polarisation between big and future/5G contingencies are affecting operators’ answer to that question will dramatically affect
small players. But yes, the relationships between network planning strategies right now, and are what MNOs can do. Would customers pay £5 more
towercos, MNOs and stakeholders will change, at they doing enough? a month for the ‘wow’ factor? The answer to that
least as a consequence of all the other changes that question will determine how 5G rolls out almost as
will take place. Nicolas Ott, Managing Director, Telecoms and M2M, much as network or technology

5G deployments: A window of
5G is driven by a vision, or a wish list, which appears
more revolutionary than the move from 3G to 4G
and that is supposed to open new revenue streams
opportunity for tower companies? for mobile network operators, while at the same
time reducing costs and increasing efficiency. Figure
Analysys Mason discuss how the use of macrocells and increasing use of small cells will
one (on page 2) summarises the 5G requirements.
drive the need for further mobile network infrastructure
Several use cases are being used as the
5G is currently a major topic commercial justification for 5G
but there still appears to be
confusion around what 5G Analysys Mason has for several years identified
three use cases, which should serve as the
actually means. For instance,
commercial justification for 5G:
Vodafone’s CTO Johan Wibergh
was recently quoted as stating
< Enhanced mobile broadband: An evolution
that “You already feel that 5G is beyond 4G to provide even higher broadband
going to solve world hunger”.[1] In capacity and bandwidth. It is difficult to see
this article, we look at potential enhanced broadband translating into massive new
5G technology developments revenue streams for MNOs but it will help them to
and provide our view on the keep up with end-user demand. There appears to be
impact they may have on mobile particular interest in Japan and South Korea for this
Emil Arnel, Analysys Mason networks and tower companies. use case.
< Massive connections (IoT): The management

Keywords: 4G, 5G, Analysys Mason, DAS, Europe, Europe Research, IBS, Infill, IoT, LTE, Rooftop, Small of millions/billions of connected devices. 5G will
Cells, Smart Cities, Third Party Reports compete for this use case with other technologies
that are already being deployed (Sigfox, LoRa and
the NB-IoT protocol within 4G). Several European
Read this article to learn: MNOs (e.g. Vodafone, Deutsche Telekom) appear
< Key drivers for 5G very interested in this use case as a way to find new
< How 5G is likely to be used revenue streams.
< What network changes will be driven by 5G needs
< Which new technologies will maximise network capacity < Ultra-reliable networks: Specific low-latency,
high-availability services or applications such as
< Possible scenarios for 5G implementation
remote surgery. This is the use case that leverages

the 5G vision the most. The monetisation potential Figure one: Key drivers and requirements for 5G
could be substantial, but this is also the most
uncertain and least developed use case. Fast response time
Low jitter, latency and delay
A fourth use case has recently emerged: fixed-
wireless access (FWA), driven by interest in the High availability
USA. Verizon has announced intentions to use
5G small cells instead of fibre final drop and in- Software-defined High reliability
Real-time
building wiring. AT&T has also announced that network performance Priority access
it is developing a proprietary fixed-wireless
Scalable, low-cost Very wide area
technology, AirGig, using mm-Wave signals along
systems coverage
power lines. FWA solutions using WiMAX, LTE or
other technologies are already used in rural areas
in many countries, but 5G has the potential to
Virtualised Critical
bring performance closer to that provided by fixed
infrastructure infrastructure
networks. The main drivers for FWA solutions are
cost savings and avoiding operational difficulties
related to connecting homes with fibre. FWA 5G
is therefore likely to be the first use case to be
implemented.
5G networks are likely to be based on different

technologies/solutions and use a wide range of
Very high-
spectrum
IoT and M2M speed
broadband
5G networks are not expected to be based on
a single specific radio-access technology but
rather to be a mixture (or a portfolio) of different
Many more connected Gigabit data rates
technologies and solutions. New and flexible 5G air
devices High-quality coverage
interfaces that will incorporate the high-bandwidth,
low-latency and high-reliability requirements are Deep indoor coverage Multi-spectrum service
under development. Such air interfaces are likely Signalling efficiency
to be initially deployed as small cells using newly
n confidence
licensed or unlicensed spectrum bands, typically
>6GHz. LTE-A is, however, likely to continue to be Source: Analysys Mason, 2016

used for macrocells for several years following 5G Figure two: Illustration of beamforming
introduction. LTE-A may gradually be replaced
by 5G air interfaces or be incorporated into and Standard antenna With beamforming
integrated with 5G and then evolve to converge with
5G.
Mobile networks traditionally use spectrum in the

Easy to
frequency range 700MHz–2.6GHz (with regional do
differences). The spectrum that can be used for
mobile services in these bands is less than 1GHz. Hard to do
This translates into a potential total capacity (shared
between multiple MNOs) of tens of Gbit/s per km2. Even harder to do
For 5G it is likely that higher frequency bands will Source: Analysys Mason, 2016
be used. These include (again with some regional
differences) 3.5GHz and 5GHz, which are relatively New technologies will be incorporated into 5G to for ultra-reliable networks applications.
similar to the current mobile bands, but also cm- maximise network capacity < Dynamic cell allocation (facilitated by C-/V-
Wave bands (e.g. 24.5–27.5GHz or 31GHz) and mm- RAN) that allows the network to dynamically and
Wave bands (e.g. 70–80GHz). The cm-Wave and mm- 5G will incorporate a number of technological in real time associate each device with one (or
Wave bands are characterised by a high availability developments (some already used in LTE-A) that more) access point instead of assigning a specific
of spectrum, multiple 10s of GHz. Therefore, it are intended to maximise the network capacity but geographical area (a cell) to an access point.
RefNo
would be possible to provide multiple Tbit/s per | Commercial
also toin provide
confidencemore efficiency and flexibility. Some < Software-defined networking, network functions
km2 using the cm-Wave and mm-Wave bands. examples are: virtualisation and network slicing[4]
The main drawback of these higher frequency < Multiple input, multiple output (MIMO)[2], which < Self-backhauling where backhauling and access
bands is propagation. Theoretical cell radii for the is likely to be used with beamforming in order to are provided using the same spectrum and radio
traditional mobile network bands can be up to tens allow the generation of narrow beams, especially interfaces. Such developments will, together with
of kilometres in rural areas (but substantially lower useful for high-frequency bands in order to mitigate general improvements on point-to-point radio
in urban areas). The cm-Wave band will have cell path loss and reduce interference. The principle backhaul, mean that fibre backhaul and fronthaul
radii in the hundreds of metres whereas for the of beamforming is illustrated below. This however will not be required to all sites. (Although we expect
mm-Wave band it will likely be in the tens of metres requires large antenna arrays. fibre usage to continue to increase.)
(and may require line-of-sight). The different < Cloud or Virtual RAN (C-/V-RAN), where
propagation characteristics mean that cm-Wave centralised shared server pools replace base station How 5G networks will be implemented in reality
and mm-Wave can realistically only be used for (BTS) equipment or at least the baseband units is still unclear
small-cell deployments. Macro-sites using <6GHz (BBUs) with remote radio heads (RRUs) on the
spectrum remain the only real realistic solution for towers. On the other hand, there may be a need to Above we have described different potential
wide-area coverage outside the densest areas. deploy mobile edge computing[3] to reduce latency technology developments. The actual network

deployments and configurations that MNOs will use
“
will however also depend on the commercial success
of new use cases and therefore remain uncertain.
Below we outline a likely evolution. There will be
some regional differences to this evolution: we
expect East Asia to be the front-runner for 5G (driven
by the 2018 and 2020 Olympic Games in South Korea
and Tokyo), followed by the USA (especially if FWA We expect East Asia to be the front-runner for 5G (driven by
deployments take off). Europe is expected to see
limited 5G development before 2022. the 2018 and 2020 Olympic Games in South Korea and Tokyo),
Until 2020:
< 4G will continue to be the main technology
deployed
< Macro-layer densification will continue, driven by
followed by the USA (especially if FWA deployments take off).
Europe is expected to see limited 5G development before 2022
“
capacity and quality-of-service requirements (cell-
edge data rates)
< Small cells will continue to be deployed in the USA
and East Asia and will start to be deployed in Europe
as an additional capacity layer in dense-urban areas in hospitals for remote surgery). Such coverage is to locations at a low cost) that new 5G technologies
< FWA deployments may begin in some countries likely to use small cells rather than macrocells. do not necessarily solve on their own. In any case,
(e.g. the USA). we expect mobile networks to require more and
Beyond 2025, it is possible that 4G and 5G will more infrastructure, which should open a window
2020–2025: merge of opportunity for infrastructure providers
< 5G will co-exist with 4G
< Macro-layer densification will subside in dense- We believe that 5G will continue to require
[1] FierceWireless, Vodafone CTO Johan Wibergh
urban and urban areas, small-cell densification will extensive use of macrocells, which will remain
warns industry not to over-hype 5G, 12 October 2016
continue important in rural areas but likely also in urban
[2] MIMO allows the use of multiple parallel transmit
< Macro-layer densification may continue in more areas. The traditional tower business model will
streams to a single device.
rural areas. therefore be valid also in the 5G world. Small cells [3] Servers deployed at the edges of networks, close to
Depending on how the use cases mentioned at the will become increasingly important but they will be the end users, which e.g. cache content.
beginning of this article develop, we may also start deployed in addition to existing macro-sites rather [4] These technologies allow a more flexible and
to see “amorphous” or focused coverage (e.g. along than as a substitute for them. It is important to note efficient use of network capacity while at the same
roads if connected cars become a big driver, along that there are significant practical and cost issues time being able to ensure specific QoS for different
residential buildings if FWA becomes important, or associated with small cells (first and foremost access services.

How 4G and 5G are changing
TowerXchange: Please introduce yourself and
your company.
the landscape for Distributed Ross W. Manire, CEO, ExteNet Systems, Inc.: My
career path has been quite varied before landing
Networking (DNS) companies in the distributed network industry. I used to be

a partner and CPA within Ernst & Young before
leaving the business and starting to work with a
How the United States went from needing 20,000 to 500,000 nodes in less than ten years
leveraged buyout client. I then became the CFO
of US Robotics, was with the company during its
One of the leading organisations in the
IPO back in 1991 and founded its network systems
distributed network industry, ExteNet
division where I familiarised myself with the ISP
Systems, made headlines back in 2015 thanks
(Internet Service Providers) business, which at the
to its recapitalisation for US$1.4bn. In this
time was completely new to me.
interview, ExteNet’s President and CEO, Ross
Manire, shares with TowerXchange his views
Our clients at the time used to be AOL, MindSpring
on the evolution and growth potential of the
and other ISPs. One of them literally had modems
distributed network industry while comparing stuck to its office walls with Velcro and I kept
its investment opportunity and key features with thinking that there had to be a better way of
the towerco model. doing it. US Robotics was then acquired by digital
manufacturer 3Com and I was recruited to lead
Keywords: 4G, 5G, Active Infrasharing, an outsourced manufacturing and design, firm
Americas Insights, Business Model, DAS, Digital Chatham Technologies, who was servicing tier one
Bridge, ExteNet Systems, Infrastructure Sharing,
OEMs on a global basis prior to their acquisition by
Insights, Leasing & Permitting, North America,
Flextronics in 2000.
Ross W. Manire, CEO, ExteNet Systems, Inc.
ROI, Regulation, Small Cells, Who’s Who
In 2002, I founded ExteNet Systems to go after an

opportunity in the telecom space I had sensed
Read this article to learn: earlier in my career. It seemed clear to me that data
< ExteNet Systems: from niche product to necessity in less than fifteen years was going to be a critical driver for both capacity
< 2002 vs. 2016: how the vision changed and what is in store for tomorrow and coverage and that macro-cells could not handle
< Who manages small cells now? And who will manage small cells in the future? the capacity requirements we foresaw at the time.
< Inhibitors to scale: permitting remains the number one obstacle ExteNet was founded to provide an answer.
< 4G and 5G and their role in driving the distributed network model in the U.S. and beyond
At the beginning, we defined ourselves as a DAS

company, whereas now we are completely agnostic
to the type of technology that gets deployed,
whether it’s DAS, Wi-Fi, small cells or C-RAN.
Since 2012, we have emphasised our distributed
networking focus as a company addressing both
indoor and outdoor capacity issues. The importance
of a distributed network architecture is imperative
today both for the access and core elements of the
communications network infrastructure.
TowerXchange: How did your vision change from

2002 to present times?
Ross W. Manire, CEO, ExteNet Systems, Inc.: At the

outset, we were purely focused on solving coverage
problems. At the time, many communities in the
U.S. were against the deployment of macro towers
which resulted in certain areas literally having zero
coverage. So distributed antenna systems were
thought to be an effective solution to a relatively
niche problem. We thought the market size was
around 20,000 to 30,000 nodes throughout the
country, to give you an idea.
Sample node in San Francisco
So the initial plan back in 2002 was to build 2,000 So now we are talking about an addressable coverage. The potential market is much larger
DAS nodes, yet we now have more than 20,000 market approaching 500,000 node sites indoors than what we originally expected, and it goes way
nodes in a variety of technology solution sets. and outdoors in the United States alone and we beyond the United States.
have the buy-in of the carriers who recognise their
The game changed in 2007 with the launch of the densification needs and know that the only way As far as the Digital Bridge group of companies is
iPhone. With its introduction, the problem for the they can achieve their quality of service (QoS) goals concerned, Mexico Tower Partners and Andean
wireless carriers shifted from coverage to capacity is through distributed networks. Tower Partners are both looking at deploying
as the iPhone combined with the 3G and 4G LTE distributed networks in their areas of operation.
networks rapidly increased the data and video Distributed networks are very specific applications, And I believe this technology will be applied widely
consumption and the size of the potential market suitable for densely populated areas, urban especially as we complete 4G rollouts and move
grew exponentially. or suburban, and for both indoor and outdoor towards 5G.

“
TowerXchange: Can you explain ExteNet’s We sign up to exacting SLAs with our clients, and
solutions and, in particular, where neutral host, provide them with comprehensive performance
multi-operator distributed networks fit within reporting: they have Access to our NOC and can
your ecosystem? see the health of the network. So I think we are in
a strong position especially since our solutions will
Ross W. Manire, CEO, ExteNet Systems, Inc.: Our become more relevant to network typologies in the
core focus as a company is designing, building, we can deploy a carrier onto U.S. in the near future, thanks to ongoing 4G and
owning and operating our distributed networks.
These networks are unique as they bring wireless
network elements closer to the user to ensure high-
capacity wireless broadband connectivity. We own
and operate over 300 multi-carrier, also referred to
our network for a lot less
than it would cost them to
build their own
“ future 5G rollouts.
So in a nutshell, the ecosystem is quite complicated

and our solutions are very capital intensive.
Building networks isn’t cheap and this is why we’ve
as neutral-host, distributed networks throughout just recapitalised our business and raised US$1.4bn.
the United States today. You need a lot of capital to design, build, own and
operate carrier-class distributed networks!
In terms of the physical deployment, we have support multiple carriers from the onset. Quicker
deployed networks where we host multiple carriers time-to-market, carrier-class network service TowerXchange: How do you drive a distributed
on the same pole and where they share the same guarantee, 24/7 network monitoring via our NOC, network business to scale? What are the critical
antenna infrastructure. And other networks where ongoing network maintenance and single point of considerations in keeping municipalities
we’ve deployed individual poles for each carrier contact are just some of the benefits that we deliver engaged and content?
but then used the same base station hub locations. to our carrier and property owner customers.
Ross W. Manire, CEO, ExteNet Systems, Inc.: The
We can adapt to a variety of business models as Early on, there were very few serious competitors permitting process is definitely an inhibitor to
long as the economics make sense. At the end of the in our space. But today in North America, there’s scaling a distributed network business. We have
day, we can deploy a carrier onto our network for a a variety of players involved in the distributed to engage municipalities one at a time. It’s by far
lot less than it would cost them to build their own. network industry and lots of competition, which the most difficult thing we have to do and for this
is expected in a growth sector. We are one of the purpose, we have a team of external relations
TowerXchange: Who is best placed to roll out largest players in this dynamic space and we people who engage with municipalities to educate
and manage distributed networks: MNOs, third continue to leverage our strong position and our and show the benefits of our solutions. We are a
party small cell network operators or towercos? unique experience to further refine our value registered utility, which gives us access to public
proposition continually for our customers. rights of way to attach our systems to utility or
Ross W. Manire, CEO, ExteNet Systems, Inc.: municipality infrastructure, but this doesn’t obviate
Frankly, the most economical path for multi-carrier I foresee more companies playing this game but we the need to secure permits.
support is a neutral-host model. Proof(s) in point are extremely competitive and offer a high quality
are our distributed networks which are designed to service. We know how to efficiently run a network. We also have a team that deals with real estate

rights and with the telecom access agreements
needed to deploy in any indoor facility.
TowerXchange: Are you looking beyond the U.S.?

And if so, do you think the same neutral host
trend could be replicated in other regions?
Ross W. Manire, CEO, ExteNet Systems, Inc.: I

believe that distributed networks will be an integral
part of the network topology across multiple
regions. We are already seeing deployments in
places like Colombia and Mexico through our sister
companies and Europe seems to be going through a
similar wave.
Regulatory environments being unique in the

respective countries, Europe has presumably the
same set of challenges that we face in our domestic
markets. The population density and the sheer
magnitude of multi-dwelling units in Europe drives
the need for network densification and a neutral-
host model would likely serve it best. The one
universal message and story-line across regions in
the world today is the proliferation of smart devices
streaming videos and transferring personalised
data. All of this requires the one constrained
resource – Spectrum.
Sample node in San Francisco
If we look at how much money carriers spend to cells compare with macro towers in terms of begin with, whereas a towerco will build a tower
acquire additional spectrum, it’s easy to understand deployment costs and potential revenues from with an anchor tenant. And like towercos we’re
how distributed networks can be a potentially multiple operators? betting on our ability to secure a second, third and
more cost effective solution. It’s like cell splitting on fourth carrier.
steroids! Ross W. Manire, CEO, ExteNet Systems, Inc.: The
models are very comparable in terms of their final Neither us nor towercos need to replicate the
TowerXchange: How do the economics of small goals. We will build a network for one carrier to capital expenditure to build the infrastructure

“
elements to be much closer to the user to deliver the
required QoS.
TowerXchange: How will this ecosystem of

distributed network operators be consolidated?
we are where towercos were around ten years ago and the real push Ross W. Manire, CEO, ExteNet Systems, Inc.: We
is coming from 4G and, around 2020, 5G, so we have many exciting always keep an eye on smaller players which
might be up for sale out there. Scale counts in this
years ahead. Network densification has not been optimised at this
stage, especially since with 5G comes the promise of low latency and
high data throughput
“ business and I believe that we are moving towards
some degree of consolidation.
Crown Castle has extended its footprint via two

acquisitions and it’s just a matter of time before
more deals happen. And maybe some new players
enter the market too!
so yes, I’d say that the economics are both distributed network even further as the premise of
TowerXchange: Please sum up your vision for
highly compelling. In fact, once the fibre and 5G is more architecture and less standards.
the future of ExteNet Systems.
infrastructure are in place and we start leasing
up to additional carriers, we’ll be operating with TowerXchange: How will 5G amplify the
Ross W. Manire, CEO, ExteNet Systems, Inc.: We
healthy gross margins north of 75%. We’ll have importance of small cells?
are still in the growth phase of the distributed
more SG&A than a towerco but the returns are still
very good. At the end of the day, if we’ve managed Ross W. Manire, CEO, ExteNet Systems, Inc.: 5G will network industry and we are planning to spend lots
to raise US$1.4bn, it must mean something! be deployed in very specific applications initially of money to build networks in urban and near-
with the primary purpose of solving capacity urban areas. For now, we are understanding the
And whereas towercos are entering a more mature problems. To begin with, I believe it will be a needs and requirements of 5G in terms of network
era, I feel that distributed networks are still in a surgical operation where extra coverage is really architecture and adapting accordingly, while
growth phase. We are where towercos were around needed and not a big bang blown out across entire keeping an eye on opportunities in and outside
ten years ago and the real push is coming from 4G networks. But we are at a very early stage with of the United States. Our vision remains steadfast
and, around 2020, 5G, so we have many exciting trials and testing going on so we’ll wait and see – to become the leading provider of distributed
years ahead. Network densification has not been what happens! But 5G enablement will require a networks while delivering value for our customers.
optimised at this stage, especially since with 5G distributed network architecture simply because This vision is pertinent for whatever we do as
comes the promise of low latency and high data the low latency requirement especially for time- a company and fits well with the oncoming 5G
throughput. This will necessitate the need for a critical applications will require the network network tsunami

The seven habits of highly effective small cells
4site identify seven steps to simplify and streamline small cell rollout
IoT and remote keyhole surgery might be looming on the horizon, but right
now what’s needed is densification, and in urban areas in particular this often
means small cells. And while you don’t need a degree in particle physics to
get it right, there are a few simple steps which are often overlooked or rushed
when it comes to deploying small cells – with costly consequences. We spoke
to Ian Duggan, CEO of innovative managed services provider 4site, to find out
what preparation is needed to underpin a successful build.
Keywords: 4site, 4G, 5G, Camouflage, Europe, Infill, IoT, LTE, On-Grid, Site
Surveys, Small Cells, Smart Cities, Stakeholder Buy-In, UK
www.4sitenetworks.com With wrap-around tri-sector stealth antenna Shrouded antenna complete with GPS & WiFii access point

< Which stakeholders have to be engaged for small cell deployment
< Considerations for site planning and design
< Accessing power and services for your small cell network
< Understanding and meeting MNO demands
< Effective KPIs for your build Pre-cast concrete cabinet plinth Street light before installation

1: Multiple stakeholders 2: Site selection and design
So, you want to deliver targeted extra bandwidth for mobile voice and It’s important to recognise that putting together a small cell network isn’t as easy as
data – maybe even deliver free public Wi-Fi while you’re at it – and you’re putting up some equipment and hoping for the best. Our experience in designing
thinking of small cell? Well, get ready to negotiate. these networks has shown that site selection, which is critically important, is all too
easy to overlook if the parties involved don’t have an appreciation of the real needs
Buy-in is needed from local government and planning authorities, of a radio network. Concrete structures stop a wireless signal dead – that’s why it’s
equipment vendors who make the base stations, mobile operators, so difficult to get indoor coverage in large buildings – while metal and glass bounce
infrastructure owners and landowners to name just a few. Buy a big packet around a radio signal, posing challenges for the receiving device.
of biscuits because it’s going to be a long meeting with lots of chat and lots
of competing agendas! Specific, in-depth knowledge is needed to design the network because
complex technical solutions are required to deliver results – these are complex
In reality, of course, it’s going to take more than one meeting and real projects with (for example) building constraints, property issues and budget
patience: combining all parties’ perspectives and working to come up constraints. Experience and know-how will save a lot of time and reduce the
with a solution that delivers the coverage where it’s needed while also risk. Design-led thinking is critical to getting the right results. Passive and active
making commercial sense for all concerned, with a design acceptable to design need to be combined in order to get the optimal solution. Good design will
all. For what it’s worth, 4site’s view is that the most feasible solutions are not only ensure the best operational network is built but also can minimise potential
multivendor hubs which establish small cell infrastructure that competing for planning issues. For example, outdoor equipment is needed so how is that going
mobile operators can use as a shared resource to deliver services to their to look? Make it as stealthy as possible to ensure it doesn’t impinge on the local
own end customers. environment will reassure local citizens and businesses.
Consultation, early engagement and multilateral buy-in are needed to Be creative – one cabinet does not fit all – equipment can be custom designed to suit
realise the vision of a highly connected, high bandwidth area. the purpose.
3: Planning The technical tools to assist in these surveys have authorities – early engagement is key and will
developed so much in recent years that its not surprising definitely lead to better delivery times.
Network planning is critical to the process of designing that we can deliver much more accurate survey data
and building the small cell network. A wireless site today. For example we use GPR (Ground Penetrating The planning phase allows us to design around the
survey has to be conducted to provide the foundation for Radar) to precisely map utilities and reduce risks that constraints that are identified – constrains such as
the small cell network design. Don’t underestimate the might occur in the build phase of these projects. space, power, structural (buildings), and cost for
elements needed for this survey, and don’t rely on existing example. Having all our ducks lined up at the start
plans and information available – our experience is that Don’t assume planning requirements – plan early allows us to be innovative, accurate and optimal in
they are most likely out of date or inaccurate. in relation to any interaction with local planning the design stage.

4: Power and services 6: Backhaul
When it comes to designing small cell networks, specifically when it comes to site Backhaul is vital for small cells – smalls cells mean we can off-load traffic
selection, services to the potential site must be considered. Each mini radio base station like voice, data and video, from the macro network and deliver high capacity
is going to need electrical power, as well as fibre connectivity into a common backhaul bandwidth locally. But a dedicated transport network is needed to support
provider, like BT or Liberty Global. the small cell base stations. In dense urban areas a combination of wireless
(for the last few hundred metres) and fibre (where available) is ideal.
A critical component of getting the solution right is understanding the urban area;
what utility services exist, underground as well as overground, and designing for
It’s important to determine what is available in the area where the network
that. Providing power to the small cell base stations in a cost-effective way is important to
is to be deployed. Part of the planning process will be to look at site selection
the overall commercial viability of the project. Looking at innovative ways to exploit off-
in relation to access to backhaul – if you have to put in additional access links
grid – green energy sources come into play in the design and planning process.
(e.g. lay fibre) to get the capacity needed then from a cost perspective the
The ultimate aim of these projects is to increase service availability and improve the end- deployment might not make commercial sense. Therefore, designing around
user experience cost-effectively. the backhaul available is necessary.
5: Delivering on MNO demands 7: The build process
The mobile operators are looking to these projects to solve the ever-increasing demand for The build is the simplest part of the process if the other six points done
capacity and service. But in an industry where margin is everything, they need to deliver correctly!
at an acceptable cost. Matching the operators’ expectations on cost is challenging. Small
Some key things to consider when building these networks are:
cell networks allow IoT to be enabled and new applications to be delivered by and for all
Minimise your time on the ground – if you do this you will minimise the cost.
stakeholders. So who should foot the bill?
If the project is set up correctly then getting a site done (i.e. a hot swop) in a
day is the target. Technology is moving apace and self-configuring radio is
The financial model is as yet undecided with several approaches being taken. In one
on the way. New technologies will help with the efficiencies of these projects.
such project we’re working with the MNO directly – they have taken the initiative to work
with the local authority and develop the network – they’re doing it themselves in order to
Minimising the risk and making sure there are no surprises is key to keeping
achieve the cost base they need. In another project we’re working with the infrastructure
everyone happy – minimal disruption to streets and businesses will keep the
owner as the project owner, and developing a shared service model where several MNO’s
local authorities, local business and citizens happy and will ensure better
can sign up for service on the new network, paying a ‘rental fee’ for the service.
cost management and budget control.
We’re working toward a ‘plug and play’ model – cheap and self-configuring. With effective With good planning, excellent design and good project management small
design, planning and developments in new technology this approach should cells can be relatively easy to install and will deliver a highly scalable,
be achievable. flexible and high capacity network that is life changing for the locality.

Regional coverage:
Europe features
We’re delighted to share insights into the Italian

market this issue, with interviews with key
players including INWIT, Cellnex, EI and HighTel.
Each one has a strong USP and different approach
to a market which is about to be shaken up by the
arrival of Iliad’s Free Mobile.
We’ve also been busy compiling a directory of

the top service providers in Europe, from RMS
to MSPs, small cells to batteries, you can review
the latest services and products on offer to
infrastructure owners.
Don’t Miss:
183 Italy special feature including interviews with
INWIT and Cellnex
201 Analysis of Global Tower’s postponed IPO
210 Portugal special feature
224 Review of the UK’s Digital Economy Bill
230 Europe Vendor Directory

Building from the ground up
TowerXchange: Can you summarise your
operations and network topography in Italy for
our readers please?
How Cellnex have used strategic acquisitions and organic growth to become
Italy’s biggest independent towerco Piercarlo Giannattasio, Managing Director,
CommsCon: Cellnex Italy’s network is homogenously
deployed throughout the country covering all the
regions in the country. Galata’s macrocells as well
as the tunnel and DAS networks of Towerco and
CommsCon guarantee a full coverage countrywide.
In terms of figures this represents a network close to
8,000 sites served by Galata and Towerco, enhanced
with the more than 1,000 nodes (DAS and small
cells) served by CommsCon. Let us underline as well,
while this is a market segment which will continue
to drive growth and may well fall in the area of the
so called “mission critical services”, that Cellnex
Gianluca Landolina, Galata’s MD and Piercarlo Giannattasio, Managing Walter Spera, Managing Director, Cellnex
Deputy MD Cellnex Italia Director, CommsCon Italia and Managing Director, Towerco already covers more than 300km of galleries and
subways: 160km managed by TowerCo and 150km
Encompassing macro structures, DAS networks and small by CommsCon. This speaks well for the capabilities
Keywords: 3, 5G, Anchor Tenant, cells, Cellnex’s Italian portfolio represents a strong mix of and engineering skills that Cellnex’s team is able to
Cellnex, DAS, Decommissioning, structures and solutions for their partners. We spoke to three contribute in Italy.
Europe, Europe Insights, IBS, of the architects of this mix: Walter Spera, Managing Director
Iliad, Infill, Italy, Multi-Country TowerXchange: What opportunities does Cellnex
of Cellnex Italia and MD of Towerco; Gianluca Landolina,
Partner, New Market Entrant, see in the arrival of Iliad in the Italian market?
Galata’s MD and Deputy MD Cellnex Italia; and Piercarlo Do you envisage more towers will come to
Regulation, Sale & Leaseback,
Giannattasio, Managing Director of CommsCon, about how market?
Small Cells, WIND
they see this market developing.
Walter Spera, Managing Director, Cellnex Italia
Read this article to learn: and Managing Director, Towerco: What is clear is
< How Cellnex’s network topography breaks down across Italy that in the current EU framework the concept of
< What opportunities Cellnex sees in MNO consolidation and new market entries keeping competition at the end-consumer level by
< Where Cellnex sees growth opportunities in Italy maintaining four big MNO’s in every “big” market
< How the Cellnex network needs to develop to support 5G has become a rule. The arrival of a fourth operator
< Where they benefit from cross pollination of networks across Europe following the merger and integration between
WIND and H3G will also become an opportunity for

each one of the telecom infrastructure operators
in Italy. It is perhaps too early to anticipate if more
towers will be divested. One can assume that the
combination of efficiencies and synergies creation
following the integration of the two entities, as well
as the market entry of a new operator may act as a
trigger for network rationalization and as a driver
of higher tenancy ratios in existing –and already
deployed- tower networks in the country. Anyhow,
this will take time and we will have more visibility
on how this may evolve during 2017.
TowerXchange: As one of Europe’s most towerco-

heavy markets, where does Cellnex see growth
opportunities in Italy?
Gianluca Landolina, Managing Director, Galata and

Deputy Managing Director, Cellnex Italia: More
than a towerco-heavy market - we would describe
it as one of the most dynamic in Europe. Due to
“ The arrival of a fourth operator

following the merger and
integration between WIND
and H3G will also become an
“
the ongoing consolidation between MNOs and the
newcomer entry we already spoke about, the market
continues to offer sound growth opportunities in
terms of network rationalization and better use
of “installed capacity”. This is valid as well for the
increasing need for DAS and small cells systems that
guarantee right and efficient coverage both indoors
TowerXchange: As towercos and operators turn
their attention to 5G and network densification,
how does your network in Italy need to develop
to meet the needs of the next rollout?
Gianluca Landolina, Managing Director, Galata

and Deputy Managing Director, Cellnex Italia:
opportunity for each one of and outdoors. Beyond this and with a medium- to This is directly related to the previous question;
the telecom infrastructure long-term vision, LTE deployment (including 5G) will densification will definitely play a decisive role.
drive densification and will, thus, let new business Existing macrocell networks should not see major
operators in Italy models emerge which will rely more on assets changes in their current topology, aside from
sharing and a multi-operator approach, involving the rationalization of their potential, which is
active equipment as well. independent of an upcoming 5G rollout. There will

Existing thresholds limit the tenancy ratio potential
for each existing site but this is valid for all the Italian
players, so from this perspective there is a level
playing field. In the specific case of Cellnex’s network
sites in Italy we do have a tenancy ratio which offers
space for growth able to capture more PoPs.
TowerXchange: As you’re expanding into new

European markets, how much ‘cross’ pollination
do you see between your experiences in Italy
and elsewhere and to what extent is each market
unique?
Walter Spera, Managing Director, Cellnex Italia and

Managing Director, Towerco: This cross experience
sharing concept is already a reality. For Cellnex
Italy is the most important market for its telecom
business. Here we have a well established track
record and this has positioned the italian team with
the right capabilities to drive a competence centre
for the group based in Italy covering areas such as
enhanced DAS and small cells coverage projects for
highly effective installments.
What we are seeing in Europe, although stepwise, is

that we are working with customers whose presence
be complementarity between macrocells, with an compared to elsewhere in Europe? and footprint cover different European countries in
improved FO backhaul and fronthaul connectivity, which Cellnex is able to offer and deliver its services.
and small cells and DAS networks that will interact Walter Spera, Managing Director, Cellnex Italia This is a business in which the “glocal” concept duly
with the current macrocells asset base. In fact the and Managing Director, Towerco: Radio frequency applies. We see space for a cross-border approach
challenge lies in the upgraded connectivity backhaul regulations in the country is something which have with a European vision, while realizing that each
to the towers. always been done. So it’s factored into our plans market deserves uniqueness. It is a fact as well that
because it’s part of the competitive landscape. infrastructures do not relocate and thus involve a
TowerXchange: How do you find meeting the Having said that it is clear that Italian emission strong local anchorage working together with our
strict radio frequency regulations in Italy? Does levels are among the most restrictive in Europe customer base as well as with regulators and public
it have a noticeable impact on your tenancy ratios with thresholds placed far below the EU average. administrations on site

More than the sum of
TowerXchange: Can you introduce EI Towers,
your history and the company’s evolution to
its parts
date? How many towers do you own?
Carlo Ramella, Chairman, TowerTel: EI Towers

is quite a new company, the combination of two
How EI Towers’ telecoms arm, TowerTel, is achieving impressive growth assets. The first comes from a listed towerco
through best practice in small scale acquisitions in Milan, DMT, which was the first company to
develop the tower business in Italy. It was founded
As the first mobile towerco in Italy, TowerTel has by Alessandro Falciai and started to acquire sites
had to deal with the arrival of two of the biggest in 2003. Between 2003 and 2012 DMT managed to
grow, thanks to acquisitions, up to 1,500 sites, a
European towercos in its market. We spoke to
mix of telecom and broadcast sites, before merging
Carlo Ramella, Chairman at TowerTel, about how with the broadcast towers of Mediaset to create
the company was formed, their growth through EI Towers. Technically speaking it was actually a
acquisition of ‘mom and pop’ tower portfolios and reverse merger, as a consequence the carved out
their vision for the future of both TowerTel and the part of Mediaset was listed by this transaction.
Italian telecoms market.
So to summarise our evolution; DMT was founded
in 2003 with zero sites, and built its portfolio to
Keywords: 3, 4G, Acquisition, Cellnex. C-Level Perspective,
1,500 sites by 2012, of which 1,300 were broadcast
Deal Structure, Densification, EBITDA, EI Towers, Europe,
and 200 were mobile sites. Mediaset contributed
Hutchison, Iliad, INWIT, Italy, New Market Entrant, about 1,000 broadcast sites to the mix, meaning
Regulation, Roaming, Small Cells, TIM, Towercos, TowerTel, that when the two companies came together to
Urban vs Rural, Vodafone, Wind form EI Towers, the company had a portfolio of
Carlo Ramella, Chairman, TowerTel
2,500 sites. The merged company has two different
approaches to the two different segments in which
Read this article to learn: they operate. We maintained the former operating
< How a broadcast towerco can achieve growth in telecoms networks company (called TowerTel) in the mobile sector
< What TowerTel sees as their strengths in a busy market and started to develop this company by acquiring
< An update on the operator landscape in Italy the small ‘mom and pop’ portfolios from a starting
< How towercos can pursue growth outside of traditional towers point of around 2,300 broadcast sites.
< What Italian regulations mean for tenancy ratios and where they are applied
Since the combination of assets and splitting out

“
of business units, EI Towers comprises around 580
people, for the most part dedicated to the broadcast
service business (so mostly working for Mediaset
Group and Cairo Group, the new main shareholder
of top Italian newspaper “Il corriere della sera”).
In the broadcast part of the business we offer a full
service agreement, so we manage not only the tower
but a wide range of services such as maintenance
of equipment, planning the network, coding of the
signal – we have 100% control of the broadcast
Since our formation, we have acquired a large number of small
mobile tower portfolios, so today we manage 1,000 mobile sites from
a starting point in 2012 of just 200
“
service management for the broadcasters.
TowerTel, on the other hand, is mainly a real

estate company. It’s a very lean company, just ten agreement with EI Towers. This will add around cities. The taller the tower, the higher number of
people are involved, and all of the activity related €15/16mn in additional revenues, making our tenancies we can achieve.
to maintenance is outsourced to managed service estimated revenue for 2018 around €136mn.
providers. Cellnex and INWIT are national players as
TowerXchange: The Italian tower market has they control around 7,000 and 11,500 towers
Since our formation, we have acquired a large exploded over the last two years, with two new respectively. In this respect we are much more
number of small mobile tower portfolios, so today and significant towercos on the scene (namely flexible, particularly in respect to INWIT, as we’re
we manage 1,000 mobile sites from a starting point Cellnex and INWIT) - how does TowerTel view independent whereas INWIT is controlled by TIM.
in 2012 of just 200. The number of broadcast sites these changes and what keeps you unique? Mediaset is absolutely independent from any
we have access to remains unchanged but we’ve operator. INWIT has to share the view of their
added new base stations to broadcast towers on 650 Carlo Ramella, Chairman, TowerTel: We are strategy with their major shareholder and TIM
sites. So all in all, the mobile business now has 1650 basically different in terms of our equity story. has an important power to decide who to host on
sites available. TowerTel is the sole independent player in the INWIT’s towers. Cellnex has a master agreement
country, meaning we do not have a master with WIND and has some terms and conditions with
At the moment the mobile sector is seeing a lot of agreement with any of the four operators in the WIND to be respected.
organic growth and the broadcast business is a country. The tenancy ratio of TowerTel is about 1.8
more static sector but two years ago we reached tenants per site, which indicates our independence. In terms of growth, we have been the sole buyer
an agreement with the third national player, Cairo We manage a niche market of 1,650 sites with an of these ‘Mom and Pop’ towers since 2003; we’ve
Group, who in 2015 launched the winning tender independent approach. We focus largely on tower gained an expertise in understanding these small
offer for an unallocated broadcast channel and sites due to the fact we can leverage a higher portfolios, we can extract the real value from them.
from 2017 will take advantage of of a full service number of clients compared to on rooftops in the Cellnex and INWIT tried to enter into this sector but

towers may come to market further down the line.
“
TowerXchange: Italy has stringent regulations
around active equipment. How does this impact
towercos operating in the country and your
The entry of Iliad implies (with the agreement of the European

Competition Authorities) that Three/WIND will pass 5,000 sites plus
some frequencies to Iliad
“ tenancy ratios?
Carlo Ramella, Chairman, TowerTel: This has an

impact in particular in urban areas as it’s about
the number of hours where the population is
exposed to certain emission levels. For sites which
are far from the population the regulations are
less stringent and so this is why we’re focusing
on rural areas. In Cellnex and INWIT’s portfolios
found it too time consuming for them to educate Recent news is the merger between Three and Wind about 50% of sites are urban sites and may host a
an internal team of people to do this. It’s nice that and the entry of Iliad into the sector. What are the second operator but having three tenants is hard.
we are the sole buyer in this sector, we can buy consequences for us? I would say positive. As soon In these areas, for example, there may be a problem
for 6-9x EBITDA and as we trade at 12x there’s a as Wind and Three announced the merger we were in adding 5G technology to the sites as the existing
mathematical equity creation. We have covered worried as the merger would have exposed us to technology uses up all the electromagnetic space on
a lot of the market and estimate we have another a risk of €2.5-3mn if there had been one operator those sites.
two years of activity in acquiring these portfolios fewer in the market. The entry of Iliad implies
ahead. (with the agreement of the European Competition TowerXchange: With European attention turning
Authorities) that Three/WIND will pass 5,000 sites to the potential of rooftops and alternative
TowerXchange: Can you give us a little plus some frequencies to Iliad. Three/WIND had topologies to densify networks, what are
background on the operator situation in Italy? perceived they would have a problem with the TowerTel’s plans for the evolution of your
As Iliad enter the market, what is your opinion European Authorities and made a deal with Iliad portfolio?
on how their network will be set up? in a preemptive basis. Iliad can select which of the
5000 they want in order to start their operation as Carlo Ramella, Chairman, TowerTel: In order to
Carlo Ramella, Chairman, TowerTel: We have four their initial offering will rely on roaming. potentiate the current rooftops, MNOs are trying
MNOs in Italy; Vodafone, TIM, Wind and Three. to deploy a new network of small cells. For us it’s
Vodafone and TIM have deployed their networks It’s early days but the good news is that Iliad have much more difficult to enter this market, you have
in terms of sites and still control these networks. 5,000 sites so they won’t rely on competitors for to be closer to the CTO point of view of the mobile
Wind has divested to Cellnex and Three controls roaming. We won’t see a sale of those tower assets carrier. INWIT are in the best position for this
their entire network. in less than 18-24 months as they bed in, but those as TIM has to deploy and reinforce their rooftop

coverage. We are much more cautious, we are than mobile at the moment and digitalisation the short to medium term remain acquisition of
still at the door for the small cells, studying the will affect this further, how do you feel about the the small ‘Mom and Pop’ companies, because of
difference between indoor and outdoor; indoor way EI Towers’ business is split? the discrepancy in the acquisition multiple and
is more customised as you can select a single we can apply our management strategies to these
project, for example, a shopping centre. Outdoor Carlo Ramella, Chairman, TowerTel: We don’t see assets. With expansion abroad, the synergies on an
needs a strong partnership with an operator and this as risk in the long run. In Italy we have three international scale are very limited. It’s hard to see
local authorities which is hard to do without the platforms; the DTT, satellite and fibre platforms with immediate synergy in a network where we’re not
guarantee of hosting someone. the government having stimulated a big investment present. We’re much more cautious on the multiple
in the fibre platform. We manage DTT; linear TV to be paid for assets abroad; we can consolidate in a
Another consideration is also the size of the market. reaches 99% of the population with free content market only if there’s a real opportunity.
Indoor site numbers aren’t as big as has been available. In the future we believe the basic content
discussed. In Italy there aren’t all that many big of the TV will still pass through our network; news, TowerXchange: You were reportedly interested in
malls with lots of shops, most people still buy in talk shows, reality TV et cetera, and will guarantee bidding for INWIT when they considered bringing
the centre of the city where you’re talking about the existence of the network we manage and host. the towers to market. Can you tell us what made
outdoor cells. It’s quite easy to contact owners of them appeal to you?
malls but outdoors it’s difficult as you have to agree We believe that the other platforms are dedicated to
with owner of the building and also the city council. on-demand content; you need to pay not only for the Carlo Ramella, Chairman, TowerTel: INWIT would
content but to have the connection in the first place, have been a great opportunity for an industrial
In this respect I’d like to emphasise that rather than so it’s a different proposition to DTT broadcasting. operator that is present in the territory, not
focus heavily on small cells we’ve recently acquired only as due to the number of sites but also their
a company, Nettrotter, with an eye towards IoT. It’s We’ve also formed a new company, EI Towers relationships with local authorities and maintenance
slightly different from the tower business, we offer Radio, to position ourselves as a full range service operators et cetera. INWIT represented an
a very low bandwidth channel to the potential client provider for the FM radio industry. We pass the opportunity for us as we could operate in a very
that may take advantage of business specific devices current hosting business from €7mn and have efficient way, increasing the top line with new
(relevant for IoT many businesses) that do not need started a small M&A campaign in this area and plan deployment and gaining efficiencies on the cost side.
battery charge for several years. We want to capture to capture around 100 sites to corner this market. We saw potential in combining the two networks;
the first clients entering this sector, for example We are positioning ourselves for the benefit of this whilst obtaining savings from decommissioning
in the application of intelligent metering whereby new entity and the other part of the market. parallel sites is challenging, we felt confident we
water companies monitor levels of water along the would be able to extract value from this in Italy.
network or in healthcare or control logistics around TowerXchange: With towercos increasingly
Europe. looking at multi-country operations, what are Unless the major transactions in Italy disappear for
TowerTel’s plans for future growth? the time being we’ve decided to invest in ourselves
TowerXchange: The broadcast industry is developing buyback shares, we’d like to buy back 5%
creating significantly less revenue and growth Carlo Ramella, Chairman, TowerTel: Our goals in of the company

Breaking new ground:
TowerXchange: Please introduce HighTel, your
history and your current status as a company.
HighTel Towers move East Nicola Parmeggiani, CEO, HighTel Towers: The
company has actually been operational for 15
Italian towerco HighTel Towers are looking to grow rapidly through years as it was founded in 2001, making it the
oldest towerco in Italy. For the first decade it only
acquisitions in the Balkans
developed around 250 assets in that time, all of
which were in Italy. In 2014 the main shareholder
Despite tracking 44 towercos across Europe and
decided to sell all the towers which had been
the CIS, TowerXchange are still often caught out
developed until that point to EI Towers.
by new entities we didn’t know existed. However,
it’s very rare that we’re introduced to a towerco
After this we built on past experience to scale up
like HighTel, who boast both a long history in
the company and to expand abroad. HighTel Towers
an established market and whose growth plans is a tower company that is fully integrated along
and success in gaining traction in new markets the value chain and the only tower company in
have gained our attention right away. As well as Italy providing turnkey towers to all MNOs in the
updating our European analyses, we managed to country. I joined the company in 2014 as CEO and
grab a few words with Nicola Parmeggiani, CEO of President, I’m also a shareholder in the company
this disruptive Italian tower owner. and very focused on our vision for the future.
My background is in telecoms, having worked for
Keywords: Acquisition, Albania, Anchor Vodafone for five years, and McKinsey prior to that.
Tenant, Build-to-Suit, Co-locations, Country Risk,
Decommissioning, Europe, HighTel Towers, Italy, Once I came on board, we focussed on four
Kosovo, Macedonia, Rooftop, Sale & Leaseback, pillars of the core business: building towers as a
Nicola Parmeggiani, CEO, HighTel Towers Tenancy Ratios turnkey offering for MNOs; the M&A of towers; the
acquisition of the land under the towers of other
tower owners and cross border tower M&A activity.
Read this article to learn: We recently raised €15mn from private equity in
< Who HighTel Towers are and how the company has developed order to support these goals.
< How many towers HighTel owns and where
< How they are planning for growth The Italian market is a very different market to
< Why the Balkans makes such an interesting growth market other parts of Europe. We’ve seen a large amount
of sale and leaseback of existing towers which

underpins the market. HighTel focusses on building
“
our own towers; indeed we not only build but
design, permit, own and manage our own towers.
TowerXchange: Can you tell us how many towers

you own and where they are?
Nicola Parmeggiani, CEO, HighTel Towers: We

We don’t have towercos who build in Italy, and thus far have mainly
currently own 300 towers in Italy and 300 in seen just the sale and leasebacks of existing towers. We are the only
Albania.
towerco in Italy who builds their own towers; indeed, we design,
Of our Italian portfolio, around 50% were acquired
from small ‘mom and pop’ portfolios and the other
50% were built to suit. Our current tenancy ratio
is 1.75 but we are targeting a tenancy ratio of 2.8,
permit, build, own and manage our own towers. This is our niche, and
we’re doing very well from it
“
which we believe our business model supports. Our
tenants include Wind, 3, TIM and Vodafone, as well
as non-mobile tenants such as Linkem; our strategy
is only to build a tower once we have interest from towers in Macedonia, Kosovo and Slovenia in the much do you keep in house?
at least two tenants. In order to deploy rapidly, we next 18 months as well. Our aim is to roll up a
begin the permitting phase once the first contract significant number of towers in the Balkans and to Nicola Parmeggiani, CEO, HighTel Towers: HighTel
is signed, so our towers may only have one tenant gain first mover advantage in these markets. As we is very small, with fewer than 20 employees. Our
in the first few months they are operational, but see it, there’s currently a huge amount of parallel aim is to manage only core activities internally, so
this should increase to two very quickly. Since infrastructure in these countries which lends things like permitting and acquisition. Everything
other towercos derive from a carve-out of MNOs’ itself to making significant efficiencies through else, such as engineering and construction et cetera
networks and they expand through M&A, they colocation. In addition, the digitisation of broadcast is outsourced. We use one construction company for
don’t tend to have towers suitable for more than television in just rolling out in the Balkans, and we each Italian region.
one tenant. HighTel, on the contrary, has a business can see our tenancy ratios jumping from one to two
model that allows the tenancy ratio to start from 2 very quickly by getting buy-in from the incumbent TowerXchange: Can you tell us about your plans
when the tower is built and reach almost 3 in the broadcasters as well. for growth and your exit strategy?
next 12 months.
TowerXchange: How have you structured the Nicola Parmeggiani, CEO, HighTel Towers: We
Outside of Italy, we’ve just signed a contract to company? With everything from design and have a three year plan. The intention is to build
acquire 287 towers in Albania, and hope to acquire build to international acquisition going on, how approximately another 100 towers per year and to

acquire another 100 per annum in Italy, excluding
land. In terms of acquiring land, our plans are
much more ambitious, it’s a €2.5bn market and we See you at our future events!
plan to play a significant role in that.
We also plan to attack all those markets in the

Balkans which do not yet have an existing towerco
and where synergies can increase the tenancy Meetup Meet up
ratio rapidly – for example in broadcasting or
consolidation. We are currently looking at Kosovo
and Macedonia as our next target markets.
Our feeling is that the market is associating too 4-5 April, 7-8 June,
much risk with the Balkans, where GDP growth
has been stable for many years, inflation is stable,
London Boca Raton
currency is stable (and additionally, our master
lease agreements are in euros) and politically the
situation has been stable for several years. The legal
systems in some Balkan countries are a hangover
from the Mussolini era and are very close to what
we’re familiar with in Italy, which helps. Of course, Meetup Africa Meetup Asia
there is more risk in the region, but we feel the
risk the markets associate with these countries is
disproportionate.
& ME 2017 2017
Other towercos have tried to tap into this market
but don’t seem to have had much traction over the
last few years, we have managed to close a deal
Johannesburg Singapore
already and have several more in the pipeline.
It’s a new market but our plan is to close down

several Balkan markets within our three year www.towerxchange.com
timeline and then assess the most suitable option
for our portfolio at that time

Gamekeeper turned hunter:
TowerXchange: Please introduce INWIT to our
readers: what was the decision making process
behind forming the company?
how INWIT are providing a Oscar Cicchetti, CEO, INWIT: Mobile network
blueprint for tower carve outs operators are separating out their tower businesses
and the number of towers managed by towercos
continues to increase all over the world: the main
With a focus on double digit EBITDA growth and a strong focus on future
reasons behind this trend are focus and total cost of
networks, INWIT are proving that MNO-owned towercos can thrive ownership.
TowerXchange catch up with Oscar Cicchetti, CEO Focus, because MNOs need to concentrate on core
of INWIT, to question him about how INWIT was activities to improve their competitiveness. How
created, how the company is valued and what they manage spectrum, network architecture and
their plans are for the future. What emerged technologies and improving customer relations
was a picture of solid growth, clear vision and is more important than the ownership of towers,
an appetite to be ahead of the curve in terms of inverters, batteries and cooling systems. I like the
preparing their network for 5G rollout. analogy of a car and a driver – infrastructure is the
car used by everyone, but the difference is in how
Keywords: 4G, 5G, Anchor Tenant, Carve Out, MNOs drive it!
Co-locations, DAS, Decommissioning, EBITDA,
Editorial, Europe, Europe Insights, INWIT, IPO, Total cost of ownership reduction is key for all the
Infill, Infraco, IoT, Italy, LTE, MNOs, Market MNOs and telcos because they have to continue
Overview, Regulation, Small Cells, TIM, Tenancy to invest in networks to deliver ultrabroadband
Ratios, Towercos, Valuation and deal with competitive pressure and growing
difficulties in so called “data monetisation”. The
only way to deal with this is sharing whatever is not
Read this article to learn: directly related to their competitive edge and tower
< How and why INWIT was formed sharing and outsourcing is perceived as a valid way
< How they prepared for and managed a successful IPO to save capex and opex.
< What INWIT has done to secure their position as a leading European towerco
< INWIT’s take on the Italian tower market Bearing that in mind, it’s not surprising that TIM, in
< How INWIT are preparing for 5G rollout line with this trend, decided to carve out and sell a
minority share of its tower asset.

“
TowerXchange: What process did you go through
to get from operator-owned assets to IPO?
Oscar Cicchetti, CEO, INWIT: TIM’s decision was

based on the drivers I’ve already mentioned: a more
focused organisation to manage the infrastructure
business, a release of capital from the sale, and How they manage spectrum, network architecture and technologies
a higher visibility of the tower asset on the TIM
and improving customer relations is more important than the
balance sheet.
I do believe that all those objectives have been

achieved: the IPO has been successful (TIM obtained
roughly €900mn for 40% of the INWIT shares, with
ownership of towers, inverters, batteries and cooling systems. I like
the analogy of a car and a driver – infrastructure is the car used by
everyone, but the difference is in how MNOs drive it!
“
a demand that was higher than eight times the
offer); INWIT is recognised as a relevant asset on the
TIM balance sheet (mid-teens EV/EBITDA multiple
which compares with the mid-single-digit typical of
the telco space) and, more importantly, the business you’ve created a valuable asset and become a key INWIT has long term contracts with high quality
focus is delivering better than expected results. player in the Italian market - what are the key customers; in our client portfolio we have all the
values and unique selling points which have led Italian mobile operators, all of whom have long
A few months after the IPO, TIM decided to to INWIT’s success? term contracts. In particular with TIM, which
look for potential buyers for the majority stake accounts for about 80% to our revenues, we have a
but this process didn’t come to a conclusion. Oscar Cicchetti, CEO, INWIT: I see four key value 24 year contract.
Without entering in decisions that belong to the drivers in our equity story: quality of the asset,
shareholders, I want to highlight that the value visibility on revenues, protection against inflation/ Moreover, the passive infrastructure business is
of the asset was not fully evident. As a matter of deflation and new business opportunities. not only characterised by high visibility on the
fact, the business acceleration methods which are revenues and high barriers to entry, but also by a
allowing us to have “low teens” growth were not The market recognises that we have a very high full protection against inflation and interest rates:
yet known and factored in the price, as well as quality asset. When it comes to towers it’s hard to the revenues we receive are linked to inflation.
many additional opportunities like the potential set qualitative benchmarks, but the tenancy ratio is And we even trade on this, because the majority
electromagnetic threshold increase or the upside often a proof of how much the customers value the of the revenues are 100% linked to CPI, while the
that could come from the consolidation in the assets over others. And our tenancy ratio is 1.7x, the costs are “only” 75% linked. This means that every
Italian tower market. highest in Italy. It’s also worth mentioning that over percentage point of inflation increase translates
60% of our sites have access to fibre backhaul which into more than a percentage point in terms of both
TowerXchange: Over a year on from your IPO is a relevant value in the Italian market. EBITDA and net income.

the same amount of antennas with a lower volume
“
of towers, which will mean a similar amount of
revenue and lower amount of opex.
TowerXchange: With the merger between

Hutchison and Wind, how do you see the tower
market changing in future?
The merger of Hutchison and Wind should translate into an another
Oscar Cicchetti, CEO, INWIT: The merger of
portfolio of towers that could come into the towerco space. We’re
interested in buying this asset and benefiting from the synergies
between the two portfolios of towers
“ Hutchison and Wind should translate into an
another portfolio of towers that could come into
the towerco space, if they confirm their willingness
to sell some of their towers. Obviously we’ll try
to have an active role in this. We’re interested in
buying this asset and benefiting from the synergies
between the two portfolios of towers.
Also in terms of interest rates we are neutral, regulations on electromagnetic load are updated. In terms of timing, I assume that in the short term,
because our debt is completely subscribed at fixed All the towers have been built up by the MNOs the combined entity will be initially focused on
rate. under pressure to cover the most populated areas merging the two networks and the two customer
and this created a significant overlap and room for bases and then will potentially look for a sale and
Last and absolutely not least: new business, which optimisation. leaseback transaction.
means small cells and backhaul, that will be the
main source of the growth in a medium/long term On the other hand the growth of data volumes and TowerXchange: In a market with three
perspective. performances and the consequent deployment ambitious towercos, how do you see INWIT
of the new mobile technologies will demand a developing? What are your plans and goals for
TowerXchange: Can you give us a little color on densification of the Radio Access Nodes. growth?
the Italian market in general? How has telecoms
and network coverage developed there? All in all, towercos can play a pivotal role in Oscar Cicchetti, CEO, INWIT: First of all, let me
managing the decommissioning and in offering highlight that our organic plan foresees a “low
Oscar Cicchetti, CEO, INWIT: In Italy we have traditional as well as innovative build to suit towers teens” EBITDA growth. And this is a relevant
more than 45,000 towers with a low tenancy to the MNOs. perspective, considering we will maintain the
ratio compared to other countries (for the overall typical low risk profile of our industry. This result
market the tenancy ratio is below 1.5x). This means Let me just remark that decommissioning is a does not consider any in-organic option, which will
there’s room for efficiencies, particularly when the positive value driver in this space, because it implies provide further upside to our planned growth.

“
Roughly half of the “low teens” growth comes from
the so-called “risk-free actions” like escalators
on revenues, contracted tenancy increases and
contracted efficiencies derived from dismantling
sites.
All the network architects currently think that the amount of small
Moreover we will benefit of the wave of investment
we have already committed to at the beginning of
the year and which we increased in June, taking
into account the commercial results and a new plan
cells required in a fully deployed 5G architecture will be ten times
the number of the traditional macro cells. In the Italian market this
translate into a demand of roughly 600,000 tenants
“
from our main customer.
To go into more detail: we decided to double the

number of new sites (from 250 to 500), to accelerate connections (billions instead of millions). 5G architecture will be ten times the number of
the small cells plan (from 1,000 to 4,000 remote the traditional macro cells. In the Italian market
units) and to enter into the backhauling market, From an industrial standpoint the expected this translate into a demand of roughly 600,000
which will be an additional revenue stream for us. performance should trigger different use cases tenants.
(virtual reality, fixed mobile substitution, connected
It’s worth mentioning we adopted a strict policy to cars, Internet of Things, et cetera) The growth of these small cells is just taking
get a “double digit return” for each euro we invest off now and creates a very concrete business
in growing the business. 5G will require several challenging technological opportunity for the towercos.
improvements (i.e. intensive MIMO and carrier
TowerXchange: There’s a lot of talk of 5G and aggregation, active and beam forming antennas, Each MNO will deploy and use its own small cells
‘futureproofing’ networks at the moment, what cloud RAN), new and relevant spectrum resources but we do believe that a relevant portion will be
are INWIT’s plans in this regard? (beyond 3 GHz) and a completely different network shared among operators and managed by neutral
topology (including the intensive use of small cells). hosts. In order to capture both needs, we offer
Oscar Cicchetti, CEO, INWIT: 4G has been the a turnkey solution for exclusive LTE small cells
first “data native” mobile data network and Small cells, which are an important network and Distributed Antenna Systems to be shared
its deployment is supporting the growth of component in the 4G environment, will play a between operators.
mobile internet everywhere. 5G is a new deep crucial role in the 5G framework in order to handle
transformation that has been conceived as a radical the very high frequencies that will be used and to Finally, if you consider that we own roughly
improvement of the performances in terms of deliver the low latency required in some use cases. 11,000 macro towers and there is a potential for
throughput (10 Gbit/sec compared with the 100 600,000 small cell tenants, even capturing a small
Mbit/sec of 4G), latency (1 millisecond compared All the network architects currently think that the percentage of this market could be a great upside
to the current 15/20 millisecond) and number of amount of small cells required in a fully deployed for us

Italy Market Overview
A saturated market, unable to progress
Italy ranks 14th out of 20 Western European

BMI’s Andrew Kitson reveals the weaknesses and opportunities in the Italian market telecommunications markets surveyed in BMI’s
proprietary Risk/Reward Index, scoring 56.7
BMI View: A mobile penetration rate of over points out of a potential 100 and slightly below
142% is testament to the maturity of the the regional average score of 57.2. With regards
Italian mobile market. However, operators to Industry Rewards, which measures the
have become over-reliant on simplistic low- attractiveness of the market in terms of future
cost service offerings to retain customers. subscriber and revenue growth, Italy scores just 45
In consequence, profit margins are slim and points. This does not bode well for the newcomer,
operating costs are being scrutinised closely Iliad, as well as its MNO and MVNO peers.
with respect to return on investment. Market
forces are once again driving consolidation, Iliad will procure some spectrum and network
with WIND set to be acquired by 3 Italia in the assets from WIND and 3 and is expected to invest
near future. We believe newcomer Iliad’s low- over $500mn in procuring towers and 35MHz of
paired spectrum. Iliad may be looking to replicate
value strategy will prevent the Italian market
the disruptive market strategy it successfully
from pursuing new competitive dynamics.
employed in France but we are of the opinion that
competition is already very high in the Italian
Keywords: 4G, 5G, BMI Analysis, BMI
market with operators giving lucrative incentives
Research, Cellnex, Co-locations, DAS, EI
and low tariffs to lure clients. Network sharing
Towers, Europe, Europe Research, IBS between operators already exists and incumbent
INWIT, IPO, Iliad, Infill, IoT, Italy, LTE, TIM has already hived-off its tower business as a
New Market Entrant, RANsharing, Rooftop, standalone operation (INWIT), but cost-reduction
Small Cells, Smart Cities, TIM, Third Party needs to go further and deeper if investments are to
Reports, Vodafone Italy be monetised.
Andrew Kitson, Senior Global Telecoms Analyst, BMI Research
In recent quarters, the overall mobile subscriber

Read this article to learn: base has contracted, declining by 3.5% y-o-y
< How market consolidation and new entrants will change the Italian market to 20.36mn by September 2016. Operators are
< The upgrades and changes needed to prepare Italy’s infrastructure for 5G rollout shedding retail subscribers as MVNOs take root
< The key revenue generators in Italian towers with low-cost ‘no frills’ services; at the same time,
< The importance of operator-agnostic IoT for growth they are also closing inactive accounts in a more
timely manner, the aim being to raise reported

ARPUs and reassure investors. Although some Italian market shares, June 2016
progress has been made with regards to migrating
customers to postpaid multi-service plans, that 12.3%
progress has been quite limited, highlighting the TIM
entrenched expectation of low-cost ‘good enough’ 35.0%
services amongst consumers. Iliad’s arrival will not,
Vodafone
therefore, change the market’s overall direction. 24.6% WIND
Tower spin-offs indicative of market weaknesses 3 Italia

28.1%
As the incumbent public telecommunications Source: BMI, operators, AGCOM
operator, TIM bears a heavy infrastructure
maintenance burden, having to attend to not only Mobile Market Forecasts Source: BMI, operators, AGCOM
expanding its high-cost 3G/4G mobile voice and
2014 87,505 146.4%
data networks but also managing the decline of
its ageing nationwide copper access network. The 38,298
latter is a huge drain on its finances and, although 85,593
2015f 143.1%
performance-enhancing technologies such as VDSL 43,467
and vectoring can (and are) being used to extend its
commercial lifespan, it will increasingly fall short of 84,309
2016f 141%
the market’s needs. A sell-off of TIM’s infrastructure 47,815
business has been mooted and the creation of a
2017f 83,846
standalone towers unit, INWIT, has been a positive 140.2%
52,119
first step in that direction.
82,292
2018f 139.3%
Besides hosting its parent’s mobile networks, 56,288
INWIT also supports WIND, 3 and Vodafone,
either operating some towers on behalf of these 2019f 82,959 138.8%
companies or allowing them to be tenants on its 58,399
sites. INWIT reported revenue growth of 56.7% 82,793
YOY to €248.8mn in the first nine months of 2016 2020f 138.6%
60,081
as third-party income improved to €57.4mn. Inwit
reported a 56:44 TIM/other licensed operator
20,000 40,000 60,000 80,000 100,000
(OLO) client ratio as of September 2016, while its
co-tenancy ratio has improved to 1.70x, improving Total Mobile Subscriptions (000) 3G/4G Subscriptions (000) Mobile Penetration (%)

“
more innovative offers, such as the content-led deals
recently offered by Telecom Italia and Vodafone,
following partnerships with Mediaset and Netflix.
Price competition has driven the overall reduction

The enlarged 3/WIND will become the market leader, having a greater of ARPU in Italy, already low by European standards
share (approx. 37%) than TIM (35%). However, it is Vodafone (28%) that
has suffered the most from price competition wrought by WIND and 3,
and will continue to be weak in the short term, being the third out of four
operators once Iliad launches
“ due to the dominance of prepaid connections.
3 traditionally reported the highest ARPU, with
WIND the lowest, and we believe the merger will
lead to a further dilution. A better subscription
mix, underpinned by new services, should see
an increase, but we believe this will remain
limited, as competition will remain strong and
consumers will not accept large price hikes for their
its monetisation of capital intensive towers in its unlikely to want to own and manage all the towers subscriptions. Operators will be able to cut costs
portfolio. Increasing tenancy ratios by adding third it will acquire from the merged operators, posing through synergies, the end of unprofitable plans to
parties to traditionally operator-specific sites is the additional expansion opportunities for INWIT. A gain market shares, and greater stability through
main way in which tower companies can improve listing of INWIT may well, therefore, be inevitable if a higher post-paid share, but not by increasing the
monetisation of passive infrastructure than would the company wishes to exploit these opportunities. prices of current services.
otherwise be possible under an operator-owned
model, but opportunities for organic growth in Service differentiation as a revenue driver falls The need for stability is apparent after a period
this field are limited by the high cost of tower flat of strong competition, and this is seen in reported
acquisition and operators’ reluctance to forego churn rates, which have improved in recent
ownership of infrastructure. The enlarged 3/WIND will become the market quarters. Operators will improve their profitability
leader, having a greater share (approx. 37%) than thanks to new services, but those can be developed
Even after it sells excess towers to Iliad, future TIM (35%). However, it is Vodafone (28%) that has more easily with a settled customer base, as
infrastructure consolidation and rationalisation suffered the most from price competition brought overall investments remain heavy. LTE is such an
will likely see the enlarged 3 Italia look to dispose by WIND and 3, and will continue to be weak in the example as, despite TIM’s focus on the technology,
of further assets, and INWIT will be well-placed to short term, being the third out of four operators it still represents under 10% of its customer base.
acquire these. Furthermore, we believe the high once Iliad launches. Migrating customers to new technologies and new
integration costs and disparities between WIND’s services, and improving stability through post-paid
and 3’s customer bases will weigh on the enlarged BMI believes that the merged operator should look and converged plans has seen success in other
entity’s profit margins and the disposal of all or to improve its services to end-users, leveraging its European markets, but Italy is starting later than
most of its towers might well take place within newly-acquired economies of scale and synergies. its peers, and with fewer assets, because of the
the next three years. Meanwhile, Iliad will be This will not necessarily mean higher prices, but predominant prepaid market and the fragmentation

“
(fixed, mobile, TV) of the different telecoms services
that can be offered to customers.
Operator-agnostic IoT key to tower companies’

growth
Although INWIT is recording particularly strong There has been muted interest [in IoT] in the European towers market
improvements resulting from expansion of its co-
so far, but the proliferation of IoT platforms and services over low-
tenancy business, its move into small cells and the
Internet of Things (IoT) bears watching. Similarly,
although telecoms accounts for just 15% of its local
rival EI Towers’ revenues, the latter’s partnership
with Sigfox network operator Nettrotter will provide
power wireless broadband solutions such as Sigfox will provide the
revenue diversification that will make this market more appealing
“
a valuable source of additional income in the future.
There has been muted interest in the European
towers market so far, but the proliferation of IoT
platforms and services over low-power wireless (ontrack pet) services. foreign rivals such as Cellnex and Crown Castle,
broadband solutions such as Sigfox will provide the but this is yet to materialise. Telecom Italia is said
revenue diversification that will make this market Besides building new towers and growing its to be mulling offers for INWIT, which would help
more appealing. backhauling capabilities, INWIT is investing small the debt-laden operator focus on service-orientated
cell technology and services, also with a view to investment opportunities; Spain-based Cellnex has
Mediaset-owned EI Towers is working with Netrotter gaining a first-mover advantage in the nascent IoT previously indicated its interest in INWIT, but the
to build a Sigfox-based wireless broadband network market. As of September 2016, INWIT claimed to be Telefónica-owned Telxius could also turn to Italy as
spanning 24 countries and covering more than hosting around 200 IoT tenants on its network and is part of its expansion drive.
a billion people. Services are already live in six looking to be in a position to host 4,000 remote small
countries but EI Towers’ Italian footprint covers 500 cells by the end of 2018. Small cells represent 25% of EI Towers does not necessarily need to bid for INWIT
operational base stations and 70% of the population its current order book for investment projects. to remain relevant to the domestic mobile market.
in 85% of cities. By early 2017, almost 1,000 base Vodafone, WIND and 3 still own most of their own
stations will be operational, essentially providing EI Towers’ less dynamic 4.3% YOY revenue growth, towers and could put these assets on sale following
nationwide coverage. EI Towers will be able to to EUR87.9mn, is due to its disproportionate focus on the merger of WIND and 3. However, it does need
monetise a broad range of off-the-shelf IoT solutions the relatively staid broadcasting market in Italy and to diversify away from broadcasting and, if tower
for companies in the utilities, infrastructure and the fact that its revenue diversification drive is still purchases are too investment-heavy, it should
consumer markets, including its water metering at a very early stage of development. The company continue to tap the emerging market for low power
(Telenet Water), smart lighting (SULnet), asset has been linked with a putative takeover of INWIT wide area broadband services and IoT connected
management (SmartCooler) and pet tracking as a means of defending its Italian business from devices for easily sustainable expansion

A change of heart:
What was on offer?
Founded in 2006 by Turkcell, Turkey’s largest mobile
Turkcell postpones Global Tower network operator, Global Tower manages 7,994
towers in Turkey, 1,181 towers in Ukraine under
IPO at the last moment subsidiary UKR Tower, plus a further 800 towers in
Belarus and Northern Cyprus. Of the Turkish towers
under management, around half of them are owned
TowerXchange analysis of the decision, plus some exclusive comments from outright by Global Tower and the other half are
Global Tower’s CEO owned by Turkcell and either leased or managed by
Global Tower, indicating that the status and value
The latest tower news to come out of Turkey. is the eleventh hour of the portfolio in Turkey is variable – with some
postponement of the Global Tower IPO by Turkey’s leading MNO, towers available for co-location and others simply
Turkcell. Citing market uncertainty caused by the US elections and managed for Turkcell by Global Tower.
cyber attacks, Turkcell announced the postponement of the listing
of their carve out towerco Global Tower, which had been planned Why IPO?
for October 27th. “Having considered the potential impacts of
the upcoming United States presidential election and the FED’s Despite Turkish MNOs traditionally being keen to
expected interest rate decision on the financial markets as well hang on to their infrastructure as a competitive
as cyberattacks, and in agreement with its major shareholder differentiator, Turkcell clearly sees potential in their
Turkcell, Global Tower has postponed its initial listing on Borsa Global Tower asset. As the towers are already carved
Istanbul planned for October 27 until the markets become more out and managed as a separate entity, with many
reliable and stable,” the company said in a statement. supporting multiple tenants and already generating
revenues estimated to be around TRY$200mn
Keywords: Anchor Tenant, Belarus, Carve Out, Country Risk, Cyprus, Europe, Europe News, Global (around US$60mn) and an EBITDA of around
Tower, IPO, News, Turkey, Turkcell, Ukraine, UKR Tower, Valuation TRY100mn (US$30mn), the asset is already market-
ready.
Read this article to learn: In April 2015, Turkcell appointed a new CEO, Kaan
< Why Global Tower originally planned an IPO Terzioğlu, whose background working for Cisco and
< When and how the IPO was postponed in the US and Europe is believed to make him more
< Potential reasons for the postponement of the listing inclined towards outsourcing and lighter operations
across the organisation. Turkcell also announced in
< Options for Global Tower in 2017
June 2016 its plans to refocus away from declining
< Exclusive comment from Global Tower on the postponement
Turkish revenue and to grow international

“
revenues from 7% of total revenue to almost 40% Valuation and IPO confidence
by expanding into North Africa, Eastern Europe, the
Middle East and Central Asia. There’s no doubt that Turkcell planned to list 25% of Global Tower, which
the capital which might have been raised from a is a fairly small commitment compared to the
Global Tower IPO would be significant in supporting if Turkcell were expecting to achieve percentages listed by Cellnex, INWIT and proposed
this international expansion. Cellnex-like multiples of 16/17x by Telxius over the last 18 months. The price range
EBITDA from the IPO, then the was believed to have been set at TRY 3.82-4.46 per
Why might the deal have been postponed? share. With 345mn shares coming to market and
reality of a potentially significantly
limited net debt, this suggested an EV of TRY 1,318
Unstable political and economic environment lower valuation may well have given to 1,539mn, around US$400-500mn. TowerXchange
them cause to reconsider the move, sources suggested revenue per tower of TRY44,000
particularly as TowerXchange have
Recep Tayyip Erdogan was sworn in as Turkish
president in August 2014, following a highly
successful 12 years as premier, during which
the Turkish economy tripled in dollar terms.
heard rumours that a trade sale
was discussed over the summer and
rejected in favour of the IPO
“ (around US$14,000). Based on an assumption that
only 3,393 Global Tower-owned Turkish and 1,181
Ukrainian towers were revenue generating, this
suggests a 12-15x EV/EBITDA multiple.
However, Turkey is a parliamentary republic and
the presidency is a largely ceremonial role, so Following the success of the Cellnex and INWIT IPOs
many believe Mr Erdogan is seeking to change the in 2015, interest in raising funds through the IPO of
constitution to create an executive presidency. in Turkey’s credit rating to continue over the next tower assets has gained a large amount of interest in
two to three years. the tower industry. However, unlike Cellnex, whose
On 15 July 2016, an attempted coup was carried out business revolves around maximising tenancies and
by members of the Turkish armed forces, during But it’s not just domestic political instability in profits, operator captive towercos such as Global
which over 300 people were killed. The coup was Turkey causing alarm. The ongoing uncertainty Tower have additional hurdles to overcome to
unsuccessful and Ergodan’s regime responded around the US elections, Brexit causing instability demonstrate their value in the market. Questions
by making mass arrests, estimated in the region in Europe, increasing tensions between Russia abound around operators’ ability to deliver the
of 40,000 detainees, across the country. Theories and the West, and the migrant crisis in Syria, ‘best of both worlds’ and reserve space for their
abound about the cause of the coup and the which has affected Turkey more heavily than any parent company and anchor tenant, safeguard
motivations behind it and the ensuing government European country, are all unbalancing markets and their competitive position, while also extracting the
action. economies, both on a local and global level. maximum potential value from leasing up the tower
network.
Ratings agency Moody’s cut Turkey’s long-term However, while political and economic uncertainty
issuer and senior unsecured bond ratings by one may have contributed to the decision to postpone, It seems likely that, if Turkcell were expecting to
notch to Ba1 with a ‘stable’ outlook in September there were no significant events in the weeks prior achieve Cellnex-like multiples of 16/17x EBITDA
2016 — placing the country’s credit rating in junk to the postponement which could alone be blamed from the IPO, then the reality of a potentially
territory and saying it expects that the deterioration for a sudden change of heart. significantly lower valuation may well have given

“
Alpha Group (which currently owns a 13.2% stake) and that Turkcell still have a desire to monetise this
acquiring Cukurova’s 13.8% stake by 28 November valuable asset to support their plans for international
2016. Such uncertainty among shareholders has expansion. It may be that their disappointment in
already hampered Turkcell’s development and the IPO valuation encourages Turkcell to reassess
We had received a satisfactory prevented the payment of certain dividends, it the benefits of a trade sale, perhaps to a strategic
may well be that this is a contributory factor in the partner who can support their growing network
demand from the international
postponement of their satellite tower business. needs overseas as well as domestically. On the other
institutional investors which hand, they may well choose to wait until the markets
motivated us further about our What next? are a little more settled, as Global Tower represents a
tower business. Especially large- portfolio of towers with a strong anchor tenant, good
TowerXchange believes that the Global Tower IPO growth opportunities and a successful ten year track
sized long-only investors who
is very much ‘postponed’ as opposed to ‘cancelled’ record
showed interest in investing in
Global Tower have confirmed our
trust in the fundamentals of our
business” - Nihat Narin, CEO,
“ TowerXchange exclusive Q&A with Global Tower CEO Nihat Narin
about the recent IPO postponement
TowerXchange: Can you shed any light on the relaunch the process once the markets become
Global Tower decision to postpone the Global Tower IPO? more stable and reliable. In that regard, we will
wait until after the US presidential elections and
Nihat Narin, CEO, Global Tower: We had received FED interest rate decision, both of which have an
them cause to reconsider the move, particularly as a satisfactory demand from the international impact on the global financial markets.
TowerXchange have heard rumours that a trade institutional investors which motivated us further
sale was discussed over the summer and rejected in about our tower business. Especially large- TowerXchange: Would Turkcell consider a
favour of the IPO. sized long-only investors who showed interest trade sale of Global Tower under the right
in investing in Global Tower have confirmed circumstances?
Investor Uncertainty our trust in the fundamentals of our business.
Overall, the level of interest from U.K., Europe Nihat Narin, CEO, Global Tower: With a view to
In addition to the above factors, a decade-long and Turkey was comparatively higher than that of a more focused management of Global Tower,
disagreement among Turkcell’s shareholders the States. and to transforming it into a regional tower
looks like it may be resolved soon, which could company, the first planned step was its initial
disrupt the decision making process of Global Our understanding is that the cyber-attacks public offering, now postponed to 2017. Investor
Tower’s parent company. A disagreement between
have negatively impacted our process, limiting interest in Global Tower during its IPO process
Russian tycoon Mikhail Fridman’s Alpha Group,
access to the Internet. Thus, we have decided to has strengthened our confidence in our tower
and Cukurova, owned by Turkcell founder Mehmet
postpone the IPO for now. We have planned to business model
Emin Karamehmet which could result in Fridman’s

countries Georgia (120%) and Armenia (119%) in
Share Square: Turkey Western Asia exhibit greater penetration levels, and
Bulgaria (150%) and Romania (138%) in Eastern
Europe are also significantly higher.
3 MNOs: Turkcell, Vodafone and Turk Telekom The mobile market in Turkey consists of three
Active
70.6 million mobile subscriptions by the end of 2015, Mobile Network Operators (MNOs) (See figure
giving a penetration rate of 89%
1), Turkcell, Vodafone and Turk Telekom (Avea).
4G coverage at 68% (Q2 2016) of the population with
3G coverage at 96%. Turkcell dominates the market with a subscriber
Current Sharing
The three operators simultaneously launched 4.5G base of 32mn (45% market share), followed by
services on 1st April 2016
There are 12 live MVNOs in Turkey. Turk Telekom Vodafone which services 22mn subscribers (31%)
Passive
hosts 11 of the virtual operators on its infrastructure,

with the remaining operator hosted by Vodafone and finally the previously state-owned Turk
In recent years, the three MNOs have been developing Telekom, which had 17mn subscribers in Q4 2015,
5G networks.
which equated to 24% of the market.
Global Tower is the only towerco currently operating
in the market. Turkey also has one of the largest
Turkey government-owned universal service networks, with
over 1,100 RAN shared BTSs deployed Key mobile developments
None
Given the market has growth potential and that there 3G services were first rolled out in Turkey in
is considerable 4G and even 5G activity, the market
holds reasonable potential for towercos in the next 2009 by all three operators. There are 27.8mn 3G
few years.
connections in Turkey which equates to 39% of all
3G 4G 5G connections. The 3G market largely replicates the
market share shown in the overall market, with
Technology Deployment
Turkcell serving 50% of the market, followed by
Opportunity for towercos entry with Opportunity for Outsourcing Limited opportunity for new Vodafone and Turk Telekom who serve 30% and
focus on high Lease Up Rate (LUR) by MNO to towercos entrant towercos
20% respectively. 3G population coverage was
recorded at 96% in Q4 2015.
Figure one: Mobile subscriptions market share Mobile market overview
Turkey had a total population of 79.1mn people and Rollout of 4G
24% 70.6mn mobile subscriptions at the end of 2015, 4G licences were eventually awarded at auction by
Turkcell giving a mobile penetration of 89% - the lowest level the Turkish Regulator, the Information Technology
45% of penetration in Eastern Europe and the fifth (out and Communications Authority (ICTA, formerly
Vodafone
of 18) lowest level of penetration in Western Asia. BTK) in August 2015 following a three month
Türk Telekom Turkey spans two continents, Europe and Asia, period of postponement. The delay was caused by
31%
however its level of penetration is significantly controversial comments from the Turkish President
below average in both regions. Neighbouring which suggested that the country may skip straight

from 3G to 5G. The three existing operators were only 42% are 4G enabled. Although consumers slowing growth in the Turkish market, Turkcell
each successful in acquiring 4G spectrum licences show an interest in upgrading their phones, the has suggested that it could look abroad to facilitate
which are valid until the end of April 2029. The high prices of not only the device but also the company expansion. The Turkish based operator
auction reportedly included 20 spectrum lots across subscriptions plans, tend to discourage them. has identified the Balkans, Middle East and Africa
the 800MHz, 900MHz, 1800MHz, 2100MHz and Additionally, Turkey currently has a limited fibre as priority markets.
2600MHz bands, costing the operators just under footprint, with penetration levels less than half the
EUR 3.4bn. OECD average. Vodafone is Turkey’s second largest mobile
operator by subscriber numbers and has featured
The auction appeared to take place later than the Rollout of 5G in the mobile market since 2006. Vodafone Turkey
operators would have liked, with Turkcell, Turk In recent years, the three MNOs have been was formed when Telsim was acquired by the
Telekom and Vodafone suggesting that they were developing 5G networks. Vodafone is reported to Vodafone group; Telesim was founded in 1994.
already in the position to roll out their own 4G have tested 10Gbps ‘E-band’ point-to-point radio A key aim for Vodafone Turkey is the evolution
networks much earlier. However, the licences network link technology to support their aim of of 5G. The operators testing of 5G solutions has
acquired at auction in August 2015, are reportedly launching 5G commercially by 2020. Turk Telekom been noticeable, with recent reports suggesting
cleared for use for 5G technologies also, preventing (Avea) has signed a deal with South Korean telco that upon roll-out in 2020, Vodafone will provide
future delays for the operators. KT Corp, with the intentions to bring 5G to Turkey high transmission bandwidth in the 71GHz-86GHz
by combining KT Corp’s 4.5G services and their ranges in densely populated urban centres.
The three operators simultaneously launched own WiFi connection to enable data speeds of
4.5G services on 1st April 2016, with over 1mn up to 1Gbps. Additionally, Turk Telekom and
subscribers expected by the end of Q2 2016. 4.5G is Nokia signed a Memorandum of Understanding Turk Telekom is the formerly state owned MNO;
reported by technology providers to be faster and (MoU), where Turk Telekom will make its network it was privatised in 1995 following the separation
to produce a better user experience, whilst using infrastructure available to Nokia. The third and of the telecommunication and postal services.
spectrum in a highly efficient manner. Average largest operator Turkcell, has also signed MoUs with Turk Telekom has a subscriber base of 16.7mn
user download speeds are advertised at 2x-3x Huawei and Ericsson to support in its 5G research connections. In 2015 Turk Telekom became the sole
that of standard LTE. The number of subscribers and development. owner of its mobile subsidiary Avea. Additionally,
is expected to increase significantly over the next Turk Telekom has spent around USD7bn over the
few years, with GSMA forecasting that Turkcell’s Operator activity last decade on building up its (partly state-owned)
4G subscriber base will grow to just under 11.9mn, Turkcell launched its mobile service offering in fibre network, currently having laid 213,000km of
Vodafone’s to 9.5mn and Turk Telecom will service Turkey in 1994 when it launched Turkey’s first fibre.
the remaining 7.3mn 4G subscribers. 4G population GSM network. Turkcell is the first Turkish company
coverage is expected to peak at 88% in 2017, to be listed on the New York Stock Exchange and MVNOs
straight-lining to 2020. is owned predominantly by holding companies, In addition to the three main MNOs, there are 12
most noticeably Turkcell Holding A.S. which live MVNOs in Turkey. Turk Telekom hosts 11 of
Smartphone penetration stands at 68% of which has a 51% stake in the operator. Due to reported the virtual operators on its infrastructure, with the

remaining operator hosted by Vodafone. In Turkey, messaging services, following claims from Turkcell at USD1.23 to USD1.44 per share. The date for the
once a MVNO acquires a licence, it is subject to pay that the regulation had a negative impact on its public offering, which had originally been set for
a 15% treasury tax on top of revenues, thus making competitive strength. The regulation was reportedly October 2016, has been postponed due to the impact
it very difficult to run a profitable operation. removed for a number of reasons including: that the U.S. presidential election could have on the
Fenercell was the first ever pre-MVNO to enter the developments in the market, the increasing market and interest rate.
market in 2009, when it chose to operate on the importance of mobile internet, the excess of services
unlicensed side. enabling communication via the internet and the Conclusion
declining importance of voice and SMS services. Turkey has the largest population (79.1mn) in
Regulation Western Asia and the second largest in Eastern
The Information and Communication Technologies The tower sharing market Europe, however it also has the lowest penetration
Authority (Turkish: Bilgi Teknolojileri ve İletişim Turkey has one of the world’s largest government- rate (89%) in Eastern Europe and one of the lowest
Kurumu (ICTA, formerly BTK)) was formed owned universal service networks, with over 1,100 in Western Asia. Therefore, there is considerable
in January 2000 and at the time was the first RAN shared BTSs deployed in rural areas and room for subscriber growth in the Turkish market.
sectoral regulatory body of Turkey. While the Turkey’s three MNOs taking it in turns to control the 4G services have been launched and consumer
Ministry of Transportation, Maritime Affairs and rural network. The network was designed to target appetite is predicted to grow with subscribers
Communications is responsible for policy making, rural areas with a population under 500 people. expected to reach 29mn by the end of 2020.
the regulation function is given to the ICTA. The arrangement with the MNOs is that they each The presence of three MNOs in the market has
manage the network for a 3 year period, without encouraged competition, with each operator
In 2008, the Electronic Communications Law came any financial payments from the government or owning a 4G (and 5G viable) licence until 2029.
into force to help clarify legislation, lessen the other parties. Each of the three operators has embarked on 5G
uncertainties for operators and allocate resources projects, with two of the operators reaching out to
to R&D. At the same time the name of the Authority In 2006, the country’s only towerco, Global Tower external sources for support in developing their 5G
was changed from the BTK to Information and was launched. Global Tower is a 100% owned capabilities. There are 12 MVNOs in the Turkish
Communication Technologies Authority (ICTA). subsidiary of Turkcell and is responsible for market with 11 hosted by Turk Telekom, however
The authority’s role includes but is not limited to managing the operator’s infrastructure. Global none of the MVNOs service a significant share of the
creating and maintaining competition, protecting Towers is thought to have 8,681 ground based market.
stakeholder rights, resolving disputes and planning towers in its network, which includes 1,186 sites
and allocating frequencies. located in Ukraine. Whilst Turkcell uses a small Global Tower remains the only towerco in Turkey,
number of third party towers, Turk Telekom and however recent reports suggest that its current
ICTA made a significant intervention in the Vodafone are reported to use around 25% (~2,000) owner Turkcell is searching for a part owner in the
market in August 2016, scrapping minimum price of Turkcell’s towers. business. Given the market has growth potential
regulation that had been imposed on market leader and that there is considerable 4G and even 5G
Turkcell since 2009. The regulation outlined a In April 2016, Turkcell launched an IPO for a 25% activity, the market holds reasonable potential for
minimum price for retail mobile voice and SMS stake in Global Tower. The price range has been set towercos in the next few years

American Tower creates new
According to James Taiclet, American Tower’s
Chairman, President and Chief Executive Officer,
venture in Europe
“The transaction supports our objective to
continue to drive double digit total shareholder
return by selectively pursuing growth across
Does the restructuring of ATC Europe as a JV show a renewed commitment to
Europe, while at the same time reinvesting
the burgeoning European market, or a desire to limit exposure
the proceeds from this transaction into higher
growth assets around the world by utilizing our
American Tower has
disciplined capital allocation process.”
announced the formation of
a joint venture ‘ATC Europe’
American Tower acquired 2,031 towers from KPN
which will focus on pursuing (now E-Plus) in Germany in 2012 for €393mn and
telecommunications real estate now manage a total of 2,197 towers in the country
investment opportunities in (the increase in numbers is we believe due to a
Europe. Their partner, PGGM, small acquisition over the last four years, with
a Dutch pension fund manager, little other organic growth to speak of).
will own 49% of the venture,
although American Tower will American Tower’s lack of significant growth in
Europe has been cause for discussion, given their
maintain control of day to day
By Frances Rose, Head of Europe, TowerXchange impressive portfolios in the US (40,426 towers),
operations.
Africa (11,877 towers), Latin America (33,809
towers) and Asia (15,074 towers). Although ATC
Keywords: ATC Europe, Acquisition, American Tower, Cellnex, Co-locations, Deal Structure, Deutsche has been linked to several European opportunities
Funkturm, Editorials, Europe, Europe Insights, Europe News, Germany, IPO, Infrastructure Funds, Sale & over the last four years, their portfolio in Europe
Leaseback, Telxius, Tenancy Ratios, Transfer Assets had remained relatively small with no major
acquisitions until their recent announcement
about the acquisition of France’s FPS Towers.
< The details behind the formation of ATC Europe Indeed, since American Tower acquired the
< A comparison of American Tower’s activity in Europe vs ROW KPN towers in 2012, they have invested around
< What the creation of ATC Europe means for American Tower and the European tower market US$1.2bn in 6,450 towers in Africa, US$1.2bn
< Input and comment from Jonathan Dann, Managing Director, RBC Capital Markets in 42,581 towers in India and $8.9bn in 36,668
towers in Latin America, while only growing their

2,031 towers and AMT paid €393m). Telefonica transferred 2,359 towers from Telefonica
Germany to Telxius for €587m implying 17.3x and €249k per tower. Earlier in 2016, Freenet
acquired Media Broadcast Group (MBG) from the parents of TDF, France for €450m or 12x
EV/EBITDA to supplement their plans around over the top (OTT) TV distribution.
European portfolio by 166 towers. During this time Figure 1: Tower deals - Germany
period Cellnex has deployed just shy of €1.8bn Exhibit 6: Tower Deals – Germany
and acquired 13,861 towers in Europe across five Germany Seller Buyer Date Sites €m Per tower (€'000) EV/EBITDA
countries. It seems American Tower have now MBG DT TDF 2007 450 850 1,889 24.3
Eplus KPN AMT 01-Nov-12 2,031 393 194 11.7
decided to make a serious play for the burgeoning MBG TPG Freenet 01-Mar-16 450 295 656 12.0
European market. O2DE TEF DE Telxius 01-Apr-16 2,359 587 249 17.3
American Tower AMT PGGM 01-Oct-16 2,197 510 232 13.5
Source: RBC Capital Markets estimates
As Cellnex demonstrates significant growth in
Our estimates for AMT Germany are derived below.
Europe and new opportunities come to market,
Figure two: Who owns Germany’s towers?
through asset sales and towerco consolidation, Exhibit 7: AMT Germany
American Tower’s acquisition of FPS Towers
AMT Germany 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16
demonstrates their intention to go after new deals Ground2,030
based towers:
Tower count
8 2,030
1.Deutsche
2,028 2,028 2,182 2,197
in the European market, and become another % property revenue 4 5 1.2 1.1 Funkturm1.1 8,000 1.1 1.1 1.0
cross-border contender in the market. Total property revenue, USDm 2. Vodafone
1,154 1,213 4,000 1,251 1,268 1,426 1,498
Implied German property revenue, USDM 13.9
3. Telxius13.3
2,350 13.8 13.9 15.7 15.0
EUR/USD 1.1069 1.1125 1.0963 1.1035 1.1292 1.1163
TowerXchange will be watching with interest to 3
Implied German property revenue, €m
4. American Tower 2,197
12.5 12.0 12.6 12.6 13.9 13.4
see how this plays out, and we believe there is Growth, % 1 11.0 11.9
Revenues €m Rooftops: 53.7
room in the market for a serious challenger to
Ground rent €000 5. Deutsche Funkturm 15,936 5.0
Cellnex for control of a leading pan-European
Ground rent, €m 6. Omega Towers 7,700 -11.0
tower portfolio, particularly now that the first SG&A -5.0
ground is broken. EBITDA
2 6
7. Vodafone 18,000
37.7
8. Telefónica 11,968
Margin, % 7 70.2
Valuation
American Tower maintains strict compliance to
EV, €m 510
their own investment thesis. This discipline had Source: TowerXchange presentation, TowerXchange and RBC Capital Markets data
EV/EBITDA 13.5
left them exiting processes short of the valuations EV/Tower (€000)
Expert view: comment from Jonathan Dann, Markets: American Tower discloses “tower 232.1
of Cellnex and others. Blending the capital and Source: RBC Capital Markets estimates
Managing Director, RBC Capital Markets revenues” and the percentage of revenues from
appetite of a major pension fund recalibrates Germany in its quarterly filings. From this and
AMT’s investment criteria in Europe and may TowerXchange: Can you give us some idea of the prevailing exchange rates we calculate annual
result in them emerging victorious from more valuation benchmarks which have come out of revenues of €54m and EBITDA of €38m.
future processes. TowerXchange are inclined to the Germany in light of both the ATC joint venture
view that this amplifies the joint venture’s appetite with PGGM? Investment fund PGGM acquired 49% of AMT
for, and prospects to close, tower transactions in Germany for €250m implying an EV/EBITDA of 13.5x
Europe Jonathan Dann, Managing Director, RBC Capital and €232 per tower on the 2,197 towers in Germany
November 30, 2016 4

European Tower Valuations
Figure 3: AmericanGermany
Tower Closed Activity 2012-2016 (at the time of acquisition from KPN there were,
American Tower (covered by Jonathan Atkin, OP, PT US$134) discloses “tower revenues” and
2,031 towers and AMT paid €393m).
the percentage of revenues from Germany in its quarterly filings. From this and prevailing
50,000 exchange rates we calculate annual revenues of €54m and EBITDA of €38m. Investment fund To put this in a German tower market context,
PGGM acquired 49% of AMT Germany for €250m implying an EV/EBITDA of 13.5x and €232 Telefonica transferred 2,359 towers from
per tower on the 2,197 towers in Germany (at the time of acquisition from KPN there were, Telefonica Germany to Telxius for €587m implying
40,000 2,031 towers and AMT paid €393m). Telefonica transferred 2,359 towers from Telefonica
Germany to Telxius for €587m implying 17.3x and €249k per tower. Earlier in 2016, Freenet 17.3x and €249k per tower.
acquired Media Broadcast Group (MBG) from the parents of TDF, France for €450m or 12x
30,000
EV/EBITDA to supplement their plans around over the top (OTT) TV distribution. TowerXchange: What can you tell us about
Exhibit 6: Tower Deals – Germany Deutsche Funkturm and their potential plans
20,000 42,581
36,668 for the future?
Germany Seller Buyer Date Sites €m Per tower (€'000) EV/EBITDA
MBG DT TDF 2007 450 850 1,889 24.3
10,000
Eplus KPN AMT 01-Nov-12 2,031 393 194 11.7 Jonathan Dann, Managing Director, RBC Capital
MBG TPG Freenet 01-Mar-16 450 295 656 12.0
2,197 Markets: DFMG is a mix of TV towers, outdoor
O2DE TEF DE Telxius 6,450
01-Apr-16 2,359 587 249 17.3
American Tower AMT PGGM 01-Oct-16 2,197 510 232 13.5 towers (about 7,500), roof tops and also “police
Latin America
Source: RBC Capital Markets estimates Africa India Europe security network”. I’d put a valuation of each
Our estimates for AMT Germany are derived below. of these at probably a mix of 12x, 16x and 10x
EBITDA, so it blends at 13-14x EBITDA for the
Figure 4:Germany
Exhibit 7: AMT AMT Germany
whole organisation.
AMT Germany 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16
Tower count 2,030 2,030 2,028 2,028 2,182 2,197 Deutsche Telekom frequently changes its mind
% property revenue 1.2 1.1 1.1 1.1 1.1 1.0
about “monetising” and it seems they would prefer
Total property revenue, USDm 1,154 1,213 1,251 1,268 1,426 1,498
Implied German property revenue, USDM 13.9 13.3 13.8 13.9 15.7 15.0 an INWIT-style sale which would allow them to
EUR/USD 1.1069 1.1125 1.0963 1.1035 1.1292 1.1163 keep control of the assets.
Implied German property revenue, €m 12.5 12.0 12.6 12.6 13.9 13.4
Growth, % 11.0 11.9
TowerXchange: Please summarise RBC’s view of
Revenues €m 53.7
Ground rent €000 5.0 the German market.
Ground rent, €m -11.0
SG&A -5.0 Jonathan Dann, Managing Director, RBC Capital
EBITDA 37.7
Markets: My view is that the scale of the market is
Margin, % 70.2
Valuation large enough to support either American Tower,
EV, €m 510 Telxius or DMFG but not all three, so it makes
EV/EBITDA 13.5 sense to roll the assets up. Right now it looks like
EV/Tower (€000) 232.1
everyone seems to want to find a PGGM to buy 40%
Source: RBC Capital Markets estimates
and keep control

Portugal: Virgin tower territory The Portuguese economy
Portugal is a western European market with a

This small Southern European country could provide instant market
relatively small population of 10.3mn. Particularly
leadership to the right towerco hard hit by the crash of the late 2000s, Portugal was
bailed out by the EU and the IMF in 2011 to the tune
Portugal has had a rough ride over the past of €78bn. Despite growth over nine consecutive
decade, hit particularly hard by the global quarters to Q2 2016, Portugal remains under close
downturn at the end of the 2000s and unable observation by the European Commission as the
to stabilise growth since then, mobile revenues country is in the centre of what the Financial Times
has dubbed a ‘perfect storm of meagre economic
aren’t as strong as elsewhere in Europe.
growth, falling investment, low competitiveness,
Operators in the country have been clever in
persistent fiscal deficits and an undercapitalised
packaging up triple play services to maximise
banking sector that owns too much of the nation’s
revenues, but where does this leave their sky-high public debt.’
appetite to retain towers: does the need to raise
capital provide an impetus to monetise towers? Portugal’s government is currently led by Antonio
Costa’s Socialist party, in an alliance formed in
December 2015 with Communist, Green and Left
Keywords: 4G, Acquisition, ANACOM, Asset
Bloc parties. The former mayor of Lisbon came
Register, Cabovisão, Country Risk, Editorial,
to tenuous power on an anti-austerity ticket and
Europe, Portugal , Altice, Vodafone, MEO,
promised to pay down debts in a ‘sustainable way’
NOS, Europe Research, LTE, MNOs, On-Grid,
after the centre-right bloc of the previous Prime
Onitelecom, Portugal, Portugal Telecom, Sale &
Minster, Pedro Passos, lost the absolute majority
Leaseback, TowerXchange Research, Transfer it had enjoyed since 2011. This anti-austerity
By Frances Rose, Head of Europe, TowerXchange
Assets, Urban vs Rural, Vodafone rhetoric has unnerved Portuguese business and
international investors alike, as the prospect of
a second Portuguese bailout looms large on the
horizon.
< How the Portuguese economy has been affected by turbulent global markets
< The evolution and current status of Portugal’s mobile network operators
Parallels with Greece and jitters in the European
< Portuguese networks and tower numbers
market fueled by the UK’s Brexit vote and upcoming
< An assessment of the potential for and likelihood of a tower divestment
German parliamentary elections mean Europe
< Possible suitors for a Portuguese tower deal
and the IMF’s appetite for these anti-austerity

measures will be extremely low and any knocks Figure one: MNO market share of Portugal’s 15mn subscribers
to the economy may well tip the country over the
edge. Tellingly, in a recent IMF report, the authors <1%
claimed that not one single Portuguese economist
agreed with the statement that “Currently, with the
program completed, the public debt is sustainable” 22%
The next few months will be critical for the MEO (Portugal Telecom)
Portuguese economy and the financial markets will 44% NOS
watch the Europe and the IMF for an indication of
how they intend to deal with this turbulent market.
Vodafone
MVNOs
The Portuguese telecom sector 32%
Mobile penetration in Portugal stands at 161%,
with 16.6mn connections in the country. There
are three mobile operators in the country – MEO
(Portugal Telecom), NOS and Vodafone, who control of pre-paid plans among retail customers, at just Portugal’s MNOs
44.1%, 32% and 22.4% of the market respectively. 49.1%, a fall of 4% from Q2 2015 and the lowest
In April 2016, two MVNOs were also launched into number since records began. MEO: MEO is a part of Portugal Telecom (PT), a
the market, Cabovisão and Onitelecom, neither of multi-play media company which was sold by
whom have captured more than 0.1% of the market The bad news for Portugal’s mobile network Brazilian Oi to Altice for 7.4bn in Q2 2015. With
to date according to data released by ANACOM, operators, however, is that revenues from retail 44.1% of the mobile market, MEO is the leading
Portugal’s telecoms regulator. customers are declining quite dramatically. mobile network operator in Portugal. PT is also the
According to Portuguese telecoms regulator, leading player in fixed broadband and number one
In Q2 2016 there were around 5.8mn users of ANACOM, monthly ARPU has dropped by 6.6% from triple play operator in Portugal, as well as one of the
mobile broadband (45.6% of sim cards in use) in H1 2015 to H1 2016 and total revenues are down biggest pay-TV players. Altice’s plans on acquisition
the country, an increase of 1.8% on Q1 2016 and 7.6%, from €733mn to €678mn. This may be a sign focused around growth through operational
of 2.1% on Q2 2015. This is thought to be linked of the deepening economic crisis in Portugal, or excellence and a highly focused management
to the higher penetration of smartphones in the of competitive pricing strategies as operators fight approach, which included ‘simplification of
market and an increase in bundled phone and for market share in a changeable market, but with operating practices’ and ‘efficiency savings in
internet offerings from Portugal’s mobile network network coverage no longer a competitive factor, it network spend’. While it’s early days for the new
operators. may be that maintaining infrastructure is becoming acquisition, Altice has carved out their target of
an increasingly unpalatable cost for network €100mn opex savings in the first 12-18 months and
Portugal is also seeing the lowest ever numbers owners. is now aiming to reduce opex by a further €100mn

Figure two: Declining revenues from Portugal’s mobile users
NOS: The smallest Portuguese operator is also the
H1 2015 H1 2016 YoY % change fastest growing, swiping 2.8% of market share
from MEO (-0.7%), Vodafone (-2%) and MVNOs
Retail customer revenues (€millions) 733 678 -7.6% over the last year. It is owned by Isabel dos Santos,
daughter of the Angolan president and Portuguese
ARPU (€) 9.5 8.9 -6.6%
conglomerate Sonae, who made a failed bid for
Source: ANACOM Portugal Telecom in December 2014, ahead of its
eventual sale to Altice, in an attempt to keep the
Mobile tower ownership in Portugal asset in Portuguese hands. Fierce competition in
the market has enabled NOS to grab more market
4,700 share, increasing their stake to 22.4% of the market.
With net profit in Q1 2016 up 5% to €24.4mn, the
1,300 group has surprised analysts, who forecast an
average estimate of €21m in a Reuters poll.
MEO
How many towers are there in Portugal?
Vodafone
3,000
TowerXchange understands there to be 6,800
NOS
towers in Portugal, with a further 4,700 sites in use
Alternate site typologies across different typologies (rooftops, street poles,
2,500 utilities etc). With no known bilateral sharing
agreements in place, colocation is organised on
an ad-hoc basis and the tenancy ratio across the
country is close to one (the only exception to this
Source: TowerXchange being indoor DAS projects, where one operator
provides the infrastructure and shares with the
across the organization. With revenue down 3.5% Vodafone: Portugal’s second biggest operator other two).
YoY in Q1 2016 (vs. -8.7% in Q4 2015), regaining controls 32% of the market. As part of the global
this ground and investing in fibre rollout must be a Vodafone group, Vodafone Portugal has been able MEO have the largest tower portfolio with
continuing priority. Altice may well see an advantage to offer innovative solutions to the market, such as 3,000 traditional structures, Vodafone owns
in transferring towers off their balance sheet to VoLTE, however they have lost 2% market share approximately 2,500 and NOS about 1,300. In
reduce opex and release funds for more pressing 2015-2016 and are seeing revenues in the country addition, there are around 350 broadcast towers
business needs. decline. run by state-owned Radiotelevisão Portuguesa,

although TowerXchange are not aware of any would certainly make it easier to bring the towers
current colocation agreements with Portugal’s three to market soon.
MNOs.
For a towerco interested in the Portuguese market, Please feel free to contact the TowerXchange team
Could we see towers coming to market? acquiring the most extensive tower portfolio in a Kieron Osmotherly
Founder & CEO
market where data usage is driving the growth of E: kosmotherly@towerxchange.com
Might any of Portugal’s towers come to market? 4G and 5G would be a smart move – if the price is Jo Jefferies
Executive Assistant to CEO
Southern Europe has experienced a high level of right. Given that Vodafone prefer to retain their E: jjefferies@towerxchange.com
tower activity over the past two years, with sale and assets, Portugal Telecom could make clear gains For editorial & speaking enquiries regarding Americas:
Arianna Neri
Managing Director, Americas & Asia
leasebacks, towerco consolidation and carve outs from being first movers in this market. E: aneri@towerxchange.com
generating a huge amount of interest. For editorial & speaking enquiries regarding Africa:
Laura Graves
Who could buy? Managing Director, EMEA
E: lgraves@towerxchange.com
TowerXchange believes that Portugal would be
For editorial & speaking enquiries regarding Europe:
a good market for a European towerco to enter, Cellnex, with an extensive portfolio in Spain and Frances Rose
Head of Europe
with three successful MNOs, good 4G/LTE coverage Italy already, would be the obvious choice, although E: frose@towerxchange.com
and very few existing colocations representing their digestive capacity could be pushed to the limit For editorial & speaking enquiries regarding Asia:
Christie Liu 刘晓郁
some significant potential for cost saving. With so if they are successful in acquiring the FPS towers on Head of Asia
E: cliu@towerxchange.com
much uncertainty around the economy and mobile the back of their Shere and Bouygues deals. MNO-
For advertising opportunities & event participation:
revenues declining, we believe it would be a logical led towercos Telxius and INWIT have yet commit to Annabelle Mayhew
Chief Commercial Officer
step for an operator to release capital from the acquisitions outside their original tower portfolios, E: amayhew@towerxchange.com
M: +44 7423 512588
region and stabilise their opex over an extended but if they intend to demonstrate growth, Portugal Emma Jones
period. may be a familiar and manageable target for a step Commercial Manager, EMEA
E: ejones@towerxchange.com
into new territories. Sarah Kerr
Commercial Manager, Americas & Asia
With the biggest tower portfolio, declining revenues E: skerr@towerxchange.com
and ambitious cost saving targets, Altice-owned American Tower’s new joint venture, ATC Europe, Toya Smith
Senior Operations Manager
Portugal Telecom would seem like the most likely may well be looking for new opportunities on the E: tsmith@towerxchange.com
candidate to sell their towers. Indeed, in 2014 continent, and a straightforward SLB scenario For media partnerships & to request additional subscriptions:
Harpreet Sohanpal
Portugal Telecom instructed Barclays to investigate would play to ATC’s strengths as an experienced Marketing Director
E: hsonanpal@towerxchange.com
this option, at the time to shore up the finances of towerco with a wealth of experience.
Alex Macbeth
PT’s Brazilian owner Oi. Although the tower sale did Head of Marketing, EMEA
E: amacbeth@towerxchange.com
not go through (Oi opting to sell PT in its entirety Finally US towercos and investors, in particular
The TowerXchange Journal is published by Site Seven Media Ltd.
to Altice), major players including Abertis Telecom Digital Bridge and SBA, are believed to have an © 2017 Site Seven Media Ltd. All rights reserved. Neither the whole nor any
(now Cellnex), American Tower and KKR & Co were interest in Europe and may well be interested in substantial part of this publication may be re-produced, stored in a retrieval
system, or transmitted by any means without the prior permission of Site
Seven Media Ltd. Short extracts may be quoted if TowerXchange is cited as the
rumoured to have been very interested in the assets, a small portfolio which allows them to capture a source. TowerXchange is a trading name of Site Seven Media Ltd, registered in
the UK. Company number 8293930.
and the work done on the asset register at the time previously under served market

Portugal Market Overview
An unattractive market, from grassroots
upwards
A struggling mobile market which needs to shed non-core assets Portugal plays host to the least attractive of
Western Europe’s telecommunications markets,
BMI View: The Portuguese telecoms market is
scoring just 46 points out of a potential 100 on
mature and exhibits volatile growth. Market BMI Research’s sectoral Risk/Reward Index (RRI),
saturation, low discretionary spending and published in October 2016. That score, which lags
over-dependence on pre-paid subscriptions even that of Greece, was downgraded slightly to
all contribute to an industry outlook that take account of the weakened Euro relative to
is far from optimistic. However, changed the US dollar (telecoms investment potential is
ownership for all key players bar Vodafone measured in dollars) as well as negative net mobile
suggests that more rational investment subscriber growth in the first six months of 2016.
An improvement is not anticipated in the short to
strategies will be employed in pursuit of
medium term.
more advanced, monetisable, services. This
will be a boon to the weak consumer market,
Our view of the market is also coloured by
but the surviving operators will need to be
increased opacity of the market’s key players.
leaner and fitter to weather the changing Private ownership may well provide for a more
competitive conditions. Tower sales or spin- rigorous and rationalised approach to developing
offs should therefore be considered, but the next-generation networks and services, but it
low-cost nature of the market will challenge also provides less clarity on operators’ success
Andrew Kitson, Senior Global Telecoms Analyst, BMI Research even the most experienced players. (or otherwise) in adapting to changing market
conditions. MEO and Nos have also realigned their
Keywords: 3G, 4G, Altice, ARPU, BMI Analysis, BMI Research, Country Risk, Europe, Market Overview, mobile businesses to function as part of broader
MEA, NOS, Portugal, Sale & Leaseback converged fixed-mobile service propositions,
making it difficult to compare their performances.
Read this article to learn: ARPU-dilutive convergence moves require asset

< The BMI view on the Portuguese telecoms market sales
< ARPU and mobile performance in Portugal
< Current and expected operator strategies Nevertheless, it is clear from the available data that
< A five year outlook for Portuguese telecoms the roll-out of 3G/4G networks and attractively-
priced data bundles has driven consumption

of advanced non-voice services. In particular, Portugal market shares, June 2016
there has been increased momentum in the
upselling of dual-, triple- and quad-play services,
reducing churn and improving customer MEO
22.4%
retention. Subscription losses result from the 32.0%
Vodafone
disconnection of standalone mobile products and
1.5%
the replacement of dedicated mobile broadband Nos
connections (dongles, M2M SIMs, etc) either with
Others
voice-and-data smartphone packages or multi-play
bundles. 44.1%
Source: BMI, operators, ICP-ANACOM
Although improved customer retention goals are
being met, this is coming at the cost of underlying Mobile Market Forecasts Source: BMI, operators, ICP-ANACOM
revenue and ARPU erosion as subscriptions

16,839
are being spread across multiple services. 2014 161.88%
5,498
Interestingly Vodafone - the only mobile player
lacking a significant wireline/convergence 16,773
2015f 162.06%
business - is the only operator to have seen ARPUs 5,841
stabilise. MEO and Nos have seen their ARPUs dip
16,740
well below the €10/month level in 2016. 2016f 162.45%
6,297
While MEO and Nos can subsidise the mobile 16,723
aspects of their businesses from new revenue 2017f 162.91%
6,637
streams such as content, value-added services
and IT operations, this will still be quite limited as 16,740
2018f 163.64%
content - in particular - is increasingly expensive 6,916
to acquire and/or make. As MEO and Nos are still
16,773
in the process of transforming their businesses, we 2019f 164.51%
7,165
believe they will be looking at positioning those
businesses for future profit growth. Non-core 16,807
2020f 164.41%
assets will be disposed off or wound down - MEO 7,387
has already set out plans to completely shut down
5,000 10,000 15,000 20,000
its copper wireline network by 2020, replacing
it with fibre - and we believe costly passive Total Mobile Subscriptions (000) 3G/4G Subscriptions (000) Mobile Penetration (%)

infrastructure assets such as towers should be customers up the value chain. Consolidation has base of 16.807mn by 2020, only a little improved
marked for disposal. added scale and brought upscaling opportunities on the current situation. We believe much of that
for all players, but they will increasingly find it growth will come from the nascent Mobile Virtual
Prior to its acquisition by Altice in late 2014, MEO hard to escape the fact that scale alone does not Network Operator (MVNO) sub-market; in April
had been considering selling most or all of its 3,000 guarantee higher monthly spending per customer, 2016 cable operators Cabovisão and Onitelcom
towers. Plans for such a sale were subsequently while new services need to be constantly refreshed. commercialised their mobile services on MVNO
put on hold while Altice completed a wide-ranging platforms, joining Lycamobile and less successful
strategic review and valuation of the business that The mobile subscription base reached 16.584mn
players CTT and Mundio Mobile. A potential
resulted in the copper shut-down decision of March by June 2016, according to operator-reported data.
purge of inactive SIMs poses a downside risk to
2016. We had expected follow-on announcements This is equivalent to a penetration rate of 161% and
this scenario, but underlying growth trends will
relating to the mobile infrastructure part of the we therefore believe that a great many inactive or
not be disrupted.
business, but this had not been forthcoming as of low-value standalone SIMs will be eliminated over
the coming months. As we believe all operators
October 2016. The weakening of the euro relative to
are potentially equally affected under such a Active 3G/4G subscriptions numbered 5.808mn
the US dollar means that European assets now have
scenario, the market share picture should not alter in June 2016, a low penetration rate considering
relatively cheap valuations; to maximise a return
appreciably. As of June 2016, MEO was the leader 3G services have been available in Portugal for
on its investment, Altice would be wise to wait until
with 44.1% of mobile subscriptions; Vodafone and several years. However, the high rate of fibre and
the currency regains its strength.
Nos lagged behind with market shares of 32.0% and DOCSIS 3.0 digital cable penetration means that
22.4%, respectively. Others accounted for 1.5%. demand for mobile broadband is quite muted.
Neither Nos nor Vodafone have ever openly
We forecast 7.387mn 3G/4G subscriptions by
discussed the possibility of selling their tower
Prior to their takeovers, MEO and Nos had been 2020.
portfolios, but their moves into the converged
indicating that non-voice services were accounting
services market will also be weighing on their
for around 40% of mobile service revenues in Buoyed by increased consumption of higher
margins, even as income from traditional mass- late 2014. Anecdotal evidence of strong new/
market services declines. They should also be value converged service products, we expect
replacement smartphone sales and rapid increases
considering tower sales, if they are not already mobile-specific ARPUs to average around €8/
in data traffic carried over their networks suggests
doing so. month through to 2020. The declining value of
that voice usage is in the minority. To capture and
operator-billed voice and messaging services will
monetise at least some of that data traffic, operators
Little room for manoeuvre in highly competitive be offset by increased spending on higher-value
need the funds to develop new products and
market services; tower sales would present a quick - albeit multi-play products, but will be undermined
a one-off - solution to that problem. by dilutive effects of allowing multiple users
The Portuguese mobile market is highly saturated to access a single paid account and the higher
and operators’ ability to add new subscribers on an Five-year outlook incidence of low data-usage connections such as
organic basis is severely constrained. Subscription home security/heating solutions, amongst other
losses tend to be the norm as operators move BMI currently forecasts a total mobile subscriber developments

And you thought footballers
TowerXchange: Can you introduce Telcabo, your
offering and your footprint?
were Portugal’s biggest export? Miguel Sampayo Ribero, International Sales

Director, Telcabo: Telcabo is a service company
Portuguese MSP Telcabo makes gains around the world providing a global services offering for telecoms and
energy networks. It has an end-to-end approach,
Despite Portugal’s turbulent economy, Telcabo, from design to deployment and maintenance,
complemented by network infrastructure solutions
a leading MSP in the country, has used the
including towers, shelters, data centres, camouflage
experience and expertise gained from working in
solutions and cells-on-wheels.
the country to secure overseas contracts across two
continents. We spoke to Miguel Sampayo Ribero, Telcabo’s biggest customers are major carriers and
International Sales Director at Telcabo, who has vendors in the countries where we are active. We’re
over 20 years of experience working in mobile, not just about deployment, we also do engineering
fixed networks and telecom services in Portugal, and operations. The goal is to provide a 360º view
to ask him about how the Portuguese market has to the customer, who looks to Telcabo as a partner
developed and what the tower landscape looks like throughout the lifecycle of the network.
right now.
With considerable international presence – projects
accomplished in 30 countries, on four different
Keywords: Altice, Backhaul & FTTT, Construction,
continents – and permanent operations in the UK,
Core Network, Editorial, Europe, Europe Insights,
Ireland, Morocco and Angola, as well as Portugal, we
Infrastructure Sharing, Installation, Managed
have a €140mn turnover and are looking to grow.
Services, Nos, O&M, Opex Reduction, Portugal,
That’s where the foreign markets tend to be strategic
Portugal Telecom, Rooftop, Sale & Leaseback,
and we’re putting considerable focus on Ireland and
Miguel Sampayo Ribero, International Sales Director, Telcabo
Small Cells, Telcabo, Vodafone
the UK where there could be interesting growth in
energy and in telecoms as well.
Read this article to learn: An important differentiator is our strong in-house

< How Telcabo used their Portuguese experience to grow globally knowledge, from engineering to deployment,
< How the Portuguese market has developed over the last 20 years commissioning, maintenance and optimisation. We
< The role of FTTH and OTT services in Portugal’s mobile offerings are able do it all with our own staff, if required,
< Where smart operators in Portugal will look for OPEX savings which together with a considerable number of
< The role of Portugal’s broadcast infrastructure resources, allows an excellent response to customers
while ensuring superior delivery and control.

“
TowerXchange: As a Portuguese company,
how have you seen the Portuguese market
developing?
Miguel Sampayo Ribero, International Sales

Director, Telcabo: The telecom market in Portugal
is very mature and competitive, with all mobile
operators offering mobile broadband services in
4G, as part of a 4-play commercial offer.
One can find several buildings whose rooftops are used by several
operators, but these don’t result from sharing agreements, but rather
from each operator adjusting its service to its customer base
“
The growth over the last few years in Portugal has
been fueled by convergent offer bundles rather
than just by TV or internet services. This convergent the most of these difficulties. Telcabo, and other location. From an economic point of view there
offer is very powerful and the market has changed firms, must continue to have confidence, pursue could be some challenges as all three have their own
completely. Five years ago, over 90% of mobile innovation, new skills and competencies which networks and this could potentially make it more
subscriptions were prepaid, now it’s nearer 50%, allow us to expand to new markets and geographies. difficult to transfer the assets to a tower company
so these bundles are very important in shaping We want to continue to serve our customers in and justify a sound business case.
the market. It’s one of the drivers for market Portugal and other geographies.
consolidation, with the operator NOS appearing as a
There has been a slowdown in terms of new sites
result of the merger of cable and mobile operators. TowerXchange: With three operators in the but there is still some investment in network
market and extensive coverage across the
modernisation which is carefully planned and
A fixed broadband service is also widely country, how easy do you think it would be for an
sharing is an important part of that analysis. Tower
available with considerable FTTH deployment incoming towerco to increase their tenancy ratio
sharing is happening in practice, but not many sites
going-on. Telcabo is an active player in both towards 2?
are shared. These tend to be on a case-by-case basis
mobile broadband modernisation projects and
with DAS projects being the exception.
in FTTH network deployment and maintenance Miguel Sampayo Ribero, International Sales Director,
programmes. Telcabo: The Portuguese market has gone through
a phase of consolidation which resulted in three One can find several buildings whose rooftops are
TowerXchange: The Portuguese economy is operators providing fully convergent offerings. used by several operators, but these don’t result
under pressure at the moment; what actions are Further consolidation and operational efficiency from sharing agreements, but rather from each
being taken by Portuguese firms to mitigate this? calls for new business models. operator adjusting its service to its customer base.
The number of towers or sites tends to be directly
Miguel Sampayo Ribero, International Sales From an engineering and technical point of view, proportional to market share with Portugal Telecom
Director, Telcabo: The Portuguese economy has with many of the sites being located in the same having the largest number, followed by Vodafone
been very challenging and we have to make area, there’s no problem transferring to a single and NOS in mobile service.

TowerXchange: Altice are focusing on reducing for new sites. Rooftops, when available, are a very TowerXchange: Tell us about Telcabo’s future
opex for Portugal Telecom. In your experience, clever solution, as is the usage of water depots, light plans; how important is Portugal to you and
where do smart operators in Portugal look for structures or camouflage solutions, because it allows where do you see growth?
opex savings in their tower networks? a good integration in the landscape. A very popular
solution are the creation of fake fiberglass chimneys Miguel Sampayo Ribero, International Sales Director,
Miguel Sampayo Ribero, International Sales Director, in which we install antennas on rooftops. Telcabo: We are a company which looks to the future
Telcabo: Towers are not an isolated entity, they are and Portugal continues to play a key role as it houses
considered as part of the network infrastructure Most of our projects are turnkey and Telcabo the relevant know-how and expertise which fuels
and operators have optimised these costs for many becomes responsible for addressing all the different many of our international operations. The maturity,
years. Tower sharing and the utilisation of networks activities involved in maintaining the network. sophistication and advance of telecoms in Portugal,
to provide new services are effective ways to reduce We engineer the solutions, speak to landlords, give us an edge to grow externally.
capex and opex, but major effort has been put municipalities and mediate with all the parties.
into optimising and controlling opex for all their Often the local population can be reluctant but they We are seeing growth in broadband network
operations including network infrastructure. A good understand if they want to use their mobiles and development and also in managed services; although
example of this is the recent award to Telcabo of have good service a balance needs to be found. we have a broader view of this, not just limited
a five year managed services contract to maintain to deployment or maintenance, but as a way to
the whole network. They look to the network Having camouflaged solutions is important. With the transform network operations management, to look
infrastructure as a whole and try to optimise. present need of the operator to get closer to the end not just from an infrastructure or active equipment
user, they need to have creative solutions to make perspective but to transform it as a whole.
TowerXchange: What does Portugal’s network things easier.
topography look like? How reliant are operators Telcabo is investing in this transformation and see
on rooftops in urban areas? Are pylons, churches, TowerXchange: What do you know about a lot of growth in this area, operators need to focus
water towers etcetera used extensively? Portuguese broadcast infrastructure? How many on servicing their customers and developing new
towers do RTP own? Are they used for telecoms services, we can free them from this daily activity of
Miguel Sampayo Ribero, International Sales Director, purposes at all? managing their telecoms network.
Telcabo: Portugal is characterised by a combination
of flat and mountain terrain. More than 90% of the Miguel Sampayo Ribero, International Sales Director, We see pressure on operators to bring capacity
population lives on a coastal strip of 50km. We do Telcabo: The dawn of the digital broadband TV coverage closer to the user, which requires new
have services that cover 100% of the population and service produced a change in the broadcast scenario ideas and ways of providing services. We’ve
territory. in Portugal, as this role was assumed by a telecom been very supportive of those changes and
operator; Portugal Telecom and uses their existing transformations and can help with our solutions;
When you look at the urban areas, it raises new network. The former national broadcaster, RTP, faster time to service and lower TCOs. We offer
challenges in terms of installing new sites. Telcabo continues to broadcast radio signals and their smaller lighter structures to address specific
mediates between landlords and local authorities towers essentially consist of high height towers; capacity needs as there are far fewer macro sites
when it comes to determining the best solution situated at high locations to maximise coverage being built

ECS developing first mobile-
TowerXchange: Please introduce our readers to
ECS.
focused tower company in Poland Janusz Kalina, Founder, ECS: Electronic Control
Systems SA, or ECS, was established in 1999.
LTE rollout expected to drive demand for 4,000 new sites
The company’s activity focuses mainly on
the realisation of technical and technological
With over 2,500 SIMs per tower or rooftop,
investments in three main industries:
almost double the European average,
telecommunications, ITS (Intelligent Transport
there is significant need for additional
Systems) and LED lighting systems.
sites in Poland, especially after 2015
auction of spectrum for LTE. The market
ECS’s most important assets are our people.
has also seen significant decommissioning,
Currently the company employs over 200 people,
particularly consolidating the Orange and
including many highly qualified specialists with
T-Mobile networks, which are managed by
many years of professional experience in the
joint venture NetWorkS! Leading turnkey
industry.
infrastructure provider ECS are leveraging
capital injected by CEE Equity Partners
The company’s headquarters are located in Cracow
to build and retain towers on their own
and we have branch offices in Warsaw, Poznan and
balance sheet, creating Poland’s first
Janusz Kalina, Founder, ECS Gdansk. ECS SA also has a plant in Finland and since
mobile-focused towerco.
mid of 2016 we have been providing services in
Germany through a subsidiary company Electronic
Keywords: 4G, Build-to-Suit, CEE Equity Partners, Construction, Decommissioning, ECS, Electronic Control Systems GmbH.
Control Systems, Emitel, Europe, Europe Insights, IBS, Insights, Installation, Investment, LTE, Managed
Services, Market Overview, NetWorkS!, Network Rollout, New Market Entrant, O&M, Orange, Play, Plug, TowerXchange: Please highlight your turnkey
Poland, Private Equity, Rooftop, Sale & Leaseback, T-Mobile, Tower Count, Towercos, Who’s Who infrastructure business for telecoms in Poland.
Janusz Kalina, Founder, ECS: ECS has successfully

Read this article to learn: realised over 5,000 investments for its clients in the
< ECS’s credentials as the leading turnkey infrastructure provider in Poland field of design, construction and modernisation of
< How ECS are leveraging investment from CEE Private Equity to transition into a towerco telecommunications infrastructure.
< The scale and structure of the mobile and tower markets in Poland
< Contrasting the macro tower, microcell and rooftop markets in Poland There are four major players in the Polish telecoms
turnkey infrastructure market, of which ECS are the

biggest – we’re the only contractor working with tower projects within and beyond Poland. Janusz Kalina, Founder, ECS: The MNOs are not
all four MNOs. For example, we helped T-Mobile ready to sell their passive infrastructure yet in
and Orange consolidate from 10,000 overlapping TowerXchange: What can you tell us about your Poland, but we’re getting closer day by day to
to 4,500 shared towers, supporting them with civil vision to evolve ECS into a towerco? convincing them! It is hard to predict timescales.
works, building permission and negotiations with
landlords. Janusz Kalina, Founder, ECS: With the support of In 2015 they seemed close to selling part of their
our new shareholders, since 2016 ECS has started infrastructure, but then discussions stopped. I don’t
ECS delivers a full set of turnkey infrastructure working on the strategic goal of creating the first think any tower sale and leasebacks will happen in
services – from site design and site acquisition to Polish passive telecom network operator, or towerco. Poland before 2018, but due to fierce competition
permitting, build, civil works and implementation. between the MNOs, the discussions could resume
We co-operate with all the OEMs. Huawei is The initial vision is to build towers to meet specific towards end of 2017.
particularly strong in Poland, but we also work with operators’ needs (‘build to suit’ or BTS), and to retain
Nokia and Ericsson on radio network optimisation, those towers on our balance sheet, generating rental TowerXchange: Please help our readers
integration et cetera. income, but we also have access to capital should it understand the mobile market context in Poland.
be possible to buy an existing tower portfolio in the
TowerXchange: How is ECS financed? future. Janusz Kalina, Founder, ECS: The mobile market
in Poland is a balanced, competitive market led
Janusz Kalina, Founder, ECS: 59% of capital in TowerXchange: What is the current state of your by Orange, Play and T-Mobile, with Plus as a solid
ECS is owned by a private equity fund managed towerco project? fourth operator. Aero2 also has a small market
by CEE Equity Partners. Most of the fund’s capital share. It’s a mature market with SIM penetration
comes from the China Eximbank and the fund is Janusz Kalina, Founder, ECS: Our long term strategy around 150% and more than half of subscribers on
headquartered in Luxemburg, so it is subject to the is to create a towerco company in Poland. mobile broadband.
investment rules and financial regulations of the EU.
The remaining capital, amounting to 41%, belongs to We have just started to construct tower sites in The Polish tower market had been in limbo in
current Polish private investors. order to lease these to operators. If there are no 2015-16 due to the LTE frequency auction creating
unforeseen delays their build will be completed in budgeting uncertainty – MNOs can’t do radio
The choice of CEE Equity Partners was not early 2017. In second half of 2017 we are going to planning if they don’t know their frequencies or
accidental. CEE has access to a €1bn fund, which start construction of another 100 sites including a what they will cost. Now the auction was finished at
gives ECS the capacity to invest in larger, more mixture of ground based towers, rooftops and some the very end of 2015, with prices three to four times
capitally intensive and complex projects, while microcells. higher than some expected, network expansion
maintaining our full independence in terms of has recommenced. We’re expecting the majority
strategy implementation and internal company TowerXchange: Do you foresee any of the Polish of the process to be completed by end of 2017 with
processes. CEE Equity Partners is a private equity MNOs selling and leasing back their towers, and as many as 3-4,000 sites rumoured to be needed
firm with a degree of infrastructure focus. The fund would ECS be interested in participating in such nationwide. Then the market will start to focus on
covers 16 CEE countries, so they have an appetite for opportunities? other strategic undertakings such as assets and

Towers versus rooftops in Poland Mobile market share by revenues Data transmission volumes (MBbns)
0.7%
~13,200 RTTs
23.6% 26.7% 2015 559.1
~8,800 GBTs
2014 260.4
21.2%
27.9%
2013 128.4
Orange Polkomtel (Plus)
GBTs RTTs T-Mobile P4 (Play) Others 100 200 300 400 500 600
LTE coverage 2014: LTE coverage 2015: Fibre: 420,000km, Mobile penetration:
8,000 municipalities 14,500 municipalities 108,000 nodes 147.2%
Sources: ECS, Polish Office of Electronic Communications (2015-16)
towers, and a new technology upgrade. Orange and T-Mobile retain ownership of the tower is gradually becoming more independent, although
assets – they are not on the NetWorkS! balance they still depend on the Plus network. There have
With the LTE rollout at around 50% completion, this sheet, so it’s essentially a maintenance and services been rumours of a prospective merger of assets or
is currently the primary driver of growth; Poland has business. For example, when ECS gets a PO from operations if the regulator allowed.
virtually 100% voice coverage. As such there is no T-Mobile or Orange, our contract is with them,
natural network expansion requirement, but there is not with NetWorkS! They didn’t combine their old TowerXchange: And what’s the size and structure
a need for gradual densification. legacy towers into the joint venture, only new build of the tower market in Poland?
undertaken since the partnership was formed.
TowerXchange: How are Poland’s MNOs currently While NetWorkS! could be used as a towerco Janusz Kalina, Founder, ECS: There are a total of
managing their networks? platform to lease up the towers to the country’s around 22,000 sites in Poland, a mixture of around
other MNOs, it doesn’t seem like T-Mobile and 60% rooftops and 40% ground based towers.
Janusz Kalina, Founder, ECS: T-Mobile and Orange Orange are thinking about that.
are co-building through joint venture NetWorkS!, Founded as a company of Orange, but now owned by
although it’s not clear whether that joint venture will Poland’s other two MNOs are Plus and Play. Play Alinda, Emitel operates Poland’s national broadcast
continue or it may be sold. was built as a local roaming partner to Plus, but it and television tower infrastructure and they’ve

leased some of their towers in strategic locations value of subscribers typically found in the building.
to MNOs. Emitel have the advantage that they own We recently met with one of Poland’s leading MNOs
450 towers in Poland, many with unique locations who were discussing a bigger pilot of lamppost
in mountains where others cannot build. As such, microcells, but at present they still represent maybe
we don’t really compete directly with Emitel, but 0.5% of the market.
if we ever did, tenants may find that they’re not as
flexible as ECS can be on time to market and price. Use of rooftop sites is not as restricted as it is in
Germany, but there are still problems with the Meetup Europe 2017
There are no other towercos yet in Poland. structural capacity of many rooftop masts, and
We know at least one international towerco is with the inflexibility of some landlords, which
4-5 April, London
researching the market, but we feel the big listed mean some rooftops can be impossible to co-locate.
towercos may wait for a large scale sale and Rooftops are generally not as attractive as towers,
leaseback opportunity before attempting to enter
the Polish market.
but we’re open to using either.
Meetup Americas
TowerXchange: Please compare the microcell
TowerXchange: Please sum up your vision for
the future of ECS.
2017
and rooftop markets in Poland with the macro 7-8 June, Boca Raton
tower market. Janusz Kalina, Founder, ECS: We are striving to
secure a contract for at least 100 sites from each
Janusz Kalina, Founder, ECS: Microtowers are MNO, and have started construction this year.
currently a small part of our activity, but building Meetup Africa
and leasing them out can be profitable at the right
time and place – for example the potential of in-
We think there will be more opportunities to
acquire a package of passive infrastructure in 2017-
& ME 2017
building solutions depends on the number and 18, either in Poland or in another country 3-4 October, Johannesburg
Introducing ECS Founder Janusz Kalina
Janusz Kalina is the company’s founder and Supervisory Board member, overlooking strategic initiatives Meetup Asia 2017
and clients. A graduate of the Cracow University of Technology, Faculty of Mechanical Engineering,
12-13 December, Singapore
he he has over ten years of experience in the realisation of investments in mobile network problem
solving. His goal is for the company to stay one step ahead of the competition, keep the position of one of
Poland’s most innovative companies and expand to other European markets. Under Kalina’s leadership,
ECS maintained a very high level of profitability as well as constant and dynamic growth of income in
subsequent years, rising from 0.4mn in the first year of operating to around 100mn today
www.towerxchange.com

The Digital Economy Bill –
Why do we need more legislation?
Telecommunications is one of the most rapidly
supporting the UK through changing industries in the world. Network

operators are constantly seeking to challenge
turbulent times their competitors by developing ever-expanding

platforms for customer engagement. To do this,
they find themselves having to meet a growing
How the new Digital Economy Bill will secure digital infrastructure and
customer demand for data and to provide those same
support growth through 5G rollout and Brexit turbulence customers with seamless services, all against the
backdrop of a rapidly evolving digital world.
As the 5G dawn breaks on the horizon, key stakeholders must
act quickly and decisively to ensure they are in a position to The Government is keen to demonstrate that the
emerge successful from the rollout. MNOs, towercos, fibre UK will remain at the forefront of this technological
owners, local authorities and service providers must work revolution. The Digital Economy Bill (the Bill) was
together to ensure the foundations are laid for this digital introduced in the Queen’s Speech in May 2016 and
published a fortnight after Brexit on 6 July 2016. The
revolution. However, a coordinated and incisive approach
Bill, which is intended to lead to the passing of a new
on a national level is critical, and governments must act now
Digital Economy Act is being championed by the
to ensure the benefits of 5G rollout are felt across the digital Department for Culture, Media & Sport who say that
divide. Natalie Lamb, Senior Associate at Vinson & Elkins, it will “put in place the foundations for the digital
By Natalie Lamb, Senior Associate, shares her thoughts on the UK government’s response in the future”, helping to make the UK “a world leader in
Vinson & Elkins digital provision”.
form of the Digital Economy Bill.
How does the Bill apply to telecoms

Keywords: 5G, Editorials, Europe, Europe Research, IoT, LTE, Lawyers & Advisors, Lease Rates, Leasing
infrastructure?
& Permitting, MLA, Regulation, UK, Vinson & Elkins
The Bill aspires to improve digital access for

Read this article to learn: everyone. It seeks to impose wide-ranging measures
< Why the Digital Economy Bill is needed which are designed to pave the way for universal
< How the bill applies to telecoms infrastructure and super-fast, yet safe and controlled access to
< Defining the key infrastructure-related changes which will be made broadband for all.
< Potential obstacles and issues which may arise from the Bill
Network operators and digital infrastructure owners,
< How the Bill will help the UK to transition to a 5G service
in particular, will be closely tracking the progress

“
of the Bill through Parliament. In the measures on or MSA, regardless of which of them directly absorbs
infrastructure and equipment roll-out contained the ground rent cost, have found that they cannot
in the Bill, cheaper and simpler infrastructure insulate themselves entirely from the risk of the
development is seen as key to universal broadband landlord increasing the ground rent. There are
access and a truly digital society. In the measures on infrastructure several examples of where this could happen.
and equipment rollout contained

What are the key infrastructure-related changes? A good example is a situation in which a network
The Bill contains a new draft Electronic

Communications Code (the Code), designed to make
the rollout of digital infrastructure less expensive
in the Bill, cheaper and simpler
infrastructure development is seen
as key to universal broadband access
and a truly digital society
“ operator wishes to perform an equipment
upgrade. Other examples include where a tower
portfolio is acquired, for example by a sale and
leaseback transaction, or if a network operator
and less complicated. Replacement of the current is the subject of a takeover or decides to share its
Electronic Communications Code, which has equipment with another network operator. Each
consistently been cited as overly complex and in of these examples opens up the possibility for the
need of an update, is being seen as a welcome change equipment on a piece of land is as valuable as the landlord to renegotiate, and in the process increase,
by many. tower and the equipment itself because, without the ground rent.
having the right to locate and access such tower
One of the key changes to the proposed Code relates and equipment, the tower company cannot look While ground rental income should always fairly
to lowering the cost of installing and maintaining after the equipment and the operator cannot ensure compensate the landlord, the Code seeks to regulate
telecommunications equipment on private land. uninterrupted services to its customers in the the increase to the ground rent. Specifically, when
relevant location. In any MLA or MSA the provisions determining ground rent, landlords will no longer
Significantly, the Code’s definition of “land” relating to ground lease extension or renewal are be able to reference the value of the land or the
specifically excludes electronic communications therefore typically a topic of great importance. economic value created by the demand for digital
apparatus. The Bill is therefore not seeking to services by consumers to leverage a rent increase. In
control the lease rates in master lease agreements Controls in the MLA or MSA over extension of other words, the profitability of the site to the
(MLAs) or managed services agreements (MSAs) ground leases and increases in ground rent are network operator or the tower company will not be
between tower companies and their tenants. This paramount. Tower companies will want to ensure relevant to the rent that can be charged. Put simply,
would have had substantial consequences. Instead, the flexibility to negotiate competitive ground landlords will not be able to impose unreasonable
the changes are focussed on the relationship with the lease terms and to relocate tenants if negotiations rental sums for the installation of equipment on their
owner of the greenfield or rooftop land on which the are unsuccessful. Network operators will want land any more.
digital infrastructure and equipment is located. relocation and the associated interruption to their
services to be an exceptional outcome only. Network The real thrust of these particular measures in the
This is not, however, to say that the changes are operators and tower companies therefore share Bill is that charging rent for digital infrastructure
irrelevant to the MLA or MSA arrangements between an interest in seeking to protect themselves from should become more like charging rent for
tower companies and their tenants. The right under increases to ground rents during the term of the equipment of other utilities such as water and
a ground lease to locate a tower and communications MLA or MSA. Traditionally, the parties to the MLA electricity. This will have the effect of controlling

“
ground rents which should become cheaper in time. infrastructure on land. Historically, local planning
Operators will be able to take advantage of lower rents authority consent would be required prior to
and, among those lobbying for the introduction of the constructing or installing broadband infrastructure
Bill into law, it is hoped that equipment rollout will at national parks, areas of outstanding natural
increase and customer access will correspondingly beauty and conservation areas. The Communications With Brexit on the horizon, and
improve. Act 2003 removed the requirement for planning the UK’s potential exit from
authority consent but only as a temporary measure
the EU’s Digital Single Market,
The political sensitivities around accessing harder-to- which had been due to expire in April 2018. The Bill
whether the Bill goes far enough
reach areas should ultimately quieten as there is likely
to be an uptake in overall national digital coverage.
The Code additionally proposes to remove the consent

proposes removal of the April 2018 expiry date so
that the easing of planning rules in relation to digital
infrastructure will become permanent.
in ensuring that the UK is at
the forefront of global digital
transformation is uncertain
“
right of landlords for equipment upgrades or network What’s the verdict?
sharing. Traditionally, landlords have been able
to demand a higher ground rent as a quid pro quo The infrastructure measures in the Bill, which
for allowing network operators to upgrade or share passed its second reading on 13th September 2016, coverage “not spots”. The report argued that
equipment, even if the amount of space used to do have been favorably received by network operators mobile users in rural areas with poor coverage
so is relatively unchanged. Anything which could and tower companies. Landlords have expressed should, like overseas visitors to the UK, be able to
dissuade the network operator from its rollout of disappointment with the proposed infrastructure switch between operators depending on which
better equipment to improve coverage is now viewed provisions on the basis of a perceived lack of has the strongest signal. Network operators
as being at odds with public policy and the need to balance. Network operators have lobbied for the have responded that such a move would be a
keep pace with rapid digital progress. changes the Code is proposing, which are hoped “significant disincentive” to competitive network
to enable more economical roll-out of equipment investment. Progression of the Bill through
In the Code, the Law Commission recommends that and improved access for fixing faults. Any change the House of Lords, itself heavily populated by
where equipment upgrades or sharing of equipment in law is, however, potentially disruptive. Network landowners, could add another interesting dynamic
between operators causes minimal visual change, operators will not want landlords’ concerns to the discussion. Understandably, many remain
landlord consent ought not to be required at all. about their income stream to interfere with the curious as to the Bill’s eventual impact.
maintenance of their infrastructure and equipment
In the event of a dispute between landowners and the or the rollout of important upgrades. Finally, with Brexit on the horizon, and the UK’s
operator or tower company regarding ground rent, potential exit from the EU’s Digital Single Market,
the court will now be able to set the rent to avoid a There is also still some uncertainty about precisely whether the Bill goes far enough in ensuring
prolonged hold up and associated lack of access to a what shape the legislation will take once it is that the UK is at the forefront of global digital
site. passed. In recent weeks, a group of almost 90 transformation is uncertain. What is already a
cross-party MPs issued a report calling for the sensitive political issue may become even more
The Bill’s proposals also extend to simplifying the Government to reconsider the introduction of a newsworthy in the context of the UK’s departure
planning process in connection with placing digital “national roaming network” in order to eliminate from the EU in the near term

Aggregating a broader
There are only 24,459 telecom towers yet 62,764
points of presence in France (source: ANFR, 2016).
The balance is made up of rooftops, public and
typology of assets transport structures, water towers, church spires.

The situation is not unique to France: only 16,532
How recently acquired FPS Towers’ looks beyond towers to enlarge their of Germany’s 70,136 cell sites are ground based
portfolio of sites towers, and only 42,700 of 117,700 in Russia. Thus,
innovative towercos are looking to alternate site
FPS Towers, recently acquired by American Tower typologies beyond ground based towers (GBTs) to
for €697mn (read more earlier in this edition of the deepen their offering to customers.
journal) exemplify the broader vision of cell site

“FPS Towers is an aggregator of the market: not
leasing which may be necessary to drive competitive
only towers and rooftops, but a broad typology of
advantage in European towers. In September 2016, assets on which one can mount a mobile antenna,”
FPS announced that they had reached an agreement said Cedric Lepolard, CFO of FPS Towers. “We
to lease-up 76,500 towers owned by RTE, a subsidiary want to enlarge our offer in order to support their
of French power producer EDF. This portfolio networks.”
supplements the 20,000 rooftops FPS markets and FPS’s
“Our strategy is to develop a variety of propositions
core portfolio of 2,500 ground based towers.
to meet the needs of the owners of all kinds of
assets. We have launched three initial programmes:
Keywords: American Tower, Business Model, Co-
one focused on public infrastructure, another for
locations, Europe, Europe Insights, FPS Towers, France,
building owners, and a third programme focusing
Germany, Infrastructure Sharing, Leasing & Permitting,
on large portfolio owners like RTE and APRR,”
Masts & Towers, Network Rollout, Russia, Stakeholder continued Cedric Lepolard. “We address the whole
By Kieron Osmotherly, Founder & CEO, TowerXchange
Buy-In, Towercos, UK, Valuation of the market through a variety of legal models
with always a view to securing a long term hosting
proposal for our customers. So it’s an extension of
the towerco business model to secure predictable
< The typology of cell site networks in France, Germany and Russia
cash flows over 10-20 year periods.”
< How bringing alternate cell sites to market can affect the competitive landscape
< The benefits for MNOs and governments of professionalizing the management of an alternative
The recent agreement between FPS Towers and
typology of cell sites
RTE exemplifies this approach. A subsidiary of
< The challenge of valuing alternate site typologies
French power producer EDF, RTE has approximately

380,000 high sites with very good coverage across Usage of alternate site typologies in Europe
France. Through a first analysis 76,500 sites in the
RTE portfolio are appropriate for radio transmission,
with easy access and the potential to be made Russia
available by FPS for immediate co-location.
Germany
France 42,700
Competitive differentiator
16,532
The French tower market developed rationally and 24,459
with minimal parallel infrastructure.
All players built their own networks one after
the others by using existing infrastructure where
possible. As a result, relatively few French cell sites
are in overlapping locations… until now. 46,959 70,136 117,700
FPS Towers’ deal with RTE enables the towerco

to offer ready-to-use sites in attractive locations
at a competitive price point they claim compares
favorably with other existing solutions or future GBTs
needs. The 76,500 RTE towers represent twice as
many towers as the four French mobile operators Total sites
Another example from FPS: highway
structures – the APRR deal Sources: TowerXchange Research, RBC Capital Markets, ANFR, FPS Towers
FPS Towers also recently secured 300 structures

and two French towercos (TDF and FPS) combined! Applying this approach to other tower markets
along French highways from APRR in a 20 year
agreement which gives FPS the same rights as a
American Tower owned FPS could offer these new MNOs all over the world use any suitable high site
site owner.
sites to accelerate FREE Mobile’s network rollout when rolling out their networks: it’s faster and often
Even though FPS had to outbid their competitors in rural and exurban areas (around 3,000 sites still cheaper than building a new site. But such sites
to secure the deal, it still came at a value need to be deployed), enable all France’s MNOs to are typically owned and managed by a fragmented
significantly less than the premium currently meet the new coverage constraints agreed upon ecosystem of private and public landlords, not by
being paid for European GBTs during the allocation of 700MHz frequencies, and telecom real estate professionals, so commercial
help accelerate the deployment of IoT networks. terms and access can be unpredictable.

“
In France there are over 20,000 high sites owned by
third party landlords, there are thousands of water
towers with telecom tenants like in the UK and Spain
- there are significant quantities of alternate high
sites in other tower markets in Europe and beyond.
There is an opportunity for towercos to painstakingly There is an opportunity for towercos to painstakingly build databases
build databases of current and prospective high sites,
of current and prospective high sites, to design a range of compelling
to design a range of compelling contract models and
commercial propositions to meet the needs of these
site owners, and to gradually rollup a significant
portfolio of alternate cell sites.
contract models and commercial propositions to meet the needs of
these site owners, and to gradually rollup a significant portfolio of
alternate cell sites
“
It’s time for towercos to invest time to make an
alternate typology of sites available on a turnkey,
responsive, professional basis
Valuing alternate site typologies
Whether a cell site is a ground based tower, a benchmarks also come from deals to acquire 65-75% of European cell sites are alternate site
rooftop, a water tower or an electricity pylon, GBTs in the US, Africa and Asia where there are typologies, not GBTs, including the majority
the valuation model is consistent: what is the simply more GBTs in the network as a function of sites in high density urban locations. But if
contractual return, what is the contract term, of available empty acreage. these rooftops and other urban sites can be co-
and what is the prospective growth rate? located to a reasonably high tenancy ratio, who
The sheer population density in European cares about typology? Any cash flow counts,
However the challenge in valuing alternate site urban areas – in particular the suburban sprawl even if we have to stop calling it “Tower” Cash
typologies remains the lack of benchmarks. spilling into mixed use areas that can utilise Flow!
Most transaction benchmarks come from every square foot of real estate, means there
deals to acquire GBTs from MNOs, which often isn’t an opportunity to build a GBT. It seems a ‘tower’ is not always a tower in
typically offer greater structural capacity Europe. And a rooftop may be worth more
and greater surety of ground rent costs and TowerXchange have not yet completed a pan- than a tower. But valuation benchmarks
access compared to a rooftop. Most transaction Continental study, but we would estimate that remain few and far between

Europe vendor directory 2016 Access Control
ABLOY
A ‘first take’ review of the most important vendors in the European ecosystem
Where? Throughout the Europe region
What? ABLOY secures business operations on land,
Whether a towerco expanding their European
at sea, and in the air – in all circumstances. Abloy
portfolio, or a mobile network operator looking
has a proven history of telecommunication business
to densify their network, European tower owners
for decades and we are one of the world’s leading
are increasingly facing pressure to manage providers in critical infrastructure protection.
opex while delivering on greater and greater Along with the new technology in telecom business
data demands. In a siloed market like Europe, Abloy has introduced new methods and systems
identifying and engaging with the optimal partners to create value and fast pay-back time to telecom
for each task isn’t always as easy as it would seem, customers. Abloy provides a complete solution
so TowerXchange is pleased to present our first including project management. Combining
European vendor directory. As a live document, mechanical and electromechanical features ABLOY
we’ll be making regular updates and changes so PROTEC2 CLIQ offers double security with wide
please get in touch if you would like to suggest any internationally tested and approved product
By Frances Rose, Head of Europe, TowerXchange range. Remotely controlled PROTEC2 CLIQ system
changes or additions frose@towerxchange.com
enables to control sub-contractors activities on
sites reducing management costs and providing
Keywords: 5G, Access Control, Air Conditioning, Batteries, Brownfield, Camouflage, Construction, DAS, traceability. Several telecom customers have chosen
Data Room, Decommissioning, Energy, Energy Storage, Europe Insights, Fencing, Fuel Cell, Greenfield, ABLOY solutions to be leaders in fast developing
Hybrid Power, Infill, IoT, LITHIUM-ION, Logistics, Managed Services, Masts & Towers, Microgeneration, telecommunication world.
Monitoring & Management, NOC, Network Rollout, O&M, Off-Grid, On-Grid, Opex Reduction, Outdoor
Equipment, Procurement, RF Design, RMS, Rectifiers, Renewables, Shelters, Site Management System, www.abloy.com
Small Cells, Solar, Steelwork, Unreliable Grid, Wind
Acsys
Where? Throughout Europe, Russia, CIS and
Read this article to learn: Turkey
< The leading suppliers in energy storage, air conditioning and Access control in Europe What? Acsys offer remote outdoor workforce
< Who can help you deliver your small cells projects management and control solutions. Improve the
< The managed service providers who are instrumental in the European Tower Industry productivity of workforce and reduce your costs.
< Key RMS and SMS partners who can help improve visibility and control of your network
www.acsys.com

Locken in telecommunications, cash in transit, goods in and technology R&D center, with the region’s
transit, utilities, government and other industries. largest manufacturing base, not only offering the
Where? Based in Europe with a worldwide reach Around the world, OUTLOCKS is changing the face customers with exclusive varieties of cooling and
What? The LOCKEN solution revolves round five of outdoor security with breakthrough solutions and air-conditioning products, but also the solutions,
components that provide security and flexibility: technology. technical advice, engineering design and construction
single electronic key, power-free cylinders, remote for cooling and air-conditioning energy saving
and flexible access control, a simple and flexible www.outlocks.com application, as well as the whole process service
application suite, a breadth of support services of contract energy management. AIRSYS’ products
Air Conditioning are sold all over the world, and it is now one of the
www.locken.eu world famous cooling and air-conditioning product
4energy supplier, as well as the internationally competitive
Mul-T-lock Where? 4energy has subsidiaries in the UK and professional supplier of cooling and air-conditioning
Where? Across Europe Germany and deployments in over 10 European equipment and engineering.
What? Mul-T-Lock’s world-renowned and award- countries via direct sales and through partners
winning locking and access control solutions What? 4energy is a global provider of COOLflow low www.air-sys.com
are as diverse as the needs they address. From energy cooling products and SMARTset intelligent
High Security, simple yet strong locksets for the energy management solutions for technical estates. Dantherm
residential market through to our sophisticated The COOLflow range of free-cooling products with Where? Dantherm has offices in Denmark, Norway,
electromechanical access control solutions, Mul-T- maintenance free air filtration save up to 90% Sweden, England with distributors across most of
Lock’s wide-range of products and solutions provide cooling energy savings in telecoms networks and Europe.
the protection their customers seek. equipment rooms. With the open, low cost SMARTset What? With more than 20 years of developing
software you can connect to any equipment or and producing cooling solutions for the telecom
www.mul-t-lock.com sensor, undertake analytics and then, if required, industry, Dantherm knows the business and the
control equipment remotely. 4energy’s simple challenges met by network operators and suppliers.
Outlocks innovative solutions are deployed at some of the Dantherm’s solutions are customised for the telecom
Where? Throughout Europe world’s largest telecommunication, transport and industry and provide reliable, energy-efficient heat
What? From cellular towers to ATMs, containers power utilities. removal from shelters, cabinets, enclosures and
and delivery vans, water utilities and governmental rooms containing temperature-sensitive electronic
facilities, with OUTLOCKS’ solutions suite, www.4energy.co.uk and telecommunications equipment. This makes
companies and governmental agencies can cost- Dantherm the preferred partner for electronics
effectively deter and prevent break-ins, control user Airsys cooling and substantiates their position as the leading
access, and manage keys under the most demanding Where? Across Europe global supplier of climate control solutions.
conditions. Founded in 2007 by experts in security What? After years of development, AIRSYS
technology, OUTLOCKS has leading customers has established industry-leading products www.dantherm.com

Stulz solutions across Europe What? In Western Europe and on-grid locations
Where? Across Europe What? GNB is a division of Exide Technologies, Northstar supply batteries for backup, in areas
What? Backed by over 40 years of experience, STULZ one of the world’s largest producers and recyclers with unreliable grid supply they offer solutions for
is one of the foremost pioneers in the field of air of lead-acid batteries. The company’s four global cyclic and unstable grid applications. Northstar also
conditioning solutions for dependable applications business groups – Transportation Americas, offer accessories to protect batteries from theft and
and Data Centers. STULZ air conditioning equipment Transportation Europe and Rest of World, Industrial temperature including acclimatised battery backup
is developed and manufactured primarily in Energy Americas, and Industrial Energy Europe systems. Energy efficiency is key, their offering is far
Germany, to the very highest standards of quality and and Rest of World – provide a comprehensive range beyond standard batteries.
in line with exceptionally stringent testing criteria. of stored electrical energy products and services for
industrial and transportation applications. www.northstarbattery.com
www.stulz.com
Industrial markets include network power Redflow
Batteries applications such as telecommunications
Where? Eastern and Western Europe, Turkey and
Russia
systems, electric utilities, railroads, photovoltaics,
Aquion What? Redflow offer the world’s coolest flow
uninterruptible power supplies (UPSs), and motive-
Where? US based company, Aquion manufactures in battery. It can be used as a backup in on-grid
power applications including lift trucks, mining and
the USA but ships worldwide situations or can be used for diesel runtime
other commercial vehicles.
What? Aquion build safe, sustainable energy storage reduction in diesel generator scenarios.
systems. They give the European market a more
www.gnb.com
enviro friendly battery: non toxic, non-flammable www.redflow.com
and non- caustic.
Leoch
Saft
Where? Throughout Europe and Turkey
www.aquionenergy.com Where? Western Europe, CiS and Turkey
What? Leoch supply all types of lead acid batteries, What? Effective, reliable backup power is essential
Energic Plus (part of TVH) AGM, gel, pure lead, high temperature, tubular for the telecommunications industry to maintain
Where? Throughout Europe and also lithium. They are one of major battery increasing service demands due to growing
What? Equipment providers for battery manufacturers in the world with eight factories and cloud computing, data streaming, etc. Wireless or
maintenance, regeneration and analysis. Testing a turnover of $900mn. Leoch are a major supplier wireline installations, indoor or outdoor, on-grid
batteries on site. of China Tower. or standalone, Saft knows your energy needs and
can meet them through its large range of advanced,
www.energicplus.com www.leoch.com specialized battery solutions operational in very hot
or cold climates, urban settings or remote hard-to-
GNB Industrial Power Northstar access locations.
Where? Throughout Europe, Russia, CIS and
Where? Headquartered in Paris, GNB provides Turkey www.saftbatteries.com

Energy Solutions Enatel Energy European heritage with Italian headquarters and
Where? Enatel Energy products are available manufacturing bases in Italy and the UK, further
Ausonia worldwide and throughout Europe via a regional supported by European Subsidiaries; Sales Offices
Where? Ausonia’s Medipower (Ausonia’s ESCO base and a network of local partners. and Distribution Centres in Italy, UK, Germany,
offering) offer an opex model which focuses on What? With an expansive portfolio of high Spain, and France.
Greece, Spain and countries where off-grid provision efficiency (>96%) rectifier modules, hybrid power
is of interest. Their capex model focusses on more systems, and rack and compact power solutions, all What? Mecc Alte are the world’s leading
mature markets such as Germany, the UK and Italy supported by embedded and GUI based software, independent manufacturer and supplier of high
What? In mature markets Ausonia offer standby A/C
Enatel Energy’s NZ-made configurable systems are quality synchronous alternators. Having produced
genset. For off-grid, they have a capex-based hybrid
designed to meet every telecommunication network a high quality range of generator alternators since
solution with solar integration and high efficiency
power requirement. Offering flexibility and 1947, they have grown to develop a wide range of
genset. Their opex model means they maintain
scalability by way of hot pluggable combinations low voltage, AC and DC alternators, welders and
responsibility for energy and can deploy quickly as
of modular rectifiers, inverters, converters, solar/ special rotating machines.
their business model is already implemented.
wind chargers and advanced energy management,
www.ausonia.net Enatel is the home of SYNERGi: the industry’s most Operating in the electromechanical sector, they
advanced hybrid DC power solution. Minimising produce a versatile range of alternators from
Cummins dependency on fossil fuels while delivering 1-5,000kVA, to cover a highly diverse range of
Where? Throughout Western and Eastern Europe, increased uptime, SYNERGi dynamically detects applications including; Marine, Medium and High
Russia and the CIS and Turkey, with Headquarters in conditions to optimise the operation of existing Voltage and Telecoms. With a worldwide service
Belgium capital, extending generator and battery lifetimes network and comprehensive after sales divisions
What? Generators, engines, filters, alternators – for significantly reduced OPEX. Specifically we ensure that our products and our customers are
anything around an engine or a generator. Cummins designed for easy integration of renewables to fully supported in all areas and applications.
provide backup power to the European market. support solar and wind inputs, the SYNERGi
solution can be easily deployed and commissioned www.meccalte.com
www.cummins.com
at multiple sites, adapting to optimize output
variables, avoiding the expensive dimensioning PRAMAC
Delta Electronics
and on-going visits necessary in deploying and Where? Throughout Western and Eastern Europe,
Where? Throughout Western and Eastern Europe,
maintaining other typical hybrids. Russia and the CIS. Not present in Turkey
Russia and the CIS and Turkey
What? PRAMAC supplies generators for backup and
What? Delta provides rectifiers, indoor and
outdoor cabinets and solution offerings, hybrid and www.enatelenergy.com in off-grid areas. They manufacture both traditional
installation commissioning. They provide solutions in generators and hybrids which can be integrated
hybrid, solar, data centres and small cells. Mecc Alte with renewables.
Where? Despite maintaining status as a global
www.deltaww.com company; Mecc Alte upholds their strong www.pramac.com

SolarWorld maintenance of physical infrastructure and content- Daly International
Where? A German company, SolarWorld cover all of to-content consumer delivery, they deliver upgrade
Europe and the CIS and expansion services for owners and operators Where? UK
What? They produce is solar models in Germany and worldwide. What? Daly International has played a key role in
also supply supporting batteries, electronics and a shaping the telecommunications infrastructure in
complete solution for PV systems. www.babcockinternational.com Australia and the United Kingdom for two decades.
From optical fibre design to rolling out national
www.solarworld.de Blue Clarity wireless networks, their people have a wealth of
Where? Based in the UK and Ireland unmatched experience in the telecommunications
Managed Services What? Blue Clarity work with a network of top- sector.
tier clients and major support contractors to
4Site manage projects safely with efficiently defined www.dalyinternational.com.au
Where? UK and Ireland requirements and scopes for evaluation, site
What? 4site’s highly skilled people are working with assessment, design and planning. Their design Delmec Engineering
infrastructure owners and operators of distributed and support solutions address a wide range of Where? Based in Ireland and with offices in the
networks to innovate, develop services, optimise applications ranging from programme and project UK, Spain and Poland, Delmec service all of Europe,
assets and deliver cost efficiencies. With over 30 management, telecommunications, mobile, FTTH, Russia, CIS and Turkey
years’ combined experience providing turnkey wireless, surveying services, acquisition and What? Design structure and analysis, supply
services in the UK and Ireland, 4site has earned a wayleaves and 2D or 3D CAD; all of which is upheld (steelwork, civil infrastructure and electrical), active
reputation as an independent, trusted partner. They by their ISO 9001 Quality, ISO 14001 Environmental installation and commission, maintenance. Delmec
have the expertise to empower our clients to stay one and OHSAS 18001 Health & Safety accreditations. also offer training services on tower climbing and
step ahead. rescue, QA tower audit, maintenance inspection
Calzavara regimes for towers, site audit and assessment of
www.4sitenetworks.com towers and strengthening. They manufacture and
Where? Western Europe supply towers, monopoles, masts and ancillary
Babcock International Group What? Calzavara is a system integrator operating steelwork as well. 70% of all structures in Ireland
Where? Throughout Europe in the field of telecommunications. The company are supplied by Delmec.
What? Babcock have been supporting offers an extensive range of traditional and
communications since the first television broadcast innovative services with particular regard to new www.delmec.ie
from the Babcock-designed Alexandra Palace Tower wireless technologies, radio relay systems, cellular
in 1936. They’ve been at the forefront of the industry and fixed networks, private mobile radio (PMRs) Projex Cellular Infrastructure
ever since and continue to provide significant in- networks and radio and television broadcasting. Where? Headquartered in Greece and with offices
house resources for high mast and broadcast antenna in the UK, Projex serves clients acorss Europe
systems. In addition to the design, construction and www.calzavara.it What? Projex CI UK ltd. and Projex Cellular

Infrastructure Group offers consulting, radio project managers, excellent project management company with almost a century’s experience in the
network planning, optimization and other value systems, a turn-key network managed services design, construction and maintenance of network
services to the telecommunications industry, team, unrivalled access to the Savills network of infrastructures; it has proven skills in building
providing a completely integrated service. Projex CI’s clients in all sectors of property and a strong brand managed services, system integration special
consulting services range from specific short-term in the property sector that unlocks access for our projects and providing smart solutions.
assignments, task based solutions through to full telecom clients
scale risk-reward based long-term turnkey projects. www.sirti.it
Expertise for a wide range of technologies (including www.savills.co.uk
cellular, private mobile radio, wireless local loop and Tech Mahindra
core network) is available. SITE SpA Where? Across Eastern and Western Europe
Where? Based in Italy, SITE now offers services What? With an array of service offerings for
Projex Cellular Infrastructure Group has significant across Europe Communication Service Providers (CSPs), Telecom
experience in all aspects of radio rollout projects, What? SITE is a system integration provider,
Equipment Manufacturers (TEMs) and Independent
including nominal plan and potential site selection, creating technological systems and infrastructure.
Software Vendors (ISVs), Tech Mahindra is a chosen
desktop surveys and analysis, technical site surveys, It installs, commissions and integrates different
transformation partner for several leading wireline,
site carrier wave tests and data analysis culminating technologies to develop telecommunications, rail
wireless and broadband operators in Europe, Asia-
in site design drawings for build. transport, metro and energy infrastructure. It
Pacific and North America. They have successfully
also provides technological solutions developed in
implemented more than 18 greenfield operations
http://projexci.com/ their entirety in-house by its R&D division. These
globally and have over 150 active customer
include: IoT solutions for the telecommunications
engagements.
Savills industry, to enhance city-wide security; railway
Where? The UK signalling systems for the Transportation industry;
www.techmahindra.com
What? Savills provides UK mobile phone operators and biomass cogeneration plants and LED lighting
with a full range of infrastructure support systems for the Energy industry
services from acquisition to E2E management of Remote monitoring and site
radio base stations. Mobile broadband operators www.sitespa.it management systems
are continuously improving their networks to
provide additional 4G coverage but perhaps more Sirti SpA AIO Systems
importantly to meet government targets in providing Where? Based in Italy with operations in Spain,
end users with higher data speeds. As a result, Sweden and Finland Where? Central Asia; Russia, Kazakhstan and
Savills’ telecoms services has expanded significantly What? The world is changing continuously; Uzbekistan
to become a market leader and has the ability to ICT is increasingly widespread and high-speed What? AIO Systems is a next generation solution
deliver fast track projects through a combination of connections are one of the most important provider of management systems for remote
a team installation engineers, acquisition agents and drivers for development. Sirti is a leading Italian unmanned sites. AIO’s management platform

and enhanced Premium EyeSite controller are and Inventory Management together with Network networks and also be monitored and controlled
incorporated with site hardware and telemetry Configuration on the same platform. remotely. HMS employs 450 people and is listed on
systems enabling companies to control, secure, the OMX Nasdaq Nordic Stock Exchange.
predict, track and remediate their remote site www.aktavara.com
operations in a timely and pro-efficient manner. www.hms-networks.com
Galooli Telecom
AIO specialize in advanced 24/7 Security solutions Where? Headquartered in Israel, Galooli, has Infozech
and Hybrid/Energy Resource Management. distributors in the UK, Netherlands, Italy, Romania, Where? Across Europe
Furthermore, they address multi-tenant Ukraine, Georgia and Kazakhstan What? Infozech is a leading provider of game-
infrastructure complexities, reduce OPEX, increase What? Galooli Telecom provides innovative changing, technology led solutions with a vision
profitability, assure access to BI services, and deliver Bottom Line Solutions™ (BLS) – the market leading to be a Leader in applied Analytics. Infozech has
effective Asset/Inventory control. practical business intelligence solution. Galooli’s been delivering cost optimization and revenue
USP is to convert big data into reliable and useful management solutions to Communication Service
tools to achieve real OPEX savings.From full-site Providers in different parts of the world. Infozech’s
AIO’s numerous business models propose alternative
remote monitoring and management to workforce solutions reach out to over 100 million subscribers
operational structures that guarantee ROI. When
and fleet management, our customizable solutions across the world through 80+ customers in 25
combined with their added value Services, such as
cover all operational aspects for Towercos and countries. Founded in 1999, Infozech’s mission is “To
Site Installation Simulations, System Integrations,
operators. Instead of the reaction to past events provide innovative IT solutions to unlock enterprise
Technicians mobile application, companies can rest
and alerts available on any standard monitoring value. Create an environment that nurtures talent
assured AIO will address all their RMS needs from
systems, Galooli promotes the use of prevention. and growth.” Driven by the core values of Integrity,
A-Z.
Customer Delight, Teamwork, and Adaptability,
www.galooli.com Infozech is firmly on the track of high growth in the
www.aiosystems.com
coming years.
HMS Industrial Networks
Aktavara Where? Headquartered in Halmstad, Sweden, www.infozech.com
Where? Across Europe HMS has Technology Centers in Germany, Belgium
What? Aktavara provides turnkey software that and Spain. Local sales and support are handled LATRO Services
dramatically improves telecom and network by branch offices in China, Switzerland, France, Where? Across Europe
operators’ efficiency in bringing their services to Germany, Italy, India, Japan, UK and USA, plus What? Through LATRO Services’ Mobile Network
their customers quickly and reliably. Fixed and distributors in more than 50 countries. Security Audit (MNSA), a process of non-intrusive
Mobile. What? HMS Industrial Networks is the leading auditing, most of which is done without the need for
independent supplier of products for industrial Mobile Network Operator (MNO) technical support
Aktavara provides unique OSS/BSS software products communication. Our products enable industrial or facility access, we will analyze, present and help
covering Interactive Network Resource Planning devices to communicate on different industrial you understand your network’s security profile.

LATRO will translate the complex technical data that required no calibration or customisation, but Treefrog
into clear business risk statements, enabling you that could ‘Plug and Start’ on site and be configured Where? Throughout Europe
and your leadership team to make the appropriate from the NOC. What? TreeFrog is dedicated to empowering
business decisions and execute GSM-standard its users. We pride ourselves on delivering the
network security. www.qowisio.com highest quality innovative solutions that you are
able to extend yourselves. Our organisation uses
www.latroservices.com SPX/Flash Technology innovation in a targeted way to ensure business
Where? Throughout Europe benefit. We understand your business and will
Md7 What? From their Franklin, TN facility, Flash know where to start. We only create extensible
Where? Across Europe Technology makes the world a safer place by product components and always look at the value of
What? Md7 combines a highly standardized process offering innovative tower and obstruction lighting doing once versus doing many times.
with local expertise through the use of LiveTrack™, solutions and the remote asset monitoring
their proprietary site development and project systems that support them. An original equipment www.treefrogsoftware.net
management software, to deliver more quickly and manufacturer (OEM) since 1969, Flash Technology
efficiently every phase of site development from helps clients mitigate risk and meet the day-to-day WebNMS
search rings through construction management. challenges of obstruction lighting operations. Their Where? WebNMS has its footprints all over the
ETL-certified and FAA-approved LED products globe. In Europe, they have partners across the
Our teams have deep experience in the local markets serve telecommunications, broadcast, wind energy, region including Turkey, Belgium and Italy
and, combined with our technology, give us an airport and utilities markets as well as specialty What? WebNMS is the leading provider of
ability to scale and deliver a high volume of daily applications. enterprise IoT platform & solutions that maximizes
throughput that reduces cycle times, reduces costs, the potential of connected business infrastructure.
and also results in quality leases. www.flashtechnology.com Branded as ‘Symphony’, their IoT platform is
completely software driven and hardware agnostic.
www.md7.com Tarantula They have a suite of ready to deploy IoT solutions
Where? Across Europe built over the Symphony IoT platform.
Qowisio What? Tarantula is a world leader in telecom site a. Powered by Symphony IoT, the Cell tower site
Where? Across Europe management software and a trusted partner of Manager is an enterprise-scale IoT application
What? Qowisio focuses on the remote monitoring, leading telecom infrastructure operators in Europe, tailor-made for connecting, automating and
management and supervision of telecom sites Asia-Pacific, and Africa. Through our specialised centralizing control of remote cell tower
for telecom operators in Africa, the Middle East site management platform, Tarantula is integral infrastructure.
and Europe for telecom operators and towercos. to the management of more than 350,000 mobile b. It is an end-to-end Customizable solution with
Launched nine years ago, Qowisio’s founders towers and US$25 billion worth of assets across the capabilities surrounding energy management,
identified that many remote power monitoring world. remote site security & surveillance, environment
systems in Africa were excessively complex and monitoring, remote asset management & location
difficult to install. So they created a wireless system www.tarantula.net tracking.

c. Listed below are features of Symphony CTM world design, build and manage their wired and devices, mobile operators’ customers expect to
solution wireless networks. Their network infrastructure have coverage anytime, anywhere. This capability
i. Temperature based HStill VAC control solutions help customers increase bandwidth; requires them to increase network capacity, which
ii. Monitoring power consumption maximize existing capacity; improve network is typically done by adding new cell sites. However,
iii. Intrusion detection performance and availability; increase energy with urban areas becoming more congested and
iv. Monitoring asset conditions efficiency; and simplify technology migration. local government zoning regulations increasingly
v. Intelligent control of power sources You will find CommScope solutions in the largest more stringent, obtaining permits for new wireless
vi. SMS/Email alert escalation buildings, venues and outdoor spaces; in data cell sites is becoming nearly impossible. Extending
vii. Energy efficient green cell tower centers and buildings of all shapes, sizes and service to these hard-to-reach areas can provide
viii. Managing logistics complexity; at wireless cell sites; in cable headends challenges. SOLiD’s wireless solutions improve
ix. Remote control and configuration and telco central offices; and in airports, trains, and both coverage and capacity in high-demand and
x. Identifying fire/fluid leaks tunnels. Vital networks around the world run on hard-to-reach locations. SOLiD is revolutionizing
d. Multi-device compatibility, Multi-protocol support, CommScope solutions. the way people communicate through their high
Legacy device retrofit, Enterprise software integration, performance and scalable solutions for wireless
Seamless connectivity and Cross-enterprise operations www.commscope.com networking. From extending fibre reach, to
are few highlights of the solution. increasing indoor and outdoor coverage and
Corning capacity, to providing high-speed wireless backhaul,
www.webnms.com/iot/cell-tower-monitoring.html
Where? Across Europe, Russia and Turkey wireless service providers consistently look to SOLiD
Small Cells and DAS What? By working closely with their customers, for reliable solutions that increase revenue, lower
Corning gains a thorough understanding of their churn and improve customer satisfaction.
Cobham Wireless challenges in tough network environments. They
Where? 150 countries globally, including most of use that knowledge to develop full-scale solutions www.solid.com
Europe to meet their specific needs. With their deep
What? Cobham Wireless are global leaders in the knowledge of materials science, optics, and global Static Assets
provision of advanced wireless coverage and mobile manufacturing platforms, they are also able to
EMEK Group
communications systems, producing innovative, cost- constantly improve their products. And Corning
Where? Across Europe
effective solutions that address market requirements continue to meet their customers’ most demanding
What? EMEK PRES specialises in the design of
for improved connectivity, greater capacity and better project challenges, keeping massive amounts of
towers, calculation of statistics and manufacturing
quality of experience. data flowing seamlessly around the world.
in order the meet high customer demands. In
addition to actualising the design and the production
www.cobhamwireless.com www.corning.com
of the towers, EMEK PRES also realises full turn-
key projects which include the entire build process
CommScope SOLiD
including acquiring and commissioning the site.
Where? Across Europe Where? Across Europe
What? CommScope helps companies around the What? With the increasing popularity of wireless www.emek-group.net

GSM Towers poles is designed and manufactured for durability, Sabre
Where? Across Europe wear and corrosion resistance, and visual appeal. Where? Across Europe
What? GSM towers is a Norwegian tower supplier What? Sabre offer a full line of engineered telecom
founded in 2012. They offer their own optimised Their design, materials, manufacturing and structures, including self-supporting and guyed
designs for tower, capacity controls of existing installation of the structures are all in accordance towers, monopoles, and concealment products. In
structures, and energy solutions on three continents. with local standards and regulations and/or addition to manufacturing new structures, Sabre has
the latest versions of international standards as the experience and capability to design, fabricate
With a future oriented mentality GSM Towers described in design section are applied. Their and install tower and monopole modifications.
emphasize the importance of high quality, innovative manufacturers have a valid, ISO 9000 certificate, Optimised for ease of installation and minimum
thinking and engineering development. certified by an internationally accepted quality interference with existing mounts and lines, their
organisation. tower upgrade components are designed to fit the
GSM Towers tailor their orders according to their first time.
client’s specifications, calculate and verify it in the www.mitaspole.com
engineering department, then in coordination of www.sabreindustries.com
their project managers ensure on-time delivery. Orion Slobozia
www.gsmtowers.com What? Orion produces towers & structures
according to their client’s specifications.
Metalogalva Where design and engineering is needed Orion
Where? Metalogalva’s main markets are France, collaborates with esteemed engineering companies
Portugal and Italy for projects based on customer specification in
What? Steel structures, design, galvanisation and order to achieve a cost-effective solution related to
painting, delivery on site. Metalogalva prefer to technical requirements.
provide new towers – they can manufacture towers
Who have we missed?
which slot over existing towers, warning lights, safety www.orionslobozia.ro
lines, herding kit etcetera which they buy and sell on
This directory is far from comprehensive
with the package. They also offer camouflage towers. Ramboll
and will evolve as our understanding of the
www.metalogalva.pt What? Whether constructing 320-metre market does. If your organisation/one of
communication masts, or developing software your suppliers isn’t featured and you think
Mitas Poles tools for project management, Ramboll provides they should be, please email
Where? Based in Turkey. Mitas Poles design and customers with quality and cost-effective solutions. frose@towerxchange.com with your
supply worldwide suggestion.
What? Mitas Poles’ selection of communications www.ramboll.co.uk

Regional coverage:
CALA features
In this edition of the TowerXchange Journal we’ve been compiling a
comprehensive guide to Who’s Who in the Central and South American
tower industry, featuring top operators, towercos, advisors and investors
active in the regional market as well as a series of useful maps. Additionally,
we offer our readers an exclusive history of Brazil, tracing back to the
very beginning of the local tower industry to today’s challenging market
conditions.
Additionally, we’ve spoken to the CEOs of Balesia and Plata Tower

Company - two new towercos active in various regional markets including
Argentina, Colombia, Peru, Guatemala, El Salvador and Ecuador. Lastly, Mott
MacDonald shares with TowerXchange’s readers an updated edition of the
Mexico Share Square.
Don’t miss:
241 TowerXchange’s who’s who in CALA towers
253 Exclusive: the history of the Brazilian tower market
262 Plata Tower Company on its Argentinian venture
266 Balesia: A new towerco with aspirations across CALA
268 Mott MacDonald’s Mexico Share Square

TowerXchange’s who’s who in
Accel: One of the leading venture capital firms
in the world with over US$8.8bn in capital under
management, Accel has funded the likes of
CALA towers Facebook, Dropbox and Spotify. QMC Telecom is

among its investments in the tower sector.
TowerXchange presents an A to Z of MNOs, towercos, investors and advisors who
are key stakeholders in the CALA telecom tower industry Albright Capital Management (ACM): A private
equity firm specialised in emerging markets. In
Home to dozens of towercos from listed giants American Tower, SBA Communications and Telesites to PE- April 2016, ACM granted a US$45mn five-year term
backed independent firms such as Grupo TorreSur, Torrecom and Phoenix Tower International, the Central credit facility to Innovattel LLC for the development
and South American tower market has been constantly expanding since 2001, when American Tower closed of build-to-suit projects in Argentina.
its first tower deal in Brazil with GVT. In this special feature, TowerXchange offers a comprehensive index of
top towercos, MNOs, investors and advisors active in the CALA telecom tower industry. AlfaSite: AlfaSite is a Brazilian build to suit (BTS)
firm part of Grupo Alfa which also owns a tower
Keywords: 3G, 4G, AT&T, Accel, Active Infrasharing, Albright Capital Management, AlfaSite, Algar Telecom, Altice,
manufacturer (Metal Alfa), an MSP (Alfa Erb) and
Altman Vilandrie & Co, American Tower, Americas, América Móvil, Analysys Mason, Andean Tower Partners,
Argentina, Avantel, Balesia, Berkshire Partners, Bitel, Blackstone’s Tactical Opportunities, Bolivia, Brazil, Brazil
an energy equipment company (Alfa Energia).
Tower Company, Build-to-Suit, Cable & Wireless, Caribbean, Carve Out, Catalina Inc., Cell Site Solutions, Centennial
Towers, Central America, Chile, Citi, Co-Locations, Colombia, Continental Towers, Costa Rica, DAS, Debt Finance, Algar Telecom: Algar Telecom is a Brazilian mobile
Delmec, Deutsche Bank, Digicel, Digital Bridge, EY, El Salvador, Entel, Entel SA, First Corporate Finance Advisors, GP operator serving approximately 1.5mn subscribers
Investments, Golden Comunicaciones, Goldman Sachs, Grupo TorreSur, Guatemala, Gávea Investimentos, Hardiman across Rio de Janeiro, São Paulo, Santa Catarina
Telecommunications, Highline do Brasil, Honduras, Housatonic Partners, ICE, IFC, IIMT, ING, Indigo Capital, and Paraná among others via 31,000km of fibre.
Infrastructure Sharing, Innovattel, Instituto Costarricense de Electricidad, Intelli Site Solutions, International It currently offers 3G services and is working
Finance Corporation, Investment, Iusacell, JP Morgan, Jamaica, KPR Consult, LTE, MCM, MHC Holdings, MVP Capital, alongside Nokia Networks to launch 4G LTE.
MX Towers, Macquarie, Madison Dearborn Partners, Message Center Management, Mexico, Mexico Tower Partners,

Millicom, Montezuma & Porto, NII Holdings, NMS, Nextel, Nicaragua, Norton Rose Fullbright, Oi, Orange, P2, PTI,
Altice: Altice took over Orange Dominicana and
Panama, Peppertree Capital, Peru, Peterson Partners, Phillips Lytle, Phoenix Tower International, Phoenix Tower
do Brasil, Private Equity, Providence Equity Partners, Pátria, QMC Telecom, RBC Capital Markets, Rent-A-Tower,
Tricom in 2014, respectively the second and
SBA Communications, Sale & Leaseback, Scotiabank, Sercomtel, Silver Swan Capital, Skysites, Small Cells, South fourth MNOs in the Dominican Republic. Orange
America, Southern Cross Group, Summit Wireless Infrastructure, TIM Brasil, TOCSA Towers, Telecom Personal, Dominicana and Tricom both offer 3G and 4G LTE
Telecommunications Partners, Telefónica, Telesites, Telxius, Torrecom, Torres Andinas, Torres Unidas, Trilogy across the Dominican Republic.
International Partners, UBS, V&E, Vinson & Elkins, Viva Bolivia, Viva Dominicana, WOM, Who’s Who
Altman Vilandrie & Co: AV&Co. has extensive tower
industry experience spanning tens of engagements
(including Latin America, Africa, Asia, North
< Towercos who’s who: a comprehensive guide to 34 towercos active in the CALA region
America, Europe) over ten years, including tower
< Thirty of the most respected CALA-focused investors, advisors and law firms
operator strategies as well as tower transaction
< MNOs guide: MNOs footprint and tower strategy at a glance
due diligences. Their recent work has addressed a

number of relevant topics such as the impact of small América Móvil’s (Telcel + Claro) footprint
cells, the future opportunity for DAS and the changing
role of rooftops.
América Móvil (AMX): AMX is one of the largest

mobile network operators in the world and part
of the Carlos Slim’s group of companies, serving
approximately 284mn mobile subscribers across
fourteen markets.
Back in 2014, AMX faced regulatory pressure to reduce

its dominant position in Mexico, which forced it to
carve-out over 11,000 of its telecom towers and create
Telesites, a separate infrastructure entity (see Telesites
for more details). Apart from the Telesites venture,
which has already expended into Costa Rica, AMX has
not faced regulatory or balance sheet pressure to divest
assets elsewhere, and thus has favoured retaining their
towers.

América Móvil operates as Claro in most of its CALA
markets and it offers both 3G and 4G LTE in all of
them except Honduras, Nicaragua, Guatemala and El
Salvador (3G). In Mexico, where it operates under the
Telcel brand, the operator is now offering 3G and 4G
LTE.
American Tower (AMT): The world’s largest

independent commercial towerco, AMT need
no introduction within this publication. With its
headquarters in the U.S., AMT operates a global
portfolio of over 147,000 sites composed of towers in
advanced, evolving and developing wireless markets, in
the U.S., South America, Africa, Europe, and Asia. AMT
is the leading towerco in the CALA region in terms of its
tower count, with over 33,000 sites across six markets. Source: TowerXchange

Since 2011, AMT has been involved in seventeen Barclays: Barclays’ global investment banking Brazil Tower Company (BTC): BTC is a Brazilian
transactions across the region and has purchased division offers a leading Technology, Media and BTS focused towerco with a portfolio of 750 towers.
over 26,000 towers for a total value of approximately Telecoms (TMT) franchise. The TMT team has Owned by private investors, including the company’s
US$5.3bn. significant experience representing leading tower CEO Dr Chahram Zolfaghari, and 1848 Capital, BTC
operators as well as telecom service providers has recently closed a funding deal with Silver Swan
Analysys Mason: Marco Cordoni and his team around the globe on buy and sell side assignments. Capital for US$40mn to pursue new deployments
at Analysys Mason are among the ‘go-to-guys’ for In this capacity, Barclays has supported its clients in across Brazil, targeting a tower count of 1,000.
tower market analysis and due diligence on a global the valuation and/or marketing of tower portfolios
basis. as well as the negotiation of various agreements Cable & Wireless: Acquired by Liberty Global in
associated with these transactions. November 2015, it serves 3.7mn subscribers in
Andean Tower Partners (ATP): Part of Digital fifteen markets across the Caribbean and Latin
Bridge Holdings, ATP is a towerco active in the Berkshire Partners: Berkshire Partners is a leading America under the FLOW brand.
Andean region. According to its CEO, Estrella private investment firm acting through eight private
Zaharia, after starting in Colombia and Peru, ATP is Catalina Inc.: Catalina is a BTS firm active in Costa
equity funds with US$11bn of committed capital.
now looking at expanding in Chile and Ecuador. Rica.
Berkshire Partners has substantial experience of

tower industry investments, having been an early
AT&T: AT&T made its entrance in the Mexican Cartesian Capital Group: a global private equity
stage investor in Crown Castle, and the company
mobile market thanks to the acquisition of Iusacell, firm with proven expertise in assisting closely-held
currently owns Andean focused towerco Torres
Unefon (part of Iusacell) and Nextel back in 2014. companies to expand internationally. The firm is a
Unidas.
AT&T has 9.2mn subscribers as of Q2 2016 and has large shareholder in NMS and BTS Towers de Peru

covered over 51mn Mexicans with 4G LTE since its and has a smaller participation into Grupo TorreSur.
Bitel: Bitel is the fourth mobile network operator
entrance in the country. Cartesian manages more than $2.4 billion in capital
in Peru, wholly owned by Vietnam’s largest
and has offices in New York, Sao Paulo, Shanghai,
MNO Viettel and mostly focused on serving rural
AT&T has inherited networks largely divested to Warsaw and Bermuda.
towercos, but has still found sufficient capacity communities across the Andean country. Bitel offers
on those inherited sites, such that the anticipated 3G services across Peru and is now deploying 4G Centennial Towers: Centennial Towers is a BTS
volume of new build from AT&T’s market entrance LTE. firm active in Colombia, Brazil and Mexico funded
has been slow to materialise. by Breslau Capital, a New York based firm with
Blackstone: Blackstone’s Tactical Opportunities presence in both Panama and Tel Aviv. In addition
Avantel: Avantel is the fourth mobile network (Tac Opps) specialises in time-sensitive and complex to its core markets, Centennial has a presence in
operator in Colombia where it offers 3G and 4G LTE ventures and is the investment firm behind Phoenix various CALA countries thanks to its network of
services. Tower International’s expansion in the U.S. and partners and a portfolio of several hundred sites
CALA. Blackstone has previous experience of the across Chile, Costa Rica, El Salvador, Panama, Peru,
Balesia: Balesia is a BTS focused towerco operating towerco asset class having invested in Global Tower Argentina and the Dominican Republic.
in CALA and owned by International Tower Partners, which they successfully exited through the
Corporation (ITC). sale to AMT. Continental Towers: Continental Towers is a BTS

firm focused on deploying sites in Central America. Digicel: Digicel is a leading MNO with a presence Entel SA: Entel SA is the Bolivian State-owned
Originally a joint venture between Terra Projects in over twenty country across Central America telecom company which was nationalised in 2008.
and Credit Suisse, it then received a US$120mn and the Caribbean, including Jamaica, Panama, El Former shareholders include Telecom Italia which
loan package from the IFC to further fund its Salvador and Haiti. Owned by Irish telecom tycoon settled a dispute with the Bolivian government over
Central American expansion in 2012. Since then, Denis O’Brien, Digicel has only dabbled in towerco the nationalisation for US$100mn. The operator now
the company has been quite secretive and to date, relationships to date; selling a handful of towers offers 3G and 4G LTE services in the country.
it operates in Guatemala, Costa Rica, El Salvador, in Central America and creating then successfully
Jamaica, Honduras and Panama with an estimated exiting a towerco in Myanmar. EY: TMT strategy and corporate finance advisory
total tower count of around 700 sites. team with extensive experience of advising on tower
Digital Bridge: Digital Bridge, the holding transactions.
Cell Site Solutions (CSS): CSS was created in 2013 company behind Andean Tower Partners and
as a joint venture between Gávea Investmentos Mexico Tower Partners, was created in 2013 by First Corporate Finance Advisors: First is
and Goldman Sachs. Focused on BTS projects, co- Ben Jenkins (Dering Capital) and Marc Ganzi a financial advisory firm based in Argentina.
locations, DAS and full turnkey services in Brazil, (former CEO of GTP) after the sale of GTP to The company specialises in M&A, valuation,
it runs a portfolio of over 1,200 sites across the American Tower for US$4.8bn. The holding infrastructure advisory and securitisation. Serving
country. manages around US$3bn in assets across multiple clients throughout Latin America, First is now
international locations. actively involved in the opening of the Argentinian
Citi: One of the world’s leading tower transaction telecom tower market.
advisory groups can be found within the TMT team Digital Bridge are renowned for having a more
at Citi. expansive investment thesis than the U.S. publics; Gávea Investimentos: Gávea was founded back
they will often be pioneers in new markets and in 2003 by the former president of the Central
Delmec: The tower experts in consultation and new asset categories (such as small cells and data Bank of Brazil, Arminio Fraga. The fund invested
engineering, providing global solutions to operators, centres), and have an appetite to rollup smaller approximately US$150mn to create CSS back in
towercos and regulators on standards, guidance and portfolios. 2013 in a joint US$300mn investment with Goldman
due diligence for portfolio management. Engaging Sachs.
audit, assessment and analysis for structural Entel: Created back in the sixties by the Chilean
enhancement, capacity and maintenance as government, Entel was privatised in the early Golden Comunicaciones: Created in April 2016 via
individual activities or by way of managed services. nineties. Since then, the company has become a joint venture between Goldman Sachs and Innova
the largest mobile network operator in Chile and Capital Partners, the BTS firm is now focused on
Deutsche Bank: Deutsche Bank provides M&A in 2013 acquired Nextel de Perú for US$400mn. serving the Colombian telecom market and headed
advisory services as well as financing services in To date, Entel owns approximately 3,000 sites in by CEO Herman Torres.
the tower space, including both equity and debt Chile and 2,400 in Peru and offers 3G and 4G LTE
products. Deutsche Bank has been involved in the services in both countries. While the company Goldman Sachs: Goldman Sachs returned to the
tower sector on a global basis, successfully executing has not to date sold any towers, Entel have Brazilian private-equity market with its 2013
transactions in North America, South America, increasingly relied on third party towercos for investment in CSS, alongside Gávea Investimentos.
Europe, Africa and Asia. new sites. In April 2016, Goldman Sachs created a joint venture

with Innova Capital Partners for the creation of Housatonic Partners: Housatonic Partners ING: Leading Dutch bank with considerable
Golden Comunicaciones, a BTS firm focused on the is a U.S. private equity firm with over US$1bn experience of providing debt finance to the tower
Colombian market. in capital under management. QMC Telecom industry.
is among its investments in the telecom
GP Investments: GP Investments is a leading infrastructure sector. Innova Capital Partners: Innova is a global investor
investment firm in Latin America and was the firm focused on energy and infrastructure projects and
behind BR Towers, one of the leading towercos in Instituto Costarricense de Electricidad (ICE): the investing arm behind Golden Comunicaciones
Brazil with its 4,200 sites that was sold to American ICE is the State-owned electricity and telecom (Colombia), via a joint venture with Goldman Sachs.
Tower in 2014 for US$978mn. provider of Costa Rica. Operating under brand
Kölbi, the company is the leading MNO in the Innovattel: Operating under the brand Torresec
Grupo TorreSur: With its 6,500 tower portfolio, GTS country ahead of Movistar and Claro. ICE has to in most markets and headed by Manuel Aviles,
is the third largest towerco in Brazil and the largest date retained its portfolio of ~1,000 towers, but has Innovattel is a Puerto Rico based BTS firm active in
private towerco in CALA. Headed by Jim Eisenstein, used towercos for new build and co-location. Colombia, Peru, Panama, Ecuador, Puerto Rico and
one of the pioneers of the U.S. tower industry and Argentina with a total portfolio of over 800 sites.
co-founder of AMT, GTS is funded by Providence International Finance Corporation (IFC): A Torresec sold 130 Ecuadorian towers to SBA in 2015.
Equity Partners, one of the leading equity firms in member of the World Bank Group, the IFC is the The first towerco to enter Argentina, Innovattel
the global TMT industry. largest financing institution in the world entirely sealed a US$45mn five-year term credit facility
focused on the private sector, with specific with Albright Capital Management in April 2016 to
Hardiman Telecommunications: A unique attention to developing and underdeveloped finance its deployments in the country.
consultancy equally capable of advising on countries. In CALA, the IFC is involved in various
engineering and operational issues as they are debt financing projects with the likes of Phoenix Intelli Site Solutions: Intelli Site Solutions is a
on commercial strategy and corporate finance. do Brasil, ON Telecom, Continental Towers and Mexican towerco focused on BTS projects as well
Extensive experience advising on both the buy-side more. as indoor and outdoor DAS. The towerco runs a
and sell-side in tower transactions. portfolio of 202 towers across Mexico.
IIMT: IIMT is a BTS and co-location firm active
Highline do Brasil: Headed by Alexandre Braga, in Mexico where it runs approximately 450 Iusacell: Iusacell was a mobile operator active in
former executive within AMT in Latin America, sites. In addition to its own portfolio, IIMT Mexico that got acquired by AT&T in January 2015
Highline was created back in November 2012 enjoys an agreement with the Federal Electricity for US$2.5bn.
to serve the Brazilian market with its BTS and Commission in Mexico to utilise its infrastructure
co-location services. Since then, Highline added for telecom purposes. JP Morgan: Leading TMT advisory team with
approximately 500 sites to its portfolio via both extensive experience in towers, including some of
organic growth and acquisitions. In 2015 the Indigo Capital: Indigo Capital was founded in the landmark transactions.
company sealed two buy and leaseback deals for a 1998 in New York and is an investment firm
total of 196 sites. Additionally, the towerco is now focused on private equity in Latin America. Indigo KPR Consult: Renowned ‘tower doctors’ – go-to
focused on offering street furniture solutions to Capital counts Torrecom and Torres Unidas among guys for structural and technical due diligence,
mobile network operators in Brazil. its investments. improvement capex planning, decommissioning

AMT, Centennial, IIMT, Balesia, Continental
Intelli Site, MTP, MX Towers,
NMS, QMC, Rent-A-Tower,
Continental
Telesites, Torrecom
PTI
Balesia, Continental, SBA, Torrecom
Balesia, Continental, SBA
Balesia, SBA, Torrecom AMT, AlfaSite, BTC, CSS, Centennial,

GTS, Highline, PTI, QMC, SBA, Skysites
AMT, Balesia, Catalina, PTI, SBA, TOCSA
Continental, Innovattel, SBA
AMT, ATP, Andinas, Centennial,

Golden Comunicaciones, Innovattel,
NMS, PTI, QMC, Unidas
Balesia, Innovattel, SBA
AMT, ATP, Andinas, Balesia, Innovattel, Tower 3

Innovattel, NMS, Unidas
Legend
Towercos have acquired the majority of towers from carriers
Towercos have acquired a significant proportion of towers
AMT, Balesia, Unidas from carriers, but the majority remain carrier-owned.
Significant BTS towerco activity also present
Less SLB activity, but plenty of BTS towerco activity
Early stage market for BTS and/or SLB
Negligible towerco activity

and just about anything to do with tower design and Millicom’s (Tigo + Millicom) footprint
maintenance.
Macquarie Group: Australian Macquarie is a

leading investment and advisory firm globally active
in the telecom tower sector. Among its notable
operations: investment in Mexico Tower Partners
(via the Macquarie Mexican Infrastructure Fund and
in conjunction with Digital Bridge), acquisition of
InSite Wireless (Puerto Rico, U.S. and Canada) and
participation in a consortium which acquired Crown
Castle Australia (now Axicom).

Madison Dearborn Partners: MDP is the U.S. based
private equity firm behind BTS firm Centennial
Towers.
Message Center Management (MCM, Inc.): MCM is

a U.S. independent developer and owner of telecom
towers with a portfolio of around 800 sites. Its
management team is among the leading forces behind
two CALA towercos, Torrecom and Torres Unidas.

Mexico Tower Partners (MTP): MTP is a fast-growing
independent towerco active in Mexico. MTP is a
joint venture between Digital Bridge and Macquarie
Mexican Infrastructure Fund. The company owns
over 1,500 sites across Mexico and is run by an
experienced team led by José Sola, whose background
includes successful spells within Global Tower
Partners and Telefónica.

MHC Holdings: MHC is an investment firm focused
on telecoms and emerging markets based in Panama
and provides the financial backing behind BTS firm
Torres Andinas. Source: TowerXchange

Millicom: Millicom is an international telecom the Nextel brand. To date, NII Holdings owns only On June 20, 2016 Oi filed for bankruptcy protection
company active in fourteen markets in Africa and Nextel Telecomunicações, the fifth mobile network for a total amount of US$19bn (the largest filing
Latin America, mostly trading under the brand Tigo. operator in Brazil currently offering 3G and 4G LTE. in the history of Brazil) and recently presented a
In the CALA region, Millicom is active in Guatemala, In May 2016, Nextel sealed a RANsharing agreement recovery plan for creditors. The recovery plan may
El Salvador, Honduras, Paraguay, Nicaragua, with Telefónica’s Vivo. eventually ease Oi’s burdensome payroll and fixed
Colombia and Bolivia. Tigo sold 2,126 towers to network connectivity obligations and enable the
American Tower in Colombia back in 2011 but has Between 2013 and 2015, NII Holdings run the Nextel company to recommence network investment in the
retained its tower portfolios in the other markets brand in Chile, Peru and Mexico but then sold medium term.
where it operates. them respectively to Novator, Entel Chile and AT&T.
Additionally, in 2013 NII Holdings divested 6,396 Orange: Orange is the leading French telecom
To date, Tigo offers 3G and 4G LTE services in towers in Brazil and Mexico (to American Tower) operator founded in 1988 with operations in
Paraguay, Colombia and Bolivia and 3G in El and faced bankruptcy in 2015. Europe, Africa, Asia and the Americas. In the
Salvador, Guatemala and Honduras. Americas it is active in Guadeloupe, Martinique
and French Guiana where it offers 3G services.
In 2016, NII Holdings sold all its remaining shares in
Montezuma & Porto: Montezuma & Porto Its Dominican Republic unit was sold to Altice in
Nextel Argentina to media giant Clarín Group. Nextel
is a Peruvian based law firm specialised in 2013.
Argentina is now owned by Clarín’s subsidiary
telecommunications, IT, Internet, data protection and
Cablevisión and is the fourth mobile operator of
other digital services. Partners Oscar Montezuma P2 - Pátria: Pátria is a leading private equity firm
Argentina.
active in Brazil in a variety of sectors including
Panez and José Miguel Porto Urrutia have advised
infrastructure and counting Blackstone among
towercos and mobile operators on a variety of NMS: NMS is a BTS firm active in Mexico, Colombia,
its partners. In 2012, Pátria invested in Highline
strategic issues. Peru and Nicaragua where it runs a total portfolio of
do Brasil and in 2015 in Odata, a data centre
600 towers.
infrastructure and co-location service company.
MVP Capital: Financial brokers and advisors active
in the U.S. since 1987. Clayton Funk, one of its Norton Rose Fulbright: Norton Rose Fulbright is Peppertree Capital: Peppertree is a private equity
Managing Directors, has been personally involved a Legal 500 law firm serving clients in a multitude fund focused on growth equity, recapitalisation and
in 125 sale and leaseback transactions and although of industries. Among them, the law firm provides buyout opportunities in the telecom infrastructure
focused on the U.S., he always keeps an eye South of services in the infrastructure and TMT arenas and is industry. Mostly focused in the U.S. where it has
the border. able to help its CALA clients via its offices in Brazil, backed companies such as Branch Towers, 4G
Colombia and Venezuela. Towers, Clearview Tower Company and Light Tower
MX Towers: MX Towers is a new firm created by Holdings, it keeps an eye on opportunities in Central
executives previously involved in the Macquarie Oi: Oi is the fourth mobile network operator of and South America.
Mexican Infrastructure Fund focused on offering DAS Brazil offering 3G and 4G LTE services. Since 2012,
and other alternative solutions to its Mexican clients. Oi has divested the majority of its 11,000+ towers Personal: Owned by Telecom Argentina, Telecom
across Brazil to Grupo TorreSur, BR Towers and SBA Personal is third mobile network operator in the
NII Holdings: NII Holdings is the company behind Communications. country where it offers 3G and 4G LTE services.

Who sold their towers in Central and South America? well as rooftops and DAS in Brazil, Colombia, Puerto
Rico as well as Mexico, where it operates under the
Conex brand.
RBC Capital Markets: RBC Capital Markets is a

Canadian investment bank part of the Royal Bank
of Canada. Jonathan Atkin and Jonathan Dann,
Managing Directors of RBC’s Telecom Research,
are two of the most respected analysts in the
global telecom and tower space and regulars at
TowerXchange Meetups.

Rent-A-Tower: Rent-A-Tower is a BTS firm active in
the Mexican market.

SBA Communications: With over 26,000 towers
Peterson Partners: Peterson Partners is a private mastermind behind the GTP rollup strategy and sale across the U.S., Central and South America and
equity and venture capital firm primarily active in to American Tower, along with other GTP alumni Canada, SBA is one of the top ten towercos in the
the U.S., Canada, Europe, Mexico, Brazil and India such as Tim Culver and Natalya Kashirina. PTI now world. SBA runs over 7,000 towers in Brazil and
and counts QMC Telecom among its PE investments. owns and operates 880 towers across the CALA 2,500 sites across Costa Rica, Panama, Nicaragua,
region, 635 in the U.S. and controls its 700-tower Guatemala, El Salvador and Ecuador. Since 2012, SBA
Phillips Lytle LLP: Phillips Lytle is a U.S. based Brazilian subsidiary, Phoenix Tower do Brasil. PTI has been involved in five tower transactions across
law firm offering a wide range of services. Partner has achieved its current scale via both organic the region and has purchased over 6,690 towers for a
Douglas Dimitroff is an expert in DAS and other and inorganic growth transactions and is active total value of approximately US$1.7bn.
het-net solutions and is able to advise U.S. as well in Colombia, Costa Rica, Panama, the Dominican
as international clients on their business and Republic and the U.S. Scotiabank: In November 2015, Scotiabank granted
regulatory dynamics. to Phoenix Tower Dominicana (Phoenix Tower
International subsidiary) a US$45mn five-year
Providence Equity Partners: One of the largest
Phoenix Tower do Brasil: Phoenix Tower do credit facility to finance the acquisition of Teletower
global private equity firms operating in the TMT
Brasil is the Brazilian subsidiary of Phoenix Tower Dominicana and further develop its portfolio in the
industry, Providence manages over US$23bn in
International. Run by former BR Towers’ CEO country.
equity commitments and is an investment partner of
Mauricio Giusti, the towerco now owns and operates
Brazilian towerco Grupo TorreSur. Sercomtel: Sercomtel is a local mobile network
700 sites across Brazil.
operator serving the Brazilian region of Paraná.
Phoenix Tower International (PTI): PTI was QMC Telecom: QMC Telecom was founded back in
founded in 2013 by Dagan Kasavana, the M&A 2008 and currently runs a portfolio of 900+ towers as Silver Swan Capital: Silver Swan Capital, a NY-based

investment firm, sealed a US$40mn funding deal with Telefónica’s (Vivo + Movistar) footprint
Brazil Tower Company in August 2016 to finance the
towerco expansion plans across Brazil.
Skysites: Skysites is an infrastructure firm active in

Brazil focused on BTS, small cells, co-locations and iDAS.
The company is led by Roberto Massaru Nishikawa.

Southern Cross Group: Southern Cross Group is a
private equity firm focused on Latin America with
offices in Argentina, Brazil, Chile, Colombia, Mexico,
Uruguay and the U.S. Mexican BTS and MSP firm Even
Telecom is among its latest investments in the telecom
infrastructure industry.
Summit Wireless Infrastructure: Summit Wireless

Infrastructure is a BTS firm active in Brazil, Mexico,
Colombia and Peru headed by Lawrence Gleason, Millicom’s (Tigo + Millicom)
former COO of AMT’s Latin American business. Summit footprint
is a subsidiary of Communications Sales & Leasing,
Inc., a U.S. publicly traded Real Estate Investment Trust
(REIT).
Telecommunications Partners: Telecommunications

Partners is a BTS firm active in the Peruvian market.
Telefónica: Telefónica is a Spanish telecom company

active in Europe, Asia, North, Central and South
America. In the CALA region, it operates under the
Vivo and Movistar brands in Argentina, Brazil, Chile,
Colombia, Costa Rica, Dominican Republic, Ecuador,
Guatemala, Panama, Peru, Puerto Rico and Venezuela.
Since 2011, Telefónica has entered into fourteen tower

transactions, divesting over 11,000 towers across the
region. The last three transactions were sealed with Source: TowerXchange

Estimated
Estimated number of towers
number of towersowned
ownedor
ormanaged
managedbyby towercos
towercos in in CALA
CALA
Telxius, the company’s own carve-out infrastructure
Source: TowerXchange research, quarterly filings, site lists
company created at the beginning of 2016, and due to
Estimated number of towers owned or managed by towercos in CALA IPO in Q4 2016.
1,220 635
*American Tower 18,851 3,773 8,870 485
900 1,220 635 1,000** In Brazil, Telefónica operates under the Vivo brand
Estimated number of towers owned or managed by towercos in CALA
Telxius 1,655
*American Tower 18,851 13,350 3,773 8,870 485 and has recently sealed a spectrum sharing agreement
900 328 1,213 627 1,000**
Telxius
*American1,655
Tower 13,350
18,851 3,768 8,865 485
with Nextel. Vivo and Claro signed a network sharing
Telesites 14,708 216
Telxius 1,655
328 900
13,350 agreement in 2013 and are currently working to take
Telesites
SBA Communications
328 14,708
7,131 617 216
548 619 408 239 146 121 21 the total number of shared sites to 412.
Telesites 13,873 170
SBA Communications
SBA Communications 7,131
7,138 599 617 548386619
540 603 408
226 136 239 146 121 21
Grupo TorreSur 6,500
Grupo TorreSur6,500 6,500
Telefónica offers 3G and 4G LTE services in most CALA
Grupo TorreSur
markets beside El Salvador, Nicaragua and Venezuela
5,000
5,000 10,000 10,000
15,000 15,000 25,000
20,000 20,000
30,000 25,000
35,000 30,000 35,000
1600 1600
5,000 10,000 15,000 20,000 25,000 30,000 35,000
(3G only).
32 40
1600 32 40
1400 138
32 40
1400 138 79
For the infrastructure firm created by Telefónica in
1400 138 79 1200
79
2016, see Telxius.
1200 1000

1200 591
800 480 Telesites: Telesites is the infrastructure company

1000
1000
1531
created by Carlos Slim which debuted on the Mexican
591591 600
1203
stock exchange in December 2015. As of Q2 2016 the

213
65
480 480
901
800
800 400 750 company owns and manages 13,873 towers in Mexico
700 221
690
1531 1531 600 400
555 500 450 100 as a result of the transfer of assets from América Móvil
200 600 400
600
600 1203 1203
208
213 213 200 202
150 40 40 Dominican Republic
as well as organic growth. Additionally, Telesites is
100 105
65 65 60 51
901 Ecuador active in Costa Rica where it is building close to 300

s
as e
r
ns
l
A
ex on er
ne er
*C any r
te
al
se el
a
C
e
na
S
es
om
T
S
ta
** rt we
Br hlin
901
p e
m
CS
da
ite
lin
CS
il
tio
re att
ni
Si
M ati ow
ic al
rt w
** om ow
rs
(T nno s
en
rr
di
sites for Claro.

c)
na
I er
Br *Q
*N
TO
ec
** Pa To
II
fa
ni
On
ys
Pa To
en
400
lu
To
or v
Unknown
do ig
An
tin
rn T
C lT
Pa
Al
rr
U
Sk
So
400 700
**
**
nt
750
an
te ix
es
m
i
on
To
es
54
az
es
de
**
Ce
221 617
te
In oen
750
rr
de
co
rr
54
rr
Si
**
To
es
700 617
221 400
An
le
To
690 Spain & Germany

To
Ph
lli
**
rr
Te
te
To
690 100
In
400
500 100 100
450500
200 600 400 450 100 Since its creation,
Dominican Telesites has added over 3,000
Republic
200 600
208 205
400 Dominican Republic
208 100
200
205
202
150 40 40 towers to
Ecuador its portfolio, proving strong growth
200 105
202
100
60
150 51
105 40ambitions
40 Ecuador
and capabilities. The firm has opened
60 51 Argentina
as
e
e r
s
Co ny r tal
A
r
Pa To ner er
az** M an er
as ite
r*t* w ial
nisec el
rr te a
**Co il T C
CS line
To eco am tes
li es
S
as
de nt om
or v IMT
s ion
e rtn e
U )Bra lin
er
rn xeT tionwe
Argentina
its sites for co-location and recently sealed a lease
To Si am
ns CS
To ers r CS
ti Si il in
az as M
rrPa Tow
ItIi T sil
enre tt
M ati oicwo al
ic arlt ow
Br ** *Qmp ow
Co il CTon C y
rt w s
an nt rs
a e n
On orr
id
Pa** o n
in aS
al )
i
nt or s va
sedo ieglh
Br d Q
erut
ni ll s ed
io O
Anine rec
** mp owtine
TO On
Te Pa ys
i a o
** T en
Ce (T enrno r
To an l
fa an
A
ex oPn eTr
rr m a
n
Unknown
ne
a
s
S
de Cecom
U te ra Ann
Mo
f
In oen ern x T
nI e
To ut T
ni **
n e
wSol
T
l
te
re
Sk
CUS
re aHtt
An A
In o B ehs li
Al e P
r
es
U *
agreement withUnknown AT&T.

nt To
i
es
t i
r
d
a
ys
Tote
Ph In oen
To
d
ni
d orirg
x
rr
l
(T no
Sk
So
s
TH
o
es
te M
SpainTower
& Germany
Ph
m
i
l
rr
es
es
de
In
te
co
rr
rr
Si
**
Year Country Seller Buyer count Deal value US$ Cost per tower US$ Deal structure
es
**
An
le
To
Spain & Germany

To
lli
**
rr
Te
te
**
To
* American Tower’s Brazil 31%

count is pro rata to the closing of the last tranche of TIM Brasil towers Telxius: Telxius was created in February 2016 byPortfolio acquisition
In
2015 Ecuador Torresec SBA Communications 130

34% Colombia and Puerto Rico
*** QMC has a portfolio of 901 towers across Brazil, Mexico, Dominican Republic Amzak/Teletower
Crown Castle 2015 Phoenix Tower 190 Company acquisition
**** Continental Towers owns a portfolio of ~690 towers, which their website claims are distributed across
American Tower
2015 Mexico, Dominican
Brazil Republic, Jamaica,
T4U Telefónica with the goal to manage the operator’sCompany acquisition
Phoenix Tower 529
Guatemala, El Salvador, Honduras, Nicaragua, Costa Rica, Panama, Colombia and Peru 2015 Brazil T4U Phoenix Tower 529 Company acquisition
***** NMS has a portfolio of 600 towers across Nicaragua, Mexico, Colombia SBA Communications
and Peru 2014 Brazil TIM infrastructure
American Tower 6480 including its towers and
$1,200,000,000 sub-sea cable.SLB
$185,185
Verizon
****** Innovattel/Torresec owns a portfolio of 500 towers across Puerto Rico,
2014 Panama
Colombia, Ecuador, Argentina, Panama and Peru
American Tower
2014 Brazil BR Towers
To date, Telxius
Phoenix Tower
American Tower
60
4630
manages 11,000 sites$211,231
$978,000,000
in Spain, 2,350
Subsidiary acquisition
Company acquisition
AT&T 2014 Brazil Oi SBA Communications 1641 $527,000,000 $321146 SLB
Miscellaneous 2013 Brazil Nextel American Tower 1940 $349,000,000 $179,897 SLB
XX | TowerXchange4%Issue 18 | www.towerxchange.com 2013 Brazil Z-Sites American Tower www.towerxchange.com
236 $129,000,000| TowerXchange
$546,610 Issue 18 Company
| 251 acquisition
4% Brazil Nextel
2013 American Tower 2790 $413,000,000 $148,029 SLB
in Germany, 1,655 in Brazil, 900 in Peru and 328 in Torrecom: Torrecom is a leading BTS firm with a WOM: WOM is the fourth mobile network operator
Chile as well as 31,000km of submarine fibre optic portfolio of over 600 sites across Mexico, Nicaragua in Chile where it’s been offering 4G LTE since the end
cable, including SAM-1, a submarine cable that and Guatemala. Its management team includes of 2015.
connects the United States with Central and South experienced executives from U.S. towerco MCM, Inc.
America. such as Maria Scotti who acts as CEO and Eric Zachs, Vinson & Elkins (V&E): V&E is one of the oldest and
Co-Chairman and Co-Founder of MCM. Indigo Capital largest international law firms, with approximately
Telefónica has confirmed plans for an IPO of Telxius is one of the investment firms behind Torrecom. 700 lawyers located in 15 offices around the world.
before the end of 2016. Their global telecommunications team has extensive
Torres Andinas: Torres Andinas is a BTS firm experience advising on international telecoms and
Tillman Global Holdings (TGH): Multinational active in Colombia and Peru run by Larry Smith telecoms infrastructure transactions in numerous
tower and infrastructure investment and operations and COO, Eric Ensor, a regular contributor at the countries.
firm led by Sanjiv Ahuja, former Chairman and TowerXchange Meetup Americas.
co-founder of Eaton Towers and ex-CEO of Orange. Viva Bolivia: Viva is the third mobile network
TGH has a joint venture partnership with JC Decaux, Torres Unidas: Torres Unidas is a towerco operator in Bolivia and is owned by Trilogy
giving them the opportunity locate points of service, focused on developing and acquiring sites in Chile, International Partners. Viva launched its 4G LTE
particularly small cells, on over 1mn prime locations Colombia and Peru, where it owns a total portfolio services in July 2015 and reportedly, its tower
worldwide. TGH is pursuing a couple of key of approximately 1,200 sites. Led by Daniel Senier, portfolio is now up for sale.
opportunities in CALA. Torres Unidas counts Berkshire Partners among its
investors and various MCM, Inc. and Indigo Capital Viva Dominicana: Viva Dominicana is the third
TIM Brasil: Owned by Telecom Italia, TIM Brasil executives among its board members. mobile network operator in the Dominican Republic
is the second mobile network operator in Brazil, where it offers 3G services. In March 2016, the MNO
serving more than 70mn subscribers across the UBS: UBS has been globally involved in several tower sealed a deal with Phoenix Tower International over
country. In 2014, TIM entered into a sale and transactions and has recently appointed André the sale of 145 sites and transfer of marketing rights
leaseback transaction with American Tower for Laloni to run its Investment Banking division in of a further 400 towers.
the sale of close to 6,500 sites. The deal, valued Brazil and the Southern Cone. With seventeen years
approximately US$1bn, is still under process with of experience in banking and specific expertise in In November 2015, Trilogy International Partners
its last tranche due to close before the end of the telecom sector, Laloni has been involved in the sold Viva Dominicana to Telemicro Group, owned by
2016. majority of Brazilian tower transactions. local entrepreneur Juan Ramon Gomez Diaz
TIM Brasil and Oi sealed a RANsharing agreement Who have we missed?

back in 2014 and network sharing agreement in
2015. Have we missed a company active in the CALA telecom tower market? Then please email Arianna
Neri, MD - Americas and Asia, at aneri@towerxchange.com and don’t forget to sign up for the
TOCSA Towers: TOCSA Towers is a BTS firm active fourth TowerXchange Meetup Americas, taking place in Boca Raton, 7-8 June 2017. More
in Central America. To date, the company owns and details can be found on our website: www.towerxchange.com/meetup/meetup-americas/
operates approximately 130 sites in Costa Rica.

TowerXchange’s history
2000s
The history of the Brazilian telecom tower market
of the Brazilian tower market dates back to the early 2000s. Interestingly, the first
towerco to snoop around the country was Crown
From AMT’s first deal to Oi’s restructuring plans: tracking the development of the Castle who went as far as opening an office in
exciting, and turbulent, Brazilian tower market Brazil and conducted an early due diligence on the
potential of the CALA market, only to then conclude
Brazil is the largest and most mature tower market in the CALA that their more imminent priorities were back in the
region. But have you ever wondered how and when the history of U.S.
the independent towerco industry began in Brazil? In this exclusive
editorial, TowerXchange retraces the path of the Brazilian tower In the meantime, another U.S. towerco was eyeing
industry from the very first deals till today’s uncertainties. opportunities in the country and after having set
its operations in Brazil in 2000, American Tower
acquired approximately 150 towers from Global
Keywords: 1848 Capital, 3G, 4G, Accel, Algar Telecom, American
Village Telecom (GVT) in 2001 and officially started
Tower, América Móvil, Anatel, BR Towers, Best of TowerXchange,
Blackstone, Brazil, Brazil Tower Company, Build-to-Suit, CSS, CTBC, the Brazilian tower industry as we know it today.
Cartesian Capital Group, Cell Site Solutions, Claro, Crown Castle,
Editorial, GP Investments, Gilat Satellite Networks, Global Village Until 2010, American Tower was one of a handful
Telecom, Goldman Sachs, Grupo TorreSur, Gávea Investimentos, of early towercos actively involved in the Brazilian
Highline do Brasil, Housatonic Partners, IFC, M&A, Morgan market and sealed a couple of deals such as the
Stanley, Movistar, NII Holdings, Nextel, Oi, P2 Pátria, Peterson acquisition of approximately 400 sites from Nextel
Partners, Phoenix Tower do Brasil, Providence Equity Partners, (between 2003 and 2008) and the purchase of over
QMC Telecom, Regulation, Sitesharing, South America, Spectrum 200 sites from CTBC (now Algar Telecom) in 2009.
Arianna Neri, MD - Americas and Asia,
TowerXchange
Auction, TIM Brasil, Telefónica, Telesites, Telxius, Vivendi
Another towerco operating in Brazil in the early
2000s was Sitesharing, an early build to suit (BTS)
Read this article to learn: firm which sold its 666 sites to American Tower in
< The beginning of the Brazilian tower industry: American Tower’s first mover advantage 2011.
< The wave of transactions 2012-2014: SBA, GTS and BRT scale
< The role played by independent developers American Tower clearly positioned itself from day
< TIM-AMT: the last big deal and the beginning of the halt era one as an acquisitive force in the Brazilian market
< Oi’s bankruptcy and today’s slow return to normality while its BTS activities didn’t start in earnest until
2007, when the company built around 100 sites. In

2008, American Tower’s Brazilian site count passed Brazilian towercos growth 2012-2016
the 1,000 landmark thanks to a healthier volume of 40,000
BTS projects (+400 YoY).
35,000
2010s
30,000
We have to wait until 2010 to see another major 25,000
tower company entering the market and, in this
case, in the form of a PE-backed entity. Grupo 20,000
TorreSur (GTS) was formed in November 2010 by
Jim Eisenstein, one of the original executives of
15,000
American Tower. GTS is backed by U.S. investment 10,000
firms including Providence Equity Partners and
Cartesian Capital Group (as minority shareholder). 5,000
Grupo TorreSur started its M&A activity in early

2012 2013 2014 2015 Q316
2011 and sealed three deals with Oi and Telefónica
SBAC AMT GTS BTC PTB
Swap clauses: a peculiarity of the CSS TELXIUS HIGHLINE BR TOWERS
Brazilian market
2012 2013 2014 2015 2016 YTD
Swap clauses are a distinctive trait of the
SBAC 800 3,161 6,927 7,032 7,138
Brazilian tower industry that guarantee to the
AMT 4,348 6,764 11,873 18,073 18,851
buyer of a given portfolio the right to literally
swap a number of towers with other sites still GTS 2,566 4,679 6,185 6,300 6,500
owned by the seller, within a certain timeframe. BTC - - - 308 753
Usually these clauses are included in M&A PTB - - - 556 700
transactions as a protection against unfit sites CSS - - 180 350 1,203
that towercos might end up acquiring as part of
Telxius - - - - 1,655
a deal, especially given the fact that a number
Highline - - - 200 500
of portfolios that changed hands over the past
few years didn’t undergo a costly and time BR Towers 2,800 4,630 - - -
consuming site-by-site due diligence ahead of Change 10,514 19,234 25,165 32,819 37,300
expedited deals
Source: Company reports, TowerXchange

in two years. Combining organic and inorganic sites. The final tranches of this deal are still closing By the end of 2014, both Oi and Telefónica had
growth, the towerco has now reached a healthy today. transferred most of their sites to towercos, with
6,500 site count and is the largest PE-backed towerco the exception of sites returned under cover swap
in Brazil. 2012-2014: the (short lived) golden era of M&As commitments, which include many of the 1,655
towers Telefónica sold to its internal towerco Telxius
In July 2015, news sources reported that Grupo Between 2012 and 2014, Brazil experienced a wave in 2016. In the meantime, Nextel decided to put
TorreSur was in talks with various potential buyers of M&A activity that put the country’s tower sector most its towers up for sale and sealed three deals
but valuation gaps were insurmountable, so the at the frontline of the global tower industry. Brazil with American Tower between December 2013 and
company hasn’t been acquired by third parties and and its high multiple deals were being benchmarked December 2014.
remains active in the Brazilian BTS market. throughout Latin America, and by analysts and
shareholders back in the United States. While Telefónica, Oi and Nextel all divested large
In December 2012, another towerco started portions of their passive infrastructure portfolio,
operating in Brazil under the name of BR Towers. In mid-2012, the Brazilian government held its 4G the Brazilian government held another auction, this
Backed by Banco Bradesco PE-unit and GP auction which raised over US$1.3bn and granted time for the much coveted 700MHz LTE-suitable
Investments, BR Towers was led by the current CEO frequencies to the (then) big four MNOs: Telefónica, spectrum, but only raised US$2.39bn (versus Anatel’s
of Phoenix Tower do Brasil, Mauricio Giusti, and in Claro, TIM Brasil and Oi. The auction awarded target of US$3.25bn). While Claro, Telefónica and
two years of activity reached a considerable scale frequencies in the sought-after 2.5GHz spectrum as TIM Brasil all picked up spectrum blocks, neither Oi
(4,630 sites) via both organic (approximately 500 well as in the less in-demand 450MHz band, suitable nor Nextel got involved in the auction, both starting
sites in two years) and inorganic (three deals with for rural broadband access. to show signs of internal troubles.
Telefónica and Oi) growth.
The auction coincided with the initial wave of tower Specifically, NII Holdings - owners of Nextel - filed
In June 2014, BR Towers was acquired by American deals with Telefónica divesting most of its Brazilian for its second bankruptcy in 2015 after divesting its
Tower in one of the largest deals in the history of assets between March and December 2012 and Oi Chilean, Peruvian and Mexican units. After exiting
Brazilian towers, valued at US$978mn. That deal sealing most of its deals between December 2012 the bankruptcy one year later, NII Holdings sold
stands up under retrospective analysis as a good and December 2013. its Argentinian unit to continue investing in its
example of private equity backed player acquiring Brazilian operations. On the other hand, Oi was just
assets, adding value through modest tenancy With the license terms setting stringent targets about to enter a troubled phase of failed negotiations
ratio growth, and quickly selling at a reasonable ahead of the 2013 Confederations Cup and the with potential buyers (including Telecom Italia and
premium. 2014 World Cup, Telefónica and Oi resorted to the LetterOne Holding) and falling revenues that would
quickest and most obvious way to raise capital and lead to its June 2016 bankruptcy protection filing.
Around the same time, TIM Brasil hired Morgan transferred most of its tower portfolios to American
Stanley to work on the sale of its own tower portfolio Tower, BR Towers, Grupo TorreSur and SBA During the “golden era” biennium 2012-2014,
which would lead to the single largest transaction in Communications, with the latter having entered the sixteen M&As took place in Brazil between MNOs
Brazilian towers: approximately US$1.2bn for 6,480 Brazilian market in 2012. and towercos at an average TCF multiple of 15.1x. In

Brazilian tower deals: 2009-2016 Source: TowerXchange, RBC Capital Markets, Company Reports
Year Seller Buyer Deal value US$ Tower count Average tenancy Cost per tower US$ TCF multiple
2016 Telefónica Telxius 1655
2015 Algar Telecom Highline do Brasil $16,000,000 127 $128,000.00
2015 T4U Holding Brasil Phoenix Tower 500
2015 TIM Brasil American Tower $1,200,000,000 6480 $185,200.00 15.7x
Dec 14 Oi SBA Communications $527,000,000 1641 1.4x $321,100.00 15.8x
Nov 14 BR Towers American Tower $978,000,000 4640 $210,800.00 12.1x
Mar 14 Oi SBA Communications $645,000,000 2007 1.6x $321,400.00 16.3x
Dec 13 Z-Sites American Tower $127,100,000 236 $538,600.00
Dec 13 NII Holdings American Tower $342,700,000 1937 $176,900.00 14.7x
Jun 14 NII Holdings American Tower $18,600,000 103 $180,600.00 14.7x
Dec 14 NII Holdings American Tower $51,700,000 750 $68,900.00 14.7x
Dec 13 Oi BR Towers $225,000,000 2113 $106,500.00
Dec 13 Oi Grupo TorreSur $225,000,000 2113 $106,500.00
2013 Telefónica American Tower $20,400,000 93 $219,500.00
Nov 13 Oi SBA Communications $302,600,000 2113 1.2x $143,200.00 10.2x
Dec 12 Telefónica SBA Communications $177,000,000 800 1.3x $221,300.00 17.3x
Dec 12 Oi Grupo TorreSur $251,700,000 1208 $208,400.00
Dec 12 Telefónica BR Towers $250,000,000 1912 $130,800.00
Aug 12 Telefónica American Tower $32,700,000 192 1.1x $170,300.00 17.3x
Jun 12 Telefónica American Tower $126,300,000 700 1.1x $180,400.00 17.3x
Mar 12 Telefónica American Tower $151,700,000 800 1.1x $189,600.00 17.3x
2011 Telefónica Grupo TorreSur $238,000,000 1358 $175,300.00
Mar 11 Sitesharing American Tower $585,300,000 666 <2.0x $878,800.00 13.0x
2010 Telefónica Grupo TorreSur $160,300,000 1085 $147,700.00
Jun 09 CTBC American Tower $51,300,000 230 $223,000.00

just two years, as many as 19,000 towers (over 30% Selection of PE-backed towercos in Brazil Source: TowerXchange
of the entire national inventory) were transferred
to towercos and approximately US$3.5bn was Year Current
Company Investors CEO
transferred to the balance sheets of the MNOs. founded tower count
QMC Telecom 2008 Undisclosed Accel, Housatonic Partners, Rafael Somoza &
The landing of the PE-backed firms
Peterson Partners José Stella
Brazil needs towers. And lots of them… During the
Providence Equity Partners,
2016 edition of the TowerXchange Meetup Americas,
panellists forecasted that the number of subscribers Grupo TorreSur 2010 6,500 Cartesian Capital Group James Eisenstein
in Brazil will reach 300 million by 2020 (60 million
Brazil Tower 2011 750 1848 Capital Dr Chahram Zolfaghari
more than today) which is approximately where the
United States is at present. But the gap with the U.S. Comapny
standards is still huge in terms of subscribers per Cell Site Solutions 2013 ~1200 Gávea Investmentos, Hugo Urbini Neto
tower (4,500 vs 1,000), average tenancy ratio (1.25 x
vs 2.5x) and total number of sites (55,000 vs 140,000). Goldman Sachs
Highline do Brazil 2013 ~500 P2 - Pátria Alexandre Braga

On this note, it’s important to keep in mind that
Brazilian subscribers can’t be calculated using Phoenix Tower do 2014 700 Blackstone’s Tactical Mauricio Giusti
the same rationale as in the U.S. In fact, most Brazil Opportunities, IFC (debt)
subscribers in Brazil own multiple SIM cards, which
they swap depending on the best service in the area, need 70,000 new towers by 2020… And towercos to operating in the country.
tariff offered for a certain call et cetera. So 4,500 do the job! TowerXchange is well aware that such a
subscribers per cell site don’t represent the real volume of new builds isn’t realistic, especially under Operating since 2008, QMC Telecom’s profile raised
number of people connecting to a given cell and we the current economic conditions, but if there’s one in 2011 when Housatonic Partners, a PE firm based
can expect this number to drop closer to 3,000 if we opportunity for Brazil to achieve greater levels in Boston, acquired a major stake in the company
take into account the high volume of multiple SIM of coverage and capacity in spite of its recession, to finance its activities in Brazil and Mexico. QMC
cards in the country. Nonetheless the comparison it’s under the guidance of third-party telecom currently has around 900 towers across CALA,
still serves to illustrate the fact that Brazil needs a infrastructure experts. And while big organisations including a substantial footprint in Brazil.
significant increase in the number of towers, and such as American Tower and SBA Communications
the number of tenants on towers, to achieve a QoS are engaged in the BTS space, from 2011 on Brazil In August 2011, Brazil Tower Company (BTC) started
comparable to the U.S. has witnessed the entrance of dozens of specialist its operations in the country with an initial focus
BTS firms, supplementing build capacity. Here on the Northeast region to then deploy throughout
So if growth predictions are accurate, Brazil might is a snapshot of the key BTS towercos currently the nation. With tower count of over 750 sites

and another 250 in the pipeline, the company is Although with different missions and visions, Tower which to date remains the largest deal in the
controlled by 1848 Capital and by Dr Chahram PE-backed entities tend to have a relatively short history of Brazilian towers.
Zolfaghari, its CEO. lifecycle and a 3-7 year refinance / exit strategy in
mind. However, with most of these firms having According to the deal, AMT entered into a SLB
February 2013 saw the entrance in the Brazilian entered the market around 2012-2013, their plans agreement with TIM Brasil for the purchase and
market of Cell Site Solutions (CSS) which marked might now be stalling due to the current economic leaseback of its 6,480 towers for an estimated
the return of Goldman Sachs in the country’s situation and forex crisis affecting Brazil. US$1.2bn (TCF multiple 15.7x). To date, the deal
private equity market. CSS is also backed by Gávea hasn’t finalised yet with the fifth (and last) tranche
Investimentos and runs a portfolio of approximately Times of forex volatility usually put a stop to of towers expected to be transferred before year
1,200 sites while focusing on BTS and DAS. transactions and this might require PE-backed end.
In March 2013, Highline do Brasil entered the companies to extend their horizons beyond their
Brazilian BTS market by sealing its first two deals anticipated hold. This may be unavoidable since it 2015: a halt to plans
with local MNOs and shortly after, the firm started could be very tough in today’s economy to achieve
offering iDAS solutions and street level sites. In the multiples upon exit Brazil witnessed in the past. With few towers left on MNO balance sheets to
2015, Highline acquired two portfolios from ON buy, Brazilian towercos still had high hopes for the
Telecom (71 sites) and Algar Telecom (125 sites) and 2015: TIM-AMT country’s densification plans. With thousands of
TowerXchange believes its now holds a portfolio towers needed to bring the Brazilian telecom sector
nearing 500 sites across Brazil. By 2015, Telefónica, Oi and Nextel had sold most up to par with more modern markets and the past
of their assets, leaving only Claro and TIM Brasil’s spectrum auctions setting tough deployment targets
In 2013, Global Tower Partners and its 15,700 sites tower portfolios operator-captive. for MNOs, BTS firms geared up for a few busy years
(across the U.S., Panama and Costa Rica) were ahead!
acquired by American Tower in a deal valued América Móvil’s strategy has been consistent
US$4.8bn. The masterminds behind GTP went on to throughout its CALA operations. The operator tends However, 2015 proved them wrong as the already
form new entities with GTP’s Founder and CEO Marc to retain its towers, with the only exception made for weak Brazilian economy was hit by one of the
Ganzi creating Digital Bridge and Dagan Kasavana the 10,800 sites it transferred to Telesites as a result deepest recessions in its history and shrank 2.6%
(in charge of M&A at GTP) launching Phoenix of the imposition to break its dominant position in in just one year. Along with its economic turmoils,
Tower International. Backed by Blackstone Tactical Mexico by IFETEL. Therefore, we don’t expect its Brazil had to face a political crisis with the then
Opportunities unit, Phoenix Tower International ~8,000 Brazilian sites to come to market anytime President Dilma Rousseff, dealing with a number of
operates a separate entity - Phoenix Tower do Brasil soon… unless Telesites enters the Brazilian market! allegations of wrongdoings, culminating with her
- in the country, where it currently runs a portfolio official impeachment and removal from office in
of approximately 700 sites built via a mix of organic On the other hand, TIM had previously hired August 2016.
and inorganic growth (In Q2 2015 T4U sold its 500 Morgan Stanley to advise on the divestment of its
sites to Phoenix Tower do Brasil for an undisclosed tower portfolio and by Q4 2014, it announced a sales Facing one of the toughest years in the history of the
amount). and leaseback (SLB) transaction with American Brazilian economy, the country’s MNOs considerably

reduced their investment plans while international Oi was initially granted sixty days to submit a its internal disputes and reach a satisfactory
towercos such as SBA and AMT dealt with a deep recovery plan but its creditors have refused the agreement with its shareholders and creditors.
forex crisis affecting the Brazilian Real, whose restructuring proposal presented on September And this might prompt the amendment of the
exchange rate touched an all time low in September 5, arguing that while it includes favourable existing bankruptcy protection law that would
2015. conditions for current shareholders in the event of enhance the level of control of the government
a positive turnaround, leaving bond investors with over MNOs.
Committing to huge investments during these shaky considerable losses if things don’t go as planned.
times isn’t ideal for either MNOs or listed towercos. On the towerco front, the latest Oi news date
Therefore both large BTS projects and any M&A Therefore, the largest group of bondholders is now back to Q2 earnings calls when SBA announced
activity among towercos had to be put on hold, in talks with Egyptian billionaire Naguib Sawiris it is pursuing a total of US$16.5mn in the MNO’s
leaving PE-backed towercos (many of which are to prepare an alternative proposal that would help reorganisation plan but added that Oi has already
increasingly impatient for a profitable exit) waiting Oi recover while safeguarding their interests. The resumed payments for amounts subsequent to
for better times. telecom mogul has previously shown interest in their filing. Seemingly, Oi has resumed payments
investing in the troubled telecom operator and towards AMT who is pursuing in full the US$7mn
And while 2016 started on a similar path with hardly expressed its positive views on the potential of Oi to revenue reserve linked to the carrier.
any new search rings being assigned, towercos recover with a capital increase and a solid business
reported slight improvements in Q3 with a few plan. The restructuring of Oi could be good news after
projects being assigned by MNOs, while economists all for the tower industry. In fact, after having
predicted some (slight) economic improvements by In the midst of this saga, the Brazilian government filed for bankruptcy, Oi is currently fulfilling its
Q4. has been assessing possible amends to the current financial obligations towards suppliers (including
bankruptcy protection law, in an attempt to ease an towercos) on time. However, we don’t expect
The Oi saga intervention into Oi in light of the internal disputes the reorganisation of the company to happen
between shareholders and creditors. anytime before Q2 2017 so for now we can only
As if these issues weren’t enough to ensure Brazil hope Oi gets out of this crisis stronger and more
holds a spot on the podium as one of the most According to Reuters (citing local news sources) “a competitive than before.
complex markets TowerXchange analyses, June 2016 government intervention in the debt-laden carrier
had another shock in store. would remove Oi’s current management and board Telxius (and Telesites)
of directors, while keeping a committee of financial
On June 21, Oi filed for the single largest bankruptcy controllers. Industry watchdog Anatel would initially Created in early 2016, Telxius is a global
request in the history of Brazil, with debts intervene in Oi for a year, with the possibility of infrastructure firm owned by Telefónica. To date,
amounting to US$19.2bn and creditors including extending it up to three.” Telxius manages 16,000 telecom towers across
three state-owned banks (Banco Nacional de five countries and 65,000km of submarine fibre
Desenvolvimento Econômico e Social, Caixa There are indications that new President’s Temer optic cables connecting Europe and the Americas,
Econômica Federal and Banco do Brasil) and various administration might be unimpressed with the including various networks connecting the United
private institutions. efforts being made by Oi’s management to resolve States with Central and South America.

In April 2016, Telefónica announced the sale of Brazil - Estimated tower count: 54,851
1,655 Brazilian sites to Telxius for an undisclosed
4707
amount and we believe that the portfolio represents
the majority of towers that were still in the hands of
Telefónica. Therefore, we don’t expect the operator- American Tower
led infraco to grow its Brazilian count thanks to 18851 SBA Communications
additional transfers of assets and only via future BTS
15000
Grupo TorreSur
projects Telefónica might assign.
Telxius
So while in Europe Telxius owns 13,350 sites and
Other independent towercos
could leverage its strong presence and scale, in
Brazil we don’t expect it to be a real game changer. Remaining big 4 operators
4707
Other operators including Nextel, Sky Brasil,
On the other hand, we recognise the potentially 7138 Algar Telecom, Sercomtel and ON Telecom
disruptive effect Telesites could have in Brazil,
1655 6500
should América Móvil decide to replicate its Mexican Source: TowerXchange
move and transfer Claro’s ~8,000 Brazilian sites into
its infrastructure unit. However, to date the move
Brazilian independent towercos
has never been hinted and, beside some BTS projects
100
in Costa Rica, Telesites’ activities remain limited to CSS
Mexico. 750 Phoenix Tower do Brasil
400
Conclusions Brazil Tower Company
150 51
40 Centennial
Over the past few years, Brazil delivered a high 40
volume of deals which resulted in towercos now 700 Highline do Brasil
owning around 70% (38,500) of the total tower AlfaSite
inventory (55,000) of the country. And while at
Torres Online
TowerXchange we remain convinced that the tower
market should be rationalised with towerco-on- 1000 Skysites
towerco consolidations, the time might not be right
Telecom Torres
for the next consolidation phase to start.
1203 Allowance for other small towercos
The fragmented Brazilian tower ecosystem is filled Source: TowerXchange

Average US$/BRL exchange rate 2011-2016
Year US$ BRL
2016 1 3.49
2015
2014
1
1
3.33
2.35
Meetup
2013
2012
1
1
2.15
1.95
Americas 2017
2011 1 1.67
7-8 June, Boca Raton Resort
with PE-backed towercos which have been created since there is hope for the reorganised entity to
on the premises of a successful and lucrative exit participate on a more level playing field with
and Club, Boca Raton
in a relatively short period of time. However, since competitors and perhaps, in due course, resume
the golden years of the Brazilian tower industry network investments. And at the end of the day, no
(2012-2014), the local economy has hit new lows and towerco wants to do business with a distressed MNO.
is now in its deepest recession ever. The Brazilian
Reais has depreciated so heavily against the U.S. The alternative which has been echoed lately
Dollar that returns expectations of PE-investors may sees América Móvil interested in acquiring Oi’s
have to be recalibrated. operations, as declared by its AMX’s CEO Daniel
Hajj in a recent interview with Brazilian newspaper
Just to explain this, investing US$100mn back in Valor Econômico. And this could be now an easier
2011 was 109% more expensive than it is today. deal since TIM Brasil seems officially out of the
A factor which might seem positive for those picture as a potential buyer.
(lovers of risky business) considering any type of
investment in US Dollars in Brazil today but for While 2016 has been a tough year for Brazil, we
those that rid the wave back in 2011-2012 means foresee a slightly brighter future for the months to
the virtual impossibility to bring revenue generated come with economists relatively optimistic about
in Reais back in the States at a profit. Which leaves the country’s overall outlook. It might take some
us wondering what’s the future for PE-backed time for the telecom tower sector to fully recover
towercos? and for the next wave of M&A to resume but when it
A unique networking opportunity with 250 leaders
does, we are bound to see some action in Brazil with of the CALA telecom tower industry
On a more positive note, the bankruptcy of Oi various PE-backed towercos juggling their investors’
- which clearly disrupted the market at first - financial expectations with the reality of two years www.towerxchange.com/meetups/meetup-americas
might not be bad news for the Brazilian industry of slow growth

Plata Tower Company,
TowerXchange: Alex, please introduce yourself
and your career path.
a new towerco entering the Alex Sepehri-Nik, Founder and President, Plata
Tower Company (PTC): Around five years ago, my
Argentinian market partners and I started Brazil Tower Company which

is now the third largest independent towerco in
Brazil. When we entered the country, the sharing
TowerXchange reports on more action in the Southern Cone. And we aren’t surprised!
concept was not popular in the market, and we
faced the resistance of the carriers and at first really
Alex Sepehri-Nik is a serial entrepreneur and one of the
struggled to convince them to work with us.
masterminds behind companies such as Brazil Tower Company
and Arqueiro Telecom. And now he is the Founder and President
The first breakthrough for us happened with
of Plata Tower Company (PTC), the latest entrant in the Argentinian
Telefónica which is now on most of our sites in
tower market (just behind our friends at Innovattel and Tower 3).
Brazil. Once that happened, things started ramping
With the Argentinian government recently passing a new pro-
up quite quickly and we then got the buy-in of the
infrastructure-sharing telecom law, and carriers announcing a
others.
combined four-year investment plan of up to US$20bn, it comes as
no surprise that towercos are making their moves in the country.
I knew that the sharing concept could be extended
And TowerXchange couldn’t be more excited about it.
way beyond towers and, as you know, I got involved
Keywords: 3G, 4G, Active Infrasharing, Americas, Americas in the creation of Arqueiro Telecom last year
Insights, Argentina, Build-to-Suit, Business Case, C-Level offering shared backhaul solutions across Brazil as
Perspective, Co-locations, Country Risk, Infrastructure Sharing, well.
Insights, Investment, Leasing & Permitting, Market Entry,
Market Overview, Network Rollout, New Market Entrant, Plata TowerXchange: From Brazil to a new market…
Tower Company, RAN-sharing, Regulation, Risk,South America, Tell us the story behind it.
Alex Sepehri-Nik, Founder and President,
Plata Tower Company (PTC) Southern Cone, Tax, Towerco Perspective, Transfer Assets
Alex Sepehri-Nik, Founder and President, Plata
Tower Company (PTC): The recent story of Brazil is
Read this article to learn: known to everyone. We went from close to US$1mn
< From the Brazilian years of gold to today’s crisis: what led to the creation of PTC worth of deployments each week down to almost
< Argentina and its openness to the towerco model zero as a result of the combined political and forex
< Carriers’ rollouts and suppliers’ skepticism: what is PTC planning for the near future? crisis. These crisis led to a spending freezing by
< Who invests in towercos? And in Argentina? the carriers and this has been going on until not
long ago. Fortunately, our business was built to be

“
profitable on an operating basis and we were able
to weather this storm.
In the last few months we’ve seen some movements

in the Brazilian market in terms of search rings but
we really need to bear in mind that the country was In Argentina, things are very different from where they were at the
on the brink of a revolution. The impeachment and
removal of Dilma Rousseff has for now contributed
to calming things down but there’s still a way to go
to really stabilise the national political situation.
beginning of the BTC venture in Brazil. The government is extremely
committed to pushing the infrastructure sharing model and is now
working on some new and important telecom laws
“
When the volume of business in Brazil started
declining, I looked for new business opportunities
everywhere, from Mexico south. I applied the
usual criteria of examining the carriers landscape, every appearance to be willing and open to work pushing the infrastructure sharing model and is
acceptance of the sharing model and planned/ with towercos. now working on some new and important telecom
forecast level of spending by the carriers. And this laws. And while permitting remains the biggest
led me to Argentina. And to the creation of Plata On the other hand, every market presents its own hurdle in terms of new deployments, I can see that
Tower Company (PTC). challenges and permitting is extremely complicated changing as well with the new law. In fact, the new
in Argentina, even more than in Brazil! rules will require municipalities to simplify the
TowerXchange: So why Argentina? And how does process and remove certain onerous requirements.
Argentina compare to the beginning of your Until a couple of years ago we were all extremely That will help us a lot just like the Lei das Antenas
Brazilian venture? excited about Brazil and its growth pattern but then in Brazil.
it all fell apart. Brazil is not an easy market to do
Alex Sepehri-Nik, Founder and President, Plata business in, and it never was. We’ve faced so many Additionally, the government has been creating
Tower Company (PTC): Carriers in Argentina have challenges with regards to permitting, carriers’ several tax breaks for investments in new
a considerable level of approved spending for 2017 acceptance and even suppliers driving prices to infrastructure and working to allow the repatriation
and likely 2018 and this to be honest was the key the sky… In a way, we are seeing some of these of funds, which is a crucial point for foreign
factor that convinced me to go ahead. And we aren’t dynamics repeating in Argentina but on the other investors. All in all, I’d say that officials have been
the only towerco that is entering Argentina… There hand, there’s a greater openness with regards to the extremely responsive and they’ve even consulted
are several of the usual suspects sniffing around but sharing model, which is very encouraging. me for some advice based upon our experience with
I think we are quite advanced in our launch plans. similar evolutions in the United States and Brazil.
In fact, PTC has our registered business entity in In Argentina, things are very different from where
Buenos Aires and we are already negotiating our they were at the beginning of the BTC venture in In Brazil for instance, we didn’t get that much
master services contracts with the carriers who give Brazil. The government is extremely committed to interest from the government which sometimes

appeared as even hindering our business. You see, disciplined and look very closely at the demand, the honest, is far from complicated. They are open to
our contracts in Brazil prohibit RANsharing and the supply chain and the permitting environment and, share documentation, contracts, paperwork with us
government went as far as supporting carriers who based on that, ask themselves how many towers they and this is helping us a lot. The level of cooperation
decided to share. We don’t ask the government to be can realistically build. is great.
on our side, we can easily enforce our contracts and
do whatever is needed to ensure that everyone plays We always talk about how many towers a given On the supplier side, things are a bit different. They
fairly, but it is more appropriate for the government country needs. Brazil needs 250,000 sites in the are a bit wary about our entrance in the market as
to stay out of it and simply avoid supporting some next three years… This was the mantra we used they don’t know yet how we’ll affect their work.
of these initiatives. And this is one of my pieces of to listen back in 2012. But if carriers in 2011 built But let me tell you one thing: yes, we are adding a
advice to regulators of new tower markets such as approximately 7,000 sites, how could towercos layer into the ecosystem and changing the dynamics
the Argentinian one. believe they’d be ordering 80,000 the following year? of the supply chain. However, they will end up
And even so, who would supply those towers? And welcoming the change since we will standardise the
TowerXchange: What can you tell us about the who would raise money to build them? model. Our approach to towers is highly specialised
carriers’ plans in Argentina? And what is PTC’s because this is our business and we’ll work with
plan for its launch? Our goal in Argentina is to stick to our working plan. suppliers as much as we can!
It’s been announced that 35,000 sites are needed
Alex Sepehri-Nik, Founder and President, Plata for both 3G and 4G rollouts and we believe that At the end of the day, we are going to order the
Tower Company (PTC): In Argentina, as you know, projections might be slightly on the low side. But we same three variants of towers - hopefully - several
there are three carriers with relatively even market are starting out humbly, building quality products times during the year. Orders will ramp up in
share and aggressive rollout plans for the years to and working closely with suppliers and carriers. Argentina, no matter whether towercos enter or not,
come. All of these three are actively deploying their and we won’t reduce the number of towers needed,
4G networks, and we are proud to help. The fourth TowerXchange: How has the relationship with we’ll just rationalise it.
carrier here is Nextel, and it appears that they have Argentinian carriers been so far? And with
some ambitious plans as well. suppliers? TowerXchange: Do you think that the taxation
regime will improve to allow carriers to
Argentina is getting so exciting that I foresee lots of Alex Sepehri-Nik, Founder and President, Plata eventually sell their assets?
different towercos entering the market. We know Tower Company (PTC): In Argentina, carriers were
that this is inevitable. But as usual, some might anticipating and welcoming our arrival. They’ve Alex Sepehri-Nik, Founder and President, Plata
think doing business here is easy when at the end embraced the infrastructure sharing concept moving Tower Company (PTC): At the moment, it’s simply
of the day, Argentina is a virgin market and will forward and, although they won’t let us build all of prohibitive for anyone to sell towers. However,
require extreme diligence from our side. their towers or really strategic sites for now, they are I believe that the current status of things is
willing to give us a shot which is very refreshing and likely to change in the future, especially since
At PTC, we will only raise money for what we are exciting! the government is so in favour of international
able and are planning to deploy, which has been investments. The big guys will definitely look at
the case with BTC too. I think towercos need to be Carriers are learning our model which, lets be Argentina more closely if and when the divestment

of assets is simplified if not incentivised.
TowerXchange: What types of investors look at

towercos? And how did you get investors to work
with you in Argentina?
Alex Sepehri-Nik, Founder and President, Plata

Tower Company (PTC): In the tower business, we
tend to encounter two types of investors. On one
hand, there are those that already know the model
and have made considerable returns with it. With
these, the approach is very straightforward. They
want to know how much money you want and how
quickly that can be deployed.
Other investors see their competitors making

considerable returns in our industry and want to
know more about it. As previously mentioned, I
think that the independent towerco model is so
simple it’s almost embarrassing. So it’s just a matter
of showing the business case and they’ll be able to
make an informed decision.
I like to summarise it as follows: there’s an asset Buenos Aires
which is going to be built. If it’s built smartly, it In Argentina, country risk has been the biggest carriers go to the moon, you can bet there will be a
will return cash from day one and it will do so for pushback from potential investors. And I didn’t Moon Tower Company there soon!
at least twenty years. The “smartly” bit is up to us, want to be the one to convince anyone to invest in
industry people, to figure out. the country. I needed informed people and firms TowerXchange: Do you think Arqueiro Telecom
committed to my project who already believed, could extend its footprint in Argentina anytime
I think on the investment side Brazil was an easy like I do, that things are going to get much better in soon?
call because at the time there was so many needed Argentina, and soon.
sites and objectively obvious room for towercos. We Alex Sepehri-Nik, Founder and President, Plata
knew we were introducing the sharing model in the All I know is that carriers are going to spend money Tower Company (PTC): Yes, I do believe there is
country but that was possibly the biggest challenge and that we need to be there for them, serving the room for an active-infrastructure sharing type of
we’d encounter. industry and riding this positive wave. If tomorrow company… Stay tuned!

A new towerco with aspirations
your career in the tower business.
across CALA Mario Rafael Álvarez Gutierrez, CEO, Balesia

Towers: I am an architect by training, having
From Puerto Rico to Argentina, Balesia will offer BTS services with an eye on acquisitions graduated in the United States with a degree in
architecture and a minor in business. After college,
Balesia is the only towerco TowerXchange has tracked so I immediately launched my firm thanks to the help
far with existing or planned operations throughout the of my father, Mario Rafael Álvarez, a civil engineer
CALA region, from Puerto Rico all the way to Argentina. from Cuba.
Its CEO, Mario Rafael Álvarez Gutierrez is an architect
who specialised in a new, niche sector such as the telecom My first client was the Los Angeles Cellular Company
tower industry in the United States. In this interview, he back in 1987. At the time, the company was owned
shares with us his background as well as the rationale by the McCaw brothers, who pioneered the cellular
behind the creation of Balesia and his plans for the industry and founded companies such as McCaw
company’s expansion across South America. Cellular (now part of AT&T Mobility) and Clearwire
Corporation. Among my other clients, I designed
and built towers for LA Cellular (now AT&T) and this
Keywords: 4G, AT&T, AT&T Mobility, Americas, is how I started working in the telecom sector. At
Americas Insights, Argentina, Balesia Towers, the peak of my activity, I was a licensed architect in
Bolivia, Brazil, Central America, Chile, Clearwire over forty-five states in the United States and also in
Corporation, Colombia, Costa Rica, Dominican Puerto Rico!
Republic, Ecuador, El Salvador, Guatemala, Haiti,
Honduras, Insights, LA Cellular, LTE, McCaw The firm was called Alvar Architects, Engineers and
Cellular, Nicaragua, Panama, Paraguay, Peru, Puerto Builders and then changed its name to Velocitel LLC.
Rico, South America, Towercos, United States, Over a period of around fifteen years, we designed
Mario Rafael Álvarez Gutierrez, CEO, Balesia Towers Uruguay, Velocitel, the Caribbean and/or built close to 35,000 sites for all major U.S.
and Puerto Rican carriers. In 1999, I sold 70% of
Velocitel to Willis Stein and Partners and became,
Read this article to learn: along with my family, a private shareholder of
< Balesia Towers: a build to suit firm with pan-regional aspirations approximately 30% of the business. Around 2001,
< Doing business in Colombia and Peru: what differs? I retired from the business and to date I still own
< Central America makes business sense if treated as effectively one country around 20% of the company’s stock.
< Balesia’s planned expansion into Argentina
In 2013, I started Balesia Towers with the goal and

“
vision to once more build towers but concentrating TowerXchange: Why have you chosen to invest in
mainly on Latin America. Balesia’s corporate office your particular target tower markets?
is in Madrid and we have a regional office in Lima,
Peru although I am mostly based in the United States. Mario Rafael Álvarez Gutierrez, CEO, Balesia Towers:
The rationale is very simple… With the deployment
we’ve just received a green
TowerXchange: What is Balesia’s geographical of 4G LTE, the demand for new towers in Latin
footprint? What is the pedigree of your
management team? Does Balesia focus on Build-
to-Suit (BTS) only or is looking at acquiring
portfolios as well?
America is going to be overwhelming for the next
five years.
TowerXchange: Please tell us the differences of

doing business in Peru vs Colombia.
light from our banks to start a
business in Argentina, as long as
our contracts with carriers are
stipulated in U.S. Dollars
“
Mario Rafael Álvarez Gutierrez, CEO, Balesia Towers:
Balesia is present in Peru, Ecuador, Guatemala, Mario Rafael Álvarez Gutierrez, CEO, Balesia Towers:
Colombia, Nicaragua, Costa Rica, El Salvador, To date, Peru presents a very flexible set of laws that And if so, how do U.S. investors feel about it?
Honduras, and Chile. And we are in the process facilitate the installation of new towers. The process
of starting offices in Argentina, Bolivia, Paraguay, is much easier now than it used to be and there’s Mario Rafael Álvarez Gutierrez, CEO, Balesia Towers:
Uruguay, Dominican Republic, Puerto Rico, Brazil, less competition among tower builders. We have just hired our new General Manager in
Panamá, Haiti and the Caribbean. Argentina and are anxious to start building sites!
On the other hand, Colombia is experiencing a huge And we’ve just received a green light from our
Our personnel holds a combined 150-year experience wave of competition among tower builders and banks to start a business in Argentina, as long as our
in the sector and we have a very strong family we find that there are less opportunities for new contracts with carriers are stipulated in U.S. Dollars.
culture within the company. We work extremely business with the local carriers.
hard, striving to provide excellent customer service TowerXchange: Please summarise your vision for
while making sure we take care of the team. TowerXchange: And what about Costa Rica, the future of your company.
Guatemala and Honduras - how do they compare?
We focus on BTS but also look at potential portfolio Mario Rafael Álvarez Gutierrez, CEO, Balesia Towers:
acquisitions. Mario Rafael Álvarez Gutierrez, CEO, Balesia Towers: My vision is the same that I had back in 1987. Back
I tend to look at Central America as effectively one then, I wanted to build a large tower portfolio and
TowerXchange: What are the key challenges of country. And this is why we have a few sites in hold on to it, full stop. But I wasn’t able to succeed
operating in the Build-to-Suit market right now? certain countries and many in others… We treat the at Velocitel since Willis Stein and I didn’t share a
region as a whole which helps making sure that our common vision and strategy.
Mario Rafael Álvarez Gutierrez, CEO, Balesia Towers: local operations make business sense.
The number one challenge we are facing today is the Now I have the resources and partners to make sure
increased competition among tower builders. Other TowerXchange: What is your view on Argentina? I realise my dream and I am very excited about the
details are all very manageable! Are you exploring opportunities in the country? future of Balesia Towers

subscribers in Mexico have a pre-paid account.
Share Square: Mexico There are three mobile operators serving the
Mexican market (see figure 1), with Telcel
(América Móvil) enjoying a dominant position
3 main MNOs: Telcel (América Móvil), Movistar (Telefónica) and with 70.5m connections and 68% market share,
AT&T. Telcel dominates the market with 68% market share
Active
significantly ahead of Movistar (Telefónica)

There were 103.5mn mobile subscriptions at the end of 2015,
giving a mobile penetration of 81% - relatively low for Latin with 24.3m connections (24% share). AT&T has
America and in comparison to many markets around the world
8.7m connections (8% share).
By the end of 2015 there were 52.4mn 3G connections (51% of all
Current Sharing
connections) and 7.5mn 4G connections (7%)

2.5GHz auction and 700MHz open access network tender due in Key mobile developments
Passive
2017
América Móvil declared as having SMP and Telecel towers spun
off into Telesites towerco. Has 13,873 towers, of which 1,108
were built in 2015 Telcel’s dominant market share of 68% is a highly
Mexico
Other towercos include: ATC, MTP, Centennial, IIMT and significant factor when considering the dynamics
Torrecom
of the Mexican mobile market – being particularly
There are thought to be around 25,000 towers in the country.
Circa 70,000 towers will be needed if Mexico is to achieve 90% high for a market with such a large number of
mobile coverage
None
With Ifetel acting to balance market, towercos already active

subscribers. Whilst there has been considerable
and many new towers needed there is good potential for consolidation in the market in the past two years
towercos
– with the number of MNOs decreasing from five
3G 4G to three as AT&T acquired Nextel and Iusacell,
the dominance of Telcel has not been diminished
Technology Deployment
significantly by these moves yet. Telcel’s
Opportunity for towercos entry with Opportunity for Outsourcing Limited opportunity for new dominance has had implications for subscriber
focus on high Lease Up Rate (LUR) by MNO to towercos entrant towercos
and coverage growth and for the tower market.
The fact that there are only three operators is also
Figure one: Mobile subscriptions market share Mobile market overview notable – Brazil, another large Latin American
market, has seven and it is not uncommon for far
8%
Mexico had an estimated population of 127.8m smaller markets to have four or five operators,
Telcel people and 103.5m mobile subscriptions at the despite a global trend towards consolidation. The
24% end of 20151, giving a mobile penetration of 81% - three largest operators in Brazil all have similar
Movistar
relatively low for Latin America and in comparison market shares to one another, all lower than 30%,
68% AT&T to many markets around the world. Indeed, all of and this makes for a very different competitive
the other principal countries in Central America dynamic than in Mexico where a single player
have mobile penetration of over 100%. 87% of holds nearly 70%.

3G services were first launched in Mexico in 2005 and post-paid users can access the network for no acquired all of Iusacell’s wireless properties,
by AT&T (operating as Nextel at the time). Telcel and extra cost. including licences, network assets, retail stores and
Movistar followed in 2008. By the end of 2015 there approximately 9.2 million subscribers. The Iusacell
were 52.4m connections (51% of all connections), of Movistar Mexico’s initial aim was to reach the 4G wireless network covered about 70% of Mexico’s
which 40.0m were with Telcel (74% - slightly higher coverage milestone of reaching fifty regional markets population at the time.
than its market share overall). by the end of 2015, rising to 300 by 2018. In May
2016 it announced that it expected to extend its 4G In early 2015 AT&T also reached an agreement
Mexico still lags behind many markets in terms LTE network to 23 new regional markets and 500 with NII Holdings to buy Nextel Mexico, with the
of geographic and population coverage, with rural communities, via the deployment of 1,700 new deal underlining the U.S. telco’s strategic shift into
demand for services outstripping supply and base transceiver stations (BTS). New areas set to be the Mexican market. The deal for Nextel Mexico
quality of service inconsistent. The demand for covered include Aguascalientes, Cancun, Cuernavaca, covered all of NII Holdings’ wireless properties in
greater coverage means a requirement for more Merida, Torreon, Veracruz and Villahermosa. the country, including network assets, retail stores,
towers – meaning potential for both existing and three million subscribers and spectrum licences.
new towercos, particularly if the stranglehold of In 2015 AT&T suggested that it would likely be No competing bidders emerged to challenge
Telcel on the market can be loosened. Whilst 4G around 18 months before AT&T could deliver AT&T’s initial offer, cash-strapped Nextel owner
is gathering pace, it will co-exist with 3G for the a “good, robust” 4G Long Term Evolution (LTE) NII Holdings having filed for relief under Chapter
foreseeable future so both coverage and capacity experience beyond urban areas in Mexico. Indeed its 11 of the U.S. Bankruptcy Code in September 2014.
increases need to be catered for. initial focus was to deploy LTE rapidly in urban areas The acquisition was completed in May 2015. AT&T
and on road transport links – acknowledging that paid US$1.88 billion for Nextel, less approximately
Rollout of 4G in rural areas widespread coverage would not be US$427 million of net debt and other adjustments.
achieved for some time. By April 2016 AT&T was able
4G services were launched by Telcel and Movistar to announce that its LTE network was now available Fierce Wireless stated that Iusacell controlled
towards the end of 2012, with Nextel (since acquired to 45 million potential customers in 42 Mexican between 20MHz and 25MHz of 800MHz spectrum,
by AT&T) following in 2014. By the end of 2015 there cities, and by October 2016 this had increased to primarily in the southern half of the country,
were 7.5m 4G connections (7% of all connections). covering more than 70 million people in 144 cities including Mexico City and Guadalajara, and an
Again, Telcel had the most connections – 5.6m (75% across the country. Going forward, AT&T has stated average of 39MHz of PCS spectrum on a nationwide
of all 4G connections). that it expects to cover 75 million people, nearly two- basis. Meanwhile, Nextel is said to have presided
thirds of the Mexican population, by the end of 2016, over 20MHz of 800MHz spectrum and 30MHz
In June 2015 Telcel announced that its 4G Long and 100 million people by the end of 2018. of AWS spectrum. As a result it claimed that
Term Evolution (LTE) network covered 14,500 the substantial frequencies give AT&T ‘a better
Mexican towns and cities. The MNO noted that its Operator activity spectrum position in Mexico than anybody’. The
network footprint was equivalent to a population new AT&T venture also came into the market as
coverage of 65.5%. Telcel claims to have forty In January 2015 AT&T Inc finalised its US$2.5 billion the second biggest revenue earner, comfortably
4G-compatible devices, and notes that both pre-paid acquisition of Iusacell from Grupo Salinas. AT&T surpassing Movistar in terms of revenue. With

its takeover of Iusacell and Nextel, AT&T planned It has also started deploying Ericsson’s Radio Dot In June 2016 it was announced that a further
to create the first ever ‘North American Mobile System small cells to improve mobile broadband five new MVNOs were set to launch in Mexico
Service’ area covering more than 400 million coverage in Mexico City. The Spanish-owned after a series of deals were signed with Telcel.
consumers and businesses in Mexico and the U.S. operator contracted Ericsson to install 1,080 Radio The first virtual operator expected to go live was
Randall Stephenson, AT&T chairman and CEO, Dot Systems in facilities including office buildings, Cuauhtemoc-based Buenocell, while other players
stated: “It won’t matter which country you’re in shopping centres and airports that are otherwise were named as Inaecom, Neus Mobile, Quickly
or which country you’re calling – it will all be one difficult to cover using existing networks, with Phone and Maxcom. The last named company,
network, one customer experience.” However, project completion scheduled for end-2016. The which has operated an underperforming MVNO
AT&T emphasised that it will be several years before small cell architecture supports both 4G LTE over the Movistar network since September
it is able to compete with Telcel on an even footing – and 3G W-CDMA indoor coverage. Movistar 2007, has awarded an MVNE contract to XIUS, an
with a heavy investment period planned. was quoted as saying that in the short term is operating brand of India-based Megasoft Limited
envisaged the implementation in 50 facilities as well as launching an MVNO in an alliance with
Movistar (Telefónica) was in the news in February within Mexico City. supermarket chain Soriana. MVNO Maz Tiempo
2015 because Francisco Gil Diaz, Telefónica’s also announced in September that had migrated
regional chairman for Mexico and Central America, MVNOs its business across to an MVNE platform built by
urged the Madrid-based telecoms group to move Austrian vendor I-New.
quickly or risk being left behind by the wave of There are numerous MVNOs active in the Mexican
consolidation sweeping the Mexican telecoms market – with a string of launches of MVNOs based Spectrum
sector. The burst of M&A activity which saw AT&T on Movistar’s network announced in the last five
Inc buy Iusacell and Nextel back-to-back was years, including Virgin Mobile Latin America 2.5GHz
perceived as leaving Movistar Mexico looking (VMLA), Lycamobile, Maxcom, Megacable, Ekofon, In August 2012 the government reclaimed spectrum
slightly vulnerable, with the Telefónica-backed under the ‘Cierto’(True) brand, Maz Tiempo, in the 2.5GHz band from eleven companies, while
operator’s rumoured tie-up with pay-TV giant Grupo QBoCel, Pepephone and weex (in association with also revealing plans to refarm the frequencies
Televisa having collapsed. An exit from Mexico was Austrian mobile virtual network enabler I-New). for the deployment of 4G technology. The
not an option given Telefónica’s US$13.5 billion In 2016 Movistar subsequently announced plans Instituto Federal de Telecomunicaciones (Ifetel)2
investment over the past twelve years. to start hosting a further five new MVNOs over its subsequently stated in July 2015 that it would
network during the second half of 2016. Simpati redistribute the spectrum for both frequency
In May 2016 Movistar announced plans to spend Mobile, also enabled by I-New, went live over the division duplex LTE (FDD-LTE) and time division
MXN3.4 billion (US$184.8 million) to replace its Movistar network in September, and October 2016 duplex LTE (TD-LTE) usage from 2016, as part
fibre backbone in Mexico, and that it was also saw the launch of a further Movistar based MVNO of its National Radio-electric Spectrum Plan
seeking to expand its LTE network coverage. Local in the form of Flash Mobile, which is supporting (Plan Nacional de Espectro Radioelectrico). The
press reports stated the company will be installing 4G connectivity from launch. In addition to all of regulator took the decision after considering
DWDM technology running at 100Gbps to replace its these Movistar supported MVNOs, Movistar has its recommendations from the ITU and the Comisión
existing legacy infrastructure. own Tuenti sub-brand. Interamericana de Telecomunicaciones (CITEL).

Local reports had also suggested that AT&T had Ifetel confirmed that following the auction, mobile providers, and which would have exclusive
approached Ifetel with a request for a 50MHz Telcel will hold a total of 41.2% of the available use of a 90MHz block of spectrum in the 700MHz
block of frequencies in the 2.5GHz band. In August International Mobile Telecommunications (IMT) band.
2016, IFT revealed that the auction for LTE-suitable spectrum in Mexico, narrowly ahead of AT&T
spectrum in the 2.5GHz band (2500MHz-2690MHz) (38.2%). Movistar – which opted not to participate In October 2014 Mexico’s Secretario de
would be delayed until 2017. The tender – which in the process – holds a total of 19.5%, while the Comunicaciones y Transportes (SCT) and Ifetel
was scheduled to be held in the second half of 2016 remaining 1.1% of spectrum is held by construction signed a series of framework agreements to the
– was pushed back to coincide with a change in firm Grupo SAI. Movistar decided not to take part network to launch in 2018. In September of that
the bidding schedule for an open access wholesale following a spectrum swap in December 2015 year the authorities received their first bid to build
network with exclusive use of a 90MHz block between Movistar and AT&T worth US$168 million. the network from a mystery consortium assisted by
of spectrum in the 700MHz band (delayed until The transaction involved a 10MHz block of Personal vendor duo Alcatel-Lucent and Ericsson.
January 2017). In the meantime, studies will be Communications Service (PCS) spectrum in the
carried out to define the size of the blocks to be 1900MHz band transferring to Movistar, while AWS In May 2015, the government subsequently cut the
assigned, the band’s uses and spectrum caps. spectrum in the 1700MHz/2100MHz band reverted estimated investment required for the wholesale
to AT&T. mobile broadband network by almost a third, to
AWS US$7 billion. This was because the view was taken
In May 2016, Telcel subsequently requested that the Mexican mobile landscape had changed
In February 2016 Ifetel carried out a Combinatorial permission to swap its AWS-3 spectrum with its dramatically since the reform legislation was enacted
Clock Auction (CCA) for Advanced Wireless Services rival’s allocation, in order to secure contiguous – with AT&T putting together back-to-back deals for
(AWS) spectrum, which generated a total of blocks of spectrum in the 1710MHz-1755MHz Iusacell and Nextel Mexico – the country’s third and
MXN43.7 billion (US$2.4 billion). Telcel committed and 2110MHz-2155MHz bands. This request was fourth largest mobile providers. Monica Aspe, the
to pay a total of MXN31.0 billion for 20MHz approved on 25 May, in an extraordinary session, as Undersecretary of Communications at SCT stated at
(2×10MHz) of AWS-1 spectrum3 alongside 40MHz it is perceived to encourage more efficient use of the the time that: “Mexico’s telecommunications sector
(2×20MHz)in the AWS-3 band4. For its part, AT&T resources. is different today to two years ago, and the tender
secured 20MHz (2×10MHz) of AWS-1 spectrum, for the shared network has to recognise that. […]
paying MXN12.7 billion for the frequencies. All 700MHz – the “Red Compartida” initiative The network shouldn’t be designed as or perceived
spectrum allocations are valid for a period of 15 (Shared Network) as a competitor to the operators that have their own
years. The two companies had thirty days within infrastructure, but as an enabler.” The reduction in
which to pay their preliminary licence fees, In 2013 a plan for a state-owned mobile wholesale the budget required was made chiefly because it was
although the full cost of the concessions are spread network was written into Mexico’s constitution assumed that the number of cell towers required will
over the course of the licences’ 15-year lifespans. as part of a sector overhaul designed to curb the be closer to 12,000 than 20,000.
Initial payments were set at MXN2.1 billion dominance of Telcel. The plan called for groups
(US$117.4 million) for Telcel and MXN1.0 billion for of private companies to bid for the right to build In July 2016 Ifetel stated that it will delay its
AT&T. and run the network, which would rent capacity to announcement of the winners of the nationwide

700MHz open access network tender until 17 In March 2014 Ifetel confirmed that it had body, the Comisión Federal de Competencia, from
November 2016, citing the complexity of some 900 determined that América Móvil held significant declaring them dominant. However, under the
queries submitted by the bidders, as well as certain market power (SMP). The decision meant that updated legislation Ifetel now became the highest
requests from international financial institutions América Móvil would now be subject to tougher authority on antitrust issues in telecoms and
interested in backing the project. The SCT was regulation, although it was also confirmed that broadcasting, while separate legal changes meant
initially expected to declare the tender winners on Ifetel was not planning to push for the break-up of companies could no longer suspend regulatory
24 August. In light of the postponement, interested any companies at this time, with such actions only decisions pending appeal.
applicants had until 20 October to submit bids. Final expected to be taken as a last resort.
contracts will be signed on or before 27 January There were several unsuccessful attempts
2017. Secondary legislation to underpin the Mexican during this period by América Móvil subsidiaries
government’s efforts to boost competition in the and associated companies to block the market
Regulation country’s telecoms sectors was put before Congress dominance rulings via injunctions. Around this
shortly afterwards, and was finally approved in time América Móvil announced plans to sell assets
In December 2012 Enrique Peña Nieto took office July 2014. This included giving Ifetel extensive in Mexico, with a view to lowering its market share,
as Mexican President, and in June 2013 he signed powers to police dominant telecoms operators, in order to cease being a “preponderant economic
legislation designed to enhance competition, as with control over elements such as tariffs and agent”. The telco noted that as-yet unspecified
part of which a new regulatory agency, Instituto discounts, as well as the ability to force operators to assets “must be sold at market conditions at their
Federal de Telecomunicaciones (Ifetel), was created seek approval every year for interconnection and commercial value”. Further, it was announced
– replacing former regulator Cofetel. Cofetel’s infrastructure sharing terms, extending right up to that all of the company’s base stations, including
attempts to attract a new international player into being able to order asset divestitures. Ifetel made towers and related passive infrastructure, “will
the market had not been successful, perhaps owing it clear, however, that it could repeal measures be separated from Telcel for their corresponding
to the very dominance of the Carlos Slim owned against Telecel and Telmex once their hold on operation and commercialisation to all interested
América Móvil and a perception that attempts to the market had been loosened. The secondary parties”.
counter it had so far failed. Ifetel immediately set legislation outlined one way in which it might do
about examining means to even the competitive this, with the document noting: “The predominant However, Ifetel subsequently made it clear to Carlos
playing-field in Mexico, one of the first ideas being economic player will cease to have such character Slim that he could not present a plan to sell off a
to examine a number of options for the creation when Ifetel determines that its national market portion of América Móvil’s assets to the regulator
of an independent operator that would use the share, considering the variables used to declare it without having an independent buyer lined up.
700MHz band to provide wholesale broadband predominant, have been reduced below 50%.” For América Móvil to avoid the new measures the
services – the “Red Compartida”. Around the same Many of the powers detailed in the secondary laws sale must be approved by Ifetel, but the watchdog
time the government also worked on a deal with did actually already exist under Mexico’s previous said it would not consider América Móvil’s plan
those companies holding spectrum in the 2.5GHz telecoms law, although Cofetel had been unable to until a buyer had been confirmed, as it would not
band under in order to recover a significant portion apply them because companies had been able to be able to verify the purchaser’s independence.
of such frequencies. file injunctions preventing the previous antitrust Ifetel emphasised that suitors for América Móvil’s

surplus assets in Mexico would have to prove they deployment, access and sharing of telecom and or will be held by entities directly or indirectly
were completely independent from the Carlos broadcasting infrastructure.” – with a deadline for controlled by the Slim family. Nevertheless, other
Slim-controlled group, beyond simply making sure responses of the November 18. operators have access to these towers, although
there were no direct financial ties – meaning that initially Telcel was the principal tenant. It has been
personal and historic relationships would also The Draft aims to promote and encourage sharing stated that the new entity will take active steps to
be scrutinised. This was pertinent at the time as and deployment of infrastructure by increasing expand its network footprint, improve its tower
one of the potential suitors for América Móvil’s the supply of infrastructure in the country and locations and increase its number of tenants. The
assets was AT&T – a board member of which had ensuring the optimal use of existing infrastructure, Telesites spin-off instantly created Latin America’s
served as the CEO of Telmex. Ifetel also requested seeking to lower the costs of deployment and second-largest wholesale supplier of tower space,
several modifications to the proposed wholesale operation of infrastructure, and removing barriers after American Tower Corp, Bloomberg claimed. In
reference offers of Telmex and Telcel, following “a to entry into the telecoms and broadcasting sectors early 2016 Telesites reported a portfolio of 13,873
thorough analysis” of the documents. It requested to promote greater competition. towers, of which 1,108 were built in 2015. Shortly
the two operators submit wholesale offers for the after its establishment both AT&T and Telefónica
following services: leased lines, access and passive The tower sharing market reported they were in discussions regarding deals to
infrastructure sharing in fixed networks, access and rent towers from Telesites.
passive infrastructure sharing in mobile networks Whilst tower sharing has not been mandated,
and mobile virtual network operators (MVNO). tower companies have been active in Mexico for After Telesites, ATC is the biggest towerco player in
several years, in spite of the strangle-hold Telcel Mexico with some 8,870 towers at the last count. It
In March 2015 América Móvil staged talks with holds on the market – with the most notable players was the first tower company in Mexico and started
Ifetel to discuss the former’s plans to spin off until recently being American Tower Corporation acquiring towers when carriers initially decided to
around 11,000 mobile masts belonging to Telcel (ATC), Mexico Tower Partners (MTP), Inversiones e divest their passive infrastructure portfolios.
into a dedicated infrastructure company – which Infraestructura Mexicana en Telecommunicaciones
would rent the towers out to Telcel’s fellow mobile (IIMT), Centennial, Torrecom and QMC. MTP is the next biggest player with 1531 towers
operators, as a means of levelling the playing when last reported. MTP was founded Digital
field. The move, which became a reality later in However, in 2015 a significant change to the balance Bridge along with Macquarie Mexico Infrastructure
2015 with the creation of Telesites, was part of of the tower market occurred with the creation of Partners, and has a model whereby it outsources
América Móvil’s long-term strategy to cease being a Telesites, an entity created by spinning off around most of its acquisition and construction to partners
“preponderant economic agent” and escape tougher 11,000 Telcel towers. The spin-off represents part – working with local towercos which build towers
regulation. However, the move was not enough in of a restructuring plan América Móvil devised in to then sell them to MTP – taking advantage
its own right to achieve that aim. response to strict regulations designed to curb its of the local knowledge and expertise of those
market dominance in the mobile and fixed markets companies with regard to working effectively in
More recently, in October 2016 Ifetel issued – although it should be noted that, as TowerXchange local conditions. It the past it has stated it has the
a consultation on infrastructure sharing – has indicated in the past, 97% of both América capacity and resources to build up to 500 new sites
namely “Proposed draft guidelines for the Móvil and Telesites shares with voting rights are per year.

Of the other key players, Centennial is thought to been in existence in Mexico for a number of years
have around 400 towers and IIMT is thought to own and a number of leading players know how to
Guest columnist Ed Siegle
around 450 towers. Torrecom has 208 towers, at operate there, and yet most experts seem to agree:
the last count, as part of a Central American focus Mexico does not have nearly enough towers to suit
which also includes towers in Guatemala, Honduras its future needs.
and Nicaragua (having previously divested assets in
Costa Rica). On the other hand the market is not without its
difficulties – for example, with the regard to the
In total there are thought to be around 25,000 process for gaining permits, with decisions made
towers in the country. It has been reported that at the municipal level, and a large number of
something like 70,000 towers will be needed in municipalities to deal with. Pricing is reported
Mexico if it is to achieve 90% mobile coverage – to be very competitive and tower prices high
meaning there is huge potential for additional compared to other Latin Market (driven by a lack
towers to be built. of supply).
Ed Siegle is a Principal Consultant in Mott
Conclusions As has long been the case, the success of Ifetel’s MacDonald’s Technology & Communications
efforts to open up the market and loosen the grip Division. He has 20 years of experience
Whilst the dominance of Telcel is still very much a of Telcel will be key to the growth of the market as a consultant, primarily focused on the
reality, the creation of Telesites, advent of AT&T as in general and the tower infrastructure required telecommunications industry, working for
operators, vendors, investors, regulators and
a disruptive force planning to invest heavily, and to enable this growth. As it stands, many positive
public sector organisations. His particular
the regulatory changes underway in the Mexican moves have been made, but Telcel’s market share
expertise lies in market analysis, commercial
mobile market are positive for the tower industry still stands at close to 68%. It will be fascinating to due diligence, product and market strategy
and bode well for the requirement for sites. see if the regulatory and market developments in development, demand forecasting and business
evidence in the last two years truly bear fruit over case production.

Indeed, a number of other factors could be said the next five. If they do, the potential of the tower
In the course of his career he has worked for
to be broadly positive with regard to the future market in Mexico is vast clients in the UK, Europe, the USA, Africa and
potential of the tower market: mobile penetration Latin America. He has spent over 2 years living
is low in a country with a high population and 4G and working in Latin America, including 18
is the early stages of roll-out, both of which bode Sources: months in Brazil where he helped establish
well for future coverage (and capacity) expansion 1. GSMA new offices for two consultancies. Over the past
3 years he has been part of a Mott MacDonald
and the need for more towers. The Red Compartida 2. The Regulator of Telecoms and Broadband in
team commissioned to execute a series of
shared wholesale network will also create Mexico (also known as IFT)
advisory projects for towercos looking to invest in
opportunities, and the 2.5GHz auction is also a 3. 1710MHz-1725MHz/2110MHz-2125MHz developing markets
positive event on the horizon. The tower market has 4. 1755MHz-1780MHz/2155MHz-2180MHz

Regional coverage:
MEA features
In this edition of the journal, we offer readers a comprehensive report on Don’t miss:
the fourth annual TowerXchange Meetup Africa and Middle East which took 294 The top 20 tips for achieving operational excellence
place on 19-20 October in Johannesburg. Over 300 industry experts joined us 300 Deepening the level of infrastructure sharing at Orange, Telenor, Safaricom
for 11 panel debates, 38 focussed roundtable discussions and four working and Cell C
groups; read insights from key discussions on site. 306 Energy priorities for sub-Saharan African MNOs and towercos
309 Financing options and exit strategies for MEA’s towercos
Additionally, TowerXchange examine Moody’s rating of IHS, drawing 312 M&A, towerco consolidation and maturation in sub-Saharan Africa
conclusions on how the capital markets view risk and return in Africa’s 316 MNO passive infrastructure strategies in MENA
towerco market. Plus we interview two towercos; Towerco of Madagascar 320 Improving urban and rural coverage in East Africa
whose site count now exceeds 1000 towers, and Al Karama Towers, Senegal’s 325 A shake-up of South Africa’s telecoms infrastructure
first towerco who have an appetite for Africa’s tier two MNO portfolios. 330 Energy, RMS and civil works working group reports

How Moody’s rated IHS*
IHS Netherlands Holdco B.V. and IHS Holdings Ltd
In order to examine the rating of IHS by Moody’s it

An in depth look at their credit opinion and the light it sheds on the investability is first important to understand the organisational
of SSA’s largest towerco *rating applies to IHS Netherlands Holdco B.V. structure of the company. IHS Netherlands Holdco
B.V. is a subsidiary of the broader tower group IHS
Holding Limited and owns 100% of IHS Nigeria
On 28 October 2016 IHS Netherlands Holdco B.V., which owns
Ltd and 100% of IHS Towers NG Limited (formerly
100% of IHS Nigeria Ltd, announced the successful launch of
known as HTN Towers, the acquisition of which
an $800mn high yield corporate bond issue which was listed was completed on 10 June 2016 earlier this year) -
on the Irish Stock Exchange. The bond, with a 9.5% coupon see figure one. IHS Netherlands Holdco B.V. owns
and a maturity date of 2021, is the largest high yield corporate 6,351 towers in Nigeria and also has full operational
bond to come out of Africa outside of South Africa and was control of IHS’s 49/51 joint venture with MTN
assigned a Ba3 rating by Moody’s. In conjunction with the governing 9,038 towers. IHS Holding Limited owns
rating of the bond, Moody’s also assigned a B1 corporate 22,961 towers across five markets (see figure two).
family rating to IHS Netherlands Holdco B.V. which provided
interesting insights into the assessment of the Sub-Saharan The issuance of a US$800mn bond
towerco business by this ratings agency. TowerXchange
examine Moody’s credit assessment of the towerco. The $800mn high-yield corporate bond with a 9.5%
coupon was issued by IHS Netherlands Holdco B.V.
and was listed on the Irish Stock Exchange, with
Keywords: 3G, 4G, Africa, American Tower, Bankability, Best of TowerXchange, Build-to-Suit, Business
a high level of demand from investors, including
Model, Capacity Enhancements, Capex, Cashflow Finance, Co-locations, Country Risk, Debt Finance,
those that had not previously placed investments in
EBITDA, Energy Efficiency, Exit Strategy, Forex, Indonesia, IHS, Infrastructure Sharing, Investors,
the asset class. The bond was assigned a Ba3 stable
IPO, Moody’s, Network Rollout, Nigeria, Operational Excellence, Private Equity, Protelindo, Risk, SBA
rating by Moody’s, one notch above the B1 rating
Communications, Solar, Tenancy Ratios, Tower Bersama, Tower Count, Towercos, USA, Valuation
given to IHS Netherlands Holding B.V. In rating the
bond, Moody’s took into the account the nature of
the capital structure of the company which included
Read this article to learn: a deeply subordinated amount of shareholder debt.
< The structure of IHS Holdings Given the substantial junior component in the capital
< Details of IHS’s US$800mn bond and how it will be used structure representing around 50% of total debt
< Factors affecting Moody’s B1 rating of IHS Netherlands Holdco B.V. Moody’s assigned a one notch higher rating to the
< How IHS’ rating compares to that of other towercos bond compared to the company reflecting a rate of
< Key learnings other towercos should take from the rating recovery above B1 for bond holders under the rating
agency’s loss given default assessment.

ofile benefits from being part of a broader towers group providing further financial strength and operational experience
and shareholding proforma for bond issuance
Figure one: IHS Holding Limited’s group structure Commenting in the press release announcing the
bond, Issam Darwish, Executive Vice Chairman and
Source: Moody’s Investors Service
CEO of IHS said “We are delighted to have completed
the largest high yield corporate bond ever issued
out of Africa [excluding South Africa]. This is a
major milestone for us, refinancing IHS Nigeria
and IHS Towers NG Limited’s (formerly known as
Helios Towers Nigeria Limited) existing debt and
underwriting the build programme of new towers.
The quality investor demand is a testament to IHS’s
strong business fundamentals.”
Factors contributing to Moody’s rating of IHS

Cote d'Ivoire
1. Confidence in the towerco business model

In Moody’s assessment the towerco model in general
with its annuity-like contracted cash flow streams
is an attractive and low risk business model. The
ability to forecast revenues with a high degree of
certainty due to the long term contracts in place
helped contribute to IHS’ B1 rating. Contrast this
to an industry such as the retail sector with highly
variable revenues and the towerco business model
has a much lower credit risk.
2. Counterparty risk
Over 90% of IHS Netherlands B. V.’s revenue comes
from MNOs whose parent companies have credit
ratings of Baa3 or higher. Etisalat is one of the
highest rated MNOs globally (Aa3 negative), Bharti
Airtel is rated Baa3 stable and MTN is rated Baa3
(although with a negative outlook owing to the
repatriation challenges faced by MTN Nigeria and
Irancell, resulting in MTN being more reliant on cash
flows outside its key markets and on debt to fund its
higher capital expenditure in South Africa).

Figure two: IHS Holding Limited’s portfolio of 22,961 towers Whilst IHS’s contracts are normally signed with the
local opcos whose credit risk would likely be higher
than their parent companies, Moody’s took into
Nigeria: 15,389 Cote d’Ivoire:
account the parent company ratings. With IHS having
2,429
agreements in place with each of the operators in
at least two different countries, they felt that the
likelihood of a default by the local opco would be low;
should the MNO lapse on one contract it would put
IHS Netherlands Holdco: 6,351 them at risk as IHS pulling the contract in the other
country and as such, the parent company would most
Cameroon: 2,409 likely step in.
JV with MTN (IHS 49%, MTN 51%): 9,038
3. Liquidity metrics
With access to a Nigerian Naira equivalent capex
facility of up to US$150mn and a US$69mn undrawn
facility on a subordinated US$900mn intercompany
shareholder loan, Moody’s felt that IHS, along with
Zambia: 1,967
their operating cash flow and existing cash balances,
had sufficient liquidity to meet their new site rollout
and tower maintenance plans for the years ahead.
What’s more, the ability of IHS to delay expenditure
Rwanda: 767 in the short term if so required offered further
confidence in the company’s ability to meet its
Source: Moody’s Investors Service
liquidity requirements.
Figure three: Bond issue characteristics The strong committed financial support from parent
company, IHS Holdings Limited was a key factor
Total amount of the issue US$800mn in improving the rating of the restricted company.
A history of equity injections via the US$900mn
Maturity 27 October 2021 intercompany shareholder loan facility gave the
reassurance that broader group financial support
Coupon 9.50% would be forthcoming should the need arise.
Moody’s issue rating Ba3 4. Operational experience

IHS’ history of operating towers in not only in Nigeria
Listing Irish Stock Exchange
but also in four other African markets via their

low:
Exhibit 14
nancies forecast to increase by 20,000 PoP and technology tenancies expected to grow by over 51,000
parent company has helped the company refine best
-location) Forecast FigurePoP
four:
and PoP and technology
Technology tenancies
Tenancies Forecast forecast by operator
by Operator
practice and excel as a tower operator. Optimising
services including power provision, security and
maintenance has enabled IHS to reach an average
uptime of 99.47% in 1H16 across their Nigerian
portfolio.
Whilst the company is exposed to a degree of

integration risk as the HTN Towers portfolio is fully
incorporated into IHS, their good understanding of
the portfolio and the Nigerian market, experience in
integrating other assets, and use of single portfolio
strategy to sell tower services across all sites in
Nigeria (including the joint venture with MTN) helps
offset some of this risk.
5. Management team
Much of the company’s management team has been
with IHS since their inception back in 2001 and
has a history of managing towers through tough
operational and financial conditions across multiple
s Investors Service Hardiman and Moody's Investors ServiceSource: Hardiman Telecommunications and Moody’s Investors Service Reports
African markets.
plans which includes the addition of 3G and 4G Hardiman Telecommunications Ltd forecast that
6. Scale of revenue and growth potential infrastructure to 7,345 existing towers as well as the number of points of presence and technology
will continue to benefit from a management team which demonstrates a long tenure of successfully operating towers
Based on Moody’s assumption that IHS will generate
the addition of 3,904 new sites by the end of 2017. tenancies for the restricted company will grow by
As part of this, IHS has been awarded a build-to- over 51,000 (figure four) in the next four years.
ther African
revenuescountries.
of $428mn in A significant
2017, their ratingnumber
was of the management team have been with the company for approximately
suit program involving the addition of 1,650 new
constrained by the limited scale of this revenue. IHS
he commencement of initial operations as a constructor of towers for mobile network operators in 2001.
7. Debt/EBITDA ratio
towers as well as the addition of approximately 2,000
Netherlands B.V.’s technology tenancy ratio currently tenancies to existing sites. IHS has a high debt/EBITDA of 8.2x (or 5.2x excluding
sits at 1.9 but given the extent of network expansion the intercompany shareholder loan which exhibits
forecasted in Nigeria, this is likely to increase, adding It is highly likely given MTN’s extensive network certain equity-like characteristics). The predictability
significant cash generation growth potential for the rollout that other MNOs in the market will look of revenues from a towerco business model however
company. to follow suit, which will provide further revenue allow for a greater comfort level with such a debt/
opportunities to IHS and offer further upsides to EBITDA ratio, thus reducing the downward pressure
MTN Nigeria have announced ambitious growth their ratings. on IHS’ rating. Moody’s rating however does

presume IHS’ deleveraging toward 6.5x (or 3.6x To minimise the impact of forex fluctuations, IHS has How does this compare to Moody’s ratings of
excluding the intercompany shareholder loan) by agreed the transition to more regular resetting of the other towercos globally?
2017. US dollar - Nigerian Naira conversion. At present,
23% of contracts are set on a quarterly basis, with The rating of IHS was not only Moody’s first rating
8. Corporate governance strategies 6% semi-annually and 49% annually. By 2018 this of a towerco in Africa but also their first rating
Following investment in IHS by both the World Bank will have transitioned to 48% of contracts being set of a towerco in EMEA, thus precluding direct
(Moody’s; Aaa stable) and the IFC (Moody’s; Aaa quarterly, 6% semi-annually and 18% on annual comparisons in the region. Having rated towercos
stable), IHS undertook significant steps in order to basis. in both the Asian and US markets however, Moody’s
ensure that their corporate governance policies were were able to share interesting insights into how
in alignment with international best practice. Putting 11. Diesel and power various factors have led to the derivation of different
in place processes to prevent bribery and corruption Excluding the cost of depreciation and amortisation, risk profiles.
whilst implementing a robust workplace code of the cost of power represented 48.7% of IHS’ cost of
conduct has further strengthened IHS’ credit profile. sales at 30 June 2016. Whilst after escalations in the In the Indonesian tower market, Moody’s have rated
past year, diesel prices have largely flattened out, Protelindo (Baa3) and Tower Bersama (Ba3), both
9. Sovereign risk exposure to increases in fuel prices remains a risk to higher than IHS’ B1 corporate family rating, largely
Whilst present in five countries, the restricted IHS’ profits. due to the differences in sovereign risk; Indonesia’s
company rated by Moody’s was solely exposed to the is rated as an investment grade country at Baa3, four
Nigerian market, a country with significant political One major positive step that IHS have taken is to notches above Nigeria’s rating of B1. A difference
and economic challenges. The country has however reduce their dependency on diesel. IHS has invested in scale is another element which accounts for
undergone a successful democratic transition a large amount of capital in replacing ageing the difference the ratings. Moody’s rating of IHS
following general elections in March 2015 and is generators with solar-hybrid solutions leading to applied to the restricted company only (although the
the largest economy in Africa, based on purchasing significant savings in diesel usage, a move which has broader group was taken into consideration); IHS
power parity basis. What’s more, the regulatory, also had a positive impact on their credit rating. Netherlands Holdco B.V. owns 6,351 towers whereas
political and economic environment is favourable for Protelindo and Tower Bersama own 14,476 and
towercos at present. Moody’s corporate family rating 12. Ground lease payments and contracts 11,389 towers respectively. One similarity between
of IHS Netherlands B.V. is B1, the same as their rating IHS own the ground under just 15% of their sites IHS and Tower Bersama was their leverage levels,
for the Nigerian government. in Nigeria which opens the towerco up to risks however the differences in sovereign risk, scale and
surrounding lease renegotiations. Failure to renew a longer track record of operations and regulatory
10. Currency risk a lease would require the towerco to relocate their framework in the case of Tower Bersama weighed
The depreciation of the Naira in June of this year site, although since 2012 only three sites have more heavily on the ratings.
hit IHS hard as exchange rates tumbled following had to be moved as a result of failure to extend
the Nigerian Central Bank’s decision to drop the a lease agreement, and as such rent escalations When it comes to the US based towercos rated by
currency peg that had kept exchange rates artificially represent the largest concern. With lease payments Moody’s, the US’s Aaa rating is a major factor which
high for over a year. Directly after the peg was paid upfront in lump sums, typically five or ten accounts for the difference in ratings between them
removed, the value of the Naira fell by 60% against year periods, this could cause certain cash-flow and IHS. When considering a towerco such as
the US dollar and has remained volatile since. constraints around the time that the lease is due. American Tower (“AMT”), however, there are several

other key factors which lead to their Baa3 profile. Figure five: Moody’s ratings of a selection of global towercos
American Tower’s greater geographic diversification Site
Country Footprint Rating
is one of these differentiating factors. American count
Tower owns and operates a portfolio of
approximately 144,000 tower sites across five IHS Netherlands B.V. 6,351 Nigeria B1
continents and 13 countries.
Protelindo 14,476 Indonesia Baa3
AMT’s commitment to operating with moderate Tower Bersama 11,389 Indonesia Ba3
leverage is another key consideration supporting
its Baa3 rating. Although acquisitive, the REIT is American Tower 145,404 Brazil, Chile, Colombia, Costa Rica, Germany, Baa3
committed to operating within its stated net leverage
Ghana, India, Mexico, Nigeria, Peru, South Africa,
target range of less than 5x (or less than 6x including
Moody’s operating lease adjustment). Uganda, USA
Importantly, American Tower’s credit profile SBA Communications 25,878 Brazil, Canada, Colombia, Costa Rica, Ecuador, El B1
benefits from the high visibility into future
earnings. American Tower’s leases are typically
Salvador, Guatemala, Nicaragua, Panama, USA
non-cancellable and include an initial term of 5 to
10 years with multiple 5-year renewals that provide Figure six: Moody’s Global Long-Term Rating Scale
an average 3% annual escalation in the U.S. and a Aaa Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level of credit risk
typically inflation-adjusted escalator internationally.
Aa Obligations rated Aa are judged to be of high quality and are subject to very low credit risk
American Tower’s non-cancellable contracted tenant
lease revenue stood at approximately $32 billion as A Obligations rated A are judged to be upper-medium grade and are subject to low credit risk
of September 30, 2016, that represents nearly seven Baa Obligations rated Baa are judged to be medium-grade and subject to moderate credit risk and as such
times its 2015 property revenue. may possess certain speculative characteristics
Ba Obligations rated Ba are judged to be speculative and are subject to substantial credit risk
Moreover, AMT benefits from favourable land
B Obligations rated B are considered speculative and are subject to high credit risk
interest attributes. AMT owns roughly 28% of the
Caa Obligations rated Caa are judged to be speculative of poor standing and are subject to very high
land under its U.S. sites but over 67% of AMT’s
domestic tower are located on owned land or have credit risk
a ground lease with at least 20 years until renewal. Ca Obligations rated Ca are highly speculative and are likely in, or very near, default, with some
Upon extension, average increase in lease terms prospect of recovery of principal and interest
are typically 25-30 years or more, and the average C Obligations rated C are the lowest rated and are typically in default, with little prospect for recovery
remaining ground lease term is nearly 25 years until
of principal or interest.
final maturity in the U.S. In addition, AMT’s landlord

base is highly fragmented, with approximately 90%
of ground leases held by landlords who own a single TowerXchange viewpoint
site.
What this means for IHS and sub-Saharan
African towercos
AMT elected REIT status beginning in 2012, and the
ratings agency views AMT’s corporate profile as
having more property like credit characteristics.
Three of sub-Saharan Africa’s towercos are
privately owned but largely viewed to be gearing
Meetup Africa
These credit strengths are counterbalanced by
up for some kind of liquidity event in the next 18-36
months. Many feel that IHS’ size precludes a trade & ME 2017
American Tower’s high tenant concentration, sale and that an IPO is the most likely exit for the
especially within its domestic market. The rating is towerco. Whilst rumours are currently circulating 3-4 October, Sandton Convention
also constrained by AMT’s exposure to the risks of that IHS are gearing up for an IPO (the bond is Centre, Johannesburg
major technological transformation and untested thought to be a precursor to this), the company has
alternative use for its properties should such suggested that this is just speculation at present.
dramatic changes occur - risks that are not typically
associated with traditional REITs. Sovereign, currency and counterparty risk,
revenue, liquidity and leverage levels, management
SBA Communications, which has the same B1 rating team and operational experience, ground site
as IHS, owned 25,878 tower sites as of September ownership and oil price exposure are just some
30, 2016. Though SBA does not own the majority of of the factors taken into consideration. IHS have
the land beneath its sites, approximately 70% of its made considerable steps towards offsetting some
towers are located on land that it owns or controls of the perceived risks, steps which other towercos
for more than 20 years via long-term ground leases may well look to follow in a bid to increase their
or perpetual easements. The majority of SBA’s attractiveness to investors.
sites are located in the US (Aaa stable) and leased
Whether now would represent a good time for IHS
under long-term contracts to the largest US wireless
to IPO is up for debate. Whilst success stories such
providers with a concentration to solid counterparty
the listings of Cellnex and Inwit in Europe have
credits, including Verizon (Baa1 stable), AT&T (Baa1
created waves in the public markets, the recent
review for downgrade) and T-Mobile (Ba3 stable).
cancellation of the Telxius IPO by Telefónica and
SBA is subject to a modest amount of currency
postponement of Global Tower’s IPO by Turkcell
exchange risk with roughly 10% of revenue
suggest that there is currently a suboptimal market
generated in non-US dollar currencies, primarily the
for towerco listings The 5th annual retreat for 350 leaders of the
Brazilian Reais. SBA’s rating is the same as IHS, due
African telecom tower community
in large part to its elevated leverage profile, which TowerXchange would like to thank Moody's investor's Service
for their input into the article. Viewpoints represent those
is around 8x total debt to EBITDA on a Moody’s of Moody's or TowerXchange, with the article having being www.towerxchange.com/meetups/meetup-africa
adjusted basis completed independently of input from IHS

Energy innovation and portfolio TowerXchange: TowerXchange last interviewed
Towerco of Madagascar back in 2013, please can
you provide an update on what the company has
expansion at Towerco of Madagascar been up to since then?
How TOM is enhancing its presence in Madagascar and extending to Comoros, Gilles Kuntz, General Manager, Towerco of
La Reunion and Mayotte Madagascar: The company is part of the Groupe
AXIAN, owned by Hassanein Hiridjee, which also
includes TELMA (the number one operator in
Towerco of Madagascar (TOM), a subsidiary of Groupe AXIAN,
Madagascar) and EDM, the national electricity
headquartered in Madagascan capital, Antananarivo, is the leading
company.
towerco in Madagascar and will have a portfolio of 900 sites in the
country by the end of 2016. Groupe AXIAN has further extended its Towerco of Madagascar itself is now five years old,
presence into the Indian Ocean region, managing portfolios of towers celebrating its birthday in October. Our portfolio
in Comoros, La Reunion and Mayotte and has an appetite for further of 780 sites in Madagascar should reach a total of
tower portfolios across the continent. TowerXchange speak to TOM’s 900 by the end of this year (approximately 55% of
General Manager, Gilles Kuntz, to discover more about the company’s the total towers in the country) through both the
expansion and how they are are improving operating efficiencies and deployment of new sites for operators in the market
driving down costs to improve their service to their clients. and through the acquisition of Madamobile’s
towers during the liquidation process following
the collapse of the operator in early 2013. We have
Keywords: 4G, Acquisition, Africa, Airtel, AXIAN, Batteries, Build-
all three MNOs in the market (TELMA, Orange and
to-Suit,Comoros, Energy, Energy Efficiency, Groupe Axian, La Airtel) as tenants on our sites, with TELMA, our
Reunion, Madagascar, Madamobile, Market Entry, Masts & Towers, sister company, being on 90% of sites. Despite a low
Mayotte, Network Rollout, New License, NOC, Off-Grid, On-Grid, Opex tenancy ratio currently, we foresee this increasing
Reduction, Orange, Renewables, Solar, TELMA, Tenancy Ratios, TOM, significantly in the future.
Gilles Kuntz, General Manager, Towerco
of Madagascar
Towerco of Madagascar, Towercos, Uptime, Wind, Wind-IT
In addition to its presence in Madagascar, Groupe
AXIAN has also been expanding its presence in the
Read this article to learn: Comoros, Mayotte and La Reunion strengthening its
< Details of TOM’s footprint and plans for organic and inorganic growth position in the region and expanding its portfolios
< Key mobile market dynamics in Madagascar of assets.
< New green initiatives being piloted by TOM
< TOM’s energy strategy and appetite for technology innovations and new partners TowerXchange: Can you explain some of the
dynamics in the Madagascan telecoms sector and

“
what growth opportunities TOM forecast. TowerXchange: You mentioned previously
that TOM has started operations outside of
Gilles Kuntz, General Manager, Towerco of Madagascar, can you provide more information
Madagascar: Madagascar is experiencing on this expansion.
significant economic and political challenges and
is still one of the poorest countries in the world. TOM is very open to new Gilles Kuntz, General Manager, Towerco of
In order to address the country’s challenges, one Madagascar: Our parent company, Groupe
of the main objectives of the Ministry of Post,
Telecommunications and Development of Numeric
is to improve connectivity throughout the country
and though that to support the local economy,
education and access to improved numeracy for
acquisitions and has been
engaged in a number of active
discussions both in and out of
Madagascar
“ AXIAN, recently acquired the mobile branch of
Outremer Telecom in La Reunion and Mayotte
and was also recently awarded the second mobile
license in Comoros. TOM has taken over all the
tower engineering and infrastructure work for
all. With this in mind, we foresee strong growth in the group in Comoros including the design and
the telecoms sector in spite of the macroeconomic specifications of new sites. We also defined all the
issues the country is facing. maintenance terms of the towers, including the
Madagascar: There are still significant areas to energy component, to accompany and support the
The Groupe AXIAN remains committed to working cover. In terms of population, around 80% of the new team in place. Whilst this brings an additional
with government to alleviate many of the difficulties market is covered. It is unlikely that we will reach number of towers for the Group, TOM as the
in the country. TELMA is currently deploying 4G 100% geographical coverage for a very long period towerco is not directly engaged in the operations as
and optical fibre and after resolution of some of time with much of the country being sparsely there are no plans actually to share infrastructure,
issues surrounding backbone, Orange will also populated, as such, the economics of bringing therefore little co-location potential. We however
be following suit shortly. This presents a big area coverage to certain areas don’t stack up. aim to further develop TOM’s position in these
of opportunity for TOM to get involved in these markets should any strong opportunity arise for
activities. TowerXchange: In addition to build to suit further growth.
strategies for each of the MNOs in Madagascar,
We have been through the budget planning do you foresee opportunities for inorganic TowerXchange: With all this growth, how has the
processes with each of our customers (Orange, growth through the acquisition of tower size of the TOM team grown?
Airtel and TELMA) for next year to pursue our portfolios?
expanding growth and to allow the development of Gilles Kuntz, General Manager, Towerco of
the industry Gilles Kuntz, General Manager, Towerco of Madagascar: TOM has grown significantly in terms
Madagascar: TOM is very open to new acquisitions of the team size and has strong teams in place from
TowerXchange: Are there still significant and has been engaged in a number of active the operational and technical level to financial
coverage gaps in Madagascar? discussions both in and out of Madagascar. We and legal experts. We are fully developed in terms
have an appetite for not only tower portfolios in of process excellence, and have a strong focus on
Gilles Kuntz, General Manager, Towerco of Madagascar but also the Indian Ocean and Africa. budgetary control. We employ around a hundred

“
to reduce energy costs and carbon emissions?
Gilles Kuntz, General Manager, Towerco of

Madagascar: As a company, we are very aware
of our costs, in particular energy, where we are
One of the reasons for us attending TowerXchange in Johannesburg working hard to reduce opex. We have built a
large NOC which oversees all our site monitoring
was to meet with companies who can help with reducing the cost
of power and reducing our carbon emissions. We have been doing
a number of trials, we are looking at renewable energy and new
batteries, examining maintenance levels required and what impact
they have on the environment
“ capabilities from fuel consumption and DG runtime
to battery usage in order to improve costs and
reliability to customers.
We have been examining a number of different

solutions and working closely with all of our
partners. One of the reasons for us attending
TowerXchange in Johannesburg was to meet with
companies who can help with reducing the cost
people directly but through all our partners we and some hybridised solar. Wind IT built the first of power and reducing our carbon emissions. We
contribute to more than 3,000 indirect jobs in prototype in France and have won a number of have been doing a number of trials, we are looking
Madagascar. awards for their system. It is not a typical wind at renewable energy and new batteries, examining
turbine, rather up to four vertical shaft turbines maintenance levels required and what impact
TowerXchange: On the operational side of the can be accommodated into the tower structure, they have on the environment. We have also been
business, can you share with us details of recent generating up 6kWh in production. This is a doing a number of trials for rooftop as well as
projects designed to improve the operational revolutionary design and we have invested in this ground based sites. We see all energy equipment
efficiency of your network? pilot to launch the first proof of concept and pilot manufacturers and providers as our partners and
in Madagascar; if it proves to be successful we will I am really looking for innovative solutions to
Gilles Kuntz, General Manager, Towerco of launch more of these tower sites. The technology improve costs.
Madagascar: We have been particularly focused on should reduce opex and the interesting thing is
providing a wealth of different energy solutions to that the capex is about the same as traditional As a towerco one of main missions is to not only
our customers. You may have seen our initiative towers and energy solutions. Reducing opex whilst provide space but also energy to our customers. We
that we submitted a nomination for the Green bringing real environmental savings is a real see ourselves as energy producers and are looking
Initiative of the Year category in the TowerXchange advantage. It has been a fantastic project to work on at how we can improve power availability and site
Industry Awards in conjunction with Wind IT. We and we expect in to be completed by the end of the uptime, as well as the ability to extend quickly when
have deployed the first prototype on the continent year. customers want to increase capacity. Our sites each
of a tower with an integrated wind turbine which have their own unique features and power systems
will power the site in conjunction with batteries TowerXchange: Is this part of a broader initiative must be designed accordingly

The sale of sub-Saharan Africa’s TowerXchange: M&A Capital have just announced
the acquisition of Expresso Telecom’s 450 towers
in Senegal and in doing so, created the first
tier two MNO tower portfolios begins independent towerco in Senegal - Al Karama
Towers (AKT). Please can you provide an
M&A Capital backed Al Karama Towers acquires Expresso Telecom’s 450 introduction to the fund and how the deal with
Senegalese sites and targets an underexplored niche on the continent Expresso Telecom in Senegal came about?
Moctar Sarr, Associate Director, M&A Capital: M&A

To date, potential tower divestments by tier two operators
Capital is a Dakar based investment company. M&A
in sub-Saharan Africa have failed to attract the interest of
Capital is focussed on investments in Western and
the continent’s towercos. The sale of Expresso Telecom’s 450
Central Africa and also carries out transaction
Senegalese towers to newly formed towerco, Al Karama Towers,
advisory services. The company has a strong
represents a landmark transaction for two reasons. Not only is
footprint in the region’s telecommunications sector
it the first tower deal in Senegal, but it also represents the first
with money at work in a local MNO as well as an
tower sale by a tier two operator for five years. TowerXchange
ISP in Gabon and has plans to invest in an ISP in
speak to Al Karama Towers investors, M&A Capital to learn
Burkina Faso and acquire a stake in an MNO in
more about this new towerco set to enter an underexplored Guinea.
area in the sub-Saharan tower industry.
M&A Capital is also focussed on Agri Business, IT/
Keywords: 4G, Acquisition, Africa, Africa & ME, Africa & ME News, Al Karama Towers, AKT, Benin, services, financial services, with an approach that
Build-to-Suit, Business Model, Burkina Faso, Central African Republic, Co-locations, Congo Brazzaville, includes taking both majority or minority stakes,
Deal Structure, Due Diligence, Expresso Telecom, Gabon, Infrastructure Sharing, M&A Capital, Mali, however we undertake strong involvement in
Market Entry, Masts & Towers, Mauritania, MNOs, Network Rollout, New License, New Market Entrant, company strategies.
News, Sale & Leaseback, Senegal, Sonatel, Tigo, Togo, Tower Count, Towercos, West Africa
We started looking at the tower industry about three
years ago, speaking closely with one major actor
Read this article to learn: based in Dubai to better understand the market and
< How the sale of Expresso Telecom’s 450 towers in Senegal came about develop our knowledge of the business environment
< Details of Al Karama Towers including its investors and management team and the key stakeholders in it. This market study led
< The size of the Senegalese tower industry, the culture of infrastructure sharing, BTS opportunities and to us starting conversations with Expresso Telecom
why there exists significant co-location potential in 2014 who at the time were looking to sell their
< The potential for further tower divestments in Senegal Ghanaian operations and raise capital for their
< Al Karama Towers’ ambitions to acquire further tier two MNO tower portfolios across sub-Saharan Africa Guinean opco. We expressed a strong interest to
Expresso in acquiring their towers as a means for

Figure one: Ownership of Senegal’s 3,350 towers We started the due diligence process on 26 July
which will last for five months. Simultaneously
we are going through the necessary regulatory
procedures to get approvals from the Ministry of
450
Finance and the Ministry of Telecommunications.
We expect to close the transaction in November of
this year.
Sonatel
TowerXchange: Have you already appointed a
800 Tigo management team to run Al Karama Towers?
2,100
Expresso / AKT
Moctar Sarr, Associate Director, M&A Capital: A
former IHS Executive has been involved in the
transaction and he will most likely become the CEO
of the newly created towerco. He has a fantastic
Source: TowerXchange level of experience and is the perfect person to run
the new business.
“
them to pursue their proposed operations strategy TowerXchange: Please can you share the details
and made an offer in January 2015, which was of the agreement and when do you expect the
rejected by Expresso. deal to close?
In 2016, the regulator in Senegal announced they Moctar Sarr, Associate Director, M&A Capital: We
were making available 4G licenses, and Orange have agreed a sale and leaseback arrangement to
A former IHS Executive has
subsequently became the first operator to obtain a acquire Expresso Telecom’s 450 towers in Senegal. been involved in the transaction
license. The other MNOs in the country expressed an With Expresso’s license due to expire in 2026, the
and he will most likely become
interest to follow suit, and our ongoing discussions legal terms of the leaseback agreement are for an
with Expresso could lead to helping them to acquire initial ten year period, but as Expresso expect to the CEO of the newly created
towerco. He has a fantastic level
the 4G license and optimise future rollout for
network resizing.
We opened a second round of negotiations with

Expresso regarding their Senegalese towers about
extend their license we plan for this to extend to 17
years.
In addition to acquiring Expresso’s portfolio of

towers, we will also have first right of refusal for any
of experience and is the perfect
person to run the new business
“
six months ago and an agreement was reached new build by the MNO, with Expresso planning to
at the end of Ramadan, with a formal agreement significantly increase their site count in the next 24
signed on 20 July 2016. months.

“
Orange and Tigo as well as Expresso?
Moctar Sarr, Associate Director, M&A Capital: We

hope so! A little while ago, the regulator mandated
that all operators increase coverage to underserved
areas of the country and as such there is significant
There are also two key events on the horizon which will add significant potential to participate in the new build that will
potential for extra tenancies. The first is in relation to the award of accompany this. The next rollout program planned
additional universal service licenses which are designed to bring coverage by Expresso in the next 24 months is driven by this
regulatory mandate. We hope other MNOs will join
to areas underserved by the current MNOs… In addition to the universal
service licenses, the government also plans to award two or three ISP
licenses, thus creating additional non-traditional tenants. These two steps
by the government create a healthy market for co-locations
“ us in this rollout strategy as we believe that we
believe our offering is more cost effective than what
they have now.
TowerXchange: What potential do you see for co-

locations on the towers that you have acquired
from Expresso?
It will be the new CEO’s responsibility to recruit are three MNOs in the Senegalese market - Sonatel Moctar Sarr, Associate Director, M&A Capital: The
the rest of the management team, however with (owned by Orange), Tigo and Expresso Telecom. widespread implementation of 4G in the market
M&A Capital having a number of investments in the In addition to Expresso’s 450 towers, Sonatel owns (which would have presented opportunities for
region’s telecommunications industry already, we approximately 2,100 towers and Tigo owns 800. additional tenancies) has stalled somewhat, with
also have a good knowledge of the sector and strong Sonatel being the only operator to have been
relations with key executives in the market. To date, infrastructure sharing between the awarded a license. Even without this 4G however,
operators has been very limited, but attitudes there are a number of strong opportunities for co-
In addition to putting in place a management team, are starting to change. A year ago it was a dream locations.
we are in the process of assigning technical partners to move into sharing, however MNOs have since
and have made sound progress in this field. opened the door and some operators are now Firstly, there is a high level of parallel
sharing a limited number of towers. All the MNOs infrastructure in Senegal; within 100m you will find
TowerXchange: What are the attitudes of in the market are now looking at ways they towers belonging to all three operators. Our first
Senegal’s operators towards infrastructure can optimise their opex to reach shareholders port of call will be to approach Tigo regarding their
sharing and what level of infrastructure sharing expectation. towers that are in close proximity to Expresso’s
has there been to date? towers and convince them to decommission those
TowerXchange: Do you see a role for Al Karama towers, put their active equipment on our towers,
Moctar Sarr, Associate Director, M&A Capital: There Towers in new build programmes on behalf of and reduce opex.

“
There are also two key events on the horizon which
will add significant potential for extra tenancies.
The first is in relation to the award of additional
universal service licenses which are designed to
bring coverage to areas underserved by the current
MNOs. The first license was awarded to an entity
called Hayo which operates in the Matam region
of Senegal and uses towers owned by Orange and
Expresso to rollout its network. The government is
now set to award a second universal license, this
There is a pressing need for a towerco whose business model is
focussed around the tier two operators and Al Karama Towers
plan to fill this void
“
time to the Kedougou region, and further universal
service licenses are expected to be awarded in other
regions. In addition to the universal service licenses,
the government also plans to award two or three community in the country we understand that a our current focus is on closing the Expresso deal in
ISP licenses, thus creating additional non-traditional small group of suppliers which had been doing Senegal, our ambitions and vision are much further
tenants. These two steps by the government create a maintenance on the Sonatel towers had tried to reaching.
healthy market for co-locations. acquire them but the transaction didn’t get off the
ground. When you look at West Africa, there are three
TowerXchange: Do you foresee Tigo and major MNOs; Airtel, Orange and MTN, and then a
Sonatel divesting their towers in Senegal? Is an AKT “ Al Karama Towers” plan is to get to a critical whole host of tier two MNOs. A number of these
acquisition of such portfolios something that is in size, say 1,000 towers and then this would better tier two operators have an appetite to outsource
AKT’s (Al Karama Towers’) business plan? position us to partake in a deal with Sonatel should to, or partner with towercos, but the appetite from
their towers come to market. In the next two years the ‘Big Four’ towercos in sub-Saharan Africa is just
Moctar Sarr, Associate Director, M&A Capital: Our we expect to get to 650 towers, combining the not there. There is a pressing need for a towerco
current business plan in Senegal is based solely acquisition of Expresso’s towers and their new whose business model is focussed around the tier
on the acquisition of Expresso’s towers but should build requirements and an new acquisition of other two operators and Al Karama Towers plan to fill
Tigo’s or Sonatel’s towers come to market we MNOs or ISP’s structures would take this number to this void.
definitely would be interested. around 1,200.
In 2017 we are plan to look at opportunities with
Tigo have been open minded regarding divestment TowerXchange: What is AKT “ Al Karama smaller MNOs in Mauritania, Mali and Burkina
of their towers in other countries and so we think Towers” broader and more long term vision? Do Faso. Benin and Togo are on our horizon, although
that to be much more likely a transaction in the you foresee the company expanding into other we are not yet 100% decided, whilst tier two
more immediate term than a tower sale from markets? operators in Gabon, Congo Brazzaville and the
Sonatel. Sonatel have reportedly been looking into Central African Republic are key players we plan to
a sale of their towers and in speaking to the finance Moctar Sarr, Associate Director, M&A Capital: Whilst target

Mozambique has the fifth largest population of the
Share Square: Mozambique East African countries, but ranks only tenth highest
in mobile penetration. The entrance of Movitel in
2012 caused a dramatic shakeup in the market,
with the MNO rolling out significant infrastructure
3 MNOs: Movitel, mCel and Vodacom and become the number one operator (ahead
Active
18.3 million mobile subscriptions by the end of 2015, giving a of mCel and Vodacom) within just a few years.
penetration rate of 65% Unlike several other East African countries, 4G
3G coverage at 32% of population with 4G yet to roll out. 2G rollout is yet to commence, although the ongoing
likely to remain in place for some time to come
extensive rollout of fibre is readying the market
Current Sharing
Significant activity has been witnessed in the fibre rollout

market, with each of the three operators now using fibre optic for such a move. With new legislation mandating
backhaul solutions; expected to pave the way for the launch of
Passive
4G infrastructure sharing being proposed and mCel

No TowerCos operating at present; TowerCo Mozambique announcing its intention to sell its portfolio of
entered the market but failed to facilitate an agreement between
mCel and Vodacom, subsequently exiting the market towers, the Mozambican tower industry may be
Each of the operators is reportedly considering the sale of part set to change shape; Mott MacDonald take a deeper
or all of their tower portfolios; mCel are thought to be most
advanced having appointed Barclays to oversee the sale look at the country in their latest Share Square.
Recent regulatory interventions have been introduced to
None
Mozambique encourage tower sharing amongst operators

Mobile market overview
Market is behind surrounding Eastern African countries;
opportunities for TowerCo activity in the short-medium term
Mozambique had an estimated population of
28.4mn people and 18.3mn mobile subscriptions
3G 4G at the end of 20151, giving a mobile penetration
Technology Deployment of 65% - the tenth highest level of penetration of
the twenty countries comprising Eastern Africa.
Opportunity for towercos entry with Opportunity for Outsourcing Limited opportunity for new
focus on high Lease Up Rate (LUR) by MNO to towercos entrant towercos Around 97% of subscribers have a pre-paid
account, which ranks fifth lowest amongst the
Keywords: 3G, 4G, Africa, Core Network, Backhaul & FTTT, East Africa, Infastructure Sharing, Market Entry, mCel, Eastern African countries. Burundi ranks the
Movitel, Mott MacDonald, Mozambique, Market Overview, Masts & Towers, MNOs, Network Rollout, New Market highest with 99.9% pre-paid subscribers.
Entrant, Regulation, Urban vs Rural, Vodacom There are three Mobile Network Operators
(MNOs) serving the Mozambican market (See
figure one), each with a relatively similar market
share, ranging from Vodacom (29%) to the current
< The shape and size of mobile market in Mozambique and how this compares to the rest of East Africa
market leader Movitel (36%). Movitel entered the
< The relative market shares of Mozambique’s three MNOs
Mozambican market in 2012, causing a significant
< The status of 3G and 4G deployment and fibre rollout
disturbance through its aggressive expansion
< Key regulatory developments in the telecoms sector
strategy. Within two years, Movitel surpassed the
< The number of towers and MNO attitudes towards infrastructure sharing and tower divestment
existing market leader and incumbent operator

mCel to achieve a dominant market share. mCel, Figure one: Mobile subscriptions market share
which was recapitalised by the government in 2015
due to long standing financial difficulties, currently
services 6.4mn (35%) subscribers with Vodacom in
third place serving 5.2mn subscribers, 29% of the
market. 29%
36%
Vodacom
Key mobile developments
Mozambique has an average mobile penetration mCel
for the Eastern African region (65%), with the
Movitel
Seychelles exhibiting the highest level of penetration
(135%), followed by Mauritius (131%) and La
Réunion (110%). When considering countries with a 35%
population of 10mn or higher in the Eastern African
region, Zimbabwe had the highest penetration
rate by a significant margin , recording 96.9% 3G networks to all districts of the country by the end however they each boast a higher penetration rate
penetration in Q4 2015, Mozambique ranked 6th of 2015 and significant infrastructure rollout activity than Mozambique.
out of 13. Mozambique’s national subscriber base has been seen by Vodacom and Movitel in recent
has grown rapidly in recent years, more than years, however mCel has been comparably quiet in Significant activity has been witnessed in the fibre
doubling since 2011 to reach a record high of this area. rollout market, with each of the three operators
18.9mn in Q3 2015, before declining slightly. The fall now using fibre optic backhaul solutions. This
in subscribers was felt relatively evenly across the The breakdown of the 3G market follows a similar development of fibre capability is expected to be
three operators and is thought to be due to the SIM trend to the overall industry, with Movitel servicing a significant step towards developing a network
card registration exercise that was enforced by the the lion’s share of subscribers. The gap between capable of providing 4G services. Since its launch,
government in November 2015. According to GSMA, Movitel and Vodacom is in fact larger in the 3G Movitel has deployed 25,000km of fibre, reporting
subscriber figures are expected to continue falling market, with Vodacom servicing 1.2mn (21%) to have fibre connections at the majority of its sites.
marginally before rallying in 2017 to reach a record of the market, mCel accounting for 2.1mn (35%) Vodacom is thought to be rolling out 1,000km a
high of 19.6mn by the end of that year. subscribers and Movitel servicing 2.6mn (44%) year and mCel, which has its own existing network,
subscribers. also has the ability to use state-backed, fixed line
mCel was first to market with 3G services in provider TDM’s fibre network.
2008, enjoying no competition until Vodacom and Rollout of 4G
Movitel entered the 3G market in 2010 and 2012 None of the three operators currently offer 4G Operator Activity
respectively. mCel, Vodacom and Movitel were all services in Mozambique, which is a surprise when Movitel (Viettel) is Mozambique’s largest operator
successful in acquiring fifteen-year 3G licences in considering the operations of neighbouring Eastern by market share, despite the short length of time
2011 in the 1900MHz and 2100MHz spectrum bands. African countries. In the last few years, Kenya, that it has been active in the market (~4 years).
Stipulations of the licences included expanding their Rwanda and Tanzania have launched 4G operations; Movitel is a partnership between the Mozambican

holding company SPI and the Vietnamese military of the INCM within the telecoms industry is to draft and Vodacom and pulled out.
backed Viettel, which caused a significant stir in legislation, regulate services (fixed and mobile),
the Mozambican telecoms market when it launched allocate spectrum licences, monitor tariffs, control It is reported that there are currently ~3,000 angular
in 2012, providing a serious challenge to the two quality and mediate between the operators. towers in Mozambique, with an additional ~1,500
existing operators. Movitel rolled-out a network that guyed masts. The Movitel tower portfolio which
provided a high quality service in a short period of Until November 2015, the telecommunications totals 1,900 is thought to largely comprise guyed
time, largely utilising guyed masts to achieve the legislation being used in Mozambique dated towers, Vodacom manages 1,400 towers with the
network roll-out. back to 2004. In late 2015, the first reading of a remaining 1,200 towers attributable to mCel.
new bill to amend telecoms legislation to force
mCel (Mozambique Cellular) was the first mobile operators to share infrastructure was passed by the Having acquired the fiercely contested third mobile
operator in Mozambique, launching its services in government of Mozambique. It is thought that the phone licence in 2010 and launched its services
1997 as a joint venture between TDM and Detecon. change in legislation will support the government 2 years later, Movitel has pursued an individual
Enjoying monopoly status in the mobile telecoms in achieving their aims of improved coverage in strategy, investing in infrastructure rather than
market from 1997-2003, mCel serviced the total rural areas and improved average mobile internet infrastructure sharing in order to develop a
subscriber base of 413,000 in 2003, however it speeds for subscribers. footprint across Mozambique. mCel initially sought
failed to retain its dominant status following the an agreement to share its existing cell towers with
entrance of Vodacom in 2003 and Movitel in 2012. In August 2015, the government issued a Movitel, however this agreement was not progressed
mCel is currently in the process of being merged judgement to the MNOs to carry out a SIM card and no infrastructure sharing is thought to have
with state-backed, fixed line provider TDM in an registration exercise of their subscribers with a 90 occurred between the two operators. In order to
attempt to achieve greater business efficiencies as day deadline. The decision stems from a similar achieve its expansion strategy, Movitel deployed a
one organisation. exercise in 2010 in response to riots in Maputo high proportion of guyed towers. This has enabled
which were reportedly coordinated by mobile the operator to achieve high coverage in a short
Vodacom Mozambique is the smallest operator phone. Fines of up to MZN 6 million (USD 115,000) space of time, however the guyed masts are less
in Mozambique by market share. The operator is were tabled for the operators if they failed to suitable for sharing.
majority owned (85%) by Vodacom International respond to the 2015 registration. The operators
Limited, a Vodafone company, with the remaining reportedly obliged, however in September 2016 In recent years, speculation has emerged about each
15% spread amongst local Mozambican holding the INCM claimed that there are still up to three of the three operators, claiming that they are each
companies and investors. Unlike mCel, Vodacom million unregistered SIM cards being used in the considering the sale of part or all of their tower
has been noticeably proactive when addressing the country, despite the registration exercise. portfolios. However, mCel is thought to be most
threat posed by Movitel, rolling out ~800 sites across advanced in this area, having appointed Barclays to
Mozambique in a two year period. The tower sharing market oversee the sale of ~1,000 towers.
No towercos currently operate within
Regulation Mozambique, although in 2013/14 a company In November 2015, new legislation was passed by
In 1996 the Instituto Nacional de Comunicacoes de called Towerco Mozambique tried to establish a the government of Mozambique to support the case
Mocambique (INCM) was established to regulate the shared site model. It identified 50 potential sites for operators sharing infrastructure, including both
Postal and Telecommunications industries. The role but couldn’t facilitate an agreement between mCel towers and fibre. This is expected to accelerate the

sharing of infrastructure in the market, potentially
paving the way for the entrance of a towerco.
Conclusions
With the 5th largest population of the 20 countries
in Eastern Africa (28.4mn people) and only the
10th highest mobile penetration (65%), there is
considerable room for subscriber growth in the
Mozambique mobile market. 4G services are yet
Meetup Meet up
Europe 2017
to reach Mozambique, however the activity of
surrounding, comparable countries in this area
would suggest a launch in the not too distant future.
Americas 2017
The entrance of Movitel into the market has
encouraged competition and subsequently shaken 4-5 April, 7-8 June,
up a previously sluggish market, in which the SIM
penetration wavered at 30%. Recent regulatory
London Boca Raton
interventions to oblige operators to share both fibre
and tower infrastructure, as well as significant
infrastructure development from the operators
is likely to improve market conditions, including
poor rural coverage and slow internet speeds.
Development has also been witnessed in the towerco
space, with mCel reportedly most advanced having
appointed Barclays to oversee the sale of ~1,000
towers. & ME 2017 2017
A steadily increasing subscriber base which is 3-4 October, 12-13 December,
expected to reach 23.7mn by the end of 2020,
in combination with significant investment and Johannesburg Singapore
development in mobile infrastructure by the
operators suggests a positive outlook for the
mobile industry in Mozambique. This suggests that
opportunities for towercos may emerge in the next
few years www.towerxchange.com
1. GSMA

The top 20 tips for achieving
With towerco focus having shifted from
acquisition to the integration and optimisation of
acquired portfolios, and management of passive
operational excellence infrastructure amongst operators who retain towers

increasingly becoming a specialist discipline, the
Vodafone, Airtel, MTN and Helios Towers Africa share their combined experience opening panel of the 4th Annual TowerXchange
Meetup Africa & Middle East focussed on the topic
As sophistication in the management of MEA’s of “operational excellence”, welcoming expertise
towers continues to grow, the opening panel from three of the continent’s biggest mobile network
at the 2016 TowerXchange Meetup Africa operators, MTN, Airtel and Vodafone and Africa’s
and Middle East focussed on the subject of third largest towerco, Helios Towers Africa.
operational excellence in passive infrastructure
management, and what this really means - As the first of MTN’s opcos to have outsourced their
whether managing your own sites, those of a sites to a towerco, MTN Ghana were represented in
third party or overseeing a towerco relationship. the discussions by Ibrahim Misto, heading up the
Adedoyin Adeola (Airtel Nigeria), Ibrahim Misto (MTN TowerXchange were delighted to welcome Helios opco’s Operations and Maintenance department
Ghana), Ahmed Saeb (Vodafone Procurement Company) Towers Africa, Airtel Nigeria, MTN Ghana and which interacts with three of the big four towercos
and Alex Leigh (Helios Towers Africa) Vodafone Procurement Company to the panel. in sub-Saharan Africa. From Nigeria, TowerXchange
were pleased to welcome Airtel’s Head of Network
Keywords: Access Control, Active Equipment, Africa, Africa & ME, Airtel, Batteries, Best of TowerXchange, Infrastructure, Adedoyin Adeola, who, as a master
Capex, Change Management, Construction, Energy Efficiency, Fuel Security, Helios Towers Africa, black belt in six sigma also brings extensive
Infrastructure Sharing, KPIs, Logistics, Managed Services, Masts & Towers, MNOs, Monitoring & experience working for Vodacom, Globacom,
Management, MTN, Multi-Country Partner, NOC, O&M, Off-Grid, Passive Equipment, Procurement, QoS, Risk, Ericsson and Alcatel Lucent (now Nokia) and
RMS, ROI, Site Level Profitability, Site Management System, Site Visits, Skilled Workforces, SLA, Towercos, has ultimate responsibility for Airtel Nigeria’s
Uptime, Vodafone, Vodafone Procurement Company, Warehousing
outsourced network.
With a total of 6,556 sites split across four countries

Read this article to learn: and a recent business restructuring to focus on
< Areas where the region’s tower owners and operators see the biggest inefficiencies in managing operational excellence, Helios Towers Africa were
passive infrastructure represented on the panel by Alex Leigh, who
< Strategies for improved collaboration with the entire tower industry supply chain heads up the company’s commercial and business
< The delicate balance between deploying new capex and improving existing equipment and processes development function.
< How to obtain a deeper understanding of operations and how to use this insight
< Success stories from four of the most important players in the African tower industry Plus from Vodafone, an operator whose strategy
is based on retaining control of their passive

infrastructure, TowerXchange welcomed Ahmed whilst supporting them in their growth into new the majority of his time was spent on governance;
Saeb who oversees the company’s assessment and business areas. With longer term contracts, service setting weekly, monthly and quarterly meetings to
selection of civil works and O&M providers on a providers can invest in their business, training staff, scrutinise service providers and their subcontractors
global level. adopting improved processes and can find new and suppliers. This management occurs at both
synergies. the local level and at the group level, and with
Leading the discussion was Delmec Engineering’s a background in managed services, Adedoyin
CTO, Spencer Crawford-White. Fostering a positive working environment whereby explained the importance of structuring your team
contractors receive the guidance to improve to mirror that of your partner, providing multiple
Over the course of an hour, each of the participants performance is also key. Penalising a supplier levels of interaction between the two companies.
shared some of the challenges they faced in the because a mistake is made on one site, or only
management of their networks and offered exclusive valuing them by the success of their last site build Tracking performance, questioning results and
insights into new processes and methodologies is not conducive to the achievement of operational figures and drilling down into granular detail is
four of the most important companies in the excellence. It isn’t just about giving suppliers and essential to ensuring that work is being carried out
region’s telecoms have adopted in a drive towards contractors business; MNOs and towercos need in the optimum manner.
operational excellence. In this article, TowerXchange to train their partners how to work with new
summarise the top 20 pieces of advice the panellists products, enter new sectors and cross borders 3. Share your own KPIs with those of your
shared with this year’s audience. into new geographies. Only with this true support suppliers and work towards a common goal
and partnership can the supply chain reach new
1. Treat your suppliers and service providers as efficiencies which can then translate into savings for Too often the success of an operator - supplier
strategic partners those at the top of the value chain. , relationship is measured solely by the supplier’s
performance against a set of SLAs. Establishing
A buzzword throughout the duration of the It is also important for towercos and MNOs to not a common set of goals that the entire ecosystem
conference, the importance of partnerships cannot abuse the word “partnership”. Every CEO or Head of is working towards, however, instills a sense of
be underestimated. Short term contracts, excessive Procurement likes to use the word “partnership”, a ownership at all levels of the value chain and keeps
penalties and finger-pointing are a surefire way phrase which can often be used to simply negotiate all parties focussed on the bigger task at hand.
to bring inefficiencies into the ecosystem. With a discount. A true partnership however embeds the
reduced revenues for MNOs globally, pressure on suppliers within an organisation, giving them clear In the telecoms sector, the ultimate goal is improved
opex and the supply chain is set to continue but direction and accountability; MNOs and towercos quality of service to the subscriber, MTN Ghana have
simply squeezing already thin margins will only lead must play their part in making the relationship adopted an approach whereby they share customer
to a compromisation of quality of service. work. net promoter scores and regulator rankings
with each of their key service providers, further
Responsible for the procurement of O&M services 2. Develop an effective corporate and operational engendering the partnership spirit and allowing
for the Vodafone group globally, Ahmed Saeb spoke governance strategy - and implement it! operators and the supply chain to work together to
of the importance of giving suppliers long-term understand the impact and consequence of their
business and allocating larger geographic regions At Airtel Nigeria, Adedoyin Adeola referenced that actions.

4. Leverage the value of local knowledge and globally. Combining this international experience highest on the continent. Whilst there is no one
suppliers... gleaned from operating large tower portfolios in stop solution for tackling the crime issue, having
multiple countries with your local knowledge on the local community on side is one of the most
Local expertise and knowledge is a huge asset in the ground can bring significant improvements to critical components in ensuring the security of your
managing a cell sites. As voiced by Adedoyin Adeola your processes. equipment and sites.
from Airtel Nigeria, when American Tower entered
the Nigerian market following the acquisition of There are also significant efficiencies to be gained 7. Knowledge and skills transfer to develop local
Airtel’s towers, whilst they had extensive experience by encouraging your suppliers and service skill sets
of managing a global network of towers, they did not providers to expand to neighbouring regions and
have the experience of managing towers in Nigeria, countries. Vodafone’s Ahmed Saeb referenced how Maintaining expat salaries represents a major cost
but were keen to learn from their new partners. You he would love to make his suppliers larger and to operators, towercos and major contractors, whilst
can’t enter a market and assume what has worked have them work across borders, but it can often highly skilled workers are often in short supply
in one country will work in another. Similarly be difficult to convince them to go from one area in many sub-Saharan regions. MTN Ghana have
differences don’t just occur country to country, to another. Committing to long term contracts and embarked on extensive road shows and training
between the north and south of Lagos challenges supporting the companies through their expansion with local workers who have access to their sites,
vary greatly and it is important to be cognisant is key to making progress on this front. delivering training which has yielded strong results.
of these differences in order to optimise your
operations. 6. Engage and empower local communities 8. Foster collaboration within your supply chain
A local supply base is also critical from a In addition to sourcing local suppliers, it is Partnerships shouldn’t just exist between an MNO
logistics standpoint. A large part of time spent by also critically important to engage with local and the supply chain, or a towerco and the supply
maintenance contractors is due to extensive travel communities, both in accelerating new site build chain; it is important to integrate your suppliers with
to site; having partners based in close proximity to and also in the protection of existing assets. each other. The relationship between DG, rectifier
the cell sites can bring huge time savings as well as and battery bank is one critical dependence.
local knowledge. Vodafone have invested heavily in Theft remains one of the biggest challenges for Another example: diesel generator manufacturers
building out a list of preferred suppliers country to African tower owners and operators, with the cost should be extensively involved in training your
country, a feature which brings real value to their of theft not just being in equipment replacement maintenance partners how to operate and maintain
operations. but also in system downtime and SLA penalties, the equipment, ensuring that it is managed in
especially in the case of energy equipment and fuel accordance with the manufacturer’s guidelines.
5. ...but also bring global expertise and support theft.
geographic expansion Enabling the ecosystem to understand who else
Employing villagers as security, engaging with is involved in managing the tower portfolio will
Whilst the importance of local knowledge cannot local chiefs and giving a sense of ownership to the improve visibility and cross-pollination of ideas
be underestimated, there are certain best practices community has delivered sound results for Airtel whilst avoiding a culture of finger-pointing when
(albeit with local tweaks required) that translate in Nigeria, where pilferage levels are some of the things go wrong. At MTN Ghana, Ibrahim Misto has

adopted a strategy to bring maintenance partners 10. Dig deep into the root causes of issues you start to reduce the occurrence of theft.
for both active and passive infrastructure into
one monthly meeting. If a site goes down, the two Solving a given problem requires you to understand This requires coordination of your service
partners are challenged in unison on why this has the true root cause of the issue in order to develop providers and suppliers, synchronising their
happened and can develop a strategy to minimise the most suitable fix, and minimise risk of repeat maintenance schedules and deliveries in order to
the risk of this occurring again. occurrences. For example, combatting fuel theft reduce the amount of visits to your sites.
isn’t simply about increasing your security and
9. Ensure continuous improvement and seek new surveillance; you need to understand why and 12. Avoid the “rush to capex” and consider the
solutions where the theft is happening. cost of change
Operational excellence is a moving target, with In order to combat issues operators and towercos The rush to deploying capex is a common mistake,
expectations of towercos, operators and ultimately face, Helios Towers Africa’s new management agreed the panellists, no matter how good the
mobile customers continuing to rise as efficiencies team has applied six sigma methodology to their solution is. If it goes into the field without the
improve. Helios Towers’ Alex Leigh noted that operations, interrogating why events are occurring skills or systems to correctly install, integrate,
when towercos first took over the management and drilling down into the root cause. In the case of commission and maintain it, the solution is
of passive infrastructure there was significant fuel theft, Alex Leigh referenced an instance where doomed to fail. Capex decisions need to be carefully
improvement on how towers performed, just from a security guard was stealing fuel. Drilling down evaluated and considered, with assessment of
the sheer focus that towercos were able to give to into the issue further revealed that the maintenance existing infrastructure being an important first
passive infrastructure. Initially, towercos just took partner wasn’t paying the security guard. Fixing the step.
the process and systems that MNOs had put in place issue wasn’t simply a case of replacing the security
and simply executed them better. guard, it required a solution to track and monitor One must also not underestimate the cost of
whether the maintenance partner was making change. Whilst a solution may promise improved
As the well known moniker goes however, payments correctly. efficiencies, requirements to train contractors in
repeating the same action and expecting using the solution, or the extensive and complex
different results is the definition of insanity. MNOs, towercos and their partners need to integration into existing systems, may quickly erode
Without implementing significant changes and continuously ask “why” and then take their some of the financial and operational benefits that
improvements, the performance of sites can only learnings and constantly reapply them in order to you had been expecting.
plateau, and the rising expectations of operators improve processes.
after initial experiences would fail to be met. 13. Rationalise your site equipment
11. Minimise the number of site visits
Ensuring that you remain at the top of your game It is not uncommon, observed Helios’ Alex Leigh,
and continuously improve is essential in the drive It was observed by panellists that a large proportion that when you inherit a portfolio of sites there
to operational excellence, especially as technology of theft occurs when contractors and service can be five different types of generators and five
and the shape of operator networks continues to providers are present on site. As such, it can be different types of controllers across the fleet of
evolve. derived that by reducing the number of site visits assets, creating 25 different potential combinations

which maintenance contractors need to familiarise referenced one of the most effective systems they on closer inspection this may correlate with some
themselves with. put in place were simple metal bars to restrict of your worst performing sites, thus indicating
access to their batteries. a problem with the generator which needs to be
By rationalising the amount of different equipment inspected.
on site, it simplifies the work of the contractors, 16. Avoid “data paralysis” and the quest for
allowing them to become familiar with the perfect data Combining data from non traditional monitoring
equipment and as such, experts in ensuring that it sources can give you a much more sound picture of
runs and is used optimally. All decisions need to be based on facts and data; your network operations and identify problems that
you need to know what information you require other systems have missed.
14. Be smarter in the way you assign your and you have to be scientific. Whilst data can never
contractors be overvalued, sometime the quest for perfect data 18. Aim for a reduced dependency on diesel
means you become paralysed by reams of analysis
Helios Towers Africa observed that it is also not instead of drawing conclusions from more simple Whilst optimising energy efficiency was the
uncommon when taking over maintenance contracts data sets. There are a lot of clever people who can subject of a separate debate at this year’s Meetup,
following a tower transaction that you have two do a lot of clever analyses, but ultimately you need all panellists were in agreement that reducing
different maintenance partners overseeing sites next to be able to extract as much value as you can from dependency on diesel would have a positive impact
to each other. Rationalising these contracts to give data without overloading the system. on operational efficiency.
each contractor clusters of towers in close proximity
to each other will reduce the amount of time each Integrating new RMS systems can sometimes reduce With fluctuating prices, localised shortages,
partner spends on the road and will ultimately efficiency as it often adds a layer of operational substantial delivery challenges and its attractiveness
improve the efficiencies of your operations. It is complexity as you have to retrofit it within existing to thieves, the dependence of cell sites on diesel is the
a straightforward solution but one that is often operations. Understanding what you really need to source of a whole array of issues for tower owners
overlooked in light of companies not having a be measuring and simplifying your monitoring can and operators. Whilst the grid situation in sub-
granular view of who is doing what on their sites. achieve real benefits. Saharan Africa not expected to improve dramatically
in the short term, the switch to hybrid systems and
15. Balance high and low tech solutions for 17. Appreciate the value of operational insight alternative energy generation sources by tower
optimal effect afforded by your P&L owners is starting to reduce their dependency on
diesel and all its challenges that it brings.
Whilst sophisticated solutions on the market can It isn’t just remote monitoring and site management
offer significant benefits to your operations, it is systems that can reveal information into the 19. Integrate active and passive management
also important to not overlook low tech options. efficiency of your operations; your P&L can reveal
Advanced locking and surveillance systems and interesting insights into what is and isn’t working Diversification of the towerco business model was
unique anti-theft battery designs can go a long way on cell sites. For example, it may be that you notice a much talked about area at this year’s Meetup,
to decreasing theft of batteries, however MTN Ghana fuel usage is a lot lower on some of your sites but however the growing interest in integrating the

management of passive and active equipment was
also echoed by the opening session’s panellists. In
order to bring bigger synergies to the sector, Airtel’s
Adedoyin Adeola felt that towercos needed to move
out of the mindset that active and passive should be
segregated, and forecasted that we would be seeing
towercos entering the active space in the next five
years.
In line with this, Vodafone’s Ahmed Saeb commented

that the MNO has worked on a project where the
same supplier carried out the passive and active
maintenance thus reducing the number of site visits
required and also creating efficiencies in the supply
chain.
20. Understand your finite resource and better

use it
The list of steps that can be made to improve

operating efficiencies is endless but ultimately the
people managing the process have a finite capacity
to execute such steps. Prioritisation of tasks and
streamlining of processes and implementation
of supporting technologies to reduce workloads
is critical to ensuring that focus remains on the < Access to the “Internet of People” in the global tower < A comprehensive archive of TowerXchange’s
industry – a trust web of over 35,000 decision makers interviews and analyses, searchable by topic, country,
steps which will make the most difference to your
operations.
how to guides)
Prioritisation of tasks is also essential when making prospects for tower transactions in selected countries < The latest news and registration information about
process improvements, it is impossible to change TowerXchange’s Meetups.
everything at once and expect it to run smoothly, you < The latest industry emerging market tower industry
need to start with the extremes and work your way
in, gradually tackling the more subtle inefficiencies
in the process

Deepening the level of
Tower divestments, towerco relations and co-
locations
infrastructure sharing at Orange, Across Africa and the Middle East there have been
31 tower transactions of scale, with highly variable
Telenor, Safaricom and Cell C strategies between operators in the region. At the
one end of the spectrum, Airtel has closed tower
transactions in 10 of the 14 markets in which it
How four key MNOs are working to reduce their network costs
operates (and has agreed the sale of its Tanzanian
The telecoms sector has come a long way portfolio to American Tower); whilst at the other
since network infrastructure was seen as a end of the spectrum, Vodafone has preferred to keep
source of competitive advantage by mobile its towers in-house, having only entered into tower
network operators. With infrastructure agreements in Tanzania and Ghana (and in both
sharing recognised as a critical strategy instances retaining ownership of or equity in the
towers).
to reduce network costs amidst declining
revenues, TowerXchange invited four
Joining the panel at this year’s Meetup were
MNOs to share their strategies, experiences
operators with a diverse set of strategies with
Brian Burns (Analysys Mason) with Muhalia Allan (Safaricom), and concerns regarding the sharing of
Dana van den Berg (Cell C) and Nat-sy Missamou (Orange) regards to outsourcing their towers. Vodafone-
passive and active infrastructure.
owned Safaricom with its portfolio of over 4,000
towers, dominates the Kenyan market. Not only
Keywords: 3G, Active Equipment, Active Infrasharing, Africa, Africa & ME, Analysys Mason, Build-to-Suit, does the operator have no current plans to sell their
Business Case, Business Model, Capex, Cell C, Co-locations, Construction, Core Network, Backhaul & FTTT, towers, but Safaricom has also formed their own
DAS, Decommissioning, Energy, Energy Efficiency, ESCOs, First Mover Advantage, IBS, Infrastructure internal towerco business (headed up by Muhalia
Sharing, Managed with License to Lease, Masts & Towers, Middle East, MNOs, Network Rollout, Opex Allan, this year’s panellist) and actively pursues
Sharing, Orange, Passive Equipment, Regulation, Risk, Roaming, Safaricom, Sale & Leaseback, Small Cells, co-locations as a revenue generating strategy.
Telenor, Towercos When Safaricom began to look at site sharing,
this was originally on a non-commercial basis,
typically through bilateral swaps, but the operator
Read this article to learn: subsequently moved to setting commercial rates
< Orange, Telenor, Safaricom and Cell C’s history of working with towercos on their sites, and has more recently entered a full
< How operators perceive the benefits and risks of outsourcing their tower networks service model, providing power as well as space to
< MNO experiences of active sharing and how they foresee the market evolving their tenants.
< Key hurdles to overcome in establishing active sharing agreements
< How MNOs are sharing energy resources and fibre to further tackle network costs Whilst Safaricom has opted to retain their sites,
Muhalia Allan explained that they still saw towercos

as playing an important complementary role in country, not only in regards to new build (Telenor the profitability of your sites and be able to control
the market. In Kenya, Eaton Towers possess a themselves have just signed a BTS agreement with your opex”
portfolio of 1,200 sites following the acquisition a towerco in the country). In total, there are almost
of Airtel’s sites and the execution of build to suit 35,000 towers in Pakistan, owned by each of the five “In South Africa, the electricity grid is robust,
programmes for operators in the market. Safaricom MNOs; whilst there is still significant requirement with the majority of sites on grid, and as such,
balance the use of their own infrastructure with to improve population coverage in the country (a the value that a towerco can bring in terms of
co-locating on Eaton’s sites and also giving build 15-20% coverage expansion is required), a network power provision, reducing costs and improving
to suit programmes to the towerco. In many of 18,000 - 20,000 sites would be the optimal size uptime is limited. What’s more, the lack of our
instances, towercos are able to deploy sites more for the market, thus demonstrating the amount of own infrastructure limits our ability to negotiate
cost effectively and can similarly obtain attractive decommissioning as well as new build required. with other MNOs when it comes to site sharing
sites which the operator has failed to secure. As Towercos are ideally positioned to play a role in this and furthermore, we need to be mindful that as
such, it makes sense for Safaricom to build the use of whilst also supporting improved power supply in a we move to 4.5G and 5G we will need a lot more
towercos into their business plan. country with severe energy challenges. infrastructure and owning your own is more
strategic. Taking all these factors into consideration,
Joining the panel was Shah Faisal Safdar Khattak we believe that it makes sense for us to own our own
who oversees network sharing initiatives for Telenor Cell C’s strategy is one very much making the tower network”
Pakistan. Telenor also has retained its sites in each industry headlines at present and TowerXchange
of the 13 markets in which it operates, although were delighted to welcome the MNO’s head of Orange have had a more diverse strategy with
the operator possesses a significant stake in the Technical Facilities, Dana van den Berg to the panel. regards to outsourcing their towers, with the
VimpelCom group which has publically announced Having been the sole operator in South Africa to differing perspectives of their 21 MEA opcos
its intention to divest towers in a bid to raise capital, have sold their sites to an independent towerco, informing their strategy as much as the company’s
with processes underway in Russia and Pakistan and (agreeing the sale and leaseback of 1,400 sites to corporate strategy, explained Nat-sy Missamou,
tower divestments being assessed in Bangladesh, American Tower back in 2010), the company has Orange’s Sharing New Business Program Director.
Algeria and the CIS. Having entered the Pakistani since taken a u-turn and is currently rebuilding their Orange has entered into MLL agreements with IHS
market back in 2004, Telenor had proposed a own tower portfolio. in Cameroon and Cote d’Ivoire, sold their Ugandan
joint rollout model with other operators in order sites to Eaton (prior to the opco being sold to Africell)
to minimise capex spend, however negotiations “Whilst management of passive infrastructure and have inherited towerco relationships following
around the strategy failed to reach an agreement isn’t an operator’s core business, it is core to our their acquisitions of Airtel’s Burkina Faso and
between all parties. The company, however, favours business” explained Cell C’s Dana van den Berg in Millicom’s DRC opcos (who had previously sold their
a co-location model, preferring to use existing sites response to whether a towerco is better positioned sites to the Eaton Towers and Helios Towers Africa
rather than rollout their own network in a bid to to manage sites. “Having an outsourced network respectively). In Egypt, Orange recently acquired
keep their capital expenditure low. has created significant challenges in controlling our MobiNil who had agreed the sale of 2000 site to
opex costs, and exposes our long term business plan Eaton, however the transaction has since been
Speaking on the Pakistani market, Telenor’s Shah to risks. Voice revenues are declining and although cancelled.
Faisal explained that there was still significant data usage is increasing, so are costs for supplying
potential for mature towercos to penetrate the that data. As an operator you need to be wary about “There is no one single strategy across our opcos”

explained Nat-sy Missamou “One must consider the Figure one: The pros and cons of working with towercos
situation in the local market; does the opco need to
alleviate debt? Are they looking to reduce opex? Do Pros Cons
they need to improve availability? It really depends
on the local issues, the relationship with other MNOs 1 Releases capital for opcos with Lacking your own infrastructure means you
in the market and also the attitudes of the regulator. financial challenges can’t doesn’t allow you to negotiate with
Whilst the head office has a good general view, the
other MNOs regarding site swaps
opco is on the front line, decisions must be made
coordinating input from the two in order to reach the 2 Towercos have the ability to invest Escalating lease rates means that it can be
right solution. Whilst we retain a large proportion
significant capex which leads to an hard to control your opex
of our sites, towercos play an important role in our
strategy. With towercos investing significant capex in
improvement in network availability
upgrading infrastructure, we have seen good results
in the improvement of network availability through 3 Towercos are able to rollout sites more Challenges can be presented when wanting
working with towercos and in places where we need cost effectively than operators to enter active sharing
to grow quickly, we have had a lot of success through
build to suit programmes such as with Helios Towers 4 Towercos can access sites that MNOs Requirements to use more sites as we move
Africa in the DRC or ToM in Madagascar”. may struggle to get hold of to 4G and 5G will further present opex
challenges
One audience member raised the question as
to whether the operators anticipated a role for
5 Towercos bring expertise in power When power isn’t a consideration, there is
towercos in managing active infrastructure in order
to further develop synergies between passive and
management less of a value add in terms of what towercos
active equipment maintenance. Orange mentioned can offer
they have had some approaches by towercos to offer
active platforms, for example, in rural areas whereby the area where the highest cost savings could be < MORAN (Multi Operator RAN where antennae,
they could offer open RAN to all operators in a bid to made, with one panel member offering the opinion transmission, power, passive equipment and all
more cost effectively tackle coverage requirements. that it represented an alternative to the towerco hardware are shared but operators use their own
Telenor referenced that it would be attractive to them value proposition. Spectrum is a finite resource spectrum)
to be able to offer the entire site management to a < MOCN (Multi Operator Core Network, in which
and is extremely expensive, the ability to share
single party and as such would welcome the entrance spectrum, as well as all of the above, is shared)
spectrum could significantly improve costs.
of towercos into the active equipment sphere. < GWCN (Gateway Core Network, where both RAN
and core network are shared)
Active infrastructure sharing There are already several permutations of
RANsharing, with the potential for still more to Whilst all agreed active sharing is something
Active infrastructure sharing, the panellists felt, was evolve in the future. The foremost of these are: that should be aimed for, the panelists observed

that there are several hurdles and barriers to the Figure two: RANsharing models as identified by Analysys Mason
establishment of RANsharing agreements, namely
MORAN MOCN GWCN
1. Regulatory frameworks not yet in place in several
Service Service Service Service Service Service
markets platforms platforms platforms platforms platforms platforms
HLR HLR HLR HLR HLR HLR

2. A lack of alignment of operator objectives
MSC/ MSC/ MSC/ MSC/ M

MSSC
C//
3. Significant upfront capital costs required SGSN SGSN SGSN SGSN S
SGGS
SNN
4. Reluctance of towercos to enter negotiations when B

BSSC
C // R
RNNC
C B
BSSC
C // R
RNNC
C B
BSSC
C // R
RNNC
C
you have sites owned/ managed by them
B
BTTS
S// N
Nooddee B
B B
BTTS
S// N
Nooddee B
B B
BTTS
S// N
Nooddee B
B
5. Imbalance of spectrum (in the case of MOCN)
Backhaul Backhaul Backhaul
In Pakistan, Shah Faisal explained, the regulatory

environment had initially not be supportive of active
network sharing, with reluctance having been, in part, First stage of active RAN Second stage of active Third stage of active
due to the large reserves of spectrum still available. sharing where spectrum RAN sharing where RAN sharing where CS
is not shared spectrum is also shared and PS core elements
Recent amendments to policy however have enabled are also shared
both MORAN and MOCN and since then, four of
Pakistan’s MNOs have entered into discussions. Legend Operator A
`
Operator B Shared element
Entering into active infrastructure sharing is not negotiations present a real challenge in the Dana van den Berg thought that it was important to
without upfront costs however, but the business deployment of DAS networks along with high costs keep lines of discussion open between all parties.
model is driven by opex reduction which typically will and disputes over who should be managing what. Currently all of the operator’s IBS are shareable,
be seen in a 8-10 year period. Safaricom have been deploying open access DAS and in South Africa there are roaming agreements
networks in malls and shopping centres to more in place between the two smaller and two larger
Whilst Safaricom’s Muhalia Allan agreed that effectively bring indoor coverage. Whilst Safaricom operators. Beyond that it remains to be seen how
RANsharing was where the real opportunity existed are conducting multiple active sharing studies, they the market will dictate the evolution of active
to reduce network costs, there were instances he felt see it as an easier step to implement sharing of DAS sharing, although increasing cost pressures and
where it didn’t make sense, such as when looking for than of macro sites, a sentiment echoed by the other requirements to drive down capex are likely to
a first mover advantage when launching 4G. One area panellists. necessitate a move towards deeper infrastructure
in particularly he felt however where RANsharing sharing.
could deliver the most value was in regards to in- At Cell C, RANsharing is currently prohibited by
building solutions. Access to buildings and landlord their existing agreements with towercos however Orange’s Nat-sy Missamou further emphasised the

sentiment that active sharing was the ideal business particular, had been gaining increasing traction the role for independent third parties. In Pakistan,
strategy with it unlocking the highest number of in the region’s tower industry, with Millicom an additional 15-20,000km of fibre needs to be
benefits to operators. There needs to be, however, undertaking a project in Chad, Energy Vision in deployed in the next 3-4 years, far outstripping the
a long process of negotiation between all parties in discussions with an operator in Gabon and Airtel capacity of existing fibrecos and operators in the
order to foster trust and open communication. In having agreed an ESCO project in Madagascar. market. With high deployment costs and security
terms of Orange’s experience, the MNO has entered At the 2015 TowerXchange Meetup we were as well as environmental restrictions constraining
into RANsharing with Vodafone in Spain and has discussing tens of towers being powered under the the process, significant rollout challenges exist.
also entered into agreements with MNOs in other opex model, this year we’re discussing hundreds. Telenor themselves have piloted fibre sharing in
European markets, and anticipate RANsharing the country, investing in joint rollout with other
coming to Africa in the near future. In Tunisia, Nat-sy Missamou felt that the ESCO value operators, dividing up geographical areas in order
Orange are taking part in a pilot to test active sharing proposition was particularly promising in sub- to improve cost efficiencies and accelerate time
alongside Tunisie Telecom and Ooredoo and they are Saharan Africa and forecasted that we would see to market. Such a strategy is estimated to save
also in discussions regarding RANsharing in Jordan. further adoption of the business model, with all operators around US$200mn. Similarly in Kenya,
operators agreeing they were open for discussions
Safaricom referenced they too were looking to
The operators felt that a dialogue with towercos on the topic. Operationally, power remains the
open up their infrastructure sharing to the next
was essential to further active sharing. Whilst most biggest challenge and the advent of specialist
level and that this may well encompass shared
towercos have been opposed to active sharing due to energy companies with sufficient expertise
fibre.
its threat to tenancy ratios and BTS contracts, some and robust enough balance sheets provides an
have started to embrace the strategy as inevitable attractive alternative to tackling the issue.
Conclusions
and opened discussions with operators on the
subject. Telenor offered the opinion that creative Now offering power as a service to their tenants,
Summarising discussions, Analysys Mason’s
solutions should be sought after; whilst revenues Safaricom have further extended the role that they
Brian Burns (the panel’s moderator) concluded
from tenancies will decline, alternative strategies are playing in the power space, whilst in Jordan,
that whilst the common ground was that there
such as revenue sharing models could help protect Orange have explored an alternative energy model
the towerco business model. Telenor explained that to lower their electricity costs, constructing a solar was a priority to optimise cost base, there was no
they were open to discussing different commercial farm that feeds power into the national grid in one strategy which fits all markets and purposes.
models; it is not in the best interest of MNOs to put a bid to counteract the high energy costs in the Active sharing is a big goal but can be difficult to
towercos under significant stress, but it is important country. As the biggest contributor to opex in much achieve; it is easier at the DAS and small cell level
that the two sides work together to develop a win- of sub-Saharan Africa, new energy models as well but more difficult on macro networks and more
win for both parties. as more efficient equipment is critical in tackling challenging still following a tower divestment.
the profitability of sites. The ESCO model and shared fibre represent two
Innovations in energy models other key opportunities to control network costs
Shared fibre and shared backhaul and will start to gain further momentum in the
Whilst discussion regarding energy models African market. Ultimately however, the future
was covered in more depth later in the Meetup Continuing on the theme of deeper infrastructure lies in cooperation, between towercos and MNOs
programme, panelists noted that the ESCO model, in sharing, discussion moved onto shared fibre and and between the operators themselves

Figure three: Infrastructure sharing strategies of Orange, Telenor, Safaricom and Cell C Source: TowerXchange
MNO Geo footprint History of working with towercos? Active infrastructure sharing? Energy models?
21 countries in Africa < MLL with IHS in Cameroon & Cote d’Ivoire < Exploring RANsharing in Tunisia < Solar farm feeding into
& ME (plus 8 European and Jordan the grid in Jordan
< Sale of 2000 towers to Eaton towers in
countries)
Egypt cancelled < RANsharing with Vodafone in Spain < Interested in ESCO
model
< Inherited towerco relationships in DRC < Further RANsharing experience in
and Burkina Faso following acquisition Europe
of Millicom and Airtel opcos
< Sold 300 towers to Eaton in Uganda prior
to opco sale to Africell
< Works with towercos for BTS
Kenya < Has own internal towerco business unit < Open access DAS for inbuilding < Providing power as a
actively pursuing co-locations solutions service to tenants
< Leverages Eaton Towers’ sites < Further active sharing studies < Yet to adopt ESCO
underway model
< Works with towercos for BTS
South Africa < Sold 1400 sites to ATC in 2010 < Current towerco agreements < Most sites on grid
preclude active sharing on macro sites
< Uses towerco sites for co-locations < Open to discussing
< IBS all shareable ESCO model
< Rebuilding own tower portfolio
< Roaming agreements with other
MNOs
13 markets covering < BTS programme agreed with towerco < Successful active sharing in Sweden, < Significant energy
Nordic countries, CEE Denmark and Hungary upgrades completed
and Asia < Preference for co-locations over new site
build creates opportunities for towercos < Trialled RANsharing in Pakistan < Yet to explore ESCO
models
< Shared fibre rollout with other
MNOs

Energy priorities for sub-Saharan Understanding your energy consumption profile
For any operator or towerco, the first step in

African MNOs and towercos any energy initiative is developing a thorough
understanding of your energy consumption profile.
Insights from Vodafone, Helios Towers Africa and Towerco of Madagascar It is impossible to manage what you can’t measure
and so you first must understand what power is
The second afternoon
being consumed on your sites. Even in Europe
of the TowerXchange
where almost 100% of sites are on-grid, you need to
Meetup Africa & Middle
understand what you are using in order to be able to
East turned its attention
reconcile your utility bill. Only once you have these
to key considerations
metrics in place can you then look to negotiate with
and solutions when
your suppliers.
managing cell site power.
From tackling the low
Across the sub-Saharan African region, the
hanging fruit on existing
energy profile of an MNO or towerco’s sites varies
infrastructure, to the
drastically, from the robust grid in South Africa
widescale deployment of
to more challenging markets such as the DRC.
new technologies and the
Any decisions that are made on tackling energy
Alex Leigh (Helios Tower Africa), Solange Karwera (Vodafone) potential and limitations
and Gilles Kuntz (Towerco of Madagascar)
generation and efficiency need to be backed by
of the ESCO model.
figures in order to inform your choices and monitor
their impact.
Keywords: Africa, Africa & ME, Batteries, Capex, Community Power, Energy, Energy Efficiency, Energy
Storage, Fixed Price, Fuel Cell, Helios Towers Africa, Hybrid Power, Infrastructure Sharing, O&M. Tackling the low hanging fruit
Opex Reduction, Renewables, Risk, ROI, SLA, Solar, Towerco of Madagascar, Unreliable Grid, Uptime,
Vodafone, Vodafone Procurement Company, Wind Huge savings can be made by first making sure that
the equipment you have on site is being properly
used and maintained. Fixing a faulty air conditioner
Read this article to learn: or ensuring that a diesel generator is operating in
< What is the low hanging fruit in improving cell site energy efficiency the correct phase will often have a bigger impact
< How the true ROI of energy equipment needs to be validated and a much better ROI than deploying the latest
< To what extent renewables are competitive in powering base stations piece of technology.
< Limitations to the ESCO business model and how these can be addressed
Spending the time and money to ensure that your

contractors know how to work with the equipment site visits can have a significant impact on TCO. The success of the technology in the field is
and are able to service it properly will yield What’s more putting in place robust preventative also influenced by the expertise of your staff
huge savings and is an absolutely critical step. maintenance schedules will reduce the amount of and contractors in installing and maintaining
Avoid rushing to deploy capex and first focus on reactive site visits and help to control costs further, the equipment according to manufacturer’s
optimising the existing equipment that you have on whilst standardisation between sites helps achieve guidelines. The equipment needs to have the correct
site. efficiencies with your contractors. maintenance and management to ensure that it
reaches it full potential, and without this in place
Replacing suboptimal configurations with tried Comparing performance in the lab, in pilot it is doomed to failure. There is no point investing
and tested solutions studies and in widescale deployment large sums of capital in new technologies if you
then fail to install, configure and maintain them
When inheriting a tower portfolio from an operator, The panel were all in agreement that there was a correctly, offered Helios’ Alex Leigh.
towercos often find that the energy equipment is huge array of fantastic technologies in the market,
sub-optimally configured. Whilst it may not make each with the promise to contribute to impressive The panel explained that tower owners were
sense to reconfigure the sites as soon as you take savings. Whilst in the lab environment these increasingly wanting to see vendors incentivised to
over the assets, the emergence of key events such solutions reliably perform to expectations, and in ensure the success of their products in the long run,
as the addition of a new tenant may present an pilot studies they often perform highly, deployment and observed that an increasing number are offering
opportune time to undertake such works. Often on a wider scale and a longer term basis can often full service warranties. Whilst a full service warranty
a towerco may have a portfolio strategy that is yield drastically different results. will increase opex, it is important to make sure that
yielding strong results across their other assets, a technology is correctly managed to ensure it is
such as the deployment of deep cycle batteries, Firstly, a lab is a controlled environment, immune delivering on its advertised ROI.
and this will therefore be the first port of call in from the variables that can be found in a network
upgrading energy infrastructure. setting. Whilst pilot studies expose technologies to a Scalability is another key component that needs to
network setting, the focus that pilot studies receive be carefully assessed prior to making purchasing
From capex evaluation to assessment of TCO from vendors as well as tower owners, coupled decisions. Whilst a piece of equipment may function
with their limited scale and study length provides optimally in a single tenant scenario, many fail to
Whilst the upfront cost of new technologies is different conditions to a full-scale deployment. In meet up to expectations when the load on a given
important to take into consideration, the panel order to assess the true ROI of a system and thus site is increased through the addition of new tenants.
underscored the importance of evaluating the assess its suitability for widescale deployment, With the towerco business model based on multiple
TCO of new systems. Simplifying site design extensive testing in the field is required, a key area tenancies, it is of fundamental importance to make
is key, not only can a overly sophisticated of focus for the Vodafone Procurement team. The sure that technologies adjust well to increases in load.
system be challenging to configure but a lack ROI that is promoted by vendors may not always
of standardisation between sites can make be the same in the field and it is important to The role for renewables
maintenance inefficient. Designing a simplified understand this difference in order to inform your
and low maintenance system that requires fewer decision making for major procurement activities. The panel were questioned on their appetite for

and experience with renewables. Helios observed Speaking on the matter the panel questioned the when considering an agreement.
that when you look at solar you can see very good ability of ESCOs to deliver a better job than the
solution that works well in low consumption single towercos have. With towercos having learned Several comparisons were drawn between ESCOs
tenant scenarios. There are still some question marks operational lessons over the past 7-10 years, power and towercos in their early days; ESCOs need to
however on how well solar works when you start has become a core competency. Excellence in convince tower owners they have the expertise to
adding more tenants. improving site uptime through improved power do what tower owners have been doing for years;
management is one of the towerco’s core USPs ESCOs are faced with the same challenges that
Vodafone commented that they had deployed lots of when speaking to MNOs, towercos themselves towercos face, whereby clients want fixed costs but
renewable solutions at big data centres and switching have specialised in power provision, they don’t also upsides to savings; and ESCOs may need to buy
centres, but when it comes to base stations, the ROI is need an ESCO to bring specialist expertise to tower existing power assets in place on sites and look to
harder to achieve and so this hasn’t been deployed at operations. The panel commented how towercos carve out teams, similar to the strategy deployed by
such scale yet. As the price of solar continues to come often make a significant part of their margins on towercos.
down however, the business case will start to stack up. power and taking power out of the equation would
sacrifice some of this benefit. The panel also observed the towerco business model
Towerco of Madagascar have trialled a wind project, works with multiple tenants and so it is rational for
offering an interesting alternative to solar, solar Whilst the ESCO model has been more widely ESCOs to look for further synergies through shared
being by far the leading renewable technology adopted in India, it was commented that the there infrastructure. Efficiencies all come into play with
being considered by cell site operators. Vodafone is a much more established network of skilled sharing and the business case is tough if you’re just
commented that they had been conducting some engineers in the country than in sub-Saharan providing for one client. The ability for ESCOs to
assessments into fuel cells in niche markets and Africa, which lowered the level of risk. Vodafone extend power to factories, industrial power users
continue to assess a whole array of different have signed ESCO contracts in India (and also parts and the local community all present new revenue
technologies. At the moment the ROI of most of Europe) but that doesn’t necessarily mean that streams. Whilst CSR is a component in extending
renewable options means that deployment can’t be the model makes sense in Africa. power to off-grid communities, it also delivers real
justified, that being said, it is important to continue benefits to the MNOs and thus ultimately the supply
trialling and testing technologies to ensure that all Another challenge for ESCOs is that they are chain. Providing power to a community along with
alternatives are being considered in the future. generally smaller unproven entities and as such, connectivity increases their purchasing power
their cost of capital is higher and more volatile which in turn strengthens operator revenues.
Adoption of the ESCO model than that accessible by towercos and MNOs. New
financing solutions will be required to make the Whilst the ESCO model is coming to the region,
The ESCO model has continued to gain traction ESCOs more competitive. panellists felt that rollout would be slow as various
in sub-Saharan Africa with companies including parties test the waters and the business model
both Millicom and Airtel in the process of adopting The differing structure of contracts in place becomes defined. When connected to the grid, MNOs
the model. A strong degree of uncertainty about between MNOs and towercos also affects the pay the utility by power consumed with different
the viability of the model does however still exist, appetite for a towerco to adopt the ESCO model and tariffs available; such thinking should be applied to
particularly amongst towercos in the market. is something that needs to be carefully considered ESCO discussions

Financing options and exit
The IHS bond
With news of the IHS bond fresh off the press at
strategies for MEA’s towercos the time of this year’s Meetup, the subject was the
opening discussion point on this year’s finance
How bonds, IPOs, increasing investor confidence and diversification of the panel. The US$800mn high yield corporate bond
towerco business model are affecting the landscape was listed on the Irish Stock Exchange and is the
largest of its kind listed out of Africa (excluding
Vinson and Elkins hosted a discussion South Africa). The bond has a 2021 maturity and
with Standard Chartered, the IFC and offers a 9.5% coupon. The funds will be used to
OPIC at 2016’s TowerXchange Meetup refinance the debt of IHS Towers NG (formerly
in Johannesburg, examining how the known as HTN Towers, which IHS acquired earlier
finance and investment landscape is this year) as well as refinance some of the IHS
changing in the African and Middle Nigeria’s opco level debt and fund the build of
Eastern tower industry. Discussion 1,650 new towers as part of MTN Nigeria’s rollout
topics included IHS’s bond, the role of plans.
local banks, potential exit strategies
for SSA’s privately owned towercos In discussion of the bond (Ba3 / B+ / B+ (Moody’s /
and IPOs that we could see on the S&P / Fitch)), Standard Chartered’s David Murphy
Rob Dixon (Vinson & Elkins), David Murphy (Standard Chartered), horizon; what are the key trends that explained that uptake of the bond had been very
Suresh Samuel (OPIC) and Eric Crabtree (IFC)
we need to observe? positive, a sentiment which was echoed by the
other panellists. In addition to the positive rating of
Keywords: Acquisition, Africa, Africa & ME, Bankability, Capex, Cashflow Finance, Country Risk, Debt IHS as the parent company (B1; Moody’s), the fact
Finance, EBITDA, ESCOs, Exit Strategy, Global Tower, IFC, IHS, Investment, Investors, Middle East, that the bond was backed by DFI funding and also
Private Equity, ROI, Standard Chartered, Telxius, Towercos, Valuation, Vinson & Elkins had an extensive pre-marketing campaign helped
contribute to the high level of uptake. The IFC’s Eric
Crabtree also added that the size of the bond was
Read this article to learn: ideal which helped contribute to its liquidity.
< Details of the IHS bond and the implications that it has on the tower industry
< Why recent IPOs have failed and what we can expect for towerco IPOs in the future The bond also managed to attract a number of new
< Exit strategies and refinancing options for the region’s towercos investors who had not previously looked at the
< Challenges in obtaining finance for Middle Eastern towercos towerco space, a development which will have a
< Appetites for investment in small cells and DAS positive impact for the future of the tower industry
on a global level.

IPOs on the horizon in the tower industry? look to bolster their portfolios through major are making however to mitigate some of these risks,
acquisitions of MNO tower portfolios. The second have had a positive impact on ratings.
It had been suggested in the industry that the phase involves the integration of the aforementioned
settlement of an bond may be a precursor to an IPO tower portfolios and driving towards operational Whilst the Telxius and Global Tower IPOs have been
by sub-Saharan Africa’s largest towerco. Many in the excellence in order to demonstrate the company’s postponed, there are further IPOs on the horizon
market have expressed their viewpoint that IHS’s size expertise in the market. The third phase is the globally with edotco, China Tower Company and
may preclude an acquisition by a strategic investor preparation of a company for a liquidity event, be potentially Indus Towers all preparing for a listing.
and as such, an IPO may be the optimal exit strategy that a sale to a strategic or a listing on the stock As the markets become more accustomed to the
for IHS’s private investors. exchange. The finance session panellists agreed that tower industry, this will help pave the way for a
potentially the privately owned towercos were not future IPO by a MEA towerco.
On the subject of IPOs, the panel observed that yet in the ideal position for such an event and that
the state of the public markets and the stage of current focus remained on the second phase. Alternative exit strategies for SSA’s privately
development of Africa’s towercos may not be owned towercos
ideal for a listing. A couple of weeks prior to the Closer inspection of Moody’s rating of IHS
With private equity at work in sub-Saharan Africa’s
Meetup, Telefónica was forced to scrap the listing Netherlands Holdco (awarded B1) alongside their
three largest privately owned towercos, it is likely
of its infrastructure unit, Telxius, after insufficient rating of the bond (Ba3 negative) reveals the financial
that investors will be looking at an exit within
investor demand; and more recently, leading Turkish markets’ perception of risk in the sub-Saharan tower
the next 18-24 months and as such we will see a
operator Turkcell postponed the IPO of their carved industry and makes for interesting reading for those
churning of capital, observed the panel.
out towerco, Global Tower, citing uncertainties working towards an eventual IPO - see “How Moody’s
surrounding the US election and cyber attacks. rated IHS” in issue 18 of the TowerXchange Journal.
In the Latin American tower industry there are
regional strategic investors such as SBA and
In the case of Telxius, while some felt the structure Stable revenues from tenants with parent company
American Tower who have a history of acquiring
of the MSA made Telxius less attractive to investors, ratings of Baa3 negative and higher, IHS’ proven
smaller towercos. Whilst 2016 saw American Tower
others felt the inclusion of the company’s subsea strong operating experience, coupled with a long acquire Eaton Towers’ South African unit (as well as
cabling in the unit was the primary factor resulting serving experienced management team and a IHS acquire HTN Towers in Nigeria) we are yet to see
in a lack of uptake from the public markets. Whilst good liquidity profile supported by the ability to a wave of towerco acquisitions across the continent.
the IPOs of companies such as Cellnex and Inwit had draw upon an intercompany shareholder loan, Should a new strategic investor enter the region (for
familiarised investors with the tower asset class, all contribute to the company’ credit strengths. example through the acquisition of MTN’s South
panellists commented that investors were potentially Sovereign risk, a volatile currency, fluctuations in African towers should they come to market), this
unable to reconcile the value of their cable business. diesel prices, exposure to integration risk from the may change dynamics.
acquisition of HTN Towers, escalations in ground
Commenting in a separate panel, Helios Towers lease payments with just 15% of sites on owned land, Funding expansion capital and examining
Africa’s Chuck Green observed that the sub-Saharan the limited scale of the company’s revenue and a refinancing options
African tower industry effectively had three phases. high debt/ EBITDA ratio all contributed to challenges
The first phase was the land grab, whereby towercos on the company and bond’s rating. The steps that IHS The region’s towercos are still capital hungry, not for

the repayment of dividends to their shareholders, it was important that local banks become more
but rather to enable them to keep investing in their involved in providing local currency to towercos
networks. On the question of whether it was now and as the market developed, expected to see more
easier for new towercos to raise capital than it was of this.
Meetup Africa
in the early days of the African tower industry,
panellists felt that the familiarity of the towerco Financing in the Middle East
business model today significantly helped. Plus as
towercos mature and develop stronger operational
excellence practices, further confidence in instilled
With a higher prevalence of towercos in sub-
Saharan Africa, much of the focus of discussions
& ME 2017
in potential investors. remained on the region, however attention did
also turn to the Middle East where a new breed of
3-4 October, Sandton Convention
With the provision of energy as a service a critical towerco is starting to emerge. Given the current Centre, Johannesburg
component in sub-Saharan Africa, there are still
liquidity issues that Middle Eastern banks are
barriers to entry for a new towerco which are higher
facing, panellists observed that the cost of financing
than for their counterparts in Latin America. The
had started to rise in the Middle East and as such,
evolution of the ESCO model, panellists felt, may
the economics of future transactions in the region
however help to address some of these concerns,
would be affected by this.
with a dedicated and experienced party taking
control of the most challenging element of tower
Rooftops, DAS and small cells
operations.
The panel rounded up discussions moving away

In relation to refinancing, the panel observed that
from macro sites and focussing on HetNet solutions.
towercos mature quickly which enables them to
access cheaper capital. As such, they expected to see With many of these sites, the panel observed, the
a number of towerco refinancings on the horizon. capex to deploy such systems is lower and therefore
companies are able to speculate on build-to suit
The increasing role of local banks programmes.
On the question of the role of local banks, OPIC The panel commented that the area of small cells
explained that it was in their remit to support and DAS had been overlooked by many of the
local banks who may not have the experience in region’s towercos and this created a niche for
The 5th annual retreat for 350 leaders of the
providing finance to the sector. DFIs coming into new players. If they could develop the technical
African telecom tower community
play with guarantee tools that help to absorb some expertise and come up with an innovative business
of the risk also assist in supporting the influx of model, there could be some attractive investment www.towerxchange.com/meetups/meetup-africa
local debt into the tower industry. Panellists felt that opportunities ahead

M&A, towerco consolidation MNO consolidation and tower transactions
Since 2010, sub-Saharan Africa has seen MNOs

and maturation in sub-Saharan Africa divest almost 40,000 towers to independent
towercos in a total of 28 transactions, in some
How the region’s tower industry is set to evolve instances retaining equity and in others electing
to sell completely. Whilst the gold rush is over, the
2016 saw the start of in-market towercos still expect a handful of transactions to
towerco consolidation as well as still filter through. Airtel have sold the majority
the opening up of tier two MNO of their sites but still retain towers in a handful of
tower transactions; with MNO countries, portfolios which participants thought
consolidation on the horizon, could well come to market; MTN has monetised
towerco shareholders looking towers in a number of countries and now their
to exit their investments and fine has been resolved in Nigeria, the operator may
the rollout of 4G starting, Helios once again start looking at their tower strategy;
Towers Africa, Eaton Towers, Al and Millicom is known to want to sell out of their
Karama Towers and Citi explain African operations.
how they expect the sub-
Saharan African tower industry In terms of M&A activity between MNOs, the
to evolve. panellists forecasted that consolidation would be
on the horizon; in many markets there are far too
Keywords: Acquisition, Al Karama Towers, American Tower, Africa, Africa & ME, C-Level Perspectives, many licenses and far too many MNOs. Whilst
Carve Out, Citi, Core Network, Backhaul & FTTT, Deal Structure, Eaton Towers, Exit Strategy, Helios MNO consolidation can often be seen as a bad
Towers Africa, HTN Towers, IHS, Infrastructure Sharing, Investors, IPO, M&A Capital, Masts & Towers, thing for towercos due to reduced tenancies, the
Middle East, MNOs, Operational Excellence, Operator-Led JV, Sale & Leaseback, Towercos panel commented how the stability brought by
such activity could have a positive impact. Towerco
business models are built on their validity of their
Read this article to learn: contracts with MNOs and a healthier operator
< Expectations for future tower divestments across Sub-Saharan Africa landscape brings reduced risk to a towerco balance
< How tier two MNO tower portfolios are most likely to be acquired sheet.
< Driving factors behind 2016’s towerco consolidation and alternative exit strategies
< Increasingly important points of negotiation in tower transactions In discussion on MNO consolidation, panellists
< Towerco expectations for diversification of their business models cautioned against operators taking steps with their
towers which may jeopardise their desired M&A

strategy. In the UK, a key factor in the blocking of Chuck Green voiced how active sharing had been towercos have looked at markets and passed on
Hutchison’s takeover of O2 was the involvement of addressed by a simple clause in the contract. them, making the decision to focus their efforts
the MNOs in different joint venture infracos in the Today, active sharing is a key point for negotiation elsewhere. Given the scale of the big four towercos,
market. If an operator is looking to consolidate, they in agreeing the deal terms. there are portfolios which they now view as too
need to be mindful of the effect that tower strategy small or not additive to their business and so have
may have on this. Tier two MNO portfolios shied away from. This does however, he added,
open up opportunities for other towercos. Whilst
The evolution of transaction structures With Africa’s big four towercos having primarily there are risks and potentially limited growth
focussed on the tower portfolios of the continent’s prospects, as long as these are accounted for in the
Whilst the structure of an MLA and the set of terms tier one operators, discussion turned to the business model and pricing then there does exist
and conditions are well defined, transactions are appetite for the infrastructure assets of the regions an opportunity for a certain type of company.
generally bespoke to the MNOs in line with their tier two MNOs.
strategic objectives; Airtel’s tower sales have been One such company is Al Karama Towers; the newly
more about raising capital whilst MTN have been With higher counterparty risk, tier 2 MNO formed towerco is in the process of acquiring
more focussed on valuation creation and the more portfolios are typically less attractive to the larger Expresso Telecom’s 450 sites in Senegal. In addition
efficient deployment of capital. towercos. Eaton voiced their opinion that if you to Expresso’s Senegalese towers, Al Karama also
are already present in a market and you already has an appetite for further tier two MNO portfolios
In terms of how transactions have evolved, Citi understand the operating conditions, there may in markets which are yet to be touched by the
who have advised Tigo and MTN on their sale be some potential synergies afforded by acquiring larger towercos.
and leasebacks, have seen a maturation in the such portfolios and in those instances a transaction
deals, with learnings from previous transactions may make sense. In instances where a towerco Smaller MNOs on the continent are keen to
reapplied. does not however have a presence on the ground, compete with the larger operators and require
the value proposition is greatly reduced. The panel significant amounts of capital to fund the rollout
One significant difference between transactions brought attention to the proposed sale of mCel’s of 3G and 4G in order to keep up with their
in the early days and the current day is that many ~1,000 sites in Mozambique for which the operator competitors. Such players have been looking
deals originally had power as a pass-through. had approached Barclays to run a tower sale. for capital to help fund this expansion and one
This has since transitioned to power as a service Commenting on the sale process Eaton explained strategy to access this capital is through the sale of
becoming the norm, with towercos also exhibiting a that when they had looked at the government their towers.
preference for this as the ability to improve energy owned operator in a country facing a lot of
opex is one of the areas where the towerco can economic challenges, they decided that their time Al Karama’s focus is on this niche, an area in which
make its most significant margins. would be best spent elsewhere. the major towercos in the continent are not keen to
play. By entering these virgin territories with MNOs
Another evolution has been around the issue of Helios’ Chuck Green echoed this sentiment who have previously been overlooked but who
active sharing. In their first transaction in Ghana, adding that there are a variety of reasons that have a strong motivation to sell, Al Karama Towers

is carving out a very interesting niche for itself. their investments. The aforementioned towerco diversification of the towerco business model
By doing the groundwork in greenfield markets, consolidation represents one such exit strategy, a and how this was likely to evolve in sub-Saharan
should the larger towercos look to enter a later date strategy that is a win-win scenario for both parties Africa. With such common principles between
as a response to MNO consolidation or larger tower involved; whilst one towerco achieves an exit, the the towerco business model worldwide (albeit
portfolios coming to market, then Al Karama Towers other increases its chances of a successful exit. with sub-Saharan Africa and some other regions
would make a very attractive acquisition target. having a higher degree of operational complexity),
An alternative strategy would be an IPO. On the the panel thought it important to look to more
Towerco consolidation subject of IPOs, Chuck Green mentioned that it was developed markets, such as the US, and how
important to consider the three phases of a towerco towercos have evolved their business model in
2016 saw the first in-market towerco consolidation, in the region. The first phase was the landgrab, such countries.
firstly with IHS’s acquisition of HTN Towers in whereby towercos focus on external growth
Nigeria and subsequently with American Tower’s through the acquisition of tower portfolios. This is Panellists commented that the diversification of
acquisition of Eaton Towers’ South African business the phase that towercos were in for the past five the towerco business model was inevitable; with
unit. to six years. The second phase requires the focus the rollout of 4G and eventually 5G, small cells,
to shift internally, focussing on organic growth in-building solutions and DAS networks are all
Speaking on the ATC-Eaton transaction, Terry Rhodes and the drive towards operational excellence. going to play an important role in eliminating the
explained how they had looked at HTN Towers’ The towerco business model is built upon selling bandwidth bottleneck. Owning the backbone is
situation as a model of what could happen to a co-locations and towercos need to now deliver strategic as the network moves towards this shape.
towerco in a market where a much larger player is these co-locations and furthermore, achieve In the US, Crown Castle has a big fibre network,
present. Whilst HTN Towers had been in the market operational efficiencies which will improve their the primary reason for this not necessarily for
for a long time, the level of competition from IHS and profit margins. This second phase is where towerco being in the fibre business per se, but rather as
American Tower gave HTN Towers little room for attention is currently focussed. a key element in supporting smalls cell and DAS
manoeuvre. Eaton could see the same thing playing deployment. IHS have entered the fibre space in
out in South Africa and were keen to take the offer With this inward looking perspective towercos can Nigeria and panellists thought that as markets
on the table rather than take the risk of a similar start to see where their weaknesses are and then mature across sub-Saharan Africa, you will see
fate. The transaction also raised funds for Eaton to be work on these weaknesses in order to improve more towercos looking to play a role in fibre, both
able to reinvest in other areas of its business, further their IPO story. At present, Chuck felt, none of owning the fibre themselves and working with
strengthening its position in other markets. the towercos had an optimal IPO story and so parties such as Liquid and Google.
this needed to become the next area of focus for
Towerco exit strategies companies. One thing the panel cautioned that towercos
must be careful of in this space is how the pricing
With private equity at work in three of the big Diversification of the towerco business model model works. Traditional fibre models do not
four towercos, liquidity events are to be expected make financial sense in the context of the towerco
within the next 18-24 months as firms look to exit Discussion on the panel turned towards the business model and so new pricing structures

need to be developed. Another area of caution was Helios’ Chuck Green added that in every market,
in relation to the failed IPO of Telxius. It is widely he has seen independence as crucial in optimising
believed that a key reason for the failed listing was the value of a towerco business. Whilst there
the inclusion of the cable business; fibre cannot are examples of operator led towercos such as
be rated at the same multiples as towercos and so Indus Towers, questions have been raised about
a towerco getting into fibre needs to consider the successful entities such as Indus Towers have
balance of their business and pricing in line with truly been.
this. Meetup Europe 2017
The panel raised the idea that often the creation of
4-5 April, London
Operator-led towercos and joint ventures an operator-led towerco was the first step towards
a tower monetisation. Getting the assets in order
The subject of operator-led towercos was high on and demonstrating their value will help to achieve
the agenda at the 2016 Meetup with an increasing
number of MNOs understanding the value in
a better release of capital as and when you look
to sell but setting a clear path to independence
Meetup Americas
their assets and actively pursuing co-locations. in the carve out of a towerco business is key. Citi 2017
In discussion of the topic, the panel commented cautioned that if the terms of the original sale and
how Airtel had created a towerco (Africa Towers) leaseback agreement were skewed towards the
7-8 June, Boca Raton
originally but then changed their strategy MNO during the carve out, it will be more difficult
completely and sold their towers. In the case of to sell or list the towerco down the road.
Airtel, they had found that other MNOs were not
so keen to lease towers from a company who had a With the Middle Eastern market also in the
Meetup Africa
competitor as their sole shareholder and thus they spotlight at this year’s event and Saudi Arabia & ME 2017
decided to monetise their towers sooner rather than seeing the formation of a joint venture infraco
later. between Saudi Telecom Company and Mobily, the
3-4 October, Johannesburg
panel were asked how they viewed opportunities
That level of distrust and unwillingness to share for such entities. Whilst all agreed that efficiencies
rollout plans with competitors, the panel thought,
was a key barrier to the rise of the MNO-led
could be achieved, challenges around alignment
of business objectives and a willingness to discuss
Meetup Asia 2017
towerco. Similarly, the panel questioned the ability strategies openly would continue to create 12-13 December, Singapore
of the two different companies to operate in a true challenges. Citi observed that they had a 100%
operator-towerco nature, commenting that it was success rate in Africa in arranging a dozen sale
less likely that the towerco would act with the same and leasebacks, whereas when it came to bringing
discipline when negotiating a sale and leaseback MNOs together, that success rate dropped to one www.towerxchange.com
contract. in six

Drivers and inhibitors of
The telecoms landscape
When discussing MENA, whilst one has to be
infrastructure sharing and tower cognisant of the fact there are large differences
between the countries, common threads tie the
sales in MENA region together. A strong Arabic influence, a central

involvement of government in the business sector,
similar climates and environmental conditions and
How and why the market is starting to evolve
a prevalence of key telecom players across multiple
markets (figure one). What’s more, the region
To date, 99% of MENA’s towers sit in the hands of the region’s MNOs. Orange’s cancelled transaction in
as a whole has yet to see the evolution in tower
Egypt, coupled with the cancellation of Mobily and Saudi Telecom Company processes in Saudi Arabia may
ownership witnessed across the globe, with over
suggest that figure is set to remain, however a wave of activity has started and those closest to the market
99% of MENA’s sites remaining in the hands of the
think it is only a matter of time before things start to change. Saudi Telecom Company are in the process of
mobile network operators.
starting a tower joint venture with Mobily; Fanasia have pioneered a new towerco business model in Iran;
and Towershare are reportedly the frontrunners in Kuwait’s first tower transaction. TowerXchange were
The period in which MNOs entered a given
delighted to welcome all three companies to an open panel debate at this year’s Meetup Africa & Middle
market, their market share, how they have funded
East with each of these companies also joining interactive roundtable discussions with a cross section of the their operations, as well as whether they are an
MENA telecom industry’s most important stakeholders. independent company or part of a broader group,
are all factors which influence a company’s strategy
Keywords: Acquisition, Active Infrasharing, ARPU, Bahrain, Build to Suit, Capex, Country Risk, and decision making processes.
Decommissioning, Densification, Egypt, Etisalat, Fanasia, Infrastructure Sharing, Iran, Kuwait,
Leasing & Permitting, Maroc Telecom, Middle East, Mobily, MNOs, MTN, North Africa, Oman, In comparison to other regions, ARPUs in the Middle
Ooredoo, Operator-Led JV, Orange, QoS, Regulation, Saudi Arabia, Saudi Telecom Company, Towercos, East have been relatively well preserved, with the
Towershare, Uptime, Zain region having some of the highest data usage and
with voice still generating strong revenues. MNOs
such as Etisalat and Saudi Telecom Company have
Read this article to learn: particularly healthy balance sheets. Roundtable
< Motivations of the region’s MNOs to enter into infrastructure sharing agreements participants questioned whether the focus of such
< Why MENA’s tower transactions have faltered in the past and what this means for future deals MNOs was geared more towards improving top
< How regulation and the role of government in the telecoms sector influences market dynamics line revenues in place of reducing costs, with some
< Where the biggest opportunities lie for independent towercos observers commenting focus was much more on the
< Leasing and permitting challenges faced in the market former.
< The role active infrastructure is expected to play

Other MNOs in the market are much more capital

Figure one: The presence of major operators in MENA Source: TowerXchange constrained, with highly leveraged balance sheets
and a need to rollout 4G in a bid to keep up with
Etisalat MTN Ooredoo Orange STC Zain their competitors, such players are keenly focused
Algeria on accessing new sources of capital.
Bahrain Quality of service requirements remain a key focus

Egypt for all MNOs in the market. With there often being
little difference in market share between MNOs
Iran in some countries, maintaining that competitive
Iraq edge through quality of service, OTT offerings
or innovative packages are key focal points for
Israel companies.
Jordan
It has been observed that MNOs in the region tend
Kuwait to be very much led by the CTO and only in recent
years have the CFO and commercial teams become
Lebanon
more involved in influencing the strategic direction
Libya of an operator, balancing the technical influence.
Morocco
Government influence and regulation
Oman
The government also has a very strong strong
Palestine
influence on MNOs in the region; several operators
Qatar originated as government-owned entities with
a number still having the government as a
Saudi Arabia
significant stakeholder; others that developed more
Sudan independently often built infrastructure under a
build-operate-transfer structure and thus in these
South Sudan
instances the government would eventually become
Syria a key stakeholder in infrastructure. Some observers
felt that regardless of ownership, MNOs often
Tunisia
operated very much like nationalised organisations,
UAE although this opinion was up for debate. Participants
questioned how a government-centric MNO behaved
Yemen relative to those that were more independent; one

MNO from the region commented how they had a Figure two: Selected tower counts in MENA
culture of being very risk averse, adding that they
were very good “second adopters”, looking at what
innovative strategies have worked for others and
Tunisia
copying them effectively. Kuwait 7,000
Yemen
Lebanon 3,900 5,100
The involvement of the government in the telecoms 2,000
Qatar UAE UAE Iraq Morocco Algeria Egypt Saudi Iran
landscape also meant that MNOs are generally 1,100 8,500 8,500 12,300 17,000 18,000 19,000 Arabia 38,000
subject to high degrees of regulation and taxation Bahrain Oman 32,800
1,700 Libya
and this presented some concerns to those looking 3,200
5,000 Jordan
to enter the Middle Eastern market. Uncertainty 5,900
over how regulation may evolve and expectations
that they may wish to get their cut of revenues in the
sector still remained one of the biggest concerns.
Whilst there has to be moderation in the way that Source: Delta Partners data, TowerXchange presentation
the government is involved in the telecoms sector
in order to not be counterproductive to investment, owned is often held in big blocks by real estate cancelled. With no established towercos of a similar
there are areas in which observers see governments companies which gives MNOs and towercos less scale to sub-Saharan Africa’s ‘big four’ active in
making positive steps to support the telecoms sector. negotiating power. With regards to permitting, MENA, the Saudi MNOs voiced concerns over a new
There are several initiatives to improve coverage participants noted that slow approval times and entrant’s ability to maintain and execute tasks to
to rural areas across the region; in Oman, the requirements from municipalities are often a major their high standard. CTOs require reassurance that
government is pushing infrastructure sharing, in hurdle to pass. the acquiring party not only has the international
Bahrain the government has issued an RFP to look at expertise but also a network of local subcontractors
how to rationalise 1,500 towers in a country that only Infrastructure sharing and motivations to divest and suppliers, a prerequisite which they felt was not
needs in the region of 400 and in Iran municipalities towers present amongst potential candidates.
have mandated infrastructure sharing, which has led
to significant decommissioning. Whilst a handful of transactions have been started Whilst STC and Mobily had hesitations regarding the
in the past, none have seen it through to fruition. sale of their towers, Zain is in the process of selling
Land ownership, leasing and permitting In 2015, Orange Egypt (then MobiNil) agreed the its portfolio of 6,800 sites in Saudi and 1,600 sites in
sale of 2,000 sites, approximately one third of their Kuwait. The MNO has reportedly narrowed down
Ground lease rates in the Middle East are generally portfolio, to Eaton Towers, only for the transaction the offers in Saudi to two bidders and in Kuwait
high, more akin to lease rates in Europe than the to be called off earlier this year. Both Saudi Telecom they are reportedly in exclusive negotiations with
African continent. A significant portion of the land Company and Mobily started tower processes a towerco, who many believe to be Towershare.
is government owned and the land that is privately in Saudi Arabia in 2016, only for those too to be Participants at the Middle East roundtable felt that

once the first transaction had been completed there together closely to ensure that the market evolves region panellists felt that it would be inevitable
would be a domino effect and we would start to sustainably. and that policy may also play a role in driving this.
see the market opening up to further transactions. Active infrastructure sharing makes a lot of sense
Based on previous experience however, participants In terms of the business case for a towerco from a cost perspective for companies that would
felt that processes were likely to still be long and looking to enter the market, the mature nature need to buy a lot of new equipment, for example
drawn out plus with restrictions on ownership of most countries’ telecom industries means that the region’s WiMAX players, but participants felt
in certain countries, deal structures may be opportunities in new build will be limited. One that it was challenging to set up.
complicated. area however where towercos can add significant
value and generate revenue is in decommissioning. In the case of STC and Mobily’s joint venture,
Questions were raised as to how towercos could WIth a high degree of parallel infrastructure in the they have opted to stick to passive infrastructure
validate the commitment of MNOs to a tower sale region, extensive decommissioning programmes sharing. With the operators being at different
process and how one can identify who the serious are required and re-using those towers to meet stages in their lifecycle as well as having different
parties are. It was commented that numerous government targets for improved high speed
amounts of spectrum, the decision was made
parties had spent a lot of money on the STC and broadband coverage to rural areas presents
to not introduce extra levels of complexity and
Mobily processes, only for them to be cancelled. lucrative opportunities.
rather omit active sharing from their plans for
In response to the question, those who were
now.
participating in the transactions commented that Speaking on the Kuwaiti market where Towershare
you could obtain a sense of how serious a process are believed to be in exclusive negotiations with
With regards to negotiating active sharing
was by the attitudes of the MNO when you enter at least one of the MNOs, the towerco voiced how
agreements where towercos are involved, there
the formal process. They also commented that if decommissioning would be very much top of the
are additional levels of complexity. Towershare
the MNO had appointed an advisor to carry out due agenda for a towerco looking to enter the market. In
commented how they were open to discussions
diligence or if they have a financial advisor in place Iran, local towerco Fanasia’s business model is also
with MNOs but that meaningful contracts are
for the process, the board must have approved at very much focussed around decommissioning, with
least US$4mn to get to that point, another indication their latest project aiming to reduce a network of very challenging to draw up when there are so
of their commitment to a transaction. 1,000 sites in Iran’s second most populous city to just many unknowns. Ultimately there had to be some
350. The formation of STC and Mobily’s joint venture agreement to agree on active sharing details at a
Having observed the evolution of the independent is expected to also lead to a decommissioning of a later stage.
towerco markets in other regions, some participants significant number of the two operators’ combined
highlighted the concerns associated with disparate portfolio of over 25,000 sites, with STC stating that a Participants commented that there were different
lease rates across the country. Whilst some lot of investment could have been saved had the two permutations of active sharing and that in
MNOs may prefer to agree on a higher lease entered into the agreement earlier. building solutions would likely come first to
rate in exchange for a higher upfront release of MENA. Speaking on this, Fanasia commented how
capital, this can lead to difficulties down the line Active infrastructure sharing they were working on active sharing agreements
as MNOs benchmark their opex against that of in shopping malls and airports in Iran and
their competitors. Stakeholders need to work On the subject of active infrastructure sharing in the forecasted further work to be done in the field

Improving urban and rural
The East African mobile market and tower
industry
coverage in East Africa When comparing East Africa’s mobile markets some
stark contrasts can be observed. In Tanzania and
Indoor and outdoor DAS, policy changes and innovative business models Uganda you have markets ripe for consolidation
with eight MNOs active in each, whilst in Ethiopia
East Africa is a dichotomy; in urban there is a monopoly with Ethio Telecom being the
areas, increasing population density, sole operator present; SIM penetration ranges
construction and data usage is presenting from around 40% in countries such as Burundi and
MNOs and towercos with one set of Ethiopia and rises to 78% in Kenya; whilst Ethiopia
challenges, whilst meeting coverage boasts the highest broadband mobile penetration at
requirements for a large underserved 58% versus just 4% in Burundi [1].
population in remote, rural areas
presents totally different issues. At Africa’s big four towercos have each established a
the East Africa roundtable at the 2016 footprint in the region; Eaton acquiring portfolios
TowerXchange Meetup, participants from Orange, Warid and Airtel in Uganda and from
focussed on how the East African the latter in Kenya; Helios Towers Africa securing
stakeholders must collaborate to address the Millicom and Vodacom portfolios in Tanzania
East Africa roundtable host Jim Burns, Eaton Towers
challenges at both ends of the spectrum. and American Tower set to enter as a competitor in
the country once their transaction with Airtel closes;
Keywords: 3G, 4G, Active Infrasharing, Africa, Anchor Tenant, ARPU, Burundi, Business Model, DAS, IHS have a footprint in Rwanda having acquired the
East Africa, Ethiopia, Infrastructure Sharing, Kenya, KPIs, Leasing & Permitting, MNOs, Network MTN and Airtel portfolios in the country.
Rollout, Opex Reduction, Opex Sharing, Passive Equipment, QoS, Regulation, Rooftop, Rwanda,
Tanzania, Towercos, Uganda, Urban vs Rural The region has also seen the rise of the operator-led
towerco with Kenya’s Safaricom actively pursuing
co-locations on around 20% of their 4,000 sites in
Read this article to learn: the country and Telkom Kenya looking to pursue a
< The shape of the MNO and towerco landscape in East Africa similar strategy. With regards to future divestments
< How increased data usage is shaping network infrastructure requirements in urban areas by MNOs, rumours have been circulating that
< Challenges presented to MNOs and towercos by increased rates of urbanisation Telkom Kenya will look to monetise their tower
< Models for deployment of in-building solutions portfolio, with the operator having entered into
< Strategies to tackle coverage obligations for remote areas and then cancelled an MLL agreement with Eaton
Towers in 2013.

Figure 1: Mobile market and telecom tower comparison across East Africa covered was in the hundreds, thus demonstrating
the difference in maturity of the two countries. In
Number of % mobile Independent Kenya, one participant estimated that there are
Connections [1] Population [1]
MNOs broadband [1] towercos present around 500 prospective buildings they felt should be
target for IBS.
Kenya 36.3mn 46.7mn 3 19% Eaton
A DAS supplier at the table also felt that Uganda was
Tanzania 38.6mn 54.3mn 8 30% Helios & ATC still quite far behind Kenya in the deployment of
IBS but saw IBS coming in a big way in the region.
Uganda 23.5mn 39.7mn 8 18% Eaton
Rwanda, they felt was showing some of the strongest
promise, with Ethiopia also being a region showing
Ethiopia 42.1mn 100.6mn 1 58% None
significant promise. Uganda and Tanzania, they felt,
Rwanda 8.8mn 11.7mn 4 35% IHS lagged behind these two countries.
Burundi 4.8mn 11.4mn 4 4% None As to the business models for IBS deployment, the
[1] Source: GSMA Intelligence
same supplier felt that MNOs were keen to hand
the responsibility to towercos to execute. One of the
Data growth and usage in the removal of microwave antennae which could towercos at the table explained, however, that IBS
have a negative consequence on towerco revenues. are more expensive to install than a ground based
In reference to the Kenyan market, one participant Towercos in the region need to work out how to tower and as such, the rates that a towerco needs to
present referenced how the data market isn’t as build revenue streams around fibre; there are charge are higher which can make it a hard business
regulated as it should be with the KPIs being set by providers who are charging for bringing fibre to the case for the MNO to justify.
the regulator tending to focus on quality in voice site and as such making money from a towerco’s
services and the number of dropped calls, rather facilities, towercos need to look at this business Another towerco at the table referenced how they
than throughput and speed. There is however model carefully. had completed two in-building projects in Africa
ongoing consultation with the Kenyan Ministry of but didn’t anticipate that it would become a major
Communications in order to set KPIs around quality revenue stream for them. Their motivation for doing
of service on data. In-building solutions the projects was more to continue good relationships
with the operators rather than seeing it as a strong
With the demand for data in the region growing, a Following on from discussions around increased commercial opportunity.
question was raised as to how this is affecting the data usage, a further question was raised on
shape of infrastructure in the market and what how extensively in-building solutions are being With regards to MNO motivations to install IBS,
impact this is having on the towercos present. One brought to East Africa. One participant referenced one participant referenced that it was less about
towerco referenced that as fibre was being brought how they had five buildings covered by DAS in securing new revenue streams and more about
to the tower to support data growth it was resulting Uganda whereas in Kenya, the number of buildings addressing quality issues but that it was harder to

justify capex spend for quality of service. Another Figure two: Ownership of Kenya’s 6,600 towers
participant offered the perspective that many hotels
are currently installing their own WiFi and through 300
this mobile subscribers are using WhatsApp and
Skype. The resulting effect of this action is that 1,000
operators are losing revenue and that deploying IBS
may help protect some of this revenue. Safaricom
Eaton Towers
As to how involved a towerco should get in designing
1,200 Telkom Kenya
and specifying an in-building solution, one towerco 4,100
with experience outside of the African market Other
explained how they preferred to give technical
design responsibility to the anchor tenant. As a
towerco, focus has always been on the passive
equipment and with the active equipment changing
so quickly, they felt specification and management of
this is better managed by the MNOs. Figure three: Ownership of Tanzania’s 7,686 towers
Changes to the outdoor urban landscape 200 54

300
Participants observed that communities are
becoming increasingly opposed to the proliferation 700 Helios Towers Africa
of towers in urban areas, even the proliferation of Airtel*
rooftop sites. As such, new solutions will need to be
found. Urbanisation is also leading to the growth 3,582 Halotel
of high-rise buildings in East African cities which Zantel
is causing challenges for signal propagation from
1500
existing towers. This trend is causing issues for Millicom
MNOs and towercos alike; MNOs lose the ability to Smart
be able to transmit a signal from a given site and
when the site is owned by a towerco, they end up
Other
1,350*
entering into a dispute with the MNO who no longer
wants to pay for rental on that site. With the towerco
having invested significant capex in the site, they are *Pending closure of the Airtel transaction Source: TowerXchange

and so a whole host of different solutions will need
to be assessed.
Improving rural coverage
Whilst much of the discussion focussed around

challenges in urban and densely populated
areas, talks also turned to rural coverage and
obligations placed upon the MNOs to address the
poor connectivity for the high proportion of the
population living in remote areas.
In Kenya, players including towercos, ISPs and

MNOs are required to pay a percentage of their
revenues into a universal service fund. At present
however, only the GSM operators are able to access
the fund. Other parties are currently working with
the regulator to change legislation so that anyone
who pays into the fund is able to access it in order
to make coverage expansion in underserved areas
understandably not willing to lose their revenue and Such a solution could be transferred across to East commercially viable.
as such an agreement needs to be reached. African markets.
One of the concerns around such a proposal is that
Participants felt that this was an area where Another challenge presented to towercos and although a towerco may access the fund to build
ultimately there needed to be improved MNOs is the creation of large and highly secured a site, this does not guarantee that an MNO would
communication between the building owner and residential estates. Such dwellings have proven hard automatically use that site. MNOs at the table felt
the operator. It is in the best interest for both parties to penetrate with 3G which has led to complaints that towercos would need to work at creating a
that building tenants have access to a robust signal amongst residents. However due to their highly model which would give the regulator and MNOs
and so counterproductive to exclude the interests of secure nature, gaining access to these estates to that assurance.
the other party. Participants also felt this is an area work on a solution is tough. One potential solution
where regulators should be getting more involved. to explore for such settings is outdoor DAS; with With the towerco business model being based on the
In major cities in Nigeria, one of the regulatory the sites needing power, attaching such antennae to addition of multiple tenants, developing a solution
agencies has proposed that any new building over streetlights could present a very interesting strategy that is commercially viable in an underserved area
a certain height needs to have a solution built into in order to improve coverage. When it comes to with no grid connection that would most likely only
it and is in the process of trying to put this into law. targeting these areas however, no one size fits all have a single tenant presents a particular challenge.

Figure four: Ownership of Uganda’s 3,485 towers
792
1,300 Eaton Towers

American Tower
In addition to that, in some remote areas, such as

MNOs
the East of Kenya, there are increased security risks
which further complicate rollout. Developing a 1,393
solution to this requires collaboration between the
full value chain in order to bring a cost effective
alternative to the market. Figure five: Percentage of the population living in urban and rural areas
in select East African countries
One participant at the table had been working
on rural coverage in Zambia, developing a low Tanzania 32% 68%
tower, low power solution. The model had initially
proposed a revenue sharing agreement with MNOs
Rwanda 29% 71%
but with such low ARPU in the region, this had never
got off the ground. The company has since looked at
developing a WiFi solution in conjunction with an
Kenya 26% 74%
ISP and a more lenient licensing structure, whereby
the WiFi is funded by media owners who use the Ethiopia 20% 80%
platform for advertising.
Uganda 16% 84%
One MNO at the table shared their experience in
extending free coverage to individuals through Burundi 12% 88%
agreements with bus and taxi owners. The owners
of the buses bear the cost of the service and use it as 20% 40% 60% 80% 100%
a loyalty scheme or attraction for their customers.
Population living in urban areas
Such innovative models are important in finding
ways to deliver coverage more cost effectively Population living in rural areas Source: CIA World factbook

A shake-up of South Africa’s
The current shape of the South African mobile
market and tower industry
telecoms infrastructure South Africa has four MNOs, with Vodacom and
MTN leading the market with 38% and 36% of
How MNOs, towercos, government and 5G evolution are shaping the future mobile subscribers respectively, Cell C possessing
23% market share and Telkom accounting for just
The shape of South Africa’s telecoms network infrastructure has 3%. There are also a number of MVNOs which hold
undergone significant changes in the past twelve months, with less than 1% of the subscriber base (figure 1).
further shake-ups on the horizon. From operator-led towercos
and Cell C’s plans to rebuild their tower portfolio, to American The country has an installed base of just under
Tower’s acquisition of Eaton Towers and the Government’s 30,000 towers with each of the MNOs, bar Cell C,
proposal to create a Wholesale Open Access Network. Such retaining their tower portfolios. Whilst Cell C had
developments made for interesting debate at TowerXchange’s sold their portfolio of 1,400 sites to American Tower
2016 South Africa roundtable as participants voiced their back in 2010, the operator is now in the process of
concerns, ambitions and forecasts for the year ahead. rebuilding their own network (more of which later).
Keywords: 3G, 4G, Acquisition, Active Infrasharing, Africa, Africa & ME, American Tower, Anchor Tenant, Having entered the market following the acquisition
Atlas Tower, Blue Sky Networks, Capacity Enhancements, Capex, Cell C, Co-locations, Coast to Coast, Comco, of the Cell C towers, American Tower are the largest
Construction, DAS, Densification, Eagle Towers, Eaton Towers, Infrastructure Sharing, Lease Rates, Leasing towerco in the South African market with a portfolio
& Permitting, LTE, Market Overview, Masts & Towers, MNOs, MTN, Network Rollout, Opex Reduction, Pro of 2,309 sites after their recent acquisition of Eaton
High Site Communications, QoS, Regulation, RF Design, Sale & Leaseback, South Africa, Southern Africa,
Towers’ 300 South African sites absorbed their
Telkom, Towercos, Vodacom
largest competitor. In addition to American Tower
there is a long tail of other independent towercos in
Read this article to learn: the country, with fast-growing Atlas Tower and their
< Mobile market shares and tower ownership in the South African market 171 sites heading the group. In addition to the MNOs
< The role South Africa’s MNOs see for towercos and how they would like business models and and towercos there are approximately 7,500 sites
pricing to evolve managed by broadcast, web and other industries
< New build requirements and challenges faced by towercos and MNOs (figure two).
< The impact of the American Tower - Eaton Towers transaction and speculation surrounding an
MTN tower sale The rise of the operator-led towerco
< Proposed mechanisms and models for 5G deployment and indoor coverage expansion
< How the National Integrated ICT Policy White Paper could affect the South African market Much discussion on the South African table this
year centred around the role for towercos in the

Figure 1: MNO market share of South Figure two: Ownership of South Africa’s ~29,500 towers
Africa’s 85.1mn subscribers (FY2015)
MTN
9,000 Vodacom
23% 7,500
Telkom
Cell C
36% 3%
<1% ATC South Africa
150
171 Atlas Tower
2,309 Smaller independent towercos including
38% Eagle Towers, Blue Sky Towers, Comco
500 3,500 and Pro High Site Communications
7,000
Vodacom MTN Cell C Others including broadcast and web
Telkom MVNOs industries
Source: Business Tech Insider Source: TowerXchange
South African market, particularly in light of the The balance of towercos and operator-led new challenge for operators and towercos alike. It was
fact that each of the South African MNOs are now build of macro sites suggested that American Tower’s recent acquisition
actively pursuing co-locations on a commercial of Eaton Towers was as much about the latter’s
basis between themselves; effectively functioning as Whilst the capability of MNOs to build, manage and portfolio of 1,000 sites under development as it
operator-led towercos. lease up their own tower portfolios is increasing, was motivated by the acquisition of their existing
participants at the table raised the fact that portfolio of 300 sites, and that generally towercos
The success of the towerco business model, operators had undergone a massive rationalisation had been more successful in acquiring highly
referenced one of the MNO representatives present, of staff in recent years, through which much of their desirable sites than had the MNOs. Operators at the
has demonstrated to operators that there are decent expertise in rolling out new sites had been lost. It table agreed that this was one of the key strengths of
revenues to be made in the space and as such, was also observed that historically MNOs had been towercos in the country.
leasing up their towers is becoming an increasingly given large reserves of capital with which to acquire
important strategy. What’s more, South Africa’s new sites but that the funds had often not been well Whilst towercos argued their ability to rollout
robust and extensive electricity grid means that the used, often sitting untouched. As a specialist skill set sites minimised capex spend for MNOs, one of the
energy challenge and costs faced by MNOs across in high demand, some participants felt that it would operators explained that their own ability to access
much of sub-Saharan Africa are of less concern to take operators a while to build up highly effective cheap capital, combined with the high towerco
South African operators and as such, much of the teams in order to manage rollout more effectively. lease prices in South Africa, meant that in current
value that a towerco can add is removed. Acquiring sites in key locations represents a major market conditions it sometimes made more financial

sense for MNOs to build their own sites. They did When questioned on their appetite to own versus There had been rumours circulating in the public
however explain that there are certain times of year lease land, it was referenced that towercos will domain that IHS had been in discussion with MTN
when they are more capex constrained and in these aim to buy the land when they can or aim for regarding a tower sale, with the towerco having
instances it would then make sense to work with long term (~40 year) leases. One of the challenges acquired the operator’s sites in Cameroon and Cote
towercos more closely to manage network expansion. in purchasing land, referenced one of the MNOs d’Ivoire and the two parties having entered into a
present, is that you only want a small area, however joint venture in Nigeria. It was referenced however
Reflecting on whether new site build was best the effort that goes into portioning off a section of that the South African market was very different to
managed by towercos or operators however, MNOs land often doesn’t make the exercise worth it. One these countries and as such there would be different
agreed that the level of demand for new sites over of the smaller independent towercos referenced motivations and considerations when looking at a
the next two years would mean that both would have that this is where their strength really comes in. deal.
an important role to play. The volume of new site As a smaller, more nimble company, they can look
build required far outstrips the capacity of MNOs to at alternative use of the land that is not being used Should MTN’s towers come to the table, however, it
deliver such numbers alone and as such, towercos by the tower - for example, a small factory could was observed that a deal would be complicated by
will be key partners in the process. be built on the land, thus finding further ways to the fact that around 1,500-1,800 sites are shared with
monetise their investment. A towerco’s ability to other MNOs, with some of them having been paired
Whilst towercos are a useful partner, one area where do this is one of its key strengths above an MNO; off with other operator sites. Uncoupling these sites
network planners would like to see an improvement flexibility is their niche. and starting to invoice each other for space used
was on the visibility of sites that towercos were able would present an added level of complexity to the
to offer. It would be highly valuable for network Participants at the table reported seeing an execution of such a tower transaction.
planners to be able to automatically view the stage of increasing number of approaches from ground
development or construction of each of the towerco lease aggregators in the market, whose involvement As to how such a transaction would impact on
sites, enabling them to weigh up their options more will further intensify property management smaller towercos in the market, representatives
efficiently when designing the timely rollout of their challenges that MNOs and towercos are facing. from such companies felt that there would be a
networks. positive impact. When a major transaction occurs,
Speculation surrounding an MTN tower sale one participant observed, a vacuum is created in the
Ground leases aggregators and property concerns country whereby the other MNOs come rushing to
It would not be a South African roundtable the smaller towercos.
Escalating ground lease rates are causing significant discussion without questions surrounding the
challenges, as the price of real estate continues to likelihood of an MTN tower sale being raised. The American Tower - Eaton Towers transaction
rise exponentially in South Africa. One participant With the company’s primary focus being on
referenced how it was hard for the sector to keep opex reduction at present, a tower sale was not One of the biggest talking points in the South African
pace with the amount of money that is filtering into something that participants expected to happen tower industry in the past year was American
real estate in the country and expected the problem imminently, although of course there were plenty of Tower’s acquisition of Eaton Towers, which had
to become more acute. interested parties present. been met by opposition from the MNOs in the

market. With American Tower possessing just over of towerco pricing models. At one end of the areas and pay for the service they use was met with
2,000 of almost 30,000 sites in the country however, spectrum, American Tower’s pricing is pretty approval from MNOs present.
South Africa’s competition commission ruled that much all inclusive, whilst at the other end of
there was no case to answer and as such the merger the spectrum some towercos charge extras for The move to 5G and the role of disruptive
was cleared. absolutely everything. technologies
Participants observed that it was no secret that MNOs questioned towerco appetites to offer Participants at the table forecasted that 5G would
American Tower’s lease rates were considerably discounts to anchor tenants as additional tenants explode in the US and Europe in 2019 and 2020,
higher than those of other towercos in the market are added to sites. One towerco referenced with this filtering through to South Africa around
(with one party suggesting rates were almost double), this was a model that worked well in other 2022/23. Most at the table felt, however that there
as function at least in part of the high leaseback markets and is something that they were open to was still some way to go in understanding how the
rate agreed with Cell C, a deal which was structured discussing. deployment of 5G should be executed, with one
to maximise cash released at the time of sale. One person commenting that RF planners and real estate
MNO suggested they had a moratorium on the use One participant at the table questioned towerco teams often have very different ideas.
of American Tower sites, at least until their lease appetite to get into fibre as a means of offering
rates came into line. A merger between the American additional services in the market. Whilst some All were in agreement that macro sites wouldn’t go
Tower and Eaton Towers has caused concern from towercos are starting to assess this, one company away, rather you will see 4G and 5G equipment hung
MNOs using Eaton’s sites, however measures have referenced that the adding fibre to the towerco on towers in place of the 2G and 3G that is there
been put in place to protect existing contracts. business model hasn’t always been effective in the today. When it came to deploying small cells, it was
US, as the anchor tenant usually wants to control commented that you wouldn’t always need permits,
On the subject of the transaction, the smaller towercos the fibre and make money from it. What’s more, all you might require was a fibre connection with
present felt that American Tower’s acquisition of with so many fibre players in the South African one participant commenting that simply installing a
Eaton has had a positive effect on their business. market already participants questioned whether network of routers in residential properties would
Should the Eaton portfolio have been acquired by there was a role for a towerco to play. create a small cell network, whilst others talked
a new entrant to the market it would have caused about the Bluetooth experiment that had been
concern, but the consolidation of the number one One area where participants did see towercos conducted in Boston to create a communications
and number two towerco has driven further business expanding successfully into was small cells and network.
towards the smaller independent players. indoor DAS. Whilst in the instance of the Mall of
Africa the role for an independent infraco was On the subject of whether investing in street
Evolving pricing mechanisms and business models bypassed with the four MNOs collaborating on an furniture constituted a sensible decision for
extensive DAS installation, instances where not all towercos, some felt that it constituted a very high
One operator at the table said that they had been MNOs are keen to invest make sense for an infraco capex investment for very little return whilst others
undertaking benchmarking of towerco pricing, to get involved. The proposal by one towerco observed that this had been big in Europe since the
finding considerable variation in the structure that MNOs could opt for coverage in just select 1990s.

Creating new synergies Postal Services’ National Integrated ICT Policy White
Paper.
With increasingly thin margins across the
industry, discussion moved to the synergies The paper calls for radical changes in the
that can be created by a single party managing telecommunications market, including the creation
maintenance of both active and passive of a Wireless Open Access Network (OAN). All
equipment, with operators referencing that this unassigned high-demand spectrum (essentially LTE
would be a desirable outcome. What’s more, spectrum) would be set aside for the OAN and what’s Meetup Europe 2017
reducing the number of people with access to a more, the paper also puts in place the suggestion that
4-5 April, London
site also reduces risk. the government can take back spectrum previously
assigned to the MNOs. The white paper proposes
One participant at the table suggested they felt that competition will only happen at the service level
there needed to be closer interaction between and that the OAN will be managed by a consortium Meetup Americas
MNOs. Rather than each operating, rolling out and which will operate with ‘competitive neutrality’.
building their own network of sites and creating 2017
parallel infrastructure, there should be improved The white paper has been met by opposition
communication so that the rollout costs can be particularly amongst the larger operators who
shared. If the government 2030 targets are to be see their network as a competitive differentiator,
met, the participant continued, it makes sense for and who have concerns about spectrum not
MNOs to consolidate budgets. With MNOs typically being allocated in proportion to the number of Meetup Africa
reluctant to discuss their network planning with subscribers each operator has, a move they feel
their competitors, one participant questioned how which will compromise their quality of service. & ME 2017
such a model could be executed, whilst others The announcement of the white paper on spectrum
raised concern over when this would constitute caused MNO share prices to fall, a downward trend
anti-competitive practice. A potential solution, which has persisted.
one person suggested, would be the creation of a
neutral independent party to oversee the process. The white paper has also held up the recent
spectrum auction in South Africa, with the
Meetup Asia 2017
The government’s draft ICT white paper and the Independent Communications Authority of South 12-13 December, Singapore
spectrum auction Africa (ICASA) having made the decision to proceed
with the auction, only for this to be blocked by
Discussions around pooled resources led the High Court following a challenge from the
to another big topic of the day, the South Department of Telecommunications and Postal www.towerxchange.com
African Department of Telecommunications and Services

Distributed generation
working group report
TowerXchange hosted our inaugural working groups at our recent
TowerXchange Meetup Africa. These unique discussions help vendors
understand the real operating conditions for leading buyers at MNOs,
towercos and their subcontractors, identifying specific requirements
and revealing much about procurement criteria. In our distributed
generation working group, we focused on diesel, hybrid and
renewable generation, drawing upon the experiences of two towercos,
two MNOs, an ESCO and three of Africa’s leading managed service
providers.
Working group members, buyers:

Airtel Nigeria, ANTOSC, Econet Power, Helios Towers Africa, Vodafone
Working group members, managed service providers:

Camusat, Likusasa, Mer Group
Working group members, suppliers:

Ascot, Ausonia, Beijing Dynamic Power, Bladon Jets, Delta, Eltek,
Emerson, Enatel, Flexenclosure, Generator Logic, Heliocentris,
HIMOINSA, Huawei, IPS, IPT Powertech, Mantrac, Pramac, Sedemac, Total
Distributed generation Working group recommendations
Key recommendations Key learnings
RECOMMENDATION 1: Convert indoor sites to LEARNING 1: Lead acid is still widely used as the default energy storage chemistry, although lithium-ion is
outdoor where possible. The energy load of an
being explored by several buyers.
indoor site can be 3-4x that of an outdoor site.
LEARNING 2: It is critical that vendors understand who is responsible for distributed generation equipment
in different scenarios; whether the MNO or towerco, and whether the towerco manages just AC or a full DC
RECOMMENDATION 2: Vendors should respond power service.
more specifically to RFPs instead of pitching off the
shelf solutions which buyers complain often don’t LEARNING 3: All the buyers in the working group selected suppliers on the basis of total cost of ownership
meet their needs. (TCO), so a low upfront capex solution might prove unattractive if maintenance was expensive and/or if the
lifecycle of the equipment fell short of expectations.
RECOMMENDATION 3: Buyers should consolidate
suppliers and standardise equipment to the LEARNING 4: Early experiences with ‘all in one’ pre-integrated powercubes have been mixed, with many let
down by poor quality connections between components. Power cubes designed and integrated by a single
narrowest range possible to enable their installation
supplier had been found to be more reliable to date.
and maintenance teams to develop expertise in the
chosen systems.
LEARNING 5: You cannot just replace diesel without risk of violent repercussions from the ‘Diesel Mafia’.
RECOMMENDATION 4: Security guards and other LEARNING 6: “Technology is not the biggest issue – people are.” Skills are scarce when it comes to the
local stakeholders must be fairly compensated to installation and maintenance of complex distributed generation systems; make them as simple as possible,
avoid conflicts of interest. and training is key.
RECOMMENDATION 5: You cannot optimise LEARNING 7: The cost of ground rent can destroy the business case for substantial PV arrays.
energy opex by looking at distributed generation
LEARNING 8: African towercos have largely built through the acquisition of legacy cell sites, and many of
in isolation: the best results are achieved when
these older sites have indoor configurations that are tough to hybridise. Many towercos will sweat their
the genset, rectifier and battery work optimally
acquired energy assets until the end of their natural lifecycle before replacing – vendors may have to be
together.
patient for towercos to invest in hybrid and renewable energy.
RECOMMENDATION 6: Towercos must treat LEARNING 9: Appetite for super-silent gensets ranged from less than 1% of the network to as much as 10%.
suppliers as genuine partners, sharing training,
sharing performance analyses and working LEARNING 10: RMS is only an effective tool to combat fuel pilferage within the supply chain if employees can
together to ensure continuous improvement. effectively be held accountable.

Executive summary Energy storage consists exclusively of lead acid
batteries to date, although Econet Power are looking
at lithium-ion.
Helios Towers Africa
Helios Towers Africa has around 3,500 sites in

Tanzania, 1,600 in the DRC, 400 in Congo Brazzaville,
and 750 in Ghana. Of these a little over 800 in
Tanzania are off grid, plus around 640 in the
DRC and 180 in Congo Brazzaville. No figure was
disclosed for off grid sites in Ghana.
Helios Towers Africa find grid conditions in

Tanzania currently to be relatively reliable, with an
average of perhaps 18 to 19 hours of good grid per
day. That drops to 14-15 hours in the DRC, where the
company are deploying their first 50 site solar trial.
It should be noted that Helios Towers Africa had

Econet Power Around 80% of Econet sites have outdoor equipment, provided an AC power service only in Ghana, but
typically with a 2-3kWh load. The remaining 20% of that is now being evolved to full DC power services.
Econet Power is a new ESCO-type carve out from indoor sites have much higher loads, typically in the
Econet’s home market of Zimbabwe. Sister company 8-10kWh range. Helios Towers Africa are currently deploying
Econet Towers is a ‘steel and grass’ towerco, improvement capex to integrate recent acquisitions
managing only the land and the towers, while Grid conditions in Zimbabwe have improved from Airtel in the DRC and in Congo Brazzaville.
Econet Power manages the energy systems at 1,380 dramatically, from typically ten hours of downtime
sites, of which 48 are off grid. Of these 44 have been per day to an average closer to three, as a function Two philosophies drive Helios Towers Africa’s
converted to solar power. of a recent power purchase agreement, although procurement strategy: lean six sigma and an
whether this is sustainable remains to be seen. imperative to treat suppliers as genuine partners.
Econet Power are seeking to utilise renewables on Protecting sites against a potential reversion to
as many as 650 sites, rising to 1,000 sites. Their RFP previous grid reliability, Econet typically sends out Helios Towers Africa recently concluded partner
was drawing to a close during the Meetup, to be RFPs seeking 10-20 hours of autonomy, although they selection, with at least two approved suppliers in
followed by a proof of concept phase with a view to noted that many of their RFP requirements were not each supplier category. The move to standardise
deployment in February 2017. being met. equipment was motivated by the wide variety

“
of systems deployed at sites, which was adding
complexity and cost to O&M.
Airtel Nigeria
Technology is not the issue when it comes to solar power – people are.
Airtel has around 6,000 cell sites in the ~25,000 site A DG might last eight years in Africa and a solar system 15 years, but if
Nigerian market, although 4,719 sites have been sold
to American Tower (Airtel retains “a few” sites as
well as 16 data centres).
people issues mean you cannot get the full value out of the system, whether
it be due to vandalism and sabotage, or simply because you cannot hire
field maintenance engineers who understand the system, then the value
“
Only 20% of Airtel’s sites are on grid, and many of proposition breaks down
those on grid sites have useable power for only half
the day, qualifying them as unreliable grid sites.
capex, transportation, maintenance et cetera. Asked ANTOSC were seeking plug and play, efficient,
It is not unusual to see DGs running in tandem 24/7 if there was a magic number in terms of return on integrated solutions upgradeable for two to three
in Nigeria, where 2,500L of diesel can be burned per investment, Vodafone’s representative said there tenants. Load averaged 2.5kWh, rising to 5kWh at
site per month, costing around US$3,000. The opex was no fixed number, but that a sub-three year ROI peak, per tenant.
challenges this creates are compounded by theft and was often required.
escalating lease costs as landlords raise prices. Managed service providers
30% of sites was the current suggested addressable
Several multi-country managed service providers
Airtel Nigeria are committed to ‘going green’, seeking market for hybrid and renewable energy
also participated in the working group, including:
the most beneficial solutions from a TCO (total cost of innovations.
< Camusat, which operates around 5,000
ownership) point of view.
sites across 20 countries, offering a full suite of
ANTOSC installation, operations and maintenance
Vodafone services, with an optional full service opex
ANTOSC is a new towerco being created in response model.
Vodafone were represented by the Network Site to the infrastructure sharing mandate in Angola. The < Likusasa, another turnkey installation and
Infrastructure team at Vodafone Procurement company hopes to have 90 sites by the end of 2016. upgrade firm which installs around 100-150
Company, which is responsible for procurement power systems per year across multiple African
across over 50,000 Vodafone, Vodacom and There are around 2,000 towers in Angola, with markets.
Safaricom sites in Africa. perhaps a further 2,000 needed, particularly if a < A third turnkey infrastructure provider, Mer
third MNO were licensed. Around 30% of sites are Group, called attention to their involvement in
Like Airtel, Vodafone are committed to ‘going on grid, although grid quality was described as designing and installing innovative remote sites
green’ and reducing carbon emissions, evaluating ‘unreliable’, with 70% off grid, mostly powers by to reduce reliance on diesel, with complete hybrid
solutions on a TCO basis, incorporating up front diesel gensets. energy systems for sites as small as 300-500W.

Hybrid and renewable power so we can get the best out of our equipment.” and data centres in Spain and Italy, but we’ve
deployed some power cubes in Albania and
All participants spoke of their companies’ The economics of utilising solar at single tenant Romania,” said one participant. “We’re responding
commitments to reduce carbon emissions and reduce sites were felt to be challenging due to the to carbon emission reduction commitments in the
energy opex. substantial ground rent costs of the space for PV UK, but the targets are not always as clear in Africa.”
arrays, suggested one participant, while another
One participant highlighted that running DGs 24/7 suggested they had demand for solar across sites Diesel gensets
in dense urban areas like Lagos could be seen as a with loads from 500W to 8kWh.
health and safety risk, which had prompted the local “We don’t buy off the shelf gensets,” said one buyer.
government to review energy permitting. Another One reason why hybridisation is proceeding slower “It’s never about one solution: it’s about how the DG,
participant admitted their company was burning than many vendors might have hoped is that the rectifier and battery work together.”
800,000L of diesel per month – seeking to reduce sites towercos are acquiring in Africa have a lot
that figure by 50% would also remove a significant of shelters; legacy configurations that are tough “We were replacing an average of 1.5 contactors
proportion of exposure to risk of fuel theft. However, to hybridise. It is often more economical to sweat every day,” said another buyer. “As a result we now
the risks of repercussions from the so-called ‘diesel acquired power assets to the natural end of their use DC control changeover switches.”
mafia’ could extend beyond vandalism. life cycle, than to hybridise immediately (although
TowerXchange have heard unconfirmed reports Sound levels were another topic of discussion. It
Tighter governance of security, starting with making that IHS, among others, tend to hybridise sooner seems there is little consistency in the regulations
sure security guards are fairly paid and local after new sites are acquired). governing sound levels, to the extent that some
community stakeholders engaged, were cited as regulations specify a decibel limit, but lack detail
mitigation steps. Effective remote monitoring of fuel, Experiences deploying early power cubes were on how far away from the site that measurement
it was noted, demanded alignment of interests: with mixed, with some buyers complaining that these should be taken! Regulation often differentiates
much fuel theft originating within the supply chain, ‘all in one’ pre-integrated, containerised solutions between daytime and night time noise limits: for
there remained a high risk of sabotage of telemetry were difficult to install, often let down by poor example in one market the limit was 70dB limit
systems if the contractors and their employees could quality connections. “We’ve had to dismantle some during daytime, 55dB at night, prompting the
not be effectively held accountable. power cubes,” complained one buyer. Better results local tower owner to adjust their specs to a 69dB
had been achieved with power cubes designed daytime limit regardless of load. One supplier called
“Technology is not the issue when it comes to solar and integrated by single suppliers. The weight and attention to the capability of some controllers in
power – people are,” said one buyer. “A DG might last logistical challenges of transporting power cubes hybrid systems to automate the imposition of a
eight years in Africa and a solar system 15 years, but was cited as another differentiator, while another curfew, reducing night time noise levels. Ultimately
if people issues mean you cannot get the full value buyer called attention to customs and regulatory the tower owners in the working group felt they
out of the system, whether it be due to vandalism and conditions which may make it more favourable rarely needed to invest in super-silent DGs: one
sabotage, or simply because you cannot hire field for imported items such as power systems to be stakeholder suggested as much as 10% of the
maintenance engineers who understand the system, packaged. gensets in their network for super-silent, another
then the value proposition breaks down. That’s why two suggested the figure was less than 1% in their
we feel it’s essential to educate and train our people, “We tend to use DG as backup power at cell sites networks

Energy storage
working group
report
Lively debate characterised the inaugural energy

storage working group at the TowerXchange Meetup
Africa 2016, where dozens of experienced buyers and
sellers of batteries exchanged insights into how to
extend lifecycles in challenging operating conditions
in Africa and the Middle East.
Working group members, buyers:

Econet Power, Helios Towers Africa, Vodafone,
Leadcom, TowerTech
Working group members, suppliers:

4energy, Aquion Energy, Energic Plus, EnerSys,
Fluidic Energy, GNB (Exide), GS Yuasa, NorthStar,
Redflow, Saft
Energy storage Working group key learnings
Key learnings
LEARNING 1: There are a lot more lead acid batteries deployed at SSA cell sites LEARNING 8: The typical power load on a cell site in Africa is around 2-3kW
than alternate chemistries – lead acid probably still has over 85% market share per tenant, rising as high as 8-10kW for indoor and hub sites. The load on
single tenant, low cost rural sites can be as low as 300W-1.5kW
LEARNING 2: Buyers felt that vendors of alternate energy storage chemistry
solutions needed to do a better job presenting a “full business case, with LEARNING 9: The unpredictability yet severity of grid outages in SSA demand
complete costs and ROI” significant autonomy, which in turn means battery banks will be ‘lazy’ for long
periods
LEARNING 3: At a “legacy” African cell site, a lead acid battery might last 18
months. With modernisation and process optimisation, that can increase to 24- LEARNING 10: Cell site autonomy requirements vary widely across the
30 months, although some MNOs are still seeking five year lifecycles continent; the lowest we heard was for 4 hours, the highest for 10-20 hours.
LEARNING 4: Cell site owners need to optimise the relationship between the
LEARNING 11: There may be a case for mixed battery banks including
rectifier and the batteries in order to maximise equipment lifecycles
lead-acid and lithium ion batteries to cater to a greater variety of operating
conditions, although one buyer suggested <10% of their sites might suit such a
LEARNING 5: The process of battery hybridisation of MNO’s African cell sites
configuration
is nowhere near complete – there is a substantial addressable market, and a
substantial replacement system market
LEARNING 12: Battery theft varies across Africa: we heard a range between
“negligible” and “higher than 5%”
LEARNING 6: Towercos’ upgrade of energy equipment acquired at the towers
formerly owned by MNOs doesn’t happen overnight – sites acquired several
LEARNING 13: Integrating monitoring systems into “intelligent batteries” is a
years ago are not all up to spec, while other sites have only recently been
promising development, but MNOs and towercos often struggle to translate the
transferred
volume of data into actionable intelligence
LEARNING 7: Towercos own >40% of Africa’s cell sites, and provide a full
DC power service at the majority of those sites – meaning towercos now buy LEARNING 14: Standard battery warrantees are meaningless in challenging
the batteries for almost half Africa’s cell sites, including the majority of sites grid conditions; a few alternate chemistry energy storage vendors are offering
occupied by Airtel, MTN and Millicom warrantees based on a guaranteed kWh output

Executive summary lead-acid batteries, across their 6,556 site network.
Helios Towers Africa’s portfolio spans four countries

and a range of vintages, from older portfolios in
Ghana (750 sites), and Tanzania (3,500) to newer
acquisitions including 400 sites in Congo Brazzaville
and the Airtel DRC sites, bringing their count in the
country to around 1,600.
Helios Towers Ghana is shifting from AC only to a

full DC power service, starting with around 300-
400 Millicom sites, which are being converted from
indoor to outdoor sites at the same time.
Grid availability in Ghana has returned closer to

norms prior to the devaluation of the local currency,
the Cedi, which saw availability slide from and
average of 22 hours to 14 hours back in January
2015. Grid conditions in Tanzania are also relatively
reliable, at just under 20 hours of good grid per
day, while in the DRC availability drops to 14-15
hours, although grid reliability falls dramatically
Sub-Saharan Africa may represent the world’s TowerXchange’s inaugural energy storage working (before it disappears altogether) outside Kinshasa,
toughest operating conditions for energy storage group convened in Johannesburg in October 2016 to Lubumbashi and Goma. Helios Towers Africa has
at cell sites. Poor grid reliability means it can be highlight these operating challenges and to challenge around 640 off-grid sites in the DRC, where the
impossible to maintain disciplined charge/discharge buyers and sellers of batteries to work in closer company are deploying their first 50 site solar trial,
regimes. High operating temperatures, combined partnership to devise products and processes to and 180 off-grid sites in Congo Brazzaville. A further
with a legacy of indoor site configurations, often enhance battery performance at African cell sites. 800 Tanzanian sites are off grid.
require that premium high temperature batteries be
installed. Premium batteries, particularly those with Let’s start our report with snapshots of three of the Vodafone
domestic or light industrial re-use scenarios, become key battery buyers present at the working group.
targets for theft. And maintenance regimes and Vodafone were represented by the Network Site
maintenance skillsets aren’t always optimum. This Helios Towers Africa Infrastructure team at Vodafone Procurement
all combines to mean that the lifecycle of a backup Company, which is responsible for procurement
battery bank at an African cell site can be as short as Helios Towers Africa has widely deployed charge across over 50,000 Vodafone, Vodacom and
18 months. discharge (CDC) battery hybridisation, mainly using Safaricom sites in Africa.

Vodafone are committed to ‘going green’ and a hub site even higher, but most sites have a power such an approach could prove viable.
reducing carbon emissions, evaluating solutions on load around 2-3kW per tenant. Energy efficiency
a Total Cost of Ownership (TCO) basis, incorporating initiatives can bring that down to 1.5-2kW. How to extend battery lifecycles?
up front capex, transportation, maintenance et
cetera. Single tenant, rural sites might typically be in the How long are batteries lasting? “At one of our low
1-1.5kW range, although we’ve seen as low as 300W. cost 500W rural sites, operating in 20-35°C, we’ll
Vodafone typically has two to four hours of battery schedule the swap of the batteries after three years,”
backup power at sites in good grid markets such Outage durations and implications for Service said a representative of TowerTech, a managed
as those in Northern Europe. Greater autonomy Level Agreements (SLAs) service provider with experience of building off-grid
is required in SSA, where high temperature lead- sites.
acid batteries are most commonly used, although There is huge variation in outage from country to
Vodafone are looking at future energy storage country and from month to month. “We might have Vodafone typical sought five year lifecycles from
chemistries. a Nation wide outage for six to eight hours, then their battery banks, while Helios Towers Africa
have no outages for months,” said Econet Power, reported that a battery might typically last two and a
Econet Power commenting on Zimbabwe. While seldom as severe, half years at an air cooled outdoor site operating up
Tanzania was similarly unpredictable, at least to 35°C, although batteries would be replaced sooner
COO Neil Taylor represented in-house ESCO Econet outside of Dar es Salaam. if autonomy dropped below a certain threshold, or if
Power, recently carved out from Econet Zimbabwe. low voltage alarms were being triggered early.
While parallel carve-out Econet Towers manages Rather than try to quantify outages, it is perhaps
only the towers, Econet Power manages the energy more pertinent to focus on SLAs and their “Previously rectifiers were killing batteries in as
systems at 1,380 sites. implications for required cell site autonomy: one little as 18 months; energy efficiency isn’t just about
MNO typically required 10-20 hours autonomy in batteries,” said one buyer. “In my experience, it
While Zimbabwe’s grid is characterised as “bad their RFPs, while a towerco sought four hours at is often the rectifier that causes under or over
everywhere”, downtime had reduced from an urban sites and six hours at rural sites. charging, so it’s about how the DG, rectifier and
average of around ten to just 2-4 hours per day at battery work together.”
the time of the Meetup, although the impact of the “A battery hybrid site might need eight hours
subsequent currency crisis remains unclear. Just autonomy and discharge to around 50% during How bad is the problem of battery theft?
3.5% of Econet’s sites were completely off grid, and a typical outage,” offered one participant as an
over 90% of those sites had solar installed. Around example. Battery theft is an acute problem in some markets, it
a quarter of their total site network was hybridised, can be almost non-existent in others. “We have had
primarily with lead-acid batteries. If you’re sizing your battery bank for 10, 12 or even no battery thefts since I started with the company,”
20 hours of autonomy, meaning it’s ‘lazy’ most of suggested one participant.
What is the typical power load on a site? the time, does that mean there might be a business
case for a mix of lead-acid and lithium-ion batteries “We have 3-4% battery theft per year,” said another.
Of course it depends on the configuration of the site. in the bank? Helios Towers Africa suggested there
An indoor site could have a load as high as 8-10kW, might be around 200 of their sites in Tanzania where “It’s higher than 5% in South Africa,” offered a third

“
participant, suggesting that TCO increased as much can be derived. Next follows an in-house or third
as 20% over a five year period due to theft. party trial. Asked target return on investment,
Vodafone simply said “ASAP”, and depended on the
It was generally agreed that battery theft was being size of the investment, although they admitted more
reduced, and that the problem was not as acute as than four years would be too long. “There is no
perceived, although it was acknowledged that the magic number for battery ROI,” they concluded.
resultant downtime could be disproportionately What matters more than the
harmful to reputations. warrantee is the level and Fixing battery warrantees
Helios Towers Africa reported having significant quality of training your product Buyers complained that standard lead acid battery
success reducing battery theft originating within
the supply chain. Their holistic approach involves
splitting O&M contracts between suppliers to create
competitive benchmarks, eradicating “bad apples”,
investing in access control solutions, process
teams provide my service
teams, and ultimately our
charging behaviour
“ warrantees were meaningless in emerging market
operating conditions . “There has to be some
limitation with lead acid battery warrantees,”
responded one vendor. “Cycles kill lead acid more
than temperature.”
optimisation and training, and simply making sure
security guards are fairly paid to reduce temptation A flow battery vendor countered “we’ll offer a
to steal. “It’s all about creating accountability. While guaranteed energy throughput, localised warrantees
these steps will initially increase opex, it drops in the themselves, and other equipment, may be an based on operating temperatures up to 60°C,
long term,” concluded Helios. important development, but beware creating data regardless of depth of discharge.”
overload as MNOs and towercos can struggle to
What buyers want from their battery suppliers integrate, analyse and respond to thousands of data A lithium ion battery vendor offered similar terms: a
points from thousands of sites. guaranteed kWh output with a maximum operating
There is an inherent contradiction in two key forces; temperature as high as 60°C.
buyers have strict guidelines for recycling and re-use Alternate chemistries
of equipment, yet they increasingly want to see re- The lead acid battery vendor countered “alternate
use scenarios reduced and scrap value minimised to “Lithium ion and flow batteries won’t replace lead chemistry batteries have to be as easy to deploy as
disincentivise battery theft. acid over night,” commented one buyer, asking that lead acid before these factors come into play.”
vendors focus on best fit use cases initially to enable
Integrating GPS has had minimal effect; one buyer limited trials (vendors suggested 100 site trials “What’s needed is a warrantee with a margin for
said it “over-complicates matters”, while another would be better than 10 sites!) The buyer continued: error,” suggested another vendor.
pointed out that law enforcement authorities seldom “we need to see a full business case, with complete
have the capacity to track stolen batteries in an effort costs and ROI.” “What matters more than the warrantee is the level
to apprehend thieves. and quality of training your product teams provide
Vodafone Procurement Company highlighted their my service teams, and ultimately our charging
Intelligent batteries which can monitor and protect process; an initial business case from which TCO behaviour,” concluded a buyer

Platforms for site
intelligence, management
and optimisation Working
group report
On 19 October, TowerXchange hosted the first working group on
platforms for site intelligence, management and optimisation. With robust
data being absolutely critical to decision making in site operations and
management, the working group was designed to address some of the
limitations that users are finding with current technology platforms, share
success stories in the implementation of different systems and examine
requirements on how technologies need to evolve.
Working group members

< Geert van Eijk, CEO, Helios Towers Ghana
< Nat-sy Missamou, Sharing New Business Program Director, Orange
< Hossein Khodayari, CEO, Fanasia
< Alisa Amupolo, CEO, Powercom
< Stefan van Heerden, Construction Manager, Atlas Tower
< Ahmed Saeb, Principal Category Manager, Networks SCM Technology,
< Ankur Lal, CEO, Infozech
< Ohad Polinovsky, Telecom Director, Galooli
< Asher Avissar, CEO, AIO Systems
< Kishore K Das, CTO, Invendis
< Tshepo Motaung, Business Development, SADC Region, Abloy
Platforms for site intelligence, management and optimisation
Working group recommendations
RECOMMENDATION 1: Avoid having The top 5 limitations that need to be addressed: Key questions buyers need answering in the
too many probes and sensors, simplify decision making process
this to the most critical metrics 1. Reliability: Even the most robust site management systems
do not match the level of uptime that cell sites must be hitting. <Why do I need an independent RMS system,
When towercos are pressured to hit 99%+ uptime but the why can’t I just use OEM embedded solutions as
RECOMMENDATION 2: Ensure
monitoring systems can only promise 90%, the discrepancy these are now commonplace? What are the real
multiple layers of redundancy in
can be problematic advantages of third party systems?
transmission of your data
2. Integrability: Vendors are so focussed on their own <How many metrics should I try and integrate
RECOMMENDATION 3: Examine your offerings that they neglect to look at how they integrate into into one system? What just adds extra levels of
budget and determine what are your other vendors’ systems; better interaction between suppliers is complexity and what is fundamentally
required to deliver the true end-to-end experience that buyers important?
priorities to integrate
are looking for
<Is a single platform the ideal or does it make me
RECOMMENDATION 4: Use intelligent more vulnerable if the system goes down?
3. Flexibility and scalability: Equipment on cell sites is
filtering and data infill to account for subject to constant change, be it the addition of further tenants
erroneous and missing data <What is the reliability of systems and what
or the replacement of a diesel generator. Site management and
layers of redundancy and backup are built into
monitoring systems need to be able to quickly and seamlessly
it?
RECOMMENDATION 5: Consider the adapt to such changes, a quality which some systems lack
pros and cons of embedded and third <How are the prices of systems forecasted to
4. Unmanageable data: With so many parameters now able
party RMS carefully change?
to be measured, the sheer volume of data and number of
alerts can make obtaining meaningful findings challenging. <What after sales support can I typically expect?
RECOMMENDATION 6: Establish a Simplification of systems and better definition of which
long term partnership between vendor parameters need to be measured is a key step moving forward <How critical are missed data points and how
and customer to ensure the system useful are systems that work to fill in the
works as well in the field as the lab 5. Lack of predictability: Whilst notifying the responsible blanks?
party of a fault is beneficial, much more value can be obtained
from flagging issues before a fault occurs. A much greater <How can you help me better predict faults
RECOMMENDATION 7: Appreciate the
degree of predictability is required from systems currently on before they occur?
value that time and the collection of the market, with suppliers working hand in hand with tower
longer term data brings to the ROI of owners and managers to identify warning signs that precede <How future proofed are systems to the way in
your system a fault which networks and antennae are evolving?

Executive summary 6. The ability to inform prior to an incident
occurring
7. Easy integration into OEM embedded monitoring

systems
8. Segregation of information tenant by tenant to

support separate invoicing
9. Simple for subcontractors and staff to use
10. High uptime and quick repair time when it does

go down
One of the biggest requirements that is often listed

of a site management system is its ability to offer a
fully integrated, truly end-to-end solution. Whilst
An increasing number of site management, Discussion in the group kicked off with a in theory this sounds like the ideal solution to be
remote monitoring and access control systems are brainstorming of key requirements from site aiming towards, in reality the measurement of a
becoming available, each of which promise to give management, monitoring and access control systems large number of parameters comes at price - not
tower owners and operators better visibility and - highlighting the features and benefits that are the only in a financial sense but also in the added
control of their site operations, driving improved most valued by users complexity that it brings.
efficiencies and cost savings. Whilst large sums
are being spent on R&D by vendors, many users 1. Integrated task force management, access control Whilst full integration is often an aspiration of
find that platforms do not stack up to expectations and job ticketing to support SLA enforcement those setting out to buy a site management system
and have reported disappointing results. When for the first time, some of the more seasoned
working properly however, platforms have the 2. Track when and how preventative maintenance site management system users advised against
ability to bring high levels of intelligence to sites, has been done - and alert the user when it is not overcomplicating your system by introducing too
better predicting faults before they occur, tracking many sensors and probes. There can be a temptation
inefficiencies in operations and informing 3. Sense and alert when the system has been when starting out to try and integrate everything
decision making processes. TowerXchange invited tampered with into one system but some users have found this
some of the most promising vendors to join both impractical, preferring instead to distill the system
experienced users and first time buyers gearing 4. The ability to analyse information region by region down to the core essentials.
up for major purchasing decisions in examining
how the full potential of such platforms can be 5. Ease of sharing information with tenants and other For smaller companies, this is even more important.
reached. parties With more limited budgets available, the high cost

of very sophisticated, fully integrated systems is discussions. Perhaps one of the biggest criticisms information can be gleaned from site equipment and
prohibitive, forcing the company to consider which of monitoring systems was the level of downtime; how efficiently it is operating. Whilst vendors are
elements are a top priority to integrate. towercos in the room explained how their SLAs with unable to share learnings between their clients on
MNOs stipulate they must have 95-99% uptime on what sort of performance they should be expecting
In terms of deciding what systems are important sites, yet no platforms in the market can provide and what they can do to improve it, they will be able
to invest in, participants questioned their peers close to this, although some vendors mentioned they to comment that they believe something is operating
over what value they thought third party remote had newer higher performance systems starting to sub-optimally and can be improved upon.
monitoring systems brought to operations. With approach this.
much equipment, particularly when it comes to Speaking of trials, one user explained their process
energy components having its own embedded Often the reason behind failure can be beyond of whittling down a range of systems to a choice of
monitoring devices, the question was raised as the control of the vendor, with the missing data one, advocating homogenisation of platforms for
to whether additional systems were surplus to a result of a communication error through the ease of operation. One challenge faced by vendors is
requirements. operator’s network. In order to protect against this it that product trials are often over very short periods
is important to have multiple layers of redundancy of time, meaning that users are unable to see the
Having third party monitoring systems does add an in the communication; be it multiple SIMs, OSS benefit of a system in that period, longer term trials
extra level of redundancy which protects against feeds or other mechanisms. Being able to fix the they felt would be more indicative of a system’s
system failure, but often there are discrepancies system quickly should it go down is of the utmost performance.
between the two readings, further complicating importance, a metric which can be affected by
interpretation of increasingly large data sets. With the level of after sales support offered by a given Discussions in the group showed that whilst
each system producing data in its own proprietary vendor. Similar to the point raised in many of awareness of system capabilities varies between
protocol, ensuring that each system is functioning the discussions at the event, seeing a vendor-user different MNOs, towercos and O&M firms, the
correctly becomes a bigger challenge when multiple relationship as a long term partnership and rather technical capabilities on their wish lists are very
systems are deployed and can add extra workload. than a standalone deal is key to the success of much ready, at least in the lab. Putting these into
implementing site management systems effectively. the field in a network setting, with large amounts
Vendors in the room explained some of the work of variables and unknowns however is where the
they had been doing to eliminate erroneous results Alongside improved reliability of the system, challenges can arise and where vendors need to
(read some of our interviews later in the report) perhaps the biggest development that users would work closely with their clients to ensure that robust,
and underscored the importance of ensuring the like to see with platforms is their ability to become reliable and insightful results are being obtained
intelligence is built upon only sound rules. As well as more predictive, notifying tower owners and and used
incorrect data points participants discussed how to operators of a potential fault before it occurs. In
For additional discussion and answers on how the
handle missing data points and algorithms that have many instances, the vendors explained that the
limitations with remote monitoring, site management
been developed to better “fill in” gaps, particularly capability was there and that the longer that a given and access control systems need to be, and are being,
important when the output relates to invoicing. system is installed, the more effectively they can addressed, checkout the interviews with Abloy (page
track trends which proceed a fault. 410), Acysys (412), Codefish (427), Galooli (459),
The robustness of systems and the uptime that they Infozech (466), LockedUp (477), Tarantula (489) and
Telemisis (493) later in this Journal.
can provide was one major talking point during Similarly the longer systems are used the more

Civil works and O&M
Working group report
On 19 October, TowerXchange hosted the first working group for Civil
Works & O&M in the African and Middle Eastern tower industry. The aim
of the group was to identify some of the key challenges in the rollout,
operations and maintenance of cell sites in the region and provide
recommendations to MNOs, towercos and managed service providers on
how to better work together amidst increasingly challenging economic
conditions.
Working group members

< Geert van Eijk, CEO, Helios Towers Ghana
< Hassan Nayef Dakhlallah, Advisor, Network Sector, Saudi Telecom
Company
< Stefan van Heerden, Construction Manager, Atlas Tower
< Martin Black, Head of Procurement & Supply Chain, Tigo Tanzania
< Ahmed Saeb, Principal Category Manager, Networks SCM Technology,
< Yatendra Chadha, Vice President (National Head - Site Acquisition),
Indus Towers
< Salah Medawar, Chief Operations Officer, ieng Group
< Arie Ben-Dayin, VP sales, AEMEA, Mer Group
< Jean Farhat, Group CEO, NETIS
< Anita Pauperio Paulino, Business Unit Manager, Telecom, Metalogalva
Civil works and O&M Working group recommendations
Training and contractor management Smarter use of time on site
RECOMMENDATION 1: Implement a continuous retraining programme with RECOMMENDATION 1: Implement better planning to coordinate site visits
contractors from all parties
RECOMMENDATION 2: Integrate contractors with equipment manufacturers to RECOMMENDATION 2: Employ the use of remote solution experts
ensure installation and maintenance is done to guidelines
RECOMMENDATION 3: Do not allow preventative maintenance schedules to slip
RECOMMENDATION 3: Create an interface between basic skilled workers and
RECOMMENDATION 4: Minimise man hours through new technologies (e.g.
higher skilled workers on rotation
drones)
RECOMMENDATION 4: Ensure remuneration is in-line with standard levels and
RECOMMENDATION 5: Carry out a full refuelling in place of multiple trips
progression is achievable
RECOMMENDATION 5: Rationalise and simplify site equipment Focus on relationships with communities and landlords
RECOMMENDATION 1: Educate local communities on the central role of towers

Strategies to combat theft
in providing critical communication services
RECOMMENDATION 1: Deploy multi-faceted solutions
RECOMMENDATION 2: Develop expertise with landlords and legal teams
RECOMMENDATION 2: Prosecute where possible and hold thieves accountable advising them on lease negotiations
RECOMMENDATION 3: Examine strategies to share poor contractor experiences RECOMMENDATION 3: Prioritise community relation skill sets in your supply
chain
RECOMMENDATION 4: Engage local communities
Innovation and partnerships across the supply chain

Specify sites correctly and look towards the shape of future networks
RECOMMENDATION 1: Diversify into new geographies and service lines
RECOMMENDATION 1: Employ more attention to detail in checking the
specification of sites to avoid unexpected costs RECOMMENDATION 2: Negotiate longer term contracts and think strategically
rather than tactically
RECOMMENDATION 2: Better understand the pros and cons of camouflaged
towers
RECOMMENDATION 3: Provide expertise and guidance to MNOs and towercos
RECOMMENDATION 3: Ensure new sites are future proofed for the advent of 4G and fundamentally shape their O&M strategies

Executive summary There are two challenges that need to be addressed;
on the one hand, contractors may not be adequately
trained, whilst on the other hand it may be more a
case of negligence or non-compliance whereby they
are not carrying out tasks in the manner explained
or potentially not carrying them out at all.
To tackle the first issue, more robust training

programmes need to be put in place. This is not
just a once off experience; training needs to be
repeated and updated to ensure that skills are
up to scratch. Stakeholders also need to work
to ensure better interaction between the supply
chain; equipment manufacturers should be liaising
directly with contractors and subcontractors,
equipping them with the knowledge and expertise
to install and maintain equipment in accordance
with manufacturer guidelines. There needs to be a
Across Africa and the Middle East, pressures on Indus Towers, leading managed service providers rotation of experts to support the lower level skill
mobile revenues are felt throughout the value ieng Group, Mer Group and NETIS and tower builders sets, and a rationalisation of equipment to simplify
chain. Whilst MNO expectations and requirements Metalogalva. After first mapping out the problem operations is key.
on quality and timelines continue to rise, a focus areas, the group focussed on steps put in place and
on reducing costs is creating challenges for innovative strategies being considered to address On the second issue, operational governance
towercos, tower builders and managed service such challenges and drive forward quality and cost strategies need to be implemented effectively and
companies who need to meet such targets whilst efficiency in the tower industry in MEA and beyond. monitoring systems put in place to verify and
being simultaneously faced with escalating costs validate that the work is being done in a correct and
of raw materials. Identifying where inefficiencies Better training, management and retention of timely manner.
are brought into civil works and O&M is critical to contractors
improving quality of service whilst protecting the Work smarter on site visits
increasingly thin margins of all stakeholders in the Personnel management remains one of the biggest
value chain. challenges in overseeing new site rollout and The time spent travelling to and between sites
maintenance of existing sites. Whilst there is a is often significantly greater than the amount of
To tackle the topic, TowerXchange brought together noticeable skills gap, even relative to other developing time spent on site by a contractor, an issue only
MNOs Vodafone, Saudi Telecom Company and Tigo, regions such as the Indian market, the moniker that compounded by the poor road infrastructure in
towercos Helios Towers Africa, Atlas Tower and it’s “good enough for Africa’” is not acceptable. much of Africa. Reducing the number of visits to site

is fundamental to controlling costs and timelines in agreed that that this was fundamental, most felt ethical frameworks, it could be possible to share
site maintenance. that their preventative maintenance often fell by a list of companies or individuals who had been
the wayside with reactive jobs taking precedence caught pilfering. Whilst word of mouth provided
One solution to inefficient site visits proposed was and that renewed focus needed to be placed upon one such means, the group were hesitant to propose
the use of remote solution experts. Whilst there is preventative maintenance being done. a formalised process as legal implications would
nearly always a need for there to be a pair of boots need to be carefully considered.
on the ground during maintenance, the opportunity One working group member explained how they
for an expert to log in remotely enables them to had introduce a “one site visit per month” strategy, Focus on relationships with communities and
service a larger number of sites in a shorter period whereby various teams are deployed to a site to landlords
of time. In the meantime, the manual worker on site carry all preventative maintenance in conjunction
can carry out key preventative maintenance tasks with a complete filling of the fuel tank. Carrying out Increasing resistance from local communities and
whilst the more sophisticated works are carried out preventative maintenance ahead of schedule and municipalities is creating challenges in the rollout
by the expert. reducing the number of access requests to site has of new sites. Community engagement programmes
had a significant impact on site level profitability. whereby stakeholders help the community view
Another technological advance discussed which towers as part of essential infrastructure are
could help reduce man hours was the use of drones. Combat theft and safety concerns through a critical to expediting rollout programmes and the
Examples are now coming to light of MNOs using variety of solutions full supply chain must work together to strengthen
drones to carry out thermal imaging and structural the value proposition, from access to power to job
assessment, which not only reduces man hours but Theft is undoubtedly one of the biggest challenges creation.
also helps to remove risks associated with climbing faced by tower owners. With the vast majority
towers for inspections. When there has been a severe of pilferage events occurring during site visits, Further challenges are arising as a result of the
storm, it is possible to deploy a drone to inspect a site minimising the number of times various parties increasing commercial awareness of landlords
for damage, rather than mobilising a team on the can access sites will help to alleviate some of the of the value of their ground or buildings. This
ground. Going forward there exists the potential for problem. Security measures also need to be put in challenge is further compounded by the rise of a
drones to carry out some of the maintenance as their place, be it smart locking systems, response teams, new breed of law firm, educating landlords on the
usage by the industry becomes more widespread. alarm activated tear gas or CCTV systems. rates which they could be charging. With continuing
downward pricing pressure on the supply chain,
It is also important to reduce the amount of reactive Holding culprits accountable is also key. Some those managing new site build need to become
maintenance carried out. Whilst the call outs stakeholders referenced the success of publicising increasingly adept at dealing with such situations.
themselves result in costs adding up, the unplanned photos of thieves, whilst others advised they had
nature of such visits means that contractors often adopted a strategy of involving the police and With local community support also important in
turn up on site with the wrong spare parts, thus prosecuting where possible in order to send out a helping to curtail theft, the importance of human
delaying the repair works. Implementing a robust clear message to other would be thieves. skills and cultural understanding is an essential item
preventative maintenance strategy is central to in the tool set of firms carrying out civil works and
alleviating the issue. Whilst working group members Panellists also questioned how, within legal and O&M.

although concerns still exist around their ensuring quality was not compromised. Giving
competitiveness. Many still felt that they were companies longer term contracts and procuring
harder and more expensive to build and maintain services strategically rather than tactically is
and so tower designers still had a way to go in an essential step; with longer term contracts
promoting their value. companies can invest in their people, processes
and technologies which enable them to reach new
How towers need to be designed for the advent of efficiencies. Larger scale contracts will also enable
4G and an increased role for small cells still need stakeholders to reach economies of scale, further
to be ironed out. It was observed that many older bringing savings to the value chain.
sites were not designed with multiple tenancies in
mind and so it is important to ensure that today’s Diversifying both geographically and into the
new sites are future proofed. Tower manufacturers offering of new service lines was another piece of
need to work closely with the MNOs and towercos advice given by the group. MNOs and towercos had
to ensure that these needs are met. an appetite to work with parties who had broader
competencies and footprints which would help to
Innovation and partnerships to address bring new efficiencies to the supply chain.
pressures on margins
MNOs and towercos also voiced the opinion that
Perhaps the most contentious subject in the service providers needed to be forthcoming with
working group focussed on the way in which recommendations of what is and and isn’t working
stakeholders needed to adjust in order to account in an O&M protocol laid out by a towerco or MNO.
for declining revenues in the mobile market. MNOs and towercos are looking for guidance and
Specify sites correctly and look towards the shape Maintenance contractors voiced concerns that expertise from service companies, and looking for
of future networks quality was meant to increase whilst expenditure areas in which they are innovating to reduce their
decreased, towercos expressed how they had own costs in house - many of which strategies were
The misspecification of sites by MNO, towerco or fixed costs agreed with MNOs and so could not shared by the group during discussions
tower builder is a major source of headaches. If a pass on escalations, and MNOs explained they
line item is missed out and a charge applied later continued to be faced with decreasing ARPU. With The next working group on civil works and
it creates significant challenges for the signed off the downward trend on revenues not showing any O&M for the African and Middle Eastern tower
budgets of the procurement teams. An increased sign of letting up, and the cost in raw materials industry is scheduled to take place on 3 October
amount of diligence is required to ensure that sites continuing to rise, concern was expressed around 2017 in Johannesburg. If you would like to be
are specified correctly from the off. how already thin margins may be further eroded. considered for participation, please contact
Laura Graves, Managing Director of EMEA,
Amongst increasing resistance from communities, Stakeholders underscored the importance of TowerXchange on lgraves@towerxchange.com
camouflaged towers are growing in popularity partnerships in helping to protect margins whilst

Regional coverage:
Asia features
In this edition of the TowerXchange Journal, TowerXchange continues
its ground-breaking coverage of China with exclusive insights into
China Tower Corporation’s procurement and operations as well as an
analysis of the challenges being faced by China’s pool of independent
towercos. Additionally, we offer our readers insights into the
Myanmar panel held at the third TowerXchange Meetup Asia as well
as interviews with local player MIG and the new investors behind
Apollo Towers Myanmar, Overseas Private Investment Corporation
(OPIC).
Exclusive content from GTL Infrastructure, Bharti Infratel and Ascend

Telecom provides a deeper analysis on the status of 4G deployment in
India as well as the opportunities being created by new players and
by the enhancement of coverage in less developed Circles. Moving
East, TowerXchange has traced back the history of the Indonesian
tower industry from its inception to today’s success story.
Don’t miss:
350 The fight for legitimacy of China’s independent towercos
353 China Tower Corporation: insights into its procurement and
operations
364 The history of the Indonesian telecom tower industry
371 Myanmar: TowerXchange Meetup Asia report, valuation
analysis and insights from MIG and OPIC
384 Insights into India: GTL Infrastructure, Bharti Infratel and
Ascend Telecom

China’s independent towercos China currently has approximately 200 independent
towercos spread across the country serving the
market alongside CTC. Some have been in the tower
fight for legitimacy and a fair game since 2008, well before the creation of CTC in
2014. Most have enjoyed success and profitability,
competitive market developing positive working relationships with

the operators and earning reputations as efficient
Challenges to the status of independent developers triggered by the introduction and effective tower developers. However, as the
State-owned entity started to become operational,
of a State-owned towerco giant
ripple effects began to be felt by the independent
towercos. The first being new build demand
In July 2014, the world’s largest towerco China Tower Corporation (CTC)
reportedly slowing around 2015. A second blow
was formed to drive infrastructure sharing, also known as “co-build,
came in July 2016, once CTC finalised its lease rate
co-share” in China. With the approval of the General Office of the State
formula, driving downward pricing pressure in the
Council and led by State-owned Assets Supervision and Administration
marketplace.
Commission of the State Council (SASAC), and the Ministry of Industry
CTC Others and Information Technology (MIIT), the three MNOs transferred all
their tower assets to the joint venture. Since then, the roughly 200
Since the formation of CTC, the consensus seems
to be that the three operators, China Mobile, China
independent towercos in China have been experiencing challenging Telecom, and China Unicom, all have different
market dynamics relegating them to an awkward position; occupying a attitudes towards third-party towercos; some accept
grey space as if their existence may not be permitted. Read on to find out their continuing role in the market, others do not.
what TowerXchange’s research in the past few months have revealed. Rumour is China Mobile has been the most friendly
of the three. But there is also another layer of
Keywords: 4G, Asia Insights, BT, Bharti Infratel, CTC, CTIL, China, China Mobile, China Telecom, China complexity at the geographical level, where some
Tower Corporation, China Unicom, Country Risk, EE,Editorial, General Office of the State Council, Goldman operators in some regions are happy and willing
Sachs, India,Indus Towers, Infrastructure Sharing, Lease Rates, MBNL, MIIT, Ministry of Industry and to work with independent towercos, while others
Information Technology, O2, Regulation, SASAC, State-owned Assets Supervision and Administration won’t touch them at all. Most CTC management
Commission of the State Council, Tax,Three, Towercos, UK, Vodafone used to work for the operators, as such have the
influential customer relationships, as well as with
government. All in all, Beijing appears to be hit
Read this article to learn: hardest, where operators reportedly won’t entertain
< Market changes and realities since the creation of CTC in 2014 conversations with independent towercos.
< Specific issues and examples faced by independent towercos in China
< How a licensing versus a “shot clock” permitting regime works Legality versus legitimacy
< How independent towercos can create value in China
Needless to say, the introduction of a State-owned

giant means it is no longer business as usual for
the independent towercos in China. There is a lot China Tower Corporation lease rates
of chatter within China and in the international
community on whether a monopoly is the desired CTC lease rates are significantly lower than anywhere else in the world, with estimates around CNY
end result of creating CTC and whether third-party ¥26,000 per tower on an annual basis or CNY ¥2,166 pcm (US$320). This figure is surprisingly low and
towercos have a right to exist in the long term. To
suggests a business model calibrated in favour of the MNOs. Since the summer, Goldman Sachs came
be clear, under the current regulatory framework,
out with a report suggesting per tower leasing fee of around CNY ¥3,900 pcm (US$575) for CTC in
an independent towerco is legal. The issue right
now is really around legitimising and clarifying 2015, and CNY ¥3,000 pcm (US$445) for 2016
status, in light of some of the issues experienced by
independent towercos. < Some local governments have enacted processes terms citing its inability to pay what the operators
and documentation such that CTC is the only party previously agreed to.
allowed to build.
Some of the realities reportedly include:
< CTC’s lease rate formula, calibrated to heavily
< In extreme cases, there were reports of operator favour the MNOs, has forced market lease rates
< A local CTC office, with the support of the
staff being fired for working with independent down.
local government, could tear down a third-party
towercos.
towerco’s tower assuming CTC was capable of
< The window for independent towercos to attract
building its own in the same location.
< Government departments across the country, foreign investors may close if this lack of clarity
and at different levels, are not well educated on persists.
< Many future site builds are being denied to the nature of the tower business, and misled by
third-party towercos as CTC has set up strategic interpretations of existing policies related to the While some acknowledge the creation of CTC
partnerships with planning departments across telecom industry and infrastructure sharing. provided important recognition for the role of
300+ cities, effectively allocating all sites in those tower builders and operators, it has also put the
cities to CTC. < Inconsistent taxation by operators across independent towercos in a challenging – and
different regions, where at times CTC is charged potentially unfair – competitive position against the
< In many instances site build requests go to 6% compared to 11% and 17% for independent State-owned giant. In this situation, more systematic
CTC first, so independent towercos are in effect towercos. ways to reshape the industry could include a
relegated to the role of sub-contractors with the licensing or permitting regime.
most difficult sites to build, at the lowest pricing. < Independent towercos contracts were flipped to
local CTC offices so that the towercos were directed Licensing
< In one city, CTC was allegedly building adjacent there to collect annual payments. At which time,
to existing independent towers. CTC also reportedly pushed to renegotiate contract Most towercos are not in favour of licensing

International examples
How independent towercos can add value in China
There are no direct comps in scale to China, but
1) Support the country’s infrastructure sharing mandate. Towercos are in the business to create value two countries provide useful comparisons when it
and efficiencies and are naturally driven to build up tenancy ratios. to comes to MNO-led infrastructure sharing firms
co-existing with independent towercos. In India,
2) Supplement CTC build capacity, particularly in tier two and three cities. independent towercos have prospered alongside
MNO-led giants Indus Towers and Bharti Infratel,
3) Enable a competitive market where time to market, quality, and value become differentiators. although the giants effectively set contract structure
and pricing as a function of volume. In the UK,
4) Play a role in setting fair lease pricing, guided by market supply and demand. independent towercos flourish alongside joint
venture infrastructure sharing companies CTIL
5) Provide opportunities for inorganic growth for CTC, as it could simply buy mature independent (Vodafone + O2) and MBNL (Three + EE / BT); indeed
developers CTIL and MBNL are primary clients of independent
towercos.
regimes, however, this approach could make the the ability to pay the fee, it serves to weed out pirate
“grey” independent Chinese tower market more towercos looking to make a quick buck with poor For further details, refer to our articles “The unique
investible by reassuring investors these entities are practices to the detriment of the entire industry. structure of the UK market” and “The history of the
permitted to exist along side State-owned CTC. In Indian tower industry.”
general, should the powers that be decide to license, Permitting
they are recommended to 1) do it as soon as possible, The way forward
2) work out the criteria and clearly communicate The other alternative to licensing is through
them and 3) make sure the licensing fee is a fair permitting. Regulators can make it a lot easier to Independent towercos in China are in the
reflection of the administrative costs incurred by the build towers if they create a uniform approach to unfortunate situation of having to seek further
agency body. permitting and thereby accelerate build. The most clarification regarding their legitimate status in the
sophisticated version of this is the “shot clock” seen market place. The current structure may not need
In Myanmar, while there were initial objections in the US and being introduced to India, a regime to change, but simply a matter of the MIIT taking
to the licensing approach, it then earned the whereby if a towerco complies with the standard action to ensure all stakeholders recognise the
appreciation of stakeholders for not only legitimising approach, then permit to a new site is assumed valuable role independent towercos play, such that
and professionalising the tower industry, but also granted if not rejected within 30 days. In the US and they can co-exist and thrive alongside State-owned
creating the right barriers to entry. As licensing India, this is seen as transforming the industry’s CTC. In the mean time, some towercos are tinkering
typically involves meeting certain qualifications such ability to deploy sites quickly and accelerate a with expanding their business models and tapping
as management credentials, access to capital, and nation’s infrastructure development. into different opportunities

What and how China Tower
Platform overview
CTC was created under the philosophy of “change,
Corporation buys innovation, and open cooperation.” In keeping

with this focus and recent e-commerce trends, and
China Tower spends CNY ¥24.8bn in 13 months with 417 suppliers through motivated by the drive to maximise the benefits of
shared economics, CTC built a new procurement
innovative online procurement platform, increasing transparency and efficiency
model known as the Tower Online Platform. By
hosting all required operational resources and
The Tower Online Platform officially launched in services on the platform, it allows for centralised
the summer of 2015, one year after the creation of control, layered implementation, frontline ordering,
China Tower Corporation (CTC). As of 5 September, unified payment processing, increased speed and
2016, there are 723 suppliers officially registered efficiency, and transparency to drive the health of
in the system, with 74% having been shortlisted the industry.
and 58% having successfully received purchase
orders; spending reached CNY ¥26bn. With 27 In a presentation in 2015, CTC highlighted
major product and five major service categories, seven mechanisms for the success of the online
and continued demand for new sites from three platform:
operators, efficient, streamlined procurement
will continue to play a major role. Read on for a 1. Platform operation and protection
comprehensive guide on this unique procurement (平台运作和保障机制)
model, created by the world’s largest towerco to 2. Supplier evaluation (供应商评价机制)
drive supply chain efficiency. 3. Dynamic, interactive operation (动态运营机制)
4. Price control (价格管控机制)
5. Quality assurance (质量保障机制)
Keywords: Asia Insights, Batteries, CTC, Capex, China, China Tower Corporation, Editorial, Energy,
6. Supplier and/or product exit (淘汰退出机制)
Insights, Lithium,Masts & Towers, Passive Equipment, Procurement, Spare Parts, Tower Online Platform 7. Information security (信息安全机制)
By bringing procurement online, CTC created a

Read this article to learn: platform that it describes as business-to-business
< How China Tower’s online procurement platform works (B2B) and online to offline (O2O).
< How a supplier can be registered on the platform
< China Tower’s procurement spend Pilot testing of the platform began in June 2015
< Product and service categories in the system across seven provinces. After user and partner
< How suppliers are evaluated and rated feedback, it became fully operational in August.
According to a letter addressed to partners in July

Tower Online Platform transactions by month Source: TowerXchange
2016, CTC noted the platform to be generally well
received by its 377 branch offices across the country
July 79.4 during its first year of operation. It also disclosed
having eight procurement management staff at
August 8,168 headquarters and just under 500 full-time and part-
September 21,425 time procurement personnel across the country.
2015
October 42,969 Transactions to date

November 85,723
The first transaction through the Tower Online
December 223,216 Platform was recorded on 15 July, 2015.
Total of
As of 18 September, 2015, within the first few
January 130,572 13 months: months of operation, the site processed 2,292
¥24.8bn orders, resulting in 7,434 product items purchased
February 99,002
at a value of CNY ¥170mn. This initial round of
March 283,274 procurement involved 396 suppliers. Registered
suppliers at this point totaled 644.
2016
April 358,496
May 410,227 One year later, orders executed on the platform

have been reported at 2mn, with over CNY ¥26bn in
June 368,359 transaction value. While from the perspective of the
three operators this number wouldn’t be considered
July 399,711
significant since they were used to spending CNY
¥200bn annually, for a towerco it was still quite
CNY ¥ (10,000s) 100,000 200,000 300,000 400,000 500,000 substantial, said CTC vice president Dong Xiao
Zhuang at a presentation in Beijing in September.
Spending in the first few months of the platform
31st August 2015 5th September 2016 going live climbed steadily, followed by a noticeable
drop in the first two months of 2016. This downturn
in activities was attributed to the Chinese New Year
Registered suppliers 260 723 holiday and operators being preoccupied with year-
end reviews, and therefore a drop in tower-related
Shortlisted 203 534 requests. Procurement picked up in March again,
hitting a peak in May.
Recieved orders 81 417
In total, purchases made through the Tower Online

Platform represent 60% of CTC’s total spend. Dong < Shelter (基站机房) 2) Registration with the State Administration for
stressed this is cumulative since the platform < Cable/fiber (光缆) Industry and Commerce of the People’s Republic of
launched, however, if tracking just from January < iDAS (室分产品) China (SAIC)
2016, 80% of total spend is undertaken through < Engineering design and supervision
the online procurement platform. He accounts the (工程设计和监理) 3) Successful third-party audit, such as by the
slower uptake at the beginning due to doubts by < Construction (施工) Ministry of Industry and Information Technology of
some provincial offices and inability to keep up < Other ancillary equipment (其他配套设备) the People’s Republic of China (MIIT)
with some of the urgent operator build demand last
year. Editorial note: What’s listed in bracket is sourced One source we spoke to mentioned increasing
straight from CTC. pressure on the supplier side as CTC is now the
Product and service categories main and only client compared to the past with
There are said to be over 2,400 product types in the the three operators. A lot of smaller players for
The first group of products to be procured online system right now. one reason or another are not on the platform and
were monopoles (单管塔), non-monopoles (非单管
instead, work through those that are and act as sub-
塔), and integrated cabinets (配套综合柜). The next
CTC believes the online procurement platform contractors.
phase brought on 13 more product categories, with
can close the gap between supply and demand,
more following since.
tighten the trading chain, reduce process costs, Platform operations
and ultimately bring greater economic and social
Today the platform boasts 27 major supplier and
benefits to the industry supply chain. Breaking through boundaries of information,
five major service categories including:
marketplace, and time, the online platform allows
Supplier certification and registration direct interaction between supply and demand.
< Tower (铁塔)
< Integrated cabinet (配套综合柜)
As of 5 September, 2016, there are 723 suppliers CTC describes the procurement process as a closed-
< Battery (蓄电池)
in the system, with 534 having been shortlisted by loop:
< Air conditioning (空调)
< iDAS antenna (室分天线) CTC provincial offices, and 417 having successfully
< Power cable (电力电缆) received purchase orders. 1. Centralised quality assurance: After certification,
< Distribution cabinet (配电箱柜) product and service suppliers set up a virtual store
< Generator (油机) Over 95% of the registered suppliers are said to be on the platform, publishing key information related
< Point of Interface (POI) private enterprises. to qualification, product information, pricing,
< Passive devices (无源器件) service, and more.
< Leaky coaxial cable (漏缆) Registration on the CTC platform is free, as long as
< Switching power supply (开关电源) the supplier meets the following criteria: 2. Layered process of ordering: Provincial offices
< Field survey unit (FSU) can leverage the information provided on the
< Feeders (馈线) 1) Hold valid manufacturing license in China (for platform, then take into account any local factors to
< Fiber jumper (光缆跳纤) product providers) select their desired suppliers.

3. Frontline staff participation: In consultation with was described as akin to buying on Taobao, the < Delivery cycle commitment (供货周期承诺)
city offices, frontline staff are directly involved with Chinese online shopping website similar to eBay < Engineering service capability (工程服务能力)
procurement; everything is on-demand and in real- and Amazon, where once you place the order, there < Fault response system (故障响应体系)
time. is mutual trust between the buyer and the seller on < Spare product and parts inventory
the legitimacy and activation of the order. (备品备件库设置)
4. Material distribution to site: Products are < Logistics capabilities (物流能力)
delivered directly to point of installation. Supplier evaluation and exit < Timeliness of delivery evaluation
(到货及时性评价)
The platform fully embraces a key feature of online
5. Unified payment system: All purchases on the < Post-engineering service evaluation
buying platforms, which is the star-rating and
platform are paid out through head office. (工程服务后评价)
commenting system. Within the context of local
environmental factors and service capabilities, As of the beginning of September 2016, a total of 407
6. Full transparency: All information related to
suppliers are rated against pricing, product, and suppliers have delivered on their orders, receiving
suppliers, product pricing, sales volume, supply,
service. average ratings of 4.72 stars out of five.
post-evaluation, et cetera are all available on the
platform, allowing for full monitoring, disclosure, In a presentation last year, CTC outlined some of Tied to the concept of supplier evaluation is the
and feedback of the various units, procurement its evaluation factors. All three categories are rated notion of “survival of the fittest” and healthy
process, and results. against five stars. competition, which in theory could lead to the
exit of a supplier and/or product at a certain point
The system allows frontline staff to do real-time Pricing
in time. CTC identifies three ways as part of its
comparisons across the whole of the market place. < Five stars = preferred (优选)
elimination/exit framework.
< Four stars = should choose (宜选)
Through the platform, for any given tower, any staff < Three stars = optional (可选) 1) Product removal: This is defined as a product
at CTC would be able to see who made the purchase, < Two stars = alternative (备选) not meeting new technology and/or business
from which manufacturer, at what cost, plus < One star = limited (限选) requirements or product quality testing not meeting
comments and ratings on product quality, delivery,
technology and/or business requirements.
service, et cetera. This level of transparency is said Product
to decrease the risk of corruption. < Raw material inspection (原材料进厂检测) 2) Self-removal: This is when a registered supplier
< Factory inspection (成品出厂检测) is no longer offering products and/or services for its
It also means there is greater clarity on purchasing < Selection test (选型检测) own reasons.
decisions made across different business units and < Unannounced inspection (飞行检测)
offices across the country. < Arrival quality evaluation (到货质量评价) 3) Forced removal: This is defined as a registered
< Post-product quality evaluation supplier committing acts against the law and/or
Also, unlike before, frontline staff can now make (产品质量后评价) fraud; breach of contract in relation to quality,
purchase orders. Once the order is placed by the supply, service, et cetera resulting in serious
technical staff, it represents a contract, whereby the Service consequences; continued and long-term poor
signing of paperwork is no longer required. This < Post-sale service channels (售后服务机构设置) evaluation ratings on the platform.

citing the cost to manufacture has been very
competitive in the past year, given the price of steel
had been on the decline since October 2015, going
as low as ¥1,840 per ton. In December, prices clearly
went back up, potentially due to governmental
influence. Nonetheless, supplier prices increased
accordingly, but still lower than the rate of increase
for raw materials. Given this, CTC feels the prices
inputted by suppliers into its platform have been
very reasonable.
Out of the 700+ suppliers registered with CTC, one

of our sources approximates over 200 to be tower
manufacturers.
Pricing for non-monopole and lithium batteries

continue to come down gradually. Though this is
not believed to be the result of suppliers negatively
bidding like in an RFP situation where the baseline
is not always known.
CTC believes the online platform allows for natural

price adjustment based on market dynamics.
Accounts payable
Online platform The first year of the platform inevitably brought

Pricing To illustrate the marketplace nature of the platform, some hiccups. In its partner letter in July 2016,
CTC shared a few charts on the pricing movement one year after the platform going live, CTC
All product pricing on the platform is visible to for monopole, non-monopole, switching power acknowledged issues regarding payments, which it
internal and external parties through searches. supply, and lithium batteries over the course of took seriously and acted swiftly with measures to
Suppliers are free to list prices as they wish and seven to ten months. Unfortunately, no actual or address the matter.
CTC does not ask for pricing discounts. This level relative pricing figures were given on the y-axis.
of transparency enables suppliers to act in a This includes the integration of the online
“reasonable manner.” Nonetheless, CTC uses monopoles as an example, procurement platform with a financial system

which simplified the overall process and therefore
increased efficiency.
CTC also introduced another first, where once the

order arrives and is inspected and accounted for,
it automatically enters into the payment cycle,
reducing human intervention and expediting
payment. This negates the partial payment cycles
of the past where collection is still needed post
order completion.
In addition, CTC has increased payments from once

a month to twice a month.
In theory, most accounts are paid within two

months of order fulfillment.
When it comes to long-term funded projects with

longer payment cycles, the provincial unit would
coordinate with China Development Bank to
manage the process.
Future
It’s clear CTC is keen to drive as much procurement
as possible through its Tower Online Platform.
< Access to the “Internet of People” in the global tower < A comprehensive archive of TowerXchange’s
What would be interesting moving forward is to interviews and analyses, searchable by topic, country,
industry – a trust web of over 35,000 decision makers
1) see what new product categories will get added, company or grouped by category (e.g. interviews or
in telecom and broadcast infrastructure
particularly as CTC has repeatedly made mentions how to guides)
of business model diversification and innovation < Independent analysis and commentaries on the
to include things like billboard ads, sensors, prospects for tower transactions in selected countries < The latest news and registration information about
weather and environmental monitoring, et cetera, TowerXchange’s Meetups.
2) the number of suppliers that get registered, < The latest industry emerging market tower industry
shortlisted, and awarded orders, and 3) product
pricing patterns give the transparent nature of the
platform

Four ways China Tower
Tower and shelter design
Corporation streamlines
CTC acknowledged that in general towers and
shelters of the past were considered eyesores,
without much thought put in them. During the era
operations and drives efficiency when operators built their own towers, with the
rush to coverage, there was very little in the way of
Standardisation and centralisation among key factors to effectively build standardisation and beautification of the structures.
and manage towers
Since taking over, and with feedback from local
Between the end of 2015 and the beginning of 2016, governments, CTC wanted to introduce designs that
the three MNOs in China transferred approximately could better blend in with the various cultural and
1.5mn towers to China Tower Corporation (CTC). physical needs of millions of different sites across the
Since then, new build volumes have been significant, country, whether urban or rural. CTC also hopes its
with 1.7-1.8mn towers in total expected by the end of beautification efforts will raise the general public’s
the 2016. In order to effectively oversee and manage acceptance and satisfaction with telecom sites.
its massive portfolio of towers, CTC has introduced
different ways to streamline its operations and lower CTC has standardised tower designs, reportedly from
costs. With the unofficial objective to become a poster 1,000 down to 155 (each design at different heights
child for successful State-owned enterprise reform – would represent one).
in being more “energised and efficient” – CTC so far
has risen to the challenge. For example, the “Urban Flower” sits at 25m, can be
integrated with lighting for the city, and incorporate
Keywords: 5G, Air Conditioning, Asia Insights, Batteries, Best of TowerXchange, CTC, China, China Tower CTC’s logo and branding. It also has a 40m tower
Corporation, Construction, Dong Xiao Zhuang, Editorial, Energy, Energy Storage, Installation, Masts & with LED lights at the top that is ideal for stadiums
Towers, Monitoring & Management, O&M, Opex Reduction, Procurement, RMS, Renewables, Shelters, Site
and large public spaces, and with the presence
Management System, Solar, Uptime, Wind
to be a landmark structure. CTC also uses a more
simple and sleek multi-purpose tower that is to be
Read this article to learn: integrated with street lighting, sensors, and data.
< How China Tower innovated tower and shelter designs
< How China Tower lowers costs while improving site build efficiency Tower heights in general have also been lowered, in
< How China Tower conducts routine tower and site inspections anticipation of future 5G coverage needs.
< How China Tower responds to power outages
CTC also has a series of shelters designed to better
< How China Tower effectively manages 1+mn towers and sites
blend in with site surroundings.

China Tower Corporation tower and shelter designs

Construction modeling
Tower standardisation is not just about creating a

uniform and consistent appearance; it serves more
practical and beneficial purposes.
When it comes to the creation of a tower, CTC

staff would start with a base (pole) then choose
from a menu of parts to add on, taking in mind
the functionality, environmental needs and the
surroundings of where the tower will go. This
mix-and-match approach, enabled by standardised
tower designs, allows CTC to lower costs and erect
towers more quickly.
“The tower body, along with other building blocks,

offer flexible and diversified product construction,
improve production, and construction efficiency,”
said Dong Xiao Zhuang, CTC vice president in China Tower Corporation tower construction chart sample: 40m tower + shelter
September at P/T Expo. (Original quote in Chinese; Construction standardisation and Given the difficulty CTC had in assessing the true
translated by TowerXchange and edited for clarity). documentation number of towers, their quality, and associated
critical information during the asset transfer process
Through standardisation of shelter designs Understandably, with such high build requests and with the three operators, it is perhaps not surprising
(4mx5m), CTC promoted prefabricated assembly to urgency, CTC took measures to ensure consistency that CTC took a fairly detailed data capture approach
the industry, thereby driving industrial production in process and thereby results. It standardised with respect to tower construction.
and ensuring product quality. The new design also both construction process and technology, with an
significantly decreases installation time, while the accompanying engineering quality handbook. Centralised remote monitoring
structure can be taken down and reused.
Once a tower has been designed, the system Through remote monitoring systems, or what CTC
This modeling of tower and required parts is linked generates and tracks a simple chart outlining the refers to as field survey units (FSU), the towerco
to CTC’s online procurement platform, allowing components of the project, say, manual digging of is able to monitor and capture data on a tower
a streamlined way to generate tower design, the foundation, or tower, or power input. Photo and site through a centralised command platform,
cost estimates, and lists of material and service documentations of the various project pieces are where alerts are issued and task orders activated
requirements. also logged in the system. accordingly.

Inspection
Routine inspection is also clearly charted within

the system, with the date, inspection personnel and
tower number/ID feeding back to the maintenance
centre.
A full inspection is tracked at various points, from

entry access, to power meter data, to cabinet/
equipment inspection, and ending with the physical
tower appearance.
Power connectivity and generation
While China has one of the most reliable electricity

grids in the world, with very insignificant
downtime, CTC still has a robust process for power
management.
Any power outage at the site would trigger an alarm

and task order to dispatch maintenance personnel.
During this time, staff at the provincial maintenance
centre would be able to see the average travel
China Tower Corporation fault response illustration
distance to the site, as well back-up battery data
Data capture through the command centre How it works: the command centre at headquarters including capacity, immediate load current, useful
includes things such as generator, battery, in Beijing receives a warning message from a life of battery, and historical discharge duration.
power switching, power costs, air conditioning, tower in a certain city. This then triggers a mobile
temperature, humidity, smoke, entry access, et message to the personnel assigned to the cluster. Once power is restored, the maintenance personnel
cetera. The alert would specify the tower number/ID, type would also transmit site data back to command
of warning, and request an immediate site visit. centre, with a “power generation” checklist that
Fault response Upon completion, the system would then capture confirms:
the reason for the fault, maintenance method,
With 24/7 monitoring, CTC is able to effectively and completion date and time, maintenance personnel, 1. Time of external power outage
efficiently respond to issues as they come up. and their contact information. 2. Time of external power restored

3. Generator type
4. Battery capacity time
5. Time of back up power generation
6. Time of back up power stoppage
7. Generator fuel consumption
There is distributed renewal energy in China as CTC

reported having 10,177 solar and wind generation
sites across the country, with annual capacity of
120mn kwH. This was as of September 2016.
Dollars and cents
At the end of the day, operational efficiency will

be a key factor in CTC’s financial performance,
given its lease rate pricing formula is calibrated
relatively in favour of the MNOs compared to Construction modeling at China Tower Corporation
global peers. In its bid to IPO by the end of 2017,

CTC will no doubt need to maintain its efforts in
leveraging standardised tower design, construction,
and processes, along with its online procurement
platform, to build quickly and cost-effectively.
On the daily operational and maintenance side,
the centralised command centre as well as data
collection and analysis should provide even greater
value in the future
Solar integration across China
There is also news that CTC has plans to

deploy solar on a large scale in line with the
government’s objectives in reducing carbon
emissions
Source: China Tower Corporation

TowerXchange’s history of
The Indonesian tower market has come a long way;
in the early 2000s, Indonesia was overpopulated
the Indonesian tower industry

with MNOs sub-optimally deploying capex to build
parallel infrastructure. However, all of that was
about to change. A 2006 regulatory policy change
An examination of the Indonesian tower market and how the country’s towercos enforced tower sharing and laid the foundation
enabled telecoms growth in one of Asia’s most populous countries for the Indonesian tower industry. Now Indonesia
is the world’s #4 mobile market, with a thriving
Indonesia’s tower industry is one of the world’s most tower industry. Indonesian towercos own 64% of
mature and strongest, combining efficient organic growth, the country’s 85,537 towers, which serve a more
strong MNO partnerships yielding substantial sale and sustainably structured operator market led by four
leasebacks, and towerco-on-towerco consolidation. tier one MNOs and three further challengers.
Towercos own almost two thirds of Indonesia’s towers, and
other than China, there are no other tower markets that While the mobile market in Indonesia has
build 3,000 to 5,000 towers, rooftops and infill sites per year experienced tremendous growth for several years,
while delivering solid tenancy ratio and TCF (tower cash it is becoming more and more competitive and
flow) growth. margins have been shrinking. MNOs have been
bracing for change as growth rates have levelled off
and tariff wars have intensified. The market is still
Keywords: 3G, 4G, Active Infrasharing, Asia, Asia
dominated by Telkomsel with a 45% market share,
Research, Balitower, BIT Teknologi Nusantara, DAS,
but the landscape has changed with the addition
Editorial, Fibre, IBS, Indonesia, Indosat, Infrastructure
of a number of newer operators backed by foreign
Sharing, KIN, Market Overview, Mitratel, Persadasokka
partners: Indosat, XL Axiata, and Hutchison 3G.
Tama, Protelindo, RANsharing, Research, Rooftops, STP, The market is rounded out by several other local
Sinar Mas Group, Small Cells, Smartfren, Southeast players: Internux, Sampoerna Telekomunikasi and
Asia, Telkom, Tower Bersama, TowerXchange Research, Smartfren, making a total of seven MNOs. Telkomsel
Towercos, Valuation, XL Axiata, iForte was the first to launch 4G in December 2014,
followed shortly by XL Axiata’s launch in three
cities later the same month. Indosat received a 4G
Read this article to learn: concession in the 800MHz, 900MHz and 1800MHz
< The origins of the Indonesian tower industry and and early deals bands in early 2015.
< An overview of the main towercos in the Indonesian market
< Financial overview of the Indonesian tower industry Indonesia’s GDP per capita has surpassed the
US$3,000 threshold, indicating the emergence of a
< The development of small cells and infill sites in urban centres
fast-growing middle class. A healthy 60% of GDP
364 | TowerXchange Asia Dossier 2016 | www.towerxchange.com/meetups/meetup-asia www.towerxchange.com/meetups/meetup-asia | TowerXchange Asia Dossier 2016 | 369
Tracking the inorganic and organic growth of selected Indonesian towercos goes on local consumption – Indonesia has relatively
little dependence on imports. During the 2008 global
60,000 financial crisis, Indonesia was one of a handful of
countries whose GDP growth remained positive.
50,000
Indonesia is home to very diverse telecom
40,000 infrastructure requirements, comprising dense
metropolitan environments and very remote rural
30,000 areas. There is a population of 28 million in the
Greater Jakarta metropolitan area alone at peak, and
mobile data demand is accelerating, which in turn
20,000 is fuelling demand for infill capacity sites. Indonesia
has a young population that moved straight to mobile
10,000 and has embraced data services; mobile broadband
penetration is at 37% and climbing, and handheld
devices are the preferred method of accessing the
2011 2012 2013 2014 2013 2015 2016 YTD Internet. Indonesia is still predominantly a 2.5G
Protelindo Tower Bersama STP IBS Tower Mitratel market, and leapfrogging from there to 4G is a huge
Balitower Persadasokka Tama Centratama Menara (Formerly Retower) task that will require substantial investment in
infrastructure and equipment.
2011 2012 2013 2014 2015 2016 YTD
6,363 Indonesia’s main players
Protelindo 8,460 9,766 11,595 12,237 15,167
Tower Bersama 4,868 7,055 8,866 10,825 11,389 11,553
Protelindo is the largest towerco in Indonesia
STP 1,428 2,246 2,798 6,651 6,674 6,938
where they own over 15,000 towers after the recent
IBS Tower 1,989 1,992 1,992 2,114 2,638 3,423 acquisition of 2,500 towers from XL Axiata in Q1
Mitratel* 2,337 3,143 4,129 5,434 6,792 8,000 2016.
Balitower 51 119 708 1241 2,317 4,510
Persadasokka Tama 314 445 621 832 904 1,012 Protelindo had a big impact on the market with
Centratama Menara** 311 374 489 531 653 719 its landmark sale and leaseback of towers from
17,661 23,834 29,369 39,223 43,604 50,537 Hutchison. Over the last two years, Protelindo has
Subtotal
significantly improved its scale and credit profile.
Change 6,173 5,535 9,854 4,381 6,933
Its leverage has improved through EBITDA growth,
Notes: Protelindo 2016 figure is inclusive of recently acquired towers from XL
supported by a significant increase in the number of
* Mitratel 2016 figure is an estimate ** Centratama Menara (Formerly Retower) Source: TowerXchange Research, Company Reports tenancies on its towers.
Tower deals in Indonesia 2008-2016 Source: TowerXchange towers and 287 shelters).
Year Seller Buyer US$/Tower Towers/Sites Value US$

STP has also started building towers as of December
2016 XL Axiata Protelindo $100k 2,500 $250mn 2012 creating organic growth in addition to its
2014 XL Axiata STP $131.4k 3500 $460mn inorganic growth; their revenue and EBITDA are
2012 Hutchison Protelindo N/A 503 N/A growing at a CAGR of around 40%, and EBITDA
margins remain over 80%.
PT Central
2012 Protelindo N/A 152 N/A
Investindo
Founded in 1995, PT. Dayamitra
2012 Indosat Tower Bersama $207.6k 2500 $519mn
Telecommunications (Mitratel) is the fourth largest
2011 Infratel Tower Bersama N/A 595 N/A
towerco in Indonesia. Mitratel is a wholly-owned
2010 Hutchison Protelindo $112k 1482 $165.9mn subsidiary of PT. Telekomunikasi Indonesia, Tbk
2008 Bakrie STP $64.4k 543 $136mn (Telkom).
2008 Hutchison Protelindo $135.4k 3692 $500mn
PT Komet Infra Nusantara (KIN) is a towerco
Protelindo has also begun to expand its microcell towers purchased from operators, and tower builds, renowned for their entrepreneurial flair. The
assets and fibre footprint to support the continued and was the first towerco to achieve scale with its company started operating in Indonesia in 1995
organic and inorganic growth of its portfolio. The early acquisition of passive infrastructure assets and was created on the basis of the simple notion
company acquired iForte in June 2015 along with from Telenet Internusa, Bali Telekom, Mobile-8, of introducing infrastructure sharing in a relatively
its 450 microcell towers, seven hotel BTS and 700km Prima Media Selaras and SKP. virgin market by its (former) CEO, David Burke,
of fibre with over 180 PoPs in the city centre and who was then employed by Telkom (David was also
business districts in Jakarta and Surabaya. A share-swap to gain control of Telkom subsidiary credited as being one of the architects of Mitratel).
Mitratel was announced, but was overruled by the David was one of the few expats to work for the
Based in Indonesia, the Tower Bersama Group government in Q3 2015. state-owned company, to whom the whole concept
comprises PT Tower Bersama, PT United Towerindo, of tower sharing was very new. To date, KIN enjoys
PT Telenet Internusa, PT Batavia Towerindo, PT STP is the third largest tower company of scale a portfolio of 1,000 towers built thanks to both
Bali Telekom, PT Prima Media Selaras and PT in Indonesia, owning and operating 6,938 organic and inorganic growth and is run by CEO
Triaka Bersama, all operated seamlessly under telecommunication sites with a tower tenancy ratio and COO, Mohamad Iwan.
one management team. The group’s infrastructure of approximately 1.7x. STP has seen steady growth
extends to Java, Bali, Sumatra and Batam and is thanks to the acquisition of existing portfolios from PT Inti Bangun Sejahtera Tbk (IBS) is one of
currently being expanded into Kalimantan and local operators such as Axis, Bakrie and Hutchison Indonesia’s “big four” publicly traded independent
Sulawesi. Telecom, and also acquired tower portfolios from tower companies, founded in 2006 and listed in
a few small tower companies over the past years: August 2012. IBS is a fully-owned subsidiary of
Tower Bersama has steadily grown its tower Nurama Tower (176 towers, 182 shelters and 100km the Sinar Mas Group, which also includes MNO
portfolio with acquisitions of smaller towercos, of fibre), HCPT (200 towers) and ISP Group (493 Smartfren among its telecoms assets. Starting as an
in-building system solution provider, IBS has since Estimated tower count for Indonesia Source: TowerXchange
focussed its resources on passive infrastructure,
Towerco-owned
earning it a significant presence in the market. 6,938 Mitratel
15,167 3,523 1,000 Tower Bersama
1,012
Founded in Bali in 2006, and a relative newcomer 719 Protelindo
to the Jakarta telecoms market, Balitower has been STP
4,510 IBS Tower
making waves with its unique business model 500
for infrastructure sharing. After its role in the KIN
3,000
Persadasokka Tama
decommissioning of parallel infrastructure in Bali, 11,553 Centratama Menara
Balitower set its sights on Jakarta, entering this
Balitower
market in 2015, and rolling out a large number of Gihon
new light towers and poles as part of a deal with the Others
18,000
local government to install CCTV on its towers and 8,000 Operator-captive
poles in exchange for access to land. Telkom + Telkomsel
8,500 XL
Established in 2006, PT. Persada Sokka Tama started 4,000 Indosat
off constructing BTS towers before becoming a
tower provider in 2008 and providing co-locations Growth Story for Indonesia’s big four: tenancy ratios
for telecoms service providers in Indonesia. The Tenancy ratio: 2011 2012 2013 2014 2015
company has over 1,000 towers mostly concentrated 2.0 Source: Quarterly and annual company reports,
TowerXchange research
in Java and Nusa Tenggara.
Financial overview of the Indonesian tower

1.5
industry
At the outset, the Indonesian tower industry

looked closely at the Indian model and used it as a 1.0
1.88
benchmark. However, the two countries ended up 1.70 1.76 1.74 1.72 1.75 1.73 1.67
1.63 1.65 1.62 1.68 1.58 1.69
taking very different paths with Indonesia being 1.53 1.50
1.39
1.3
able to allocate risks and rewards more evenly 1.20
0.05
between towercos and MNOs and more closely
replicating the North American tower industry
model. And the profitability of the Indonesian tower
industry is one very obvious measure of its success.
Protelindo Tower Bersama STP IBS Tower
New Street Research single tower model details excluding pass-through expenses). New Street
Research estimated prevailing lease rates in
Indonesia to be around US$1,200pcm at the end of
2015.
Tower Bersama and Mitratel
One of the largest proposed tower deals in the

history of the Indonesian tower market was the
acquisition of Mitratel from Telkom by Tower
Bersama. First announced in late 2014, the initial
phase of the swap deal was to see TBIG receive 49%
of the shares in Mitratel in return for 290mn TBIG
shares (approximately a 5.7% stake). No cash was to
change hands in the first phase of the deal, although
TBIG would assume ~US$234mn of debt. The second
phase could follow anytime in the following two
years, during which time PT Telkom Indonesia had
the right to swap its remaining 51% stake in Mitratel
for an additional 473mn TBIG shares – a further
8%. This would value the deal at the equivalent of
around US$904mn, including ~US$142.5mn in cash
as a deferred consideration if certain performance
Source: New Street Research, Company data 2015
milestones were achieved. In the end this deal
Indonesian towercos, particularly Protelindo, Tower In a recent TowerXchange article New Street was cancelled in mid-2015 as it failed to gain the
Bersama and STP, quickly drew the attention of the Research referred to a Single Tower Model the approval of the Indonesian government, and to date
investment community. Debt was made available research firm built to compare colocation growth, the future of Mitratel and its ~8,000 towers remains
and capital flowed, enabling further organic and economics, and returns of towers in different uncertain.
inorganic growth. Successful bond issuances and markets around the globe. The model analysed
IPOs followed. There are five towercos of scale in base station density, smartphone penetration, Continuing growth and acquisitions
Indonesia and over forty ‘mom and pop shops’ and leasing rates, escalators, pass-through expenses,
middle market towercos in Indonesia, ranging from construction costs and regulatory risk, and they The ebb and flow of sale and leaseback deals since
local community managed assets to substantial concluded that Indonesia was the most attractive 2008 has led to Tower Bersama, Protelindo and
regional entities, owning anything from a handful tower market for investors, and generated one STP deploying around US$2bn to acquire 12,220
to 1,000 towers each. of the highest day one cash flow yields (at 15%, towers from Indonesia’s operators, and they’ve built
New Street Research global market ranking by tower returns Axiata would be the creation of a joint venture
%, IRR less WACC towerco to pool and optimise their tower assets.
At this stage, however, these planned partnerships
have been limited by the government, and it
appears that they won’t advance anytime soon,
raising concerns about the level of competition
in the MNO market, and rumours of MNO
consolidation and sales are starting to emerge.
There is significant cell site densification occurring

in Indonesia driven by consumer demand for
mobile data services, and the tower industry is
starting to grasp the heterogeneous networks
(‘HetNet’) opportunity. Rooftop installations make
up a significant chunk of the assets of Indonesia’s
‘Big 3’ towercos, namely Protelindo, Tower Bersama
and STP. The other major factor in the future
of Indonesia will be diversification of product
offerings to adapt to LTE. STP and Protelindo appear
to be on the front foot in this regard with their
Source: New Street Research, Company data 2015 diversification into fibre, microcells and DAS. As of
September 2015, STP had a 2,454km fibre network
a similar number of build-to-suit and build-to-fill In addition to the active tower market, operators
sites over that period. For Indonesia’s ‘Big Three’ are also continuing to partner with each other to and 384 microcell poles, thanks to their purchase
towercos, the prized assets are Telkom/Telkomsel’s remain competitive, especially the smaller market of BIT Teknologi Nusantara, and their earlier
17,615 remaining operator-captive towers, the most players. Indosat and XL Axiata have been engaged acquisition in 2012 of PT Platinum Teknologi.
pervasive network in the country, of which the in RANsharing for some time, and this has also been Protelindo recently acquired iForte and their 450
operator has admitted as many as 13,000 could be extended to include co-operation on the rollout of micro cell towers, seven Hotel BTS and 700km of
sold, although they have no financial imperative to some LTE sites. Partnerships like this can greatly fibre. Meanwhile, Balitower have installed fibre and
divest. With the cancellation of the Mitratel deal, it reduce opex and help smaller operators to remain added over 2,000 micropoles in Jakarta.
is unclear whether these assets can still be acquired competitive, and keep shareholders happy. The
or whether Mitratel is destined to continue as a model is so successful that Indosat and XL Axiata Conclusion
captive towerco, in which case it could be a vehicle have proposed creating a separate entity to manage
for the management of the aforementioned 13,000 their networks outside of Java. Another possible The Indonesian tower market is elegant and
Telkom towers. step in terms of partnership for Indosat and XL investible because of its simplicity. A deep culture of
infrastructure sharing has been rapidly developed:
Indonesia’s towercos build 3,000-5,000 towers,
rooftops and infill sites per year, tenancy ratio See you at our future events!
growth compares favorably to many other global
tower markets, with around 0.13 tenants added
per tower per year. Indonesia may be the most
comparable tower market in the world to the USA,
with MSAs and economics closely resembling the Meetup Meet up
world’s oldest independent tower market, perhaps
not surprising given the prominent role played by
one of the US tower market’s forefathers, Michael
Gearon, in the creation of Protelindo. Indonesia’s
towercos are not encumbered by significant 4-5 April, 7-8 June,
engagement in energy logistics - power is a pass
through on almost all their sites, yet many are
London Boca Raton
expanding their business model by investing in
fibre and small cells.
TowerXchange are a little surprised by the relatively

low valuations ascribed to Indonesian towercos,
although STP and Protelindo have such a low float Meetup Africa Meetup Asia
as to make poor benchmarks. Tower Bersama’s
share price reached such an attractive point that
the company recently instigated a substantial share
& ME 2017 2017
buyback programme.
TowerXchange think there is still value to be found Johannesburg Singapore
in the simple, stable, mature Indonesian tower
market, and there are many best practices to learn
from the Indonesian market leaders attending
the TowerXchange Meetup Asia in Singapore on
December 12-13! www.towerxchange.com
www.towerxchange.com/meetups/meetup-asia
Healthy tenancy ratio growth Industry growth
While tower build had naturally slowed down

and further consolidation expected for the second half of 2016, most agree this was
temporary, partly due to reduced capex allocated
in Myanmar towers in 2017 by the operators and their focus on urban areas
(infill) to support data demand, which has exceeded
Entry of new operator and enforcement of licensing conditions among key expectations. Operators are said to focus on the
drivers of change biggest bang for the buck, with eyes to special
structures such as billboards and lampposts to
Myanmar remains an exciting tower market though not without its provide additional coverage, as well as rooftops. In
challenges. The country has seen rapid uptake in mobile subscriptions, with many cases, such builds were undertaken by the
SIM penetration rising from ten per cent two-and-a-half years ago, to now operators, mostly because they were single tenant
between 75-80%. With seven towercos serving the marketplace and inclusive sites that cannot be shared, plus the economics
of operator-captive towers, there are approximately 16,500 tenancies on do not make sense for towercos (the rental costs
12,030 towers in the country. At TowerXchange’s 3rd Annual Meetup Asia for urban rooftops is often prohibitively high to
in December 2016 in Singapore, our esteemed panelists from edotco, Apollo sustain towerco margins). Between Apollo and MIG,
Towers Myanmar, Myanmar Infrastructure Group (MIG), Shining Star they are said to have rejected 10-20% of such build
International Holdings Limited, and Overseas Private Investment Corporation requests.
Christie Liu, Head of Asia, (OPIC) shared their views on last year’s developments and what to expect for
TowerXchange the coming 12 to 18 months. However, there is much to look forward to in 2017
and beyond, as organic tower growth is expected
Keywords: 4G, ARPU, Apollo Towers Myanmar, Asia Insights, Business Model, Capex, Co-locations, to pick up on the backs of the 1,800MHz spectrum
Construction, Country Risk, Debt Finance, edotco, ESCOs, Exit Strategy, Infrastructure Sharing, MIG, MPT, auction in Q1 and the eventual enforcement
Market Overview, Myanmar, Myanmar Infrastructure Group, Myanmar Posts and Telecommunications, of the operators’ licensing conditions around
Network Rollout, OPIC, Off-Grid, Ooredoo, Overseas Private Investment Corporation, Private Equity, rural coverage. In addition, several new fixed
Regulation, Rooftop, SLA, Shining Star International Holdings Limited, Telenor, Tenancy Ratios, Towercos, line operators were awarded 2,600MHz licenses
Unreliable Grid, Uptime, Viettel, Who’s Who that could require as many as 14,000 sites. One
approximation is that if currently 7,730 towers in
Myanmar have been built by towercos, this number
could grow to 15-16,000 in the next four years.
< How Myanmar’s tower industry evolved
< Market size forecast for 2017 and beyond
The reality is tower counts are unlikely to grow
< Factors to drive organic and tenancy growth
at the same rate as during the initial rollout, but
< Investment climate and future deals
co-location on existing towers are growing, and

“
this is further buoyed by the imminent entry of the
fourth operator, a consortium led by Vietnam-based
Viettel.
The tenancy ratio for edotco is currently at 1.9 while

MIG is already at 1.6 on a fairly modest portfolio of
approximately 100 towers. Both towercos expect to
hit 2.0 in next 12-18 months. In any market, growth
of 0.2 per year is indication of healthy growth and a
2017 will be quite exciting. We focused more on co-locations this year, but
next year we’ll start building again, and hopefully cross the tenancy ratio
threshold of two with Viettel coming - Vijendran Watson, Managing
Director of Myanmar, edotco
“
generally good lease-up environment.
The general consensus seems to be that Viettel is

doing its primary planning around co-location of sustain seven or eight towercos in the long run In terms of potential buyers in 2017, edotco has
existing towerco sites, with the odd sites for infill and towerco on towerco consolidation is the most expressed its commitment to be in Myanmar for
to match the radio plans. Co-location appears to be likely natural progression. One important factor is the long-term, with a focus on organic growth while
the quickest way for Viettel to launch its network whether the buyer and seller share a similar DNA looking at inorganic growth opportunities as they
around August or September 2017. Viettel’s go-to and similar customers. Due to market and customer become available. MIG is now backed by an investor
market strategy tends to be more suburban and demands, most towercos in Myanmar have evolved in Shining Star who believes in the investibility
rural, perhaps anticipating a slightly lower ARPU. to provide a tower+power model. However, some of the tower industry, and is keen on further
While Viettel has in the past built its own towers in legacy assets are still run on a pure steel and grass acquisitions pending the performance and results of
other markets, that deployment and rollout strategy set up, with energy assets operated by a third-party its first towerco acquisition.
is not expected to work in Myanmar since the like IPT PowerTech (edoto and PAMEL) and some as
conditions, rules, and regulations are much tougher a full-service provider (MIG and Apollo).
in comparison. Investment climate
While there is a will to consolidate in the industry,
All three operators MPT, Telenor and Ooredoo are overcoming the contractual differences between The only transaction in 2016 was the sale of
expected to take part in the 1,800MHz spectrum towercos and their clients will be challenging. Every Myanmar Infrastructure Group (MIG) by Singapore
auction in the new year, which could be held contract has subtle differences, and something like Myanmar Investco (SMI) to Hong Kong’s Shining
as soon as March, to help with their 4G roll out. the “most favoured customer” (MFC) clause, which Star International Holdings Limited for US$12.7mn.
Ooredoo was the first to launch 4G, followed by guarantees the anchor tenant the best lease rate, While Shining Star is new to the tower business,
Telenor, then MPT recently in the Fall. could have negative impact on the other portfolios it is a real estate veteran and sees similarities
when two towercos come together. This was said to between the two industries. The company entered
Industry consolidation be more of an issue for legacy towercos than newer the Myanmar market two years ago and is keen
entrants who tend to already be at the common to expand their portfolio within the country
It is generally agreed upon the market cannot lowest denominator. beyond real estate. By following China’s One Road,

Estimated total number of sites in each Myanmar MNOs network One Belt policy, Shining Star is able to tap into
good financing from domestic banks and other
(inclusive of co-locations)
financing resources. Its headquarter in Yunnan
also puts it in close proximity to Myanmar which is
a plus. All in all, MIG is now backed by an investor
with optimism for the marketplace and an appetite
5,300
to do more.
6,900 Telenor
Ooredoo On the debt and equity financing side, through its
backers TPG and Tillman Global Holdings, Apollo
MPT
Towers secured US$250mn in debt from Overseas
4,300 Private Investment Corporation (OPIC), the U.S.
Government’s development finance institution.
Commercial banks in general are said to be still
nervous about the market, with lingering concerns
Breakdown of ownership of the 12,030 towers and rooftops about the sanctions programme taking time to
ease. And while sanctions are being lifted now,
TowerXchange estimates have been built to date in Myanmar
commercials banks are still concerned about who
3500
they’re doing business with. Entrepreneurial
3000 investors have also expressed interest in the
market place and been active in pitching their
2500 ideas to OPIC. With the political transition over
the last nine months, OPIC is hoping to see more
2000
3600 investors in the space.
1500
2500 Future outlook
1000 1800
1250 1250 In general the towercos on the panel remain
500 200 200 optimistic on the opportunities within the
530 300 100 300 marketplace for the coming year. While the grid
0
and power remain a challenge, the towercos are
T
PT
CK
IG
te -
llo
co
EL
or
o
T
EC el
EF
o
IG
M
en
ot
committed to meeting their SLAs on uptime and

M iett
ed
l
o
O
Ap
ed
PA
or
Te
continuing to provide value to the operators and

O
Independent towerco towers MNO captive towers Source: TowerXchange marketplace as a whole

SMI sells Myanmar Infrastructure TowerXchange: Thanks for taking time to
connect Tony. You’ve been in Myanmar now
since the beginning of 2016. How’s it going over
Group for $12.7mn to Hong Kong’s Shining there?
Star International Tony Pretorius, COO, MIG: It’s interesting.

The people are lovely here, though from a
COO on market realities, valuations, and future opportunities in Myanmar developmental point of view, there is still a long
for towercos way to go. The dynamic is different from what I am
used to.
Tony Pretorius was formerly CTO with Helios
Towers Africa and joined Myanmar Infrastructure TowerXchange: Can you expand on that a bit
Group (MIG) in January 2016. The industry more?
veteran brings his years of experience in SSA to
Myanmar, a country where a rollout that started Tony Pretorius, COO, MIG: Access to capital is a big
with a lot of momentum and is now in a bit of challenge, purely because there isn’t an investment
a shakeout. Read on to learn about MIG’s sell to banking or commercial banking history here
Shining Star and the current state of the Myanmar yet. Great strides have been made over the
tower industry. last couple of years, but to raise debt finance
locally is a challenge. Not impossible, but not as
Keywords: 4G, Asia Insights, C-Level Perspective, straightforward as in more established economies.
EBITDA, Interview, MIG, Market Entry, Market To be able to leverage your infrastructure is not
Overview, Myanmar, Myanmar Infrastructure impossible, but not as easy as elsewhere.
Group, Ooredoo, Private Equity, Telenor,
Towercos, Valuation, Viettel, Who’s Who Furthermore, the MNOs have also faced many
Tony Pretorius, COO, MIG
challenges in meeting their licensing obligations,
which naturally have had knock-on effects to
Read this article to learn: their partners and vendors. Nonetheless, we
< Unique and common challenges in Myanmar   have found them to be responsible partners in
< Valuation considerations for towercos in Myanmar   working with us. Again, these challenges are not
< What Shining Star is buying from MIG insurmountable.
< MNO rollout strategies and focus
< Co-location opportunities offered by new operator TowerXchange: Given your role, what about
from an operational perspective?

Tony Pretorius, COO, MIG: There are differences on
the operational front, not fundamental, but similar
to other emerging markets.
There’s a cadre of staff who need a lot of training

and support to get them to the levels you want,
hence reliance on expats which should diminish
over time. The power situation is similar to other
emerging markets. There is the unique challenge
in Southeast Asia with weather patterns. Monsoon
season is quite severe as opposed to just heavy or
seasonal rain throughout the year. But you deal
with it. Operational challenges are not that severe
here compared to some of the SSA markets I’ve
worked in.
TowerXchange: What about the market dynamics

right now? Do you foresee consolidation or a
potential sale?
Tony Pretorius, COO, MIG: Consolidation may

occur at some point but at the moment we see
new entrants and this is still an attractive market
in its early stage of development. We believe that
MIG is well placed to take advantage of the market
developments. Clearly the number of towers
needed in this country will far exceed some of the
earlier projections, given where we are at present.
TowerXchange: So what type of valuations are we

looking at potentially?
Tony Pretorius, COO, MIG: Typically, the valuation

of a towerco business that’s been operational

Tony Pretorius, COO, MIG: Simply stated, Shining new site build front. Consequently, there’s been
Star has made an offer to buy SMI’s entire share of a dilution of the number of sites being awarded
MIG. amongst multiple towercos, and a reduction
in volume. Each towerco has therefore been
TowerXchange: What motivated SMI to sell at building fewer towers. However, we expect that
this time? this situation is temporary, especially given the
imminent launch of a fourth operator.
Tony Pretorius, COO, MIG: The proposed divestment
represents a good opportunity for SMI to re-deploy TowerXchange: What’s the situation with the
its capital and focus its resources on its fast-growing soon to be confirmed fourth operator?
duty-free retail business, F&B ventures, and auto
services in Myanmar. Tony Pretorius, COO, MIG: I’ve dealt with Viettel
before in Africa; they are very aggressive and very
TowerXchange: What makes Shining Star smart, and they know what they are doing. I think
International a good counterparty? the towercos are expecting lease up opportunities
from Viettel, to assist them with their launch.
Tony Pretorius, COO, MIG: The Shining Start Group
for a while is done on multiples of EBITDA. Such is a well-established group within China/Hong Kong, TowerXchange: Both Telenor and Ooredoo have
towercos have good co-leasing on towers, and have focusing primarily on real estate, hotel and property been featured in the local press recently. A bit
built up decent cash flows. Then, based on annual management, education, healthcare, sports, and of a marketing and branding play here ahead of
EBITDA or Tower Cash Flow (TCF), multiplied by tourism businesses in China, Myanmar, and south- the fourth operator?
(say) 12-14x, you’ll get the typical enterprise value a east Asia in general. Shining Star views Myanmar
deal is done on. strategically in terms of its investments, along with Tony Pretorius, COO, MIG: Maybe a bit of a
adding telecoms infrastructure as one of its sectors marketing campaign in pushing the 4G rollout,
Tower Bersama (Indonesia) did partial IPO a to be developed. where there are already 4G signals in the major
few years ago, at 20x EBITDA. This market won’t cities. The traditional way for MNOs to roll out,
necessarily get 20x but could yield in excess 10x; TowerXchange: Going back to what’s happening i.e., roll out 2G, infill 3G, then infill 4G, appears to
likely somewhere in between. on the ground right now in Myanmar. We are have been followed by one of the MNOs, whereas
hearing build volumes have slowed for now? another MNO appears to leapfrogged straight to
TowerXchange: On a similar vein, 3G, overlaid some 4G, and is now backfilling 2G;
congratulations on the recent announcement of Tony Pretorius, COO, MIG: Multiple factors have a slightly different approach. Right now for the
the sale of MIG to Shining Star International for come in, where it appears that the biggest factor MNOs, as it is still a growth market, it’s all about
$12.7mn. Can we ask in simple terms, what are is that the MNOs have not rolled out as many new a “land grab,” competing on a daily basis at the
they buying? sites as previously, resulting in a slow down on the customer level

Chasing valuations in
First recorded transaction
Myanmar: from US$176,000 per

The first deal in Myanmar took place in Q4 2015,
with edotco’s acquisition of a 75% controlling stake
in Digicel Myanmar Tower Company (MTC). The
tower to US$127,000 transaction valued 100% of the towerco, on a cash

and debt free basis, at US$221mn. At the time,
Why MIG was worth less than MTC, and who might sell next MTC’s portfolio included 1,250 towers, setting the
benchmark price per tower of US$176,800.
Since the opening of the market to international operators in 2014,

Following the deal, TowerXchange noted that while
Myanmar has seen rapid uptake in mobile subscriptions, with
this is a considerably higher price than India,
demand exceeding even the most optimistic forecasts. From a very
where towers changed hands for an average of
low base, SIM penetration has raced to between 75-80%. As an
US$114,301 between 2009 and 2015, lease rates
emerging country with vast opportunities, the realities on the ground
in India are typically just US$550-600, whereas
also prove challenging for foreign operators and towercos alike. Seven
in Myanmar lease rates range from US$1,400 to
towercos currently serve the marketplace, with ownership having
US$1,700, driven by relatively high capex and
changed hands for two, in 2015 and 2016 respectively. The two deals
opex.
took place roughly one year apart, with a 28% drop in valuation when
By Christie Liu, Head of Asia, comparing price per tower. Read on for full deals on the players
Towerxchange
TowerXchange also felt the pricing was justified as
involved and key details.
the towers were built in phase one of the rollout,
concentrated on Myanmar’s three biggest cities
Keywords: Acquisition, Asia Insights, Axiata, edotco, DBS, Deal Structure, Debt Finance, Digicel, Digicel Yangon, Mandalay, and Naypyidaw, in highly
Myanmar Tower Company, Editorial, Exit Strategy, First Mover Advantage, ING, Investment, Lease Rates, desirable locations.
MIG, MTC, Myanmar, Myanmar Infrastructure Group, OCBC, PAMEL, Pan Asia Majestic Eagle, Private
Equity, SMI, Shining Star International, Singapore Myanmar Investco, Standard Chartered, Sumitomo Roughly one year later, in early November 2016,
Mitsui, Valuation, Viettel, Yoma Strategic Holding it was announced that Axiata, parent company of
edotco, increased its stake in Myanmar to a further
87.5% by exercising the put and call option it
Read this article to learn: signed with Yoma Strategic Holding Ltd., back in
< History of deal transactions in Myanmar December 2015.
< Tower valuations to-date in Myanmar
< Tower valuations compared to India The additional 12.5% stake was sold for US$35mn,
< Who will buy and sell next based on previous negotiations that set the price
for the full 25% at the higher of US$40.25mn or an

agreed multiple of the towerco’s 12-month EBITDA, Tower transaction history in Myanmar Source: TowerXchange
and trailing 12-month actual performance. A
multiple between 9.80x and 12.40x was quoted in Tower Price per
Date Seller Buyer Deal value
The Myanmar Times. count tower
Oct 2015 Digicel Asian Holdings Axiata Group US$221mn 1,250 $176,800
According to Yoma, the sales price is based on Pte Ltd: Digicel Myanmar Berhard: edotco SG
the formula set out in the put and call option Tower Company
agreement, and an agreed premium taking into
account certain agreed variations to the terms of Oct 2016 Singapore Myanmar Shining Star US$12.7mn 100 $127,000
the existing agreements. Yoma also noted based on Investco: Myanmar International
the latest unaudited financial statements, as of 30 Infrastructure Group Holdings Limited
September 2016, the book value of the sale shares is (MIG)
approximately US$32.55mn.
Second recorded transaction account for a substantial difference in valuation.
Indeed TowerXchange feels SMI realised a good yield
Minority shareholder Yoma, one of Myanmar’s
Myanmar’s second acquisition was announced in selling their towers at approximately a 27% premium
foremost real estate companies, has done well out
October 2016, which after months of speculation, on replacement value after just a single year.
of the deal. Yoma Chief Executive Melvyn Pun was
confirmed the sale of Myanmar Infrastructure
quoted in Singapore’s The Strait Times saying,
Group (MIG), owned by Singapore Myanmar Next deal
“Our original investment of US$20 million has now
Investco (SMI) to Hong Kong-based Shining Star
grown to US$70 million, of which half is being sold.”
International Holdings Ltd., for US$12.7mn. Tower As we noted in our article “Two tiered towerco
Yoma also reported a fair value gain of US$14.7mn
count for MIG around September was reportedly market emerges in Myanmar,” the next sale will
through this transaction.
around 100, which would yield a price per tower likely be Pan Asia Majestic Eagle Limited (PAMEL,
around US$127,000. sometimes referred to as Pan Asia Towers or PAT),
For now Yoma will retain the remaining 12.5%, with with edotco being a likely bidder.
a new revised shareholders agreement to be signed While it may be tempting to compare the yield
with edotoco for future sales. from the edotco-MTC and Shining Star-MIG PAMEL’s 1,250 towers were built for Ooredoo in
transactions and conclude that valuations are phases one and two. The portfolio is almost a mirror
At the time of edotco’s purchase from Digicel, the declining in Myanmar, it is not that simple. First, image of the Digicel MTC towers. While the tenancy
25% owned by Yoma would have been valued edotco’s tenancy ratio was reportedly “1.84 and ratio is not in the public domain, TowerXchange
around US$55.25mn to the sale price of US$221mn. heading for two” as recently as Q2 2016. While expects it to be above 1.8. PAMEL has management
Given this, 12.5% one year ago, was roughly MIG’s tenancy ratio is not in the public domain, DNA in common with Indonesia’s Protelindo, but
US$27.625mn, compared to the recent sell price TowerXchange understands it is substantially less remains a distinct entity. In 2014 PAMEL secured
of US$35mn. Note that the put and call option than edotco’s. Secondly, while the MIG towers are in US$85mn in financing from a consortium of five
agreement had set one base price of US$40.25mn good locations, they are not as desirable as those in banks: DBS, ING, OCBC, Standard Chartered and
for the 25%, or US$20.125mn for 12.5%. the edotco portfolio. These two factors alone could Sumitomo Mitsui.

Apart from edotco and perhaps new entrant OCK,
TowerXchange feels that it is a case of when, and not
if Myanmar’s other private equity backed towercos
exits, although the backers of Irrawaddy Green
Towers (Alcazar Capital et al) and Apollo Towers
(Tillman Global Holdings et al) seem patient enough
to lock in maximum value from the 4G rollout and
fourth MNO launch before selling – indeed either
could be a bidder for PAMEL at the right price.
Sell now or hold?
The question remains whether now is the best time

to sell, when plenty of transactions are expected in
2017. Organic and tenancy ratio growth is almost
guaranteed, especially in light of the MNOs focus on
4G rollout to support data services, to be spurred
by the auction of 1,800MHz spectrum in early 2017,
and the entry of the fourth operator Vietnam-based
Viettel via a consortium
About Axiata and edotco
Axiata Group Berhard is one of the leading

telecommunications groups in Asia, with
controlling interests in six mobile operators
under the brand names of ‘Celcom’ in Malaysia,
‘XL’ in Indonesia, ‘Dialog’ in Sri Lanka, ‘Robi’ in how to guides)
Bangladesh, ‘Smart’ in Cambodia and ‘Ncell’ in < Independent analysis and commentaries on the
Nepal, with strategic interests in ‘Idea’ in India prospects for tower transactions in selected countries < The latest news and registration information about
and ‘M1’ in Singapore. In 2012, it established TowerXchange’s Meetups.
edotco, the group’s infrastructure company, < The latest industry emerging market tower industry
which now operates a portfolio of 17,054 towers
and 12,000km of fibre across six countries

Why OPIC Invested US$250mn In 2010, when Myanmar held historic elections that
would end over 50 years of military rule, it was a
country that had endured decades of isolation. Less
in Apollo Towers Myanmar than three percent of the population had mobile
phones and this lack of connectivity limited not
Why increasing access to technology is a key focus of the Overseas Private only access to services and information, but the
Investment Corporation country’s potential for economic growth.
Today, mobile penetration is closer to 75 percent,

Apollo Towers Myanmar was introduced to Overseas Private
surpassing what had been considered extremely
Investment Corporation (OPIC) through its initial backers TPG
optimistic targets form the Government of
and Tillman Global Holdings. With a purpose to build out
Myanmar, and making this long-isolated country
towers in an emerging market, and with multinational operator
a stand out success story in rapid adoption of
Telenor as its key customer, Apollo had a good story that piqued
advanced technology. Myanmar’s ability to
the interest of OPIC. Further due diligence also uncovered many
swiftly construct a network of telecom towers and
other details that financiers such as OPIC need and like to see.
dramatically improve connectivity is a testament to
Read on to find out the challenges, opportunities, and success the speed at which progress can occur in emerging
factors in securing debt financing – and fundraising in general markets when demand for a product or service
for emerging markets telecom infrastructure. is strong, local governments are motivated, and
financing is available.
Keywords: Apollo Towers Myanmar, Asia Insights, Burma,
Country Risk, Debt Finance, Due Diligence, Interview, TowerXchange: Could you please tell us about a
Investment, Investors, Market Entry, Myanmar, Myanmar little bit about OPIC?
Investments International Limited (MIL), OPIC, Overseas
Private Investment Corporation, Regulation, Risk, TPG, Julia Robbins, Associate Director, Structured
Julia Robbins, Associate Director, Structured
Telenor, Tikona Digital Networks, Tillman Global Holdings, Finance and Insurance, Overseas Private
Finance and Insurance, Overseas Private
Investment Corporation (OPIC) Who’s Who Investment Corporation (OPIC): OPIC is the U.S.
Government’s development finance institution. It
mobilises private capital to help address critical
Read this article to learn: development challenges and in doing so, advances
< What is OPIC and what are its mandates U.S. foreign policy and national security priorities.
< OPIC requirements for project financing Because OPIC works with the U.S. private sector, it
< What attracted OPIC to invest in Apollo helps U.S. businesses gain footholds in emerging
< What issues and risks were identified by OPIC markets, catalysing revenues, jobs, and growth
opportunities both at home and abroad. OPIC

achieves its mission by providing investors with
financing, political risk insurance, and support for Apollo’s seven winning factors to securing US$250mn
private equity investment funds, when commercial
funding cannot be obtained elsewhere. 1. Development angle that aligned with OPIC’s financing mandates
2. Reputation of initial investors TPG and Tillman Global Holdings
Established as an agency of the U.S. Government in 3. Link to US-based entities via TPG and Tillman Global Holdings
1971, OPIC operates on a self-sustaining basis at no 4. Strong management team with proven industry experience
net cost to American taxpayers. 5. Market opportunity in Myanmar with accelerated mobile uptake
6. Management team’s ability to tackle challenges creatively
All OPIC projects adhere to high environmental and
7. Adherence to high labor standards
social standards and respect human rights, including
worker’s rights. By mandating high standards, OPIC and Insurance, OPIC: Our range of investments connectivity to people that don’t already have it
aims to raise the industry and regional standards of is also quite large, everything from US$250k to or improve connectivity where it is weak. We’re
the countries where it funds projects. OPIC services US$250mn, which is an incredible range. looking at projects like the Apollo Towers one, where
are available for new and expanding business they are building towers in a country where there
enterprises in more than 160 countries worldwide. OPIC has three main products. We provide financing wasn’t a cell network before and enabling people
and political risk insurance directly to projects, like to connect for the first time. Or we’re looking at
TowerXchange: What is OPIC’s experience in the Apollo Towers project, and we also have another projects like the one we recently committed in India,
telecom investments? product where OPIC provides debt to private equity Tikona Digital Networks, where they are expanding
funds. A lot of our telecom deals and successes Internet access to people who didn’t have it before.
Julia Robbins, Associate Director, Structured Finance have come through working with private equity We also work on projects like data centers and
and Insurance, OPIC: At OPIC we’ve just reached our funds that specialize in in the telecom. Some of subsea cables where the objective is to significantly
US$1bn portfolio in telecom deals and we’re quite those private equity funds have the ability to do the improve the quality of service available in the
excited about that. We have deals across the world, smaller projects, whereas direct financing is usually country. That’s really the first thing we look at, the
with the Apollo Towers financing in Myanmar as one better suited to larger projects. development story.
of the most recent ones. We’ve also recently done
deals in India, Colombia, and Kenya. We have deals TowerXchange: Can you share the process behind TowerXchange: What happens after that?
in every continent at this point. Ranges from telecom how OPIC goes about choosing a project?
deals to data storage, to subsea cable to interesting Julia Robbins, Associate Director, Structured
and innovative mobile healthcare type of projects. Julia Robbins, Associate Director, Structured Finance Finance and Insurance, OPIC: We still function like
and Insurance, OPIC: OPIC’s main objective is to a bank. We screen projects for the development
TowerXchange: And what is the range of advance global development in a way that will story and connection to the U.S., but after that
investments? benefit people in developing countries. In a lot of we’re really looking for the creditworthiness of the
our telecom/technology projects, the main thing project. Everything that a bank would do in terms
Julia Robbins, Associate Director, Structured Finance we look for is projects helping to bring greater of credit due diligence, that’s what we do; looking

through their financial performance, operational the first time. You can’t really get better than that! Myanmar Investments International Limited (MIL)
performance, making sure that the management And we do that all over the world. We are active in came in later.
team is strong and experienced. And then we have a over 100 countries at the moment and everywhere
series of credit and policy approvals that we would we go, that’s our objective: to encourage economic Another thing that was really exciting about the
go through same as a bank would, and we negotiate development with the objective of improving the project was the market opportunity. There was
the loan. lives of the people in the countries where we work. a study that was done that showed the rate they
thought mobile phones would be adopted in the
TowerXchange: Could you tell us about your TowerXchange: How did the partnership with country, and we’ve seen it outstrip that every
background Julia, how you got involved with Apollo come about? How did you “meet”? quarter. That was also a great plus for us in the
OPIC, and the focus of your role? project.
Julia Robbins, Associate Director, Structured Finance
Julia Robbins, Associate Director, Structured Finance and Insurance, OPIC: This was an interesting story TowerXchange: What were you most concerned
and Insurance, OPIC: I came to OPIC two years for us. In Myanmar, all US foreign investments about?
ago and started in late 2014. What really got me had to register their investment with the US
interested in OPIC was the development finance Embassy. When TPG and Tillman Global Holdings Julia Robbins, Associate Director, Structured Finance
model. Right out of college I joined the U.S. Peace first invested in the project, they went to the US and Insurance, OPIC: Of course Myanmar is a newly
Corps, in Morocco and saw firsthand the power of Embassy and registered the investment; the Foreign opened country so there are issues we had to work
the private sector to push forward development in Commercial Service happened to mention OPIC’s through. One of the early challenges we came across
a really focused and efficient way. When I came out name and connected us, and the rest is history. was land registration. There’s very little way to get
of grad school I wanted to find a place that could clear title to land, or register security interest in a
combine the development and private sector and TowerXchange: What attracted OPIC to the piece of land. The government is still working on
luckily enough I was able to find a job here at OPIC, opportunity? What did you like about it? this process, trying to update the registrar system so
which has been a great fit for me. My focus here that it’s easier for foreign investors to take security
has been both on telecom projects and SME banking Julia Robbins, Associate Director, Structured Finance in physical assets.
projects. and Insurance, OPIC: What caught my eye other
than development story, which was very important We also took a long time evaluating the foreign
TowerXchange: What most excites about your to us, was the strength of the management team: exchange situation in the country. The project did
job? they really had a lot of experience in developing benefit from dealing with customers who were
towers and building telecom networks in mainly large international players, such as Telenor,
Julia Robbins, Associate Director, Structured Finance challenging places. and a lot of MSAs are at least indexed in dollars,
and Insurance, OPIC: We get to see projects where so that helped, but there was still the transfer and
they’re going to change the countries where they The strength of the investors in the project was also convertibility risk.
take place. You get to work on a project like Apollo important. TPG is of course a very well known firm
where they’re building a cell phone network that so we knew they had well vetted the investment. TowerXchange: And what is the status of the land
will enable people get access to a cell phone for They had two investors to start, and a third registry system now?

“
Julia Robbins, Associate Director, Structured Finance ahead with it? You mentioned the development
and Insurance, OPIC: There was a large political story, market opportunity, and strength of
transition in Myanmar in 2015, when Aung San Suu existing investors and management team.
Kyi, the National Democratic leader was elected. Anything else?
There has been a bit of lull in trying to work on The one thing that would’ve been
some of these issues during the political transition. Julia Robbins, Associate Director, Structured Finance an immediate deal breaker for us
Now the new administration has settled in and and Insurance, OPIC: Yes, all of that. And I think the
would’ve been any violation of
people have been appointed, we’re hopeful that company’s ability to come up with creative solutions
they’ll really dig into it and address this issue. It’s to challenges as they came up. That really gave us the US sanctions policy. Here at
a complex issue that has a lot of stakeholders so it
takes a while to get it right.
TowerXchange: What might usually “make or

confidence they were able to deal with things as they
arose. Specifically, the actual registration of the loan
agreement, getting the stamp duty paid was quite a
challenge, and the company was very resourceful in
OPIC we are very much focused on
making sure projects are done with
the proper environmental, social,
and labor standards
“
break” a project like this? how they dealt with the situation.
Julia Robbins, Associate Director, Structured Finance TowerXchange: What are your thoughts on the
and Insurance, OPIC: The one thing that would’ve state of industry in Myanmar right now? What do they probably can sustain a fourth operator. And
been an immediate deal breaker for us would’ve you foresee by year end 2016? For 2017? the more competition will hopefully be good news
been any violation of the US sanctions policy, we for consumers in terms of pricing. Which works
take our customer policy very seriously. Julia Robbins, Associate Director, Structured Finance really well for OPIC’s objective, since it will make
and Insurance, OPIC: We’re really looking forward telecommunications services even more accessible.
Here at OPIC we are also very much focused on to the final confirmation of a fourth operator. A
making sure projects are done with the correct lot of new towercos have entered the market and TowerXchange: What’s the sense of priorities for
environmental, social, and labor standards. Apollo we’re interested to see how Telenor and Ooredoo the operators in Myanmar? SIM penetration is
was really great in working with us and making sure will distribute next orders and move forward in pretty good right now, with reports around 70-
that the project respected human rights including the build out. In terms of implications, we think all 80%.
worker rights. The nice thing also was Telenor was of the towercos are looking forward to the fourth
the first in the market and Telenor is very serious operator increasing their co-location ratios. Julia Robbins, Associate Director, Structured
about the quality of labor on their projects. They Finance and Insurance, OPIC: I think the operators,
actually very closely spot check all of the tower TowerXchange: Do you think the market can conjecturing from the outside, will focus on
companies, not just Apollo, and publish their sustain a fourth MNO? continuing to expand their geographic scope to the
findings. We have really appreciated that and found more rural areas of the country and continuing
that to be a positive development for the market. Julia Robbins, Associate Director, Structured Finance to reinforce the cities, since there’s been such a
and Insurance, OPIC: Yes, I think we’ve seen such high demand for data, and maybe more than they
TowerXchange: What gave you confidence to go an incredible demand for mobile services that expected in the original roll out

Akhil Gupta’s agenda for the Gupta congratulated TowerXchange on hosting
the premium event for the global tower industry,
tower industry in 2017

recognising the year on year growth of the
community. More importantly, Gupta led the
audience in applauding towercos, MNOs and their
Bharti Infratel and TAIPA Chairman’s keynote address highlights three suppliers for the creation of the tower industry, a
opportunities for towercos, and emphasises the importance of access to capital new infrastructure asset class with listed entities
totalling a global market cap of US$125bn, of which
Akhil Gupta, esteemed Chairman of both almost US$25bn comes from Asia, with significant
Bharti Infratel and of the Tower And future IPOs in the pipeline. “The tower industry is
becoming mainstream,” Gupta remarked.
Infrastructure Providers Association
of India (TAIPA), reprised his role as
Gupta described the robust, unique towerco
keynote speaker at the 3rd Annual
business model in Asia and reiterated his vision for
TowerXchange Meetup Asia, hosted in the “disarmament of the MNOs” – offering modern,
December 2016. While being Chairman reliable infrastructure under tariffs such that MNOs
of Asia’s benchmark listed towerco, Mr have no choice but to lease shared infrastructure
Gupta is also a Director of India’s leading rather than build or buy their own infrastructure.
MNO, Bharti Airtel, so his vision includes
that of both infrastructure provider In his 2016 keynote, Akhil Gupta chose to highlight
and tenant. Here are the highlights of three great opportunities for towercos and
Akhil Gupta, Chairman, Bharti Infratel
Gupta’s keynote speech. infrastructure providers for the coming year:
1. Specific prioritised adjacent growth areas

Keywords: Asia, Asia Insights, Bankability, Bharti Airtel, Bharti Infratel, Business Model, C-Level 2. How to tackle energy
Perspective, Capex, Deal Structure, Energy, Energy Efficiency, Fixed Price, IBS, IPO, Infrastructure 3. Access to capital
Sharing, Insights, Investment, Lease Rates, Multi-Region, Pass-Through, Stakeholder Buy-In, TAIPA,
Towercos, Wi-Fi Specific prioritised adjacent growth areas
Driven by the data explosion, hundreds of

Read this article to learn: thousands of micro sites will be needed as Asia
< Opportunities for towercos in provision of micro sites, Wi-Fi and IBS migrates to 4G and eventually 5G.
< A call to connect most shared towers to fibre within the next two years
< Seeking a win-win model for the provision of energy While Gupta was pleased to see Asian towercos
< How to access capital: consolidate to reach scale, IPO diversifying into the provision of these lighter sites,
he noted that some MNOs are still self-deploying

micro sites. Gupta re-iterated his call for towercos transport network – whomever that may belong of the tension which currently characterises annual
to step up and completely disarm the operators, to – and to buildings in which they provision negotiations.
offering rapid deployment at a price where it makes Wi-Fi. But later the focus should shift to shared
no sense to build their own sites. “If MNOs have microwave, inter and intra-city long distance fibre “We could virtually eliminate diesel… if we’re able
built their own sites,” suggested Gupta, “we should and ultimately even international long distance to work out a common win-win formula to share
buy them.” Gupta also called on technical teams to infrastructure. benefits between towerco and customer,” concluded
design micro sites with capacity for two tenants. Gupta.
Fibreising sites enables MNOs to take microwave
“Towercos must not just provision outdoor dishes off towers, freeing space for an extra tenant. Access to capital
infrastructure, but must offer white label service in “I believe there is a great opportunity for us to
building solutions.” become tower and transmission companies,” Whilst MNOs in Asia and worldwide continue to be
concluded Gupta. capitally constrained, access to capital remains a
With more than 80% of data traffic generated key issue for towercos.
indoors, Gupta called on industry colleagues to
How to tackle energy
commit to a vision to provide coverage in virtually
The capitally intensive nature of the micro site, Wi-
every building over 10-20,000sqft. This service
“Provision of energy at the right cost is a Fi and IBS, and transmission opportunities, and the
should be provided by towercos on a white label
mainstream responsibility for towercos in India investment required in renewables, energy storage
basis: towercos should never compete with their
and in other Asian countries where power is not and grid extensions, require that stakeholders work
customers.
dependable. Provision of energy is also the most together, and make it imperative for towercos to
complex activity we provide – yielding little or no devise feasible tariff plans that both ensure their
“I see Wi-Fi and IBS as a virtually endless
margin under the traditional pass through model,” business case and ensure MNOs don’t find it more
opportunity, but if we yield this space, someone else
opined Mr Gupta. economic to self-deploy.
will occupy it,” added Bhati Infratel’s Chairman.
“This is the year we really need to step up our
efforts as an industry, and make this a mainstream The imperative to reduce energy opex has To optimise the investibility of infrastructure
activity of all towercos. Towercos must become the stimulated investment in energy efficiency providers as an asset class, Gupta called for
owners of indoor Wi-Fi infrastructure.” solutions, resulting in the introduction of the consolidation among sub-scale towercos to improve
fixed energy model. This has motivated Indian their access to capital, while the Bharti Infratel and
Alongside micro sites, Wi-Fi and IBS, the third piece towercos to invest significant management time into TAIPA Chairman also called on towercos of scale to
adjacent growth area highlighted by Gupta was negotiating energy charges. consider listing to facilitate easier access to capital.
transmission.
Gupta called on stakeholders to work out a model Gupta concluded by re-emphasising the need for
“Most shared towers can feasibly be connected to where, after providing for depreciation of energy collaboration to unlock these opportunities and the
fibre within the next two years,” said Gupta. equipment, any profit from energy efficiency associated capital, commending TowerXchange for
programmes should be transparent, and should providing a forum for the exchange of experience
Initially towercos should link towers to the nearest shared with the customer, thus taking away much and ideas

Ascend Telecom leverages TowerXchange: Please tell us about your
company and your personal background in
telecoms.
innovative technologies to optimise Sushil Kumar Chaturvedi, CEO, Ascend Telecom:
its 5,200 tower pan-Indian footprint Ascend Telecom Infrastructure Pvt. Ltd. is an ISO
9001-2015 Company, incorporated in 2002, with an
Infrastructure Provider (IP-I) registered with the
CEO Sushil Kumar Chaturvedi talks about the origins of Ascend telecom and Department of Telecommunications, Government
their approach to achieving operational excellence of India.
The Indian tower market is mature and diverse, During the financial year 2011-2012, Ascend
with a variety of infrastructure providers meeting acquired India Telecom Infra Ltd., a company
the needs of MNOs across the country's expansive engaged in a similar business which had a
geography. Founded in 2002, Ascend Telecom has portfolio of around 2,500 telecom towers with
been offering coverage for 10,000 tenants, with 4,000 tenants.
42% of them in growth circles. We recently spoke
with Sushil Kumar Chaturvedi, CEO of Ascend Ascend is a professionally owned and managed
Telecom to learn about his vision for the future of company, and is backed by NSR (New Silk Route)
the Indian tower market. which holds a majority share, and Infrastructure
Leasing & Financial Services (IL&FS).
Keywords: Air Conditioning, Ascend Telecom,
Asia, Asia Insights, Batteries, Construction, Having a pan-India presence with 5,200 towers
Energy Efficiency, Energy Storage, IL&FS, and 10,000 tenants, with 42% concentrated in
India, Investment, M&A, Network Rollout, New growth telecom circles, Ascend Telecom is a
Silk Route, O&M, Opex Reduction, Small Cells, preferred business partner of all major telcos, and
Tenancy Ratios is recognised as the lowest cost operator with the
Sushil Kumar Chaturvedi, CEO, Ascend Telecom
fastest turn around delivery, offering operational
excellence in diverse geographies. Ascend Telecom
Read this article to learn: has been a pioneer in green energy deployment,
< The origins of Ascend Telecom and its pan-Indian footprint providing green energy solutions in over 50%
< The structure of NSR’s funding and its plans for growth of our towers. Ascend Telecom operates from its
< Ascend Telecom’s innovative approach to energy efficiency corporate headquarters in Bangalore, and has a
< New approaches to small cells and the Smart Cities initiative state-of-the-art NOC in Hyderabad and field offices
in all of the state capitals.

“
full service inclusive of power? What are some of
your strategies to lower opex?
Sushil Kumar Chaturvedi, CEO, Ascend Telecom:
Ascend has consciously engaged in strategic green energy

initiatives to address the pain point of the industry and align with
government/TRAI directives
“ Ascend is a turnkey passive infrastructure provider,
and is recognised as the lowest-cost towerco. We
have made extensive use of new technology to excel
in operations.
TowerXchange: What is your appetite to

deploy your own capex into energy efficiency
programmes versus partner with ESCOs?
Ascend Telecom is managed by a team of in Southern African Development Countries (SADC) Sushil Kumar Chaturvedi, CEO, Ascend Telecom:
professionals with a combined total of 250+ years at the ITU/TCIL, and was the Director of Indian Ascend has consciously engaged in strategic
of industry experience in operating large defence, telecoms services at BSNL. green energy initiatives to address the pain point
telecom, PSU, and private telecoms networks in of the industry and align with government/TRAI
India and abroad with an illustrious track record. TowerXchange: How is Ascend Telecom financed directives. These investments have paid dividends
and how has this evolved over time? with a realised margin of 12-15%, and the gains
I took over the reins of Ascend in 2012. I have 34+ from power and fuel have been increasing over the
years of industry experience in key management Sushil Kumar Chaturvedi, CEO, Ascend Telecom: years. These initiatives include energy efficiency
and leadership positions, managing telecoms Ascend is backed by marquee investors New Silk improvement programmes, analytics-driven energy
PSU and private telecoms enterprises across the Route (“NSR”), the majority shareholder and IL&FS, assets, optimal performance, green initiatives and
globe. I was awarded the President’s medal for the minority shareholder. achieving a higher number of tenancies under fixed
distinguished telecoms services in 2001, anad in opex plans to provide for higher gains.
2008 I was recognised as “CEO of the Year” for the NSR is a leading Indian subcontinent-focused
fastest growing company in Asia Pacific by Deloitte growth capital firm founded in 2006 with more than So far Ascend Telecom has internally funded its
& Touche. US$1bn under management. NSR has a strong and energy program and all deployments have been
experienced team of investment professionals, who done by in-house teams. Armed with trained
My other telecoms experience includes my role utilise their domain expertise and leverage their manpower and credible results, Ascend Telecom
as Group CEO for managed telecom and satellite broad network of relationships to create value and is planning energy management for other
services at ORG Informatics, Vice President of GDSS contribute substantially to the future growth and infrastructure providers and telcos on a capex-
Inc. where I pioneered and deployed triple play success of their portfolio companies. sharing basis.
services across Africa and Southeast Asia. I was
also responsible for the development of telecoms TowerXchange: Does Ascend Telecom provide a TowerXchange: Is Ascend Telecom engaged in

“
The equipment includes fabricated towers which
are SERC/IIT pre-approved, silent and super-silent
diesel generator types which are certified by CICB
and Pollution Control Boards. Other technology
includes VRLA, tubular flooded and lithium-ion
battery banks, prefab shelters, electrical equipment,
air conditioners, safety equipment, wind chimneys,
and solar PV systems selected from ISO certified
Ascend Telecom is forging Smart partnerships to provide suppliers, complying to national and international
an innovative bouquet of services to address small cells, in-

building solutions, and smart poles with value-added services
“ standards.
TowerXchange: Please outline your vision for the

future of Ascend Telecom.
Sushil Kumar Chaturvedi, CEO, Ascend Telecom:

Focused on profitable build and successful M&A, we
will continue to pursue our growth strategy with
organic and inorganic expansion through accretive
organic growth and/or looking for potential based on constant innovation, extensive analytics acquisitions.
acquisitions? and operations feedback.
Ascend Telecom is forging smart partnerships
Sushil Kumar Chaturvedi, CEO, Ascend Telecom: Technology and supply chain teams continuously to provide an innovative bouquet of services to
Ascend has had a proven track record of M&A, strive to identify the most effective and cost- address small cells, in-building solutions, and smart
and is pursuing a growth strategy of organic and optimised solutions for their infrastructure, both poles with value-added services. Ascend Telecom
inorganic growth, with accretive acquisitions, on new builds as well as upgrading their current will be a key player in the Smart City program and
offering innovative solutions and creating avenues sites. Ascend Telecom recognises effectiveness is supporting the Digital India initiative.
for value-added services. of management through multiple suppliers and
service contractors spread across all regions in We will continue to provide cost-effective energy
TowerXchange: What is your procurement model order to ensure sustainability of supplies and management through our green energy initiative.
and process – is it in-house? Who are the key services at all times.
stakeholders? How do you buy and what are your We will strive to continue being the preferred
current priorities? Technology teams, the operations team, the supply business partner of telcos. With planned organic
chain management team, suppliers and service and inorganic growth, and expanded energy
Sushil Kumar Chaturvedi, CEO, Ascend Telecom: contractors and the quality assurance teams are key management, Ascend Telecom is in discussions with
Ascend Telecom’s in-house procurement model is stakeholders. strategic investors

4G drives the restructuring
Phase one of the 4G rollout in India has, to date,
consisted primarily of loading 4G onto MNOs’
of the Indian tower industry

existing sites. Because master lease agreements
in India are structured to derive a relatively small
fee for loading, the equivalent of 10-15% of a
TowerXchange examines the impact of the rollout on tower cash flow and tenancy, rather than 80-100% of a tenancy (as it
towerco consolidation in India is for towercos in the U.S.), the full effect of 4G on
towerco profitability has not yet been seen.
It is increasingly apparent that the 4G rollout will have a
significant effect on the structure of the mature, hitherto The 4G rollout will soon require that new sites be
stable Indian tower industry. While MNOs committed added as more affordable 4G devices come on to
outlay of Rs66,000 crore (US$9.9bn) in India’s most the market, as more subscribers take up 4G, traffic
recent round of spectrum auctions did not precipitate increases, and as networks need to be densified
any immediate tower monetisations to raise capital, it to deliver a true 4G experience. In phase two of
the 4G rollout TowerXchange predict a significant
seems the cost of rollout, exacerbated by competitive
uptick in new full blown tenancies and new build
pressures created by Reliance Jio’s innovative tariffs,
once the “low hanging fruit” of overlay on existing
has prompted several MNOs to reconsider monetising sites is harvested. Deloitte has forecast that tenancy
their towers, as well as prompting consolidation among ratios, currently around two in India, will rise to
By Kieron Osmotherly, CEO, TowerXchange towercos and MNOs. almost 2.5 by 2020.
Keywords: 4G, American Tower, Anchor Tenant, Ascend Telecom, Asia, Asia Research, Bharti Airtel, As India’s first all-IP network, Reliance Jio is a
Bharti Infratel, Brookfield, CPP, Capex, Densification, GTL Infrastructure, Idea Cellular, Idea Cellular benchmark, albeit an atypical one. While about
Infrastructure Services, India, Indus Towers, Investment, KKR, LTE, Lease Rates, Loading, MLA, MNOs, half Reliance Jio’s rollout is co-located on towerco
Market Overview, RCOM, Reliance Infratel, Reliance Jio, Sale & Leaseback, Tenancy Ratios, Tower Vision, sites, they have self-deployed over 25,000 new sites,
TowerXchange Research, Towercom, Towercos mostly micro sites, and have suggested they could
deploy a further 45,000. Reliance Jio continues
to rapidly deploy capex, and is raising Rs30,000
Read this article to learn: crore through a rights issue, bringing their total
< Phase one of 4G rollout is being driven by loading of existing sites investment over Rs2 lakh crore (US$27bn).
< Phase two will include more new full blown tenancies and new build
< At least one MNO has started self-deploying again, particularly micro sites While network capex is rising across the board,
< The need to raise capital for 4G has re-ignited tower transaction deal flow in India we have not yet seen other Indian MNOs self-
< The impact of consolidation among India’s MNOs deploying micro sites in large numbers, perhaps
because other MNOs have a more symbiotic

relationship with a towerco (Bharti Airtel with Prospective buyers and sellers in Indian towers
Bharti Infratel and Indus Towers, with which they
Buyers Sellers Legend
are joint venture partners with Vodafone India and
Idea Cellular). Tilman Fund
Group
With Reliance Jio challenging incumbents on Towercom
(RITL) Potential buyer/
several fronts: network strategy, tariffs and
Brookfield equity seller?
technology, India’s leading MNOs have raced to
deploy their own 4G base stations. This accelerated
rollout has both added value to the towercos hosting Strategic buyer
CPP
many of the utilised sites, and at the same time put
pressure on the balance sheets of the MNOs who Bharti Idea Tower Sale rumored
own significant equity stakes in many of the same Infratel Cellular IS Vision
towercos. These twin pressures have re-invigorated Sale confirmed
the formerly nascent Indian tower transaction KKR
Indus Ascend
pipeline. GTL Infra
Towers Telecom Deal rumored
Buyers and sellers

Deal confirmed
American Viom
One can increasingly divide India’s towercos Tower Networks Source: TowerXchange
into buyers and sellers – those seeking to grow
inorganically, and those seeking to complete an exit Bimal Dayal, recently promoted CEO of Indus Reliance Jio co-location package, which brought
strategy. TowerXchange count American Tower, Towers, recently told TowerXchange they were their tenancy ratio close to two, although the impact
Indus Towers and Bharti Infratel among potential open to the idea of acquisitions, adding “M&A is a on tower cash flow would have been dampened
strategic buyers, joined by a cluster of funds with game of synergies given the scale of our footprint. by a substantial discount agreed between brothers
an appetite for Indian towers, including Brookfield, Any potential acquisitions must have a good fit with Mukesh and Anil Ambani’s MNOs, which the latter
CPP, KKR and Blackstone, as well as tower our rollout strategy; there must be a need from our recently described as “virtually merged”.
entrepreneurs such as the Ahuja family’s Tillman clients for those locations.”
Global Holdings, backed by TPG. Bharti Infratel could be another buyer, but
After Tillman balked at the deal, Brookfield parent Bharti Airtel are also exploring the sale
American Tower, which has been rolling up Indian recently signed a binding agreement to acquire of a substantial equity stake, with the Economic
towercos since 2009, has already taken the prized RCOM’s Towercom (formerly known as Reliance Times suggesting Brookfield, KKR and CPP all have
Viom Networks assets off the table, and Chairman Infratel), which owns ~45,000 towers. For several appetite for stakes reportedly between 40-51% of
and CEO James Taiclet recently said “we are open to years, RCOM had struggled to find a buyer for the towerco. Airtel’s stake in Indus Towers is also
those discussions with any potential sellers.” their towerco, but benefitted from a substantial contained within Bharti Infratel, so any investment

opportunity in the Bharti Infratel platform (already played a significant part in prompting tower assets Capital deployed for spectrum
28% owned by public shareholders) could increase to change hands in India, but the restructuring has
third party investor access to India’s largest only just begun. “Eventually the Indian market will In last year’s spectrum auction Bharti Airtel,
towerco. be consolidated into maybe four larger towercos,” Vodafone India and Idea Cellular, fortified their 4G
suggested Indus Towers CEO Bimal Dayal. spectrum holdings across key circles, giving them
Idea Cellular are also rumoured to have appointed adequate 4G spectrum to counter Reliance Jio.
advisors to explore the monetisation of some or How mature is the rollout of mobile broadband
all of their 16% stake in Indus Towers, and/or in India? The Rs66,000 crore outlay bring the total invested
the monetisation of Idea Cellular Infrastructure in spectrum by India’s MNOs to over Rs 350,000
Services, their captive towerco, within which some With 3G coverage of India approaching 95% within crore (over US$50bn) in the last five years.
~11,000 towers are held outside of the Indus Towers the next two years, 4G has already taken root and
platform. Idea Cellular Infrastructure Services is spreading rapidly: the overlay is reportedly At 14x the price of the 2,300MHz spectrum and
has been proactively leasing up the towers, which already on over 20% of sites. After Airtel launched 4x the price of the 1,800MHz, MNOs clearly felt
reportedly have a tenancy ratio of 1.8. first, Reliance Jio been a disruptive innovator in 4G, the coveted 700MHz and 900MHz spectrum
launching India’s only all-IP, 4G network, rapidly was overpriced, thus none was sold, so further
Rumours persist about the potential sale of rolling out new infrastructure and purchasing attractive spectrum for 4G could come to market
India’s smaller towercos, Ascend Telecom and prized spectrum. India’s other MNOs have followed in the future. In the meantime, with higher
particularly Tower Vision. And there is a growing suit by increasing the pace of their 4G network frequencies being used for 4G, greater cell site
sense that, amid GTL Infrastructure’s balance rollout, and looking to monetise their infrastructure density will be required - good news for the Indian
sheet restructuring, the more attractive 18,000 to raise capital for the most expensive spectrum tower industry.
Chennai Networks portion of GTL’s portfolio could auctions in India’s history.
be monetised, although valuations are affected by While industry debt in Q1 2016 was around Rs2
the uncertainty about the 86% of revenues that While Reliance Jio has rolled out over 100,000 base lakh crore (US$27bn), the capital outlay for the
reportedly come from Aircel: the anchor tenant stations, in terms of network size, Bharti Airtel still recent auction will have significantly increased
is in the process of being acquired by RCOM. The leads the market with between 150,000 to 160,000 MNOs’ leverage. India’s MNOs are taking different
business may also have to be restructured, as a deal base stations across the country including 2G, 3G approaches to raising capital for 4G spectrum and
to recast GTL’s debts in 2011 reportedly restricts and 4G towers. Idea and Vodafone have around rollout. Vodafone India has secured an investment
carving out the Chennai Networks towers. 100,000 each, but neither has all-India coverage. of Rs47,700 crore from their parent company.
Idea Cellular has issued corporate bonds and is
The final piece of the 457,597 piece Indian tower According to CRISIL research, India’s top three exploring monetising its towers. Meanwhile Bharti
portfolio jigsaw is BSNL, whose carve out of their telecom operators – Bharti Airtel, Vodafone India Airtel are releasing further equity in their towerco,
~65,000 towers is dragging on into another year. and Idea Cellular—are expected to spend around Bharti Infratel.
Rs 80,000 crore (almost US$12bn) in network capex
MNOs’ need to raise cash for 4G and towercos over the next two years, which is 25% higher than Reliance Jio is raising capital through share
jockeying to benefit from the rollout have both the aggregate network capex in the previous two. issuances whilst leveraging co-location to

Airwaves acquired in India’s most recent spectrum auction While there has been speculation in the press about
a prospective Vodafone-Idea merger, or even a
USD Rs Crore Vodafone-Reliance Jio merger, consolidation is a
bn 000’s more immediate prospect among a second tier of
Rs20.280 MNOs, led by Reliance Communications (RCOM).
3
20 RCOM is integrating the acquisition of Sistema and
is finalising a deal to acquire Aircel. Meanwhile,
Airtel is reportedly in “advanced talks” to acquire
15 Rs14.244 Telenor India, while Tata DOCOMO could be
Rs12.798 Rs13.672 another acquisition target.
2
While Morgan Stanley expect MNO consolidation
10
to slow tower tenancy growth, a view echoed by
Goldman Sachs whose models suggest up to 10,000
Rs4.500 Bharti Infratel tenancies could be at risk because of
1 5 consolidation in the coming year, towercos take a
more positive view.
MHz 173.8 365.2 349.2 269.2 12.4

“It is not healthy for the industry to have say
Airtel Vodafone Idea Reliance Jio Tata Teleservices ten operators, including five or six sitting on
spectrum without the wherewithal and means to
accelerate time to market. TowerXchange Will MNO consolidation offset the 4G rollout,” Bharti Infratel Chairman Akhil Gupta told
understands around half of the Reliance Jio opportunity for towercos? TowerXchange. “Consolidation remains a work in
network is co-located, with 30% of their sites on progress, but it will leave spectrum in the hands
RCOM (Towercom) towers, 20% on other towercos’ After the cancellation of 122 MNO licenses in 2012 of companies that have the resources for rollouts.
structures (The Economic Times reported that created a more rational MNO landscape in India So Indus Towers and Bharti Infratel and the entire
Reliance Jio had taken 14,000 tenancies with Indus, (at the expense of tens of thousands of towerco tower industry in India will benefit from each of
5,000 with American Tower and around 6,000 with tenancies), the market has settled into a two tiered these developments.”
GTL at lease rates varying from Rs 28-33,000). While structure, led by Bharti Airtel, Vodafone and Idea
Reliance Jio has built over 25,000 captive towers Cellular. American Tower’s Amit Sharma, President of
to date, and has suggested they could build 45,000 American Tower Asia, concurred, telling the
more, TowerXchange understand many of these Reliance Jio is making inroads in the high value, Economic Times: “carrier consolidation has
sites are too small to accommodate multiple tenants, 4G customer segment, the addressable market for been historically positive for our operations, and
thus we think it unlikely Reliance Jio will launch its which is estimated to be around 5% of the total 1bn we expect strong growth trends in India, going
own towerco soon. current subscribers. forward.”

Forging a path for 4G in India
TowerXchange: Can you tell me about your
company and your personal background in
telecoms?
Thanks to surging demand for data services, operators in India are rushing
to do business with GTL Infrastructure Milind Bengali, Chief Operating Officer – Business
Operations, GTL Infrastructure: GTL Infrastructure
GTL Infrastructure Limited is a leading Ltd (GTL Infra) is in the business of shared passive
independent telecom tower company. It telecom infrastructure. We have around 28,000
provides passive infrastructure on a shared towers across India, which allow us to bring
connectivity at affordable prices to the masses and
basis for telecom operators to host their active
create a positive impact on the economy.
network components. In this interview, Milind
Bengali, Chief Operating Officer – Business The group as a whole has revenues of around
Operations, GTL Infrastructure, explains what US$500mn and operations in Asia Pacific, Europe
his business is doing to support 4G in India; and the Middle East.
talks about his company’s plans to increase
tenancy ratios; and explains why GTL Infra is It is worth mentioning that our tower portfolio
serves all of the major cellular operators in India.
about to embark on a debt conversion plan.
We have a business model of infrastructure sharing
that is based around building, owning, operating
Keywords: Asia, Asia Insights, Capex,
and maintaining the passive telecom infrastructure
Co-locations, GTL Infrastructure, India, sites that are used by multiple service providers.
Infrastructure Sharing, Insights, Investment,
NOC, Network Rollout, New License, Opex, There are many benefits that our customers
Opex Reduction, QoS, Reliance Jio, Tenancy get from working with us, but for the purpose
Milind Bengali, Chief Operating Officer –
Business Operations, GTL Infrastructure
Ratios, Tower People, Urban vs Rural of this article I would like to pick out three.
Our telecom infrastructure and services allow
operators to reduce capex and opex through shared
Read this article to learn: infrastructure, to reduce energy costs and enjoy
< How GTL Infra is helping operators to reduce their Capex and Opex faster rollouts.
< About GTL Infra’s debt conversion plan
< How growth in Indian telecom circles is leading to higher tenancy ratios Before taking up my current position at GTL
< What steps GTL is taking to reduce its costs Infrastructure, I headed the M&A function for the
< How GTL Infra is helping to support 4G in India global group. Prior to that, I held senior positions
with Crompton Greaves, Aptech and The Thapar

“
Group. In total, I have over 25 years’ of experience and penetration in these circles has been lower
in telecoms and ITES across business operations and historically, and therefore operators are focusing on
strategy; sales and marketing; business and market these circles for rollouts to tap into their potential.
development; as well as P&L, and have worked all
over the world. TowerXchange: Can you give us some guidance
about your tenancy mix?
TowerXchange: What can you tell us about the
18 to 24 months after SDR, we
recently announced debt conversion plan? plan to bring this debt down Milind Bengali, Chief Operating Officer – Business
Operations, GTL Infrastructure: Currently, GIL along
Milind Bengali, Chief Operating Officer – Business substantially further, helping with its associate company CNIL has approximately
Operations, GTL Infrastructure: Over the last six
years both our companies have reduced domestic
debt from a high of Rs. 12,000 crores down to Rs.
8,300 crores. Current SDR, conversion of bonds
and promoter loans into equity are expected to
to generate cash to modernise
our network and add 10,000
to 12,000 more tenancies
“ 45,000 tenancies with a tenancy ratio of around 1.8x
on radiating towers.
Due to a good portfolio in growth markets like

Bihar, UP-East, NorthEast, Assam and J&K, amongst
dramatically reduce the debt further to Rs. 4,800 others, we expect to receive sizable tenancies in
crores. Details will be known through the stock these circles, helping us improve our tenancy ratio
exchange releases. in record time.
only independent and truly neutral company with a
18 to 24 months after SDR, we plan to bring this pan-India presence. Amongst other tower companies today, we have
debt down substantially further, helping to generate the all-important capacity to quickly offer access to
cash to modernise our network and add 10,000 In addition, we have a very good mix of both rural new entrants and help them rollout in the shortest
to 12,000 more tenancies, subject to fulfillment of and urban infrastructure. Approximately, 65 to possible time. I should also mention that we work
uptime of network operations. 70% of our towers are Ground Based Towers (GBT), with all telecom operators in India today.
while most of our rural GBTs are between 50 and
TowerXchange: Please tell us about your 60 metres in height. This is a clear advantage to the TowerXchange: What are some of your strategies
portfolio: the assets you have on the ground, operator today – the height advantage is beneficial to lower opex?
your geographical footprint, and your ratio of when it comes to QoS.
ground based to rooftop towers. Milind Bengali, Chief Operating Officer – Business
I should also mention that we are present in all Operations, GTL Infrastructure: We have taken
Milind Bengali, Chief Operating Officer – Business of the twenty-two telecom Circles. In particular, several measures to lower opex. First of all, we have
Operations, GTL Infrastructure: GTL along with we have a strong presence in the circles of Tamil optimised our site security; our overall security cost
its associate company CNIL (Chennai Network Nadu, Karnatka, UP-East, J&K, NorthEast, Assam has been drastically reduced through innovation. In
Infrastructure Ltd) has around 28,000 telecom and Bihar. All of these circles have grown since addition, we are deploying deep discharge batteries
towers spread across all telecom Circles. We are the last year. I should also point out that the coverage to reduce DG run hours and diesel consumption.

“
in making sites ready for sharing thanks to quick
upgrades to meet and surpass operators timelines,
therefore we have been able to receive a large share
of the service orders in this category.
TowerXchange: What can you tell us about your

This year, all the leading operators have been focusing on data
services, and average data usage per subscriber has been rapidly
rising. The launch of RJio has also triggered greater competition
amongst operators to expand their 4G network coverage
“ recent deal with Reliance Jio for 6,000 tenancies?
Milind Bengali, Chief Operating Officer – Business

Operations, GTL Infrastructure: GTL Infra and
its associate company CNIL have signed a site
sharing agreement with RJio which includes energy
management services across all the telecom Circles
of India. The independent and neutral status of GTL
As part of this programme, we are also introducing leading operators have been focusing on data Infrastructure has allowed us to rollout a sizeable
a state-of-the-art central Network Operations Centre services, and average data usage per subscriber numbers of tenancies for RJio. We hope to continue
(NOC) in Pune which will track site performance, has been rapidly rising. The launch of RJio has also working with RJio in the future.
fleet deployment and fault resolutions around the triggered greater competition amongst operators to
clock. expand their 4G network coverage. TowerXchange: Will GTL be bidding for any
of the Smart City contracts - if so what is your
In a bid to cut costs further, we have also focused Thanks to these developments, we have received proposition as an enabler of Smart Cities?
on network rectification over the last 18 months. business from all the leading telecom operators,
As part of this process, we are currently working in including RJio, the new entrant. Each operator has Milind Bengali, Chief Operating Officer – Business
consultation with customers to improve network a unique mix of spectrums from 800 to 2300MHz. Operations, GTL Infrastructure: We will continue
quality. We are also working with petroleum However, 4G is largely being rolled out on higher to watch and observe this space and will take a
companies on a programme for diesel filling and frequencies. Higher frequencies bring with them decision in the future.
cash-less dispensing. Lastly, we are working with higher propagation losses. Therefore, to maintain
customers to close fixed energy management QoS, a large number of cell sites are required i.e. TowerXchange: What is your procurement model
contracts, thus improving cash flow. tenancies. And due to higher propagation losses and process – is it in-house? Who are the key
on higher frequencies, operators also require stakeholders?
TowerXchange: What opportunities has the additional sites even in an existing coverage area.
rollout of 4G created for your business? Milind Bengali, Chief Operating Officer – Business
Over the last few years, new entrants as well as Operations, GTL Infrastructure: We have our own
Milind Bengali, Chief Operating Officer – Business some of the leading operators have carried out a central purchase process led by a committee which
Operations, GTL Infrastructure: This year, all the number of fresh rollouts. One of GTL’s strengths lies is supported by the supply chain team

Orissa Wicomm: TowerXchange: Please introduce yourself and
your company.
telecom infrastructure project Nallen Singhe, CEO, Orissa Wicomm: I’ve been
in the telecommunications industry since 1993,
implement experts originally with operator Maxis, then with energy

equipment provider Eltek. In between I was also
COO at a broadband operator in the Philippines.
How this I&C firm deployed RMS and access control solutions at 5,200 Asian
cell sites in 14 months I started Orissa Wicomm in 2011 initially with a
focus on renewable and industrial power, but we
Achieving operational excellence depends upon effective project were drawn back into telecommunications, for
implementation. Orissa Wicomm are among a select group of whom we provide lightning protection, DC power,
consulting, installation and commissioning firms with a proven cooling, RMS, batteries, fuel cells, solar, COWs et
track record of serving as implementation partners of MNOs and cetera – we’re focused on the infrastructure side
towercos. The firm came to TowerXchange’s attention thanks to
of the business.
their impressively swift and successful implementation of RMS
and access control solutions for edotco – we learn more about
Orissa Wicomm represents several leading
that project, their aspirations as a licensed network facilities
suppliers in the region, including Hitachi, Ellego,
provider in Malaysia, and their experiences in The Philippines in
Nallen Singhe, CEO, Orissa Wicomm Ballard, Envicool, Invendis, Acsys, Ying Li and
this exclusive interview with CEO Nallen Singhe.
Narada.
Keywords: Access Control, Acsys, Asia, Asia Insights, Bangladesh, Batteries, edotco, Energy, Energy Efficiency,
TowerXchange: Please tell us about your
Fuel Cell, Fuel Security, Globe, Hybrid Power, Insights, Installation, Invendis, Lithium Ion, Malaysia,
recent project to deploy RMS and access
Managed Services, Monitoring & Management, Network Rollout, O&M, Off-Grid, Operational Excellence,
control solutions for edotco.
Orissa Wicomm, RMS, Renewables, Site Visits, Smart, Solar, Sri Lanka, Stakeholder Buy-In, The Philippines,
Towercos, Who’s Who
Nallen Singhe, CEO, Orissa Wicomm: We were
trying to sell batteries and power systems to
Read this article to learn: edotco, but were asked to participate in an RFP to
< The critical success factors behind the installation of RMS and access control systems at 5,200 cell integrate two key technologies with their ECHO
sites in 14 months monitoring centre in Kuala Lumpur: remote
< How Orissa Wicomm secured an NFP license with intent to build their own towers monitoring and access control systems. The RFP
< The structure of the tower market in Malaysia went to 16 vendors, and we won the tender.
< How tower networks are being modernised in The Philippines
We tested three different equipment providers,

“
of which Invendis were the stand-out choice; the
sensors were easy to connect to each other, and
calibration was easy. Invendis were selected as
the RMS supplier, and they introduced Acsys for
access control.
we deployed at a spectacular rate, installing solutions at 5,200
We did a 15 site proof of concept in each country
before the main rollout. This enabled us to train
the engineering, operations and management
teams, and to quality check the fuel, battery and
temperature monitoring sensors.
sites in 14 months across Bangladesh, Malaysia and Sri Lanka!
Invendis now has capacity to supply 3-4,000 new sites per quarter
in this region
“
The first PO was for 3,000 sites, and I remember
Invendis initially thought we could rollout maybe
500 per year – we deployed at a spectacular rate, knew the local “lords” who can restrict access if We also laid many cables underground in steel
installing solutions at 5,200 sites in 14 months you don’t manage the relationships carefully. pipes, and as a result have had no cable cuts to
across Bangladesh, Malaysia and Sri Lanka! date.
Invendis now has capacity to supply 3-4,000 new TowerXchange: A common challenge when
sites per quarter in this region. rolling out RMS and access control solutions, Fuel theft has been dramatically reduced, and
which are in part designed to combat fuel and there have been fewer battery thefts in the last
TowerXchange: What were the critical success equipment theft, is that much of that theft year. Thanks to the Acsys mechatronic lock
factors behind the implementation of RMS and originates within the supply chain, which can system, an internal thief would have to use
access control systems for edotco? result in would-be thieves trying to discredit their own key to enter the site and steal fuel or
or vandalise the systems – what has been your equipment and we’d know it was them.
Nallen Singhe, CEO, Orissa Wicomm: edotco were experience with these issues?
very open about the process and the budget; they TowerXchange: What’s next for your RMS and
gave us plenty of leeway and treated us like part Nallen Singhe, CEO, Orissa Wicomm: We access control project?
of the company not just as a supplier. anticipated more problems with this than we
actually encountered. Nallen Singhe, CEO, Orissa Wicomm: The total
Another critical success factor was our contract was for 12,000 sites in four countries;
experience on the ground in the region. We didn’t Because our proofs of concept had demonstrated next year we’re hoping to rollout in Cambodia,
reinvent the wheel, we used existing networks to edotco management that the solution worked, plus more sites in Sri Lanka and Bangladesh.
and local partners in Bangladesh, Sri Lanka and their eyes were open if people claimed the
Malaysia who know how to deploy, and who system didn’t work because they didn’t want fuel Now we have developed and proven our
know the stakeholders at the MNOs. They also consumption to be watched. expertise in deploying RMS, we’re promoting the

solution to other operators in Malaysia and The in Invendis and Acsys solutions onto my towers at most active today of which are edotco, OCK and
Philippines. my own cost – I want intelligent towers, enabling Premium Radius… And soon Orissa Wicomm!
us to show operators it’s easy to monitor their
TowerXchange: We understand Orissa Wicomm towers, and I don’t want my field engineers to TowerXchange: I understand you personally
is interested in building and leasing your own drive hundreds of kilometers just to get a key! have considerable experience in The
towers – what can you tell us about that? Philippines, and that Orissa Wicomm has an
Orissa Wicomm also wants to be the go-to-guys to office in the country. What can you tell us
Nallen Singhe, CEO, Orissa Wicomm: A couple of provide green power because we understand the about the tower network in The Philippines?
months ago we were awarded a Network Facilities unique requirements of these sites. If you need
Provider (NFP) license in Malaysia. to build a site off grid we can design and build Nallen Singhe, CEO, Orissa Wicomm: Globe has
sites with the latest fuel cells, solar hybrid and/ around 7,300 towers in The Philippines and
We needed to demonstrate to the Multimedia or lithium ion batteries, all at competitive prices Smart around 9,000.
and Telecom Ministry how we were going to add because we deal directly with manufacturers – in
value to Malaysia’s telecom infrastructure – in some cases because we represent them directly. There are currently no towercos in The
particular we needed to have a unique land bank Philippines. We had enquired whether either
of prospective sites to offer. There are Hindus, TowerXchange: What have been your company might be interested to share their
Christians and Muslims in Malaysia, and each impressions of the towerco segment in towers, but at the moment there seems to be
has a substantial number of places of worship. Malaysia? no real push to form a towerco or to sell to
We were able to sign up a deal with an authority the towercos. Both MNOs are serving over
which controls 2,700 Hindu temple compounds, Nallen Singhe, CEO, Orissa Wicomm: There are 50mn subscribers, and have healthy balance
many with a lot of land in strategic places. The around 150 NFP license holders and 20 are active. sheets and thus no financial impetus to sell
deal has a revenue sharing component that While all the NFP licenses are nationwide, most their towers. However, they are still extending
facilitates investment in community activities. are held by State backed towercos who remain coverage, building new towers yearly, and we’re
focused on a single State. The State backed helping with a major network modernisation
We want to compliment, not compete with, our towercos have a close relationship with the programme, for example installing a lot of
friends at edotco. So we are working closely stakeholders who control site permitting and lithium ion batteries and LPS at key sites.
with edotco to map this land bank against their approvals, giving them near-monopoly status
own sites, and work together to offer them to within some States. However some (not all!) of However the operational cost of running a tower
operators. We will retain a proportion of the sites them don’t have the funds and can be slow to network in The Philippines is phenomenal.
ourselves as we had to make a commitment to the rollout. The MNOs sometimes get impatient to Sometimes we have to catch a plane, then a boat
Ministry to build a certain number of towers per rollout, and are reluctant to meet high rental then take a donkey up a mountain to install
year. We hope to have our first towers up by Q1 costs – lease rates are fairly uniform in Malaysia. lightning protection systems or lithium batteries
2017. at a remote tower! We think remote monitoring
In addition to the State backed towercos there and access control systems could be valuable
Whether or not the telcos ask for them, I will put are a handful of independent towercos, the tools in such an environment

TowerXchange’s Welcome to the TowerXchange who’s who!
who’s who in passive Welcome to the TowerXchange who’s who, a kind of vendor directory with
personality! Over the last three years we’ve interviewed over 202 business
infrastructure equipment leaders from innovative passive infrastructure equipment and service
and services
providers. By popular demand, here we categorise those profiles, with each
company name hyperlinked to our exclusive interviews.
179 4site: 7 habits of highly effective small cells 449 Fluidic: zinc-air batteries set to displace DGs
403 4energy: zero-maintenance free cooling 454 Galooli: fuel monitoring reduces consumption 40%
405 Abloy: flexible access control for MEA 456 Ganges delivers total tower solutions worldwide
407 Acsys: improved access control 458 Huawei: nextgen site level energy intelligence
410 Aerolens: drones for cost-effective site auditing 461 Infozech on preparation and use of data
413 Aquion Energy: lower TCO than lead-acid 465 IPT Powertech T-ESCO offers guaranteed savings
415 Ascot and Makasa Sun upgrade 2,500+ IHS sites 468 Jabil Inala’s new monitoring and analytics platform
420 DPC: China’s leading telecom power supply company 472 LockedUp: advanced security software+hardware
422 Codefish: customised site management solution 475 NETIS develop and retain a skilled workforce
426 Delta Electronics: smarter, greener, together 396 Orissa Wicomm: project implementation experts
431 Elektroskandia on SCM for operational efficiency 478 Perkins extend the 400 series product range
433 Enatel’s SYNERGi: 90% less genset runtime 481 SPTDI’s site design and deployment best practices
437 Energy Vision: the first ESCO of scale in SSA 484 Tarantula’s go-to product for shared infrastructure
442 EnerSys: cyclic use of batteries 488 Telemisis to supply SiteNote to Jabil Inala’s platform
445 Exide Technologies TCO-driven power management 490 ZTE proposes integrated end to end solutions
Image courtesy of Camusat

Is your company not included in our Who's who?
TowerXchange's who's who in passive equipment and services Would you like to suggest additions? Please email
amayhew@towerxchange.com
Energy equipment and ESCOs Controllis Heliocentris SUNCO
4energy Cummins Heliocentris hybrid solutions SunEdison
Ascot DAQS Europe Huawei energy intelligence Total
Ascot hybrid Delta Electronics Huawei Network Energy TSi Power
Ascot & Makasa Sun Eltek Africa IPS Turbina
Apollo Solar Eltek APAC IPT Powertech UGE (Urban Green Energy)
Apollo Solar on Africa Eltek CALA IPT Powertech T-ESCO Unipower
AST (Applied Solar Technologies) Eltek on ESCOs Mecc Alte ZTE
AST case studies Emerson Network Power Orun Energy Energy storage
Ausonia Enatel SYNERGi Pace Group Amara Raja
Ballard Enatel Panasonic Aquion Energy
Ballard CALA Energy Vision Perkins Coslight India
Beijing Dynamic Power Enertika PowerOasis EnerSys
Bergey Windpower FG Wilson PRAMAC EnerSys Africa
Bladon Jets FG Wilson opex-busters! ReliOn EnerSys optimise cyclic use
Bladon Jets revisited Flexenclosure Schneider Electric Exide Technologies
Camusat Flexenclosure Myanmar SDMO Flexenclosure on batteries
CCE Flexenclosure Myanmar, part two SEDEMAC Fluidic
CCE EMSaaS case study Gen Power Solar BK GE Energy Storage

TowerXchange’s who’s who in passive equipment and services (cont.) Would you like to suggest additions? Please email
GILDEMEISTER Caryon Development Jabil Inala ZNV
GS Yuasa Codefish NAAP Global Solutions Access control, Health and Safety
Imergy ConnectM Nexsysone Abloy
Abloy Africa
NorthStar Digant Technologies Nexsysone Africa
Abloy CALA
Redflow FieldForce Nexsysone network management
Acsys
Saft Flexenclosure eManager Qowisio Long Range Technologies
Acsys on access control
Trojan Battery Company Flexenclosure on fuel monitoring Qowisio goes wireless
Acsys on SLAs
Site monitoring and management Galooli Quintica
Acsys mobile app
Accruent Galooli fuel monitoring Tarantula Acsys productivity
Accruent on globalisation HMS Industrial Networks Tarantula Asia Acsys efficiency
Accruent’s SaaS Inala SAM Tarantula Europe AKCP
Accruent site management Inala Infrastructure Intelligence Tarantula process optimisation Capital Safety
AIO Systems Infozech Tarantula shared infra EMSS Consulting
Karam
AIO Systems Asia Infozech ‘Discipline of Action’ Telemisis
LockedUp
AIO Systems CALA Infozech India and Myanmar Telemisis and Jabil Inala
Construction, O&M and managed
AIO Systems Nigeria Infozech on use of data Treefrog services
azeti Networks InfraSTAT WebNMS 4site
azeti Networks on site protection Invendis Westell Africa ADNA
Broadnet Telecom Invendis Africa and Asia Westell CALA AJ Ingenieros

TowerXchange's who's who in passive equipment and services (cont.) Would you like to suggest additions? Please email
Alifabs (now CommScope) Jtel Plessey Intelli Towers on evaluation
Alkan CIT KGP Logistics Reime Group Intelli Towers on strengthening
Ardom Telecom Leadcom Sagemcom Leadcom on strengthening
Camusat Leadcom CALA TES Le BLANC
Camusat East Africa Leadcom Myanmar ZTE Metalogalva
Camusat Myanmar Lemcon Americas Structural engineers, rooftops, Mott MacDonald

masts, towers and accessories
CLEARGOL Likusasa NANHUA
Aerolens
COTECH Likusasa Mozambique Orion
Ambor Structures
EEC Group Mer Group Ramboll
ASE Structure Design
Ericsson Mer Group CALA Sabre Industries
Calzavara
Ericsson Nigeria Mer Group Ghana Sierra Tower Partners
Cue Dee
Ericsson Managed Services Mer Group low cost sites Solaris Technologies
Delmec
Everest Engenharia Mobiserve Elektroskandia SPTDI
Grid Rental Sites NETIS Ganges Internationale TIA Telecom
GSMTOWERS turnkey NETIS Ghana Ganges total tower solution TKM Maestro
Huawei Managed Services NETIS workforce Geostrut TNX
HOI-MEA NEWL GSM Telecom Products Valmont Site Pro 1
i engineering Orissa Wicomm GSM Telecom Products Myanmar VNTower
IPT PowerTech Planex Intelli Towers on costs Zamil Infra

The world’s first zero-
TowerXchange: Please can you provide an
introduction to 4energy to those not familiar with
the company.
maintenance free cooling system Param Singh, COO, 4energy: 4energy designs,
4energy’s COOLflow can cut opex by 30% and pay for itself in under two years develops and supplies energy efficient cooling
products and industrial IoT solutions to tier one
4energy’s COOLflow system is the world’s telecom, utilities and technology customers across
the globe. Some of our customers include Vodafone,
only zero-maintenance free air cooling
Deutsche Telekom, Orange, Telefonica, Network Rail,
solution. The system has been deployed
Scottish Power and British Telecom.
at over 15,000 sites on three continents,
achieving 90% reductions on cooling spend The patent protected COOLflow, is the world’s
and up to a 30% reduction on the total site only connected zero-maintenance free air cooling
opex costs. The solution pays for itself in solution and has a five year filter guarantee. This
less than two years. TowerXchange speak product saves up to 90% cooling energy on technical
to 4energy’s Chief Operating Officer, Param sites including base stations, shelters and cabins.
Singh to learn more. The typical ROI for our customers is less than two
years.
Keywords: 4energy, Africa, Africa & ME,
Air Conditioning, COOLflow, Energy, Energy Our state of the art industrial IoT solution with the
Efficiency, Free Cooling, Masts & Towers, SMARTset software platform and SMARTstation
Monitoring & Management, O&M, Opex series of hardware, connects, analyses and controls
Reduction, RMS, ROI, Shelters, Site Level any assets or equipment in critical facilities across
Profitability, SMARTset, Who’s who the globe. It helps technical managers make
Param Singh, COO, 4energy
decisions, manually or automatically, to reduce
energy and maintenance spend or improve network
Read this article to learn: performance.
< The suitability of free cooling systems for the MEA region
< The extent to which 4energy’s COOLflow systems have been deployed across the globe TowerXchange: How suitable is free cooling for
< Energy savings that can be achieved through deployment of the system areas in the Middle East and sub-Saharan Africa
< Maintenance requirements for COOLflow and how it can be integrated into RMS platforms with particularly high ambient temperatures?
< COOLflow’s differentiating factors from its competitors Does there need to be any modification to the
technology?

Param Singh, COO, 4energy: Free air cooling works Telecom. Our cooling systems are deployed on three Param Singh, COO, 4energy: Our COOLflow range
efficiently in the Middle-East and sub-Saharan continents in countries including the UK, Germany, of products (in its fifth generation) do not require
Africa even at higher ambient temperatures. A France, Poland, Czech Republic, Portugal, Greece, any filtration maintenance compared to traditional
combination of factors support free air cooling in Italy, Romania, Spain, Egypt and India and in a competitors’ free cooling systems, where periodic
these areas: range of environments including cold, hot, clean, maintenance is required every two to four weeks in,
dusty, coastal and desert conditions. for example, countries such as Egypt.
< The difference in the temperature between day
and night, and average temperature during the TowerXchange: Typically, what kind of energy We provide a five year guarantee on COOLfilter.
year savings can be made by installing a free cooling We have over 500 million hours of guaranteed
< Radio kit and transmission equipment is often system? Similarly how can this prolong the continuous operation of the filter over eight years
capable of working at higher ambient lifespan of other equipment? years and without any maintenance requirements.
temperatures
< Use of free air cooling as a backup system to air Param Singh, COO, 4energy: Our customers have Our eController, is a state of the art controller that
conditioners to enhance network reliability experienced energy savings of up to 90% on cooling allows for the integration into an RMS platform
spend i.e. up to 30% of the site bill. Energy savings using MODBUS or BACnet.
There is no modification required to the technology depend on various factors including:
however free air cooling alone will not cool sites TowerXchange: What differentiates 4energy's
100% of the time so it needs to be supported by < Existing cooling equipment on the site COOLflow system from other free air cooling
active cooling or air conditioners. < Ambient temperature of the region products on the market?
< Set points of the site (at what temperature the site
We have deployed several thousand free air cooling needs to be maintained) Param Singh, COO, 4energy: Our COOLflow system
systems for customers across Egypt. < Capacity of the free air cooling system has significant advantages over other systems in the
market:
TowerXchange: Please can you share some of Installing a free air cooling system on a site which
4energy's experience in the telecoms space? is being cooled solely by air conditioning can < COOLflow uses COOLfilter with its’ patented zero
Where have your systems been deployed and for prolong the life of the existing air conditioner. This maintenance filtration technology
which parties? is because the air conditioner will not be used 100% < The COOLflow free air system is modular and
of the time, and will come on as a supplement to the upgradable to a full packaged system including
Param Singh, COO, 4energy: We have been working free air cooling when the ambient temperature goes active cooling
very closely with telecom operators for the last eight above a certain point, when free air cooling is not < The COOLflow free air system range offers
years and our systems are deployed in multiple enough to cool the site. multiple capacities including 10kW and 15kW at
countries at over 15,000 sites. delta T of 10
TowerXchange: What kind of maintenance is < The COOLflow range comes with the eController
Some of our customers include Vodafone, Deutsche needed and similarly how can monitoring of the which can be connected to an existing RMS or
Telekom, Orange, Telefonica and Bouygues cooling system be integrated into RMS platforms? BMS system using MODBUS or BACnet

A flexible solution for access TowerXchange: Please tell us about Abloy’s
activities in Africa and the Middle East. Which
countries are you active in?
control in the Middle East and Africa David Knight, Area Director, Africa, Abloy: Abloy
Abloy’s PROTEC2 CLIQ system combines the benefits of electromechanical provides high security locking systems to the
and mechanical solutions telecoms market in Africa. We provide solutions
that can combine electromechanical systems and
Abloys high security mechanical mechanical systems. This means most clients start
locks and keys are widely with the Abloy high security mechanical locks
used to secure cell sites across and keys. The keys cannot be duplicated and can
the MEA region. There is a be set onto a master keying system. This system
smooth product progression is extremely effective in sites which are shared.
path, without wasting the A case in point is in South Africa where most
original investment, to sites are shared between five telecom companies.
Everyone’s key can open the main gate and then
Abloy's electromechanical
only opens their own equipment (BTS or BBS). This
PROTEC2 CLIQ solution. This is
method gives the client a cost advantage as when
supplemented by CLIQ CONNECT,
upgrading to an electromechanical system their
which manages full access rights
previous investments would not be wasted, and
and provides an audit trail. can be used in the electromechanical system. Abloy
is active in most countries in the Middle East and
Keywords: Abloy, Access in the majority of Sub-Saharan countries, namely,
Control, Africa, Africa & ME, SADC countries, East Africa (Kenya, Tanzania,
Monitoring & Management, Uganda and Ethiopia) and West Africa (Nigeria,
Site Surveys, Urban vs Rural, Ghana, Democratic Republic of Congo and Congo).
Who’s Who
TowerXchange: Who are your main clients? And
how does the demand change between operators
and towercos?
< Abloy’s history and footprint in Africa and the Middle East
< How security requirements vary across the region and between customers
David Knight, Area Director, Africa, Abloy: Our
< Urban compared to rural sites and their specific risks
clients are mobile network operators and the
< The award-winning Abloy CLIQ Connect and other top range products
tower companies. There is a huge demand from

“
the operators who require site efficiency and long
term solutions. There is a growing trend where
there is a need for an integrated solution within
the sites. Over the last couple of years, with the
towercos purchasing, and taking over operators’
towers, the demand has certainly moved towards
the towercos. The “big 4” towerco companies,
IHS, Eaton Towers, ATC and Helios are certainly
We are also the only company who has introduced a product progression
plan. This means clients can install a mechanical solution with the intention
of upgrading these products to electromechanical products
“
the main players, however, the operators still have
a clear presence in the Sub-Saharan region.
TowerXchange: How does the demand for sites differ greatly. We have realised that there We are also the only company who has introduced
security solutions differ between different is a higher theft in rural areas than urban areas. a product progression plan. This means clients can
countries across the MEA region? Rural area sites are generator driven, as opposed install a mechanical solution with the intention
to direct electricity in the urban areas, therefore a of upgrading these products to electromechanical
David Knight, Area Director, Africa, Abloy: In continuous supply of diesel is required. The theft products.
certain countries there is a high demand for of diesel is a major headache for the towercos and
security. There are two types of scenarios; first, operators. Due to the fact that the rural sites are PROTEC2 CLIQ is the only product in the market
there is a need for controlling access into our where one solution combines the benefits of
generally outside of a populated area, anything of
clients’ infrastructure, such as the base station electromechanical and mechanical solutions. The
value is vulnerable to theft. In these areas, where
sites. Our solution gives the client the ability to CLIQ CONNECT feature provides access rights and
thieves have more time on their hands, the demand
determine who actually has entered a site. The logs audit trail in any situation, whether you are
for re-enforcing security is more prominent than
second scenario deals with re-enforcing security. working at an online or offline location. Not only
controlling access.
In most cases this means the Abloy solution is it a highly advanced electronic key controlling
must provide stronger locks which cannot be system, but as an extra level of security, we have
TowerXchange: How does your product differ
easily cut. We have also cooperated with cabinet the ABLOY PROTEC2 mechanical platform backup.
manufacturers to create integrated cabinet locking from others in the market? So, if ever your electronic system is compromised
solutions. your assets remain secure with the mechanical
David Knight, Area Director, Africa, Abloy: We platform backup.
TowerXchange: How do you find security issues are an established global company with 110 year
vary between rural and urban areas? track record in protecting critical infrastructure. We are also able to provide a complete solution
Our PROTEC2 CLIQ is a proven solution with over from padlocks and cylinders to door closers and
David Knight, Area Director, Africa, Abloy: The 1000 customers worldwide, 500,000 cylinders and electric locks to secure and protect our clients’
security issues between the rural and urban 500,000 keys already delivered and in use. facilities, infrastructure and assets

Enhanced security and
TowerXchange: Please can you describe some of
the limitations of mechanical locks and keys?
operational efficiencies through Olivier Meganck, VP Sales, Africa, Acsys: There are
several limitations in the use of mechanical locks
improved access control

and keys; keys can be copied, lost and forgotten
or unreturned and the cost of replacing the lock
is often higher than the lock itself. In managing
An interview with leading access control provider - Acsys keys, operators need to employ numerous amounts
of workers who require training and the wrong
keys can be given to the vendor. With traditional
Poor access control can not only lead to
mechanical lock and key there is no way to prevent
security concerns but it can also have
collusion, and users can forget to close sites
a significant impact on a company's (intentionally or not).
operational efficiency and bottom line.
In this interview, we speak to leading Regular audits need to be undertaken to ascertain the
access control system provider, Acsys, to amount of keys in use and the keys’ location and the
management of keys and locks requires dedicated
understand how the telecom tower industry
space and security. Managing keys on weekends or
has been affected by poorly managed access
during an emergency is a problem as staff will not
control and discuss the advantages that be present, it is critical to be able to respond quickly
mechatronic locks can bring to the sector. to downed sites but if access is prevented in the
absence of keys then the only way is to cut the locks
which will require a lock replacement and sites can
Keywords: Access Control, Acsys, Africa, Health & Safety, Job Ticketing, KPIs, Logistics, Masts &
stay unsecured for quite some time
Towers, MLA, MNOs, Monitoring & Management, NOC, O&M, Operational Excellence, RMS, Site
Level Profitability, Site Surveys, Site Visits, SLA, Towercos
When keys are copied it is difficult to detect when a
theft or loss occurs and with picking and bumping
there is no proof of break and entry and as such
Read this article to learn: there are high insurance premiums. The result of
< Limitations with mechanical locks these inefficiencies is that some vendors eventually
< Challenges in controlling access to NOCs make their own copies of the keys to gain access.
< The importance of access control in enforcing SLAs
< How mechatronic locks can contribute to increased efficiency TowerXchange: In relation to controlling access
< Safety and security benefits afforded by mechatronic locks and NOCs, what are some of the operational
challenges faced?

Olivier Meganck, VP Sales, Africa, Acsys: The The lack of data prevents an operator from setting management solution
NOC deals with a complex set of equipment that operational KPIs to benchmark the performance of
is scattered around a region and is impossible to the various vendors between each other. The fact TowerXchange: What are some of the basic
control efficiently with mechanical locks. The NOC that there is no or little data from the performance practical advantages of mechatronic locks?
also deals with a large amount of vendors, who are on the SLA also means that the NOC and operator
responsible for site maintenance. It is hard for the need to rely on the vendor to obtain performance Olivier Meganck, VP Sales, Africa, Acsys: The
NOC to respond efficiently to emergencies as they information which creates a conflict of interest. solution is a standard padlock and Euro-Din cylinder
don’t know where the vendors are located and false SLAs fees are being paid when the services that configuration meaning that no modifications are
alarms can cause disorder. need to be provided aren’t being carried out. required to install them. The padlocks and cylinders
Vendors invoke the problems of collecting and can be fitted on all equipment and no maintenance
Access to the NOC is impossible to control. Vendors returning keys as a valid reason for non-compliance is required. The stainless steel plating prevents
are requested to do maintenance and only do it when with SLAs. corrosion on the padlock body and cylinder and
they are able to do it, not necessarily when the NOC what’s more anyone can use the solution.
has requested that they do it. When sites are down TowerXchange: What are the advantages of
it can be difficult to find the vendor, the NOC then implementing mechatronic locks for remote site The operational advantages of using mechatronic
needs to call other support to get someone to the site management? locks are instantly visible after deployment and
lasting over time, uptime is increased and the
The NOC is looking for a solution whereby tickets Olivier Meganck, VP Sales, Africa, Acsys: solution prevents keys being copied, stolen, lost
are issued and acted upon as quickly as possible in a Mechatronic locking systems cannot be picked/ or unreturned, locks being picked, issues around
first phase. In a second phase the NOC needs to know bumped, hacked, copied or corrupted in any way. collecting and returning keys, the requirements for
when the vendor has arrived, what he has done, Telecom customised software enables the NOC to lock and key audits and unauthorised access.
whether the problem is fixed and when he has left manually or automatically control where users can
the site. NOC operations need to rely solely on the go, for how long wirelessly and in real-time with TowerXchange; How do mechatronic locks
vendors assertions minimal cost. contribute to increased efficiency?
TowerXchange: What challenges can poor access Mechatronic solutions allow the NOC to control Olivier Meganck, VP Sales, Africa, Acsys: Users can
control systems have on SLA implementation and precisely what assets can be opened and when. All service more sites in one day and a user’s position
adherence? keys and locks memorise the last thousand actions and length on site is controlled and monitored. The
giving an incorruptible record of the user’s actions, NOC can have a real-time view of site status looking
Olivier Meganck, VP Sales, Africa, Acsys: MNOs and providing the NOC and operator with valuable at the number of sites, which sites have guards and
towercos will have SLAs in place with their vendors operational data. are they present or not, which site is in need of
to regulate site maintenance. These SLAs have maintenance and for what reason and which and
escalation clauses that dictate when a vendor should The mechatronic locks combine four important how many vendors are on the site.
arrive on location. It is hard for the NOC to see when solutions into one system; a wireless and real-time
vendors are going to the sites and if they completed access control system, a high security lock and key By implementing mobile apps, the NOC is now
the job correctly making SLAs redundant. solution, a time and attendance solution and a key able to receive real-time site information and user

performance, such as when did the user receive TowerXchange: What information can be data that mechatronic locking systems provide
the task, accept the task, arrive on and leave the collected to monitor behavioural patterns and effectively will lead to more efficient access
site. This system can also monitor what the user did how does this translate into more cost effective policies, enhanced SLA agreements and increased
on the site (watermark GPS pictures) and can also operations? productivity. The data collected does not only benefit
receive information on whether the user closed the the site owner, but is also valuable for tenants and
locks after leaving the site. Olivier Meganck, VP Sales, Africa, Acsys: The NOC vendors. The data helps build relationships between
will be able to download the access logs stored on the the ecosystem by aiding their understanding
This data has significant value to determine SLA key through programmers and study what sites or and giving evidence of site activities. The more a
adherence because the tower owner can now see assets were accessed and when, how long the vendor database is built and the further it is integrated the
exactly what is happening on their site. Being able spent on each site, whether the user tried to access more valuable it becomes to its users
to understand who is going where and for how long sites or assets without authorisation and on which
means that the owner can make smarter business day, time or location.
decisions. Data collected by mechatronic locks gives
concrete undisputable data on whether the vendor By collecting data on user performance the NOC and
has been meeting the SLAs. Furthermore upon operator are now able to obtain site maintenance
additional analysis of the data, site operators can benchmarks which in turn allow them to set KPIs for Meetup Europe 2017
create and negotiate more suitable SLAs using the certain tasks.
information collected. 4-5 April, London
In addition, mechatronic locks allow for increased
TowerXchange: How do mechatronic locks
increase site and user security and reduce theft?
flexibility. When a technician is unavailable, another
can be called as a substitute with no wasted time
Meetup Americas
Olivier Meganck, VP Sales, Africa, Acsys: With
or resources. A temporary access can be instantly
granted ‘on the fly’ for a site normally outside of this
2017
regards to safety and security, as the NOC knows technician’s work zone. 7-8 June, Florida
who is on the site and for what reason, in the case a
vendor does not request a locking code (because of a
fall or injury) the NOC is able to act on that.
By collecting data on behavioural patterns, the
financial department is also able to control how
Meetup Africa 2017
much time was spent on site by users, thereby 3-4 October, Johannesburg
In relation to thefts, most thefts are caused by people gaining a better control over payment of billable
who had a mechanical key at one stage and copied it.
The mechatronic keys can have an embedded feature
hours to vendors.
Meetup Asia 2017
that monitors where the key is being used, if the user TowerXchange: How will the data that 12-13 December, Singapore
tries to fraudulently use the key three times, the key mechatronic locks provide influence the way in
will automatically block themselves thereby forcing which the telecoms sector works?
the user to go back to the NOC or programmer to www.towerxchange.com
update his key. Olivier Meganck, VP Sales, Africa, Acsys: Using the

Eyes in the sky:
TowerXchange: Please introduce us to your
company and tell us about your background.
Using drones to provide cost- Tom Caska, CEO, Aerolens: Aerolens was founded
two years ago, and we’ve developed UAV’s that can
effective site auditing create an accurate 3D model of large buildings or

structures including telecoms towers, and then use
the models to provide detailed data on the subject
Aerolens provides high-resolution 3D models captured by drones to
via our platform. Our current solution was created
maintain and optimise tower assets after a fifteen month R&D program to create a
proof of concept at commercial level. The company
In the ongoing rush to provide was founded in Australia and we currently have
comprehensive maintenance and some operations in the U.S. I have a background
increase loading on telecoms towers, in aviation and was a pilot with Qantas, and also a
new innovative technologies are project manager in fleet and technical development
appearing that can streamline the at management level.
process. We spoke with Tom Caska, CEO
of Aerolens to learn about their state-of- TowerXchange: Tell us about your solution and
the art UAVs and modelling applications some of its applications in the field.
that are already being used for rapid and
efficient tower audits and valuations. Tom Caska, CEO, Aerolens: Our solution is the
product of recent breakthroughs in 3D modelling
Keywords: Aerolens, Australia,
applications combined with commercial UAV’s
Americas, United States, Who’s Who,
with high grade GPS units on board. They can
Site Management System, O&M,
Valuation, RMS, Transfer Assets, provide very precise 3D models, digital twins,
Loading, SiteSee, Site Surveys, Asset which deliver predictive site analytics that can
Register support maintenance and network operations. We
can model an asset over time enabling clients to
look at different 3D models over a twelve month
Read this article to learn: period; this can provide data on things like changes
< The applications of UAVs and computer modelling in site management in dish location, how often they move, and share
< Capturing multiple 3D models over time to identify changes in assets some insight into why they’re moving. This is
< Using 3D models for virtual load testing especially valuable for companies that do frequent
< Measuring electromagnetic emissions by UAV valuations of their assets as they can get accurate
measurements from the models which help with

the auditing process. Our first success stories are in
different industries including telecommunications
and mining, but we can model any structure
accurately. We recently created a 3D model of a
large stadium in Australia with 52,500 seats.
We have worked with a few large telcos in Australia

and have significant interest in America.
Typically a towerco or MNO will start by modelling
a segment of their assets, but ideally whole
portfolios can be digitised and they can deliver
very powerful analytics over time. Some telecoms
companies in the U.S. are trying to do this but it is a
complex process.
TowerXchange: What’s the turnaround time for

creating a model?
Tom Caska, CEO, Aerolens: Depending on the

location of the asset, we can survey with a drone
and turn around the model in around three days
using a powerful computer to perform all of the Towerxchange: How is your solution changing and carry out virtual load testing. The detailed
complex calculations; a typical finished 3D model based on experience gained in the field and new digital representation of the asset means all of this
is around 12 gigabytes. If we use cloud computing technologies? data can be gathered without a time and labour
and add additional engines this can be reduced to intensive survey, and the design team can have
as little as twenty four hours. This increases the Tom Caska, CEO, Aerolens: We have a couple of it at their fingertips. The models can be used for
cost, but is useful in time-sensitive situations. The new capabilities that we’re integrating in the near maintenance and optimisation, but they’re also a
models can be extremely valuable after significant future. We’re planning on providing aerodynamic valuable tool for companies that want a detailed
weather events, like the cyclones we get in APAC. analysis and create a sail area of the model which and cost effective valuation of assets before
After a storm we can go and perform an audit and can be back engineered in a wind tunnel. Data from they buy them. We’re also looking at adding the
get a report straight back to evaluate any damage. this modelling can help determine how to increase engineering model into CAD; clients can do so
The level of detail can also be adjusted by the use of the number of assets on a tower. This is helpful much with it and this model could interact with
ground-based control points and laser trigonometry; when a client has 1,000 assets but isn’t sure about all the other RMS sensor data to connect the dots
to capture everything down to individual wires we the capacity of each of them. Clients have used with IoT and create an even more comprehensive
use LIDAR or laser radar. our 3D models to redesign their structures in CAD dataset.

Another tool we’re looking at integrating is the
ability to measure electromagnetic emissions
from the towers and ensure that they’re compliant
with government regulations. In Australia the
government tracks this closely and our clients need
to be aware. Finally, we’re also looking at adding an
asset catalogue to tag assets and components over
time in a cloud-based system.
TowerXchange: How does the client interface

with the 3D models work?
Tom Caska, CEO, Aerolens: We can host them

externally over Azzurri or Amazon Cloud, but next
year we will have a whole package including a
cloud-based interface that clients subscribe to to
access their 3D models. We’re are currently working
with our software partners SiteSee and Bentley
Systems to find the best solution.
TowerXchange: What are your plans for future

growth?
Tom Caska, CEO, Aerolens: In addition to Visit the TowerXchange.com website

our presence in Australia and the U.S. we’re
looking at new markets, especially large telecoms
markets and we’re prepared to expand rapidly
in different regions. Currently we’re the only company or grouped by category (e.g. interviews or
in telecom and broadcast infrastructure
company with a license to operate UAVs in the U.S. how to guides)
and Australia. We’re also considering setting up a < Independent analysis and commentaries on the
presence in Hong Kong or Singapore. prospects for tower transactions in selected countries < The latest news and registration information about
TowerXchange’s Meetups.
We also look forward to developing our < The latest industry emerging market tower industry
relationship with Bentley Systems and SiteSee to be
able to offer an unbeatable turn-key solution to the
telecom tower industry (and beyond)

Environmentally friendly
TowerXchange: Please can you introduce Aquion
Energy and where they sit in the telecoms supply
chain.
battery achieves lower TCO than Matt Maroon, Vice President, Product Management,
lead-acid batteries Aquion Energy: Aquion Energy manufactures

maintenance-free, daily deep-cycling batteries
that provide energy storage for off-grid and weak-
Aquion Energy’s Aqueous Hybrid Ion solution
grid telecom towers. Our batteries store power
generated from solar and enable towers to run from
Aquion Energy’s Aqueous Hybrid Ion chemistry offers an
solar during nighttime hours or during periods of
environmentally-friendly solution which is particularly
cloud cover. This enables telecom towers to provide
important for developing countries with no robust
reliable service and reduce their use of diesel
recycling programmes in place. The battery’s resistance to
considerably.
high temperatures and ability to withstand deep cycling,
partial state of discharge conditions make it ideally suited
TowerXchange: Can you explain the benefits of
to off-grid applications, and with a TCO lower than lead
Aquion Energy’s aqueous hybrid ion chemistry
acid batteries offers a financially compelling alternative.
batteries? What has been the reaction of
TowerXchange speak to Aquion Energy to learn more about industry to their environmentally-friendly
their innovative solution. design? Do you see this as becoming increasingly
important?
Keywords: Aquion, Aquion Energy, Batteries, Energy,
Energy Efficiency, Energy Storage, Microgeneration, Matt Maroon, Vice President, Product Management,
Off-Grid, On-Grid, Opex Reduction, Renewables, Solar, Aquion Energy: Aquion’s batteries are made using
Matt Maroon, Vice President, Product
Management, Aquion Energy Unreliable Grid, Who’s Who our unique environmentally-friendly Aqueous
Hybrid Ion (AHI) chemistry. They contain no heavy
metals or toxic chemicals, and are non-flammable
Read this article to learn: and non-explosive. We have found that safety and
< The appetite amongst tower owners for environmentally friendly batteries and their importance sustainability resonates with our customers and sets
in developing countries us apart from traditional battery chemistries. The
< The resistance of Aquion’s battery to partial state of discharge conditions, deep cycling, variable environmentally benign content of our batteries is
power supply and high ambient temperatures especially important in developing nations that do
< The extent to which Aquion Energy’s batteries have been deployed globally not have robust recycling programs in place. If our
< How TCO compares to lead acid batteries batteries are landfilled or recycled by hand, this
poses no danger to people and the environment.

“
TowerXchange: What is the sweet spot for the
battery in terms of grid availability?
Matt Maroon, Vice President, Product Management,

Aquion Energy: The sweet spot for Aquion batteries
The environmentally benign content of our batteries is especially
are sites that are off-grid and require long duration
storage of anywhere from four hours to multiple
days. The AHI chemistry in the battery is not
negatively affected standing partially charged when
the solar PV generation varies. This is a problem for
important in developing nations that do not have robust recycling
programs in place. If our batteries are landfilled or recycled by hand,
this poses no danger to people and the environment
“
lead acid batteries. Also high ambient temperature
doesn’t affect the life of the Aquion batteries.
TowerXchange: How proven is the solution in the off-grid microgrid project for ecotourism lodges in TowerXchange: What warranty and sales support
field? Who are your key clients and what results Kenya, an off-grid farm in Hawaii, visit our blog at do you offer?
have been achieved relative to other batteries? blog.aquionenergy.com.
Matt Maroon, Vice President, Product Management,
Matt Maroon, Vice President, Product Management, TowerXchange: What kind of maintenance do the Aquion Energy: We offer a standard 8 year
Aquion Energy: Aquion has been shipping batteries require and what is their lifespan? warranty. We have a sales team that covers the
commercially for over two years and we have global market, as well as partners that distribute,
shipped over 30 MWhs of batteries to over 200 Matt Maroon, Vice President, Product Management, design, and install systems worldwide.
locations worldwide. We have a demonstration Aquion Energy: Our batteries are sealed and
telecom site in Chile with Wireless Energy, three maintenance-free. We expect 8+ years of life in TowerXchange: How does the TCO of an energy
telecom installations in China - two that are grid- the field when they are daily cycling with deep system incorporating your solution compare to
tied and one off-grid, and an off-grid telecom discharge. Aquion batteries are high temperature systems incorporating other batteries?
installation scheduled for South Africa in Q4 of this tolerant, and can operate from -5℃ to 40℃ with
year. We also have numerous off-grid microgrid no HVAC required. On the high end that’s 40℃ Matt Maroon, Vice President, Product Management,
systems in the field that operate the same way a averaged over 24 hours. The batteries are robust Aquion Energy: Given that our batteries can cycle to
telecom system operates. Our batteries are paired and abuse tolerant; they can sit at partial states of 100% depth of discharge, are temperature tolerant,
with a solar array which carries the load during charge without degradation, they do not require a and last 2-3 times as long as lead acid, we have
the day and charges the batteries. The batteries are trickle charge, and they are designed to daily deep found that Aquion-based hybrid storage systems
discharged to feed the overnight energy loads and cycling which makes them an ideal match for long- deliver a lower TCO over lead acid. Our batteries
during periods of cloud cover. The systems include duration solar self-consumption applications. They operate with most solar charge controllers on the
a diesel generator for emergency backup. For more are long-lasting, 2-3 times that of lead acid, and market so they can be installed at existing sites to
examples of our projects in the field, including an therefore require fewer replacements. replace lead acid batteries

Ascot: All in one, plug & play TowerXchange: Please introduce where Ascot
Industrial fits into the telecoms infrastructure
ecosystem.
hybrid generator with solar and AC/DC Dr Michele Greca, CEO, Ascot Industrial: Choosing
generators for mobile telecom sites Ascot today means trusting an organisation
with twenty-seven years of international market
Ascot’s ‘Flying Doctors’ ensure successful installation and integration experience with a brand name that means quality
and reliability. Our typical products include hybrid
generators: AC and DC generators designed by
With eight years of experience and thousands of installations in critical
a team of in-house, highly skilled engineers in
markets throughout Europe, the Middle East and Africa, the Ascot hybrid
accordance with our customers’ specifications,
energy solution for telecom is considered one of the most reliable and
which work with advanced controls and energy
proven hybrid solutions on the market. Approved and widely used by the
storage, often incorporating renewable energy
Vodafone Group, Helios Towers Africa, IHS Tower, STC Saudi Telecom,
sources.
Ooredoo, Zain and Sudatel in their critical operations, Ascot’s technology
has been proven as the right product for harsh environments such as in Telecommunication companies historically
Saudi Arabia, Iraq and Sudan – as well as mountain top sites in Nevada. recognise Ascot as a leader in the sector thanks to its
innovative products and technologies for generators
Ascot’s certified performance has been proven over a decade of and for the family of hybrid solutions deployed
accumulated system data thanks to a sophisticated and efficient remote globally in thirty-eight countries.
control system embedded in the Ascot Hybrid Power Unit (HPU).
This is the true know-how of Ascot competence
Keywords: Americas, South America, Peru, Haiti, Caribbean, Ascot, Energy, How To, Opex Reduction, and flexibility. It’s only by visiting remote sites and
Power, Renewables, Site Visits, Solar, Unreliable Grid, Off Grid, Who’s Who, Wind, Opex, Capex, Fuel looking at how they are configured that we can
Security, Batteries, Energy Efficiency, Hybrid Power, Solar, LPG, Wind, Logistics apply our knowledge to optimise hybrid systems to
benefit both the operator and ourselves!
Read this article to learn: TowerXchange: How did Ascot Industrial get into
< How to meet the changing energy requirements of multi-tenant tower operators the hybrid energy for telecoms market?
< Tailoring solutions to meet the power needs of sites with varying climactic conditions and grid availability
< Deploying a significant number of hybrid solutions across African and American portfolios Dr Michele Greca, CEO, Ascot Industrial: From the
< How the business case for solar and wind power is justified by logistics and the criticality of coverage inception of Ascot Industrial from 1986 until 2000,
< What it will take for demand for hybrid energy to reach the ‘tipping point’ our core business was developing generators for
the military, oil and gas, power plant and marine

as many countries for various telecom operators,
so we tested the solution in different temperatures,
humidity and altitude scenarios – it was a good
challenge that pushed us to invest in the project.
When we were working with the operators in the

field, Ascot was fixing the problems of today and
of tomorrow. Ascot is well established to meet the
specific needs of telecoms. A cell site in a remote
location is like a forward communication base
in war – reliability is critical and maintenance
visits must be kept to an absolute minimum. As
competition becomes more aggressive in telecoms,
battles will be won by whoever can provide the
best service at the lowest opex, so it’s critical to
improve energy efficiency.
TowerXchange: Why do telecom operators need

to reduce opex?
Dr Michele Greca, CEO, Ascot Industrial: The role

of the operators is to provide subscribers with
an always-on service, grow usage and reduce
sectors. The defence sector has been for us like submarine batteries to charge cell site battery customer churn. In order to gain more market
Formula One is to Ferrari – a cutting-edge R&D banks, even when the generator is switched off. share than their competitors they need to have a
function we’ve applied to the telecoms sector. reliable network operating at the lowest possible
Having proven our application in large scale operating expense.
For example, back in 1997 we developed an projects such as the submarine one, it was relatively
application to charge the huge batteries on simple to adapt it to charge the 600-1550 amp hour A decade ago when the competition was minimal,
submarines while in port. Ten years later I was batteries at cell sites, and we quickly developed and operators expanded rapidly and the cost of phone
speaking with a manager at Zain who challenged sold our first hybrid solution in 2008, which was calls was high. At that time operators did not pay
me to produce an engine with low fuel consumption installed in very harsh physical and maintenance very much attention to opex, concentrating on
to power his cell sites. At first I thought it was conditions in Sudan. building their infrastructure rather than finding
impossible, but from his words came the idea an optimised power solution. Very inefficient
to apply the same technology we used to charge Between 2008 and 2009, we installed fifteen units in energy solutions, based on standard and often

“
“disposable” diesel generators as the primary
energy source, were installed with very high
servicing costs – especially for off-grid and weak
grid sites.
That era is now over. To be and remain competitive Subscriber revenue generated by telecom operators has a direct impact
in the future, operators and tower companies
have to find and implement new strategic
energy solutions to enable lower opex than their
competitors.
Subscriber revenue generated by telecom operators
on opex. In fact, only with lower expenditure and reliable service
can the operator decrease call tariffs, acquire more subscribers and
generate more revenue
“
has a direct impact on opex. In fact, only with lower
expenditure and reliable service can the operator
decrease call tariffs, acquire more subscribers and
generate more revenue. The innovative Ascot patented DC-HPU is an where they do not exist and are terribly expensive,
integrated “plug & play” power solution designed to and the optimum RF site coverage objectives were
TowerXchange: Can you tell us more about the supply energy to telecommunication sites using up achieved in one case with one off-grid site rather
hybrid solutions already in the market? to 68% less fuel than the current diesel generating than four sites that were located near existing
sets running 24 hours a day and using up to 98% power. The opex and capex savings are compelling
Dr Michele Greca, CEO, Ascot Industrial: As hybrid less fuel when integrated with solar solutions. and our solution is applicable for difficult sites
technology is relatively new, today’s market offers throughout the region.
different solutions made by combining different We have recently deployed our first fleet of U.S.
brands of products to form a hybrid package: hybrid sites including generator, solar and battery TowerXchange: How has your offering evolved as
ie. X Controller and Y Batteries combined with Z storage for remote locations. These unique off- the off-grid tower market changes?
generator et cetera. grid sites can include a non-penetrating tower
foundation, rapid deployment multi-tenant Dr Michele Greca, CEO, Ascot Industrial: In the
The result of that mix is the manufacturer of monopole tower and our hybrid power system. It last couple of years, hybridisation has attracted
each single part guarantees their part as a stand can be constructed and commissioned in less than the increasing interest of the telecom operators.
alone item, not associated with other components, one week but run autonomously for six months – a They have pushed the market to propose hybrid
hence the controllers available on the market are design necessity for mountain top cell sites which solutions to power their sites. However it’s not
not specifically designed for the scope and the are inaccessible for many months throughout the easy to replace a traditional generator with a
integration of the parts to combine into a hybrid year. hybrid solution because most of the current hybrid
package - resulting in cell site energy being very solutions on the market are new and also the local
expensive and inefficient, and with no single point Minimal site disruption achieves speed and maintenance teams are not prepared to manage
of accountability. environmental goals; no power lines are necessary these sophisticated systems. Operators want hybrid

power solutions but once installed, they can face a It’s a market-proven product especially in Africa; those cars are not competing with normal cars.
lot of problems if they don’t fully understand how network owners like Helios Towers Africa and They are serving different needs and there is simply
the system works. Vodacom are using our hybrid systems and are no comparison in terms of fuel consumption.
making referrals and giving references to use Ascot
To overcome that resistance, Ascot offers a “plug products as they are so easy to install, manage and The telecom sector is just like the automotive
& play” hybrid solution, which utilises the same maintain. industry – in the future no-one will use diesel (or
interface as standard generators - typically a petrol) engines – hybrid power is the future. Why
DeepSea Control System - that can dialogue with Our solution easily integrates with PV or wind don’t people use hybrid now? Price, performance
the internal logic of the hybrid component. power so these energy sources can plug and play and availability – and Ascot is at the forefront of
with our machine. We’re also offering a remote improving all three.
In addition, today we include a service called monitoring and control system so our clients can
“Flying Doctors” which means that once our clients remotely manage the performance of our machines. Telecoms operators want hybrid power already, but
have purchased the technology we can offer like consumers changing their normal car for an
installation, training and operational support along Ascot is a manufacturing company so originally, our electric car, they want to know how the change will
with the package (for example we used this on the business model was just to supply the equipment affect their operations. Once telecom operators are
1,500 sites we recently upgraded for Vodacom). and leave the client to organise other details – sure hybrid power works, it will only be a matter of
We also offer a package where our team and local namely financing packages. Now some clients want time before all off-grid and weak grid cell sites are
partner will go side by side installing the machines a capex-based model and some want an opex model upgraded to hybrids.
and doing onsite training in order to guarantee the with integration in a financial package. We can now
machines’ installation and performance. We use offer both and have the flexibility to provide what Essentially hybrid solutions are big battery
this team to identify the main difficulties faced in our clients desire. chargers. Their role is to produce, store and
the field by our clients. Our “Flying Doctors” team reuse energy. As the price comes down and the
report back this information immediately allowing TowerXchange: How do hybrid solutions performance and reliability is proven, the business
us to continually improve the difficulties faced compare to running diesel generators 24/7? case for hybrid energy becomes more compelling at
in operations. For example, if they don’t like the more and more cell sites.
control panel we can change it to work better for Dr Michele Greca, CEO, Ascot Industrial: The magic
them. This helps us to provide our clients with the number of fuel savings is 68%, achievable with the There will be a tipping point where demand for
solutions they need. Ascot Hybrid. You can reach 98% in combination hybrid power rises very quickly. At the moment,
with a Solar PV System. innovators are still finding competitive advantages,
For tower operators, we created and integrated which they don’t want to share, but when
a distribution box which just didn’t exist before, Operators were only using diesel generators off- innovations are collated, everyone will want it and
meaning the client had to supply it. Now it’s grid because there were no other financially viable it will stimulate that big jump in demand. Investors
integrated into the system so the output of the solutions until recently. aren’t afraid of those consolidated technologies.
machines matches the output for the tenants so
you can have one, two or more different tenants. When a consumer goes out to buy a hybrid car, TowerXchange: How do the power requirements

Dr Michele Greca, CEO, Ascot Industrial: Our
innovations are always driven by market demand.
Today the main challenges are fuel theft and the
possibility to deliver our systems to remote and
difficult areas. To overcome these challenges we
have developed a range of Liquefied Petroleum Gas
(LPG) hybrids – we now offer LPG powered engines.
In markets like Nigeria, LPG is cheap and easily

available, and it’s also far more complicated to
steal. The LPG hybrid project was developed for
the United States market and now we’re making it
available for the African market where we foresee a
lot of uses.
In terms of delivering the system to remote areas,

today we offer two solutions: a semi-knock down
product that can be hand carried and then easy
reassembled on site and a containerised cargo
package which is a complete and mobile telecom
site; both are effective and very popular solutions.
differ between single and multi-tenant cell sites? Ascot’s tested and proven power solution for
towercos, our modular DC-HPU for one to three BTS Other advantages of LPG include eliminating
Dr Michele Greca, CEO, Ascot Industrial: Towercos of up to two kW, has an engine capable of supplying fuel degradation and associated damage to diesel
often have to invest in power solutions before they power to three banks of batteries, so the main generators (LPG does not degrade over time) and
know how many tenants will be on the tower and change to accommodate multiple tenants is just to more acceptable environmental aspects – we are
before they know their total power requirements. add extra battery stacks. We also enable metering to deploying these systems into sensitive ecosystems
bill tenants for their own energy consumption. We such as U.S. Government public lands.
So energy systems for shared sites need to be allow customers to right-size their power systems
modular, with a low initial capex investment and then stack on new systems only when needed. We continue to evolve and expand our portfolio by
for single tenant sites, and a small increase in This drives fuel efficiency and sequences capex quickly learning and adapting to the most difficult
investment for each additional tenant. Towercos properly. site requirements, based on both the most rough
don’t want to deploy the capex to support multiple and remote conditions as well as sites with the most
tenants right away, they need scalable modules with TowerXchange: Tell us about the innovative LPG difficult environmental and government approval
a few small extra parts for additional tenants. solutions Ascot is bringing to the market? processes

DPC: China’s leading telecom TowerXchange: Please can you introduce Beijing
Dynamic Power to those unfamiliar with the
company. Where does the company fit in the
power supply company telecoms infrastructure ecosystem?
Beijing Dynamic Power Company’s extensive and high efficiency product offering Thomas Liu, Deputy Director, Sales, Beijing Dynamic
Power Co.: Beijing Dynamic Power Co., Ltd. (DPC for
Arguably the largest name in energy short) is a leading manufacturer of telecom power
equipment provision to the telecom supply equipment in Beijing China. The company
industry in China, with such accolades was established in 1995, the first public company in
as being the number one supplier to the power supply industry in China, and underwent
China Tower Company, Beijing Dynamic an IPO in 2004 (Shanghai Stock Exchange Code:
Power (DPC) boasts a diverse product 600405), the open market value is over US$800mn.
offering with strong R&D, high efficiency The group has five wholly-owned companies
and customer service at the heart of its with a total of over 3000 employees including 400
offerings. TowerXchange speak to the R&D engineers in three R&D centres. Our main
company to discover more about its high production base is 330,000m2, with production
efficiency solutions and their suitability to capacity of 80,000 pcs rectifiers and 15,000 sets
systems per month. DPC has nearly 30% market
the global telecom industry.
share in China and are the number one supplier
Keywords: Beijing Dynamic Power, Capex, to China Tower Company (CTC). DPC have been
China Tower Company, DPC, Energy, committed to supplying power solutions for the
Energy Efficiency, Infrastructure Sharing, telecoms sector and a wide range of rectifiers for
Microgeneration, O&M, Off-Grid, On-Grid, telecom integrated system suppliers in the telecoms
Opex Reduction, Rectifiers, RMS, Unreliable infrastructure ecosystem for the past 21 years.
Thomas Liu, Deputy Director, Sales, Beijing Dynamic Power Co. Grid, Who’s Who
TowerXchange: How extensive is the company’s
experience? How many systems are deployed
in the field? What is the company’s geographic
< DPC’s scale and depth of experience in the supply of power equipment to the telecom industry
footprint and who are some of your key clients?
< The company’s wide product offering applicable to the sector
< How a focus on R&D is driving higher efficiency and cost-competitive solutions
< Features of DPC’s products which are ideally suited to multi-tenant applications Thomas Liu, Deputy Director, Sales, Beijing Dynamic
< DPC’s RMS platform, its compact design and ease of operation Power Co.: DPC has been the leading mainstream
power supplier in the Chinese telecommunications

industry for years. DPC has created hundreds of conditions, which will ensure the system is always key data of each tenant, helping the towercos
different power products and supplied a huge working at the highest efficiency point, aiming to effectively manage tower sharing.
number of solutions to worldwide customers, reduce energy loss.
covering the entire range of power requirements; TowerXchange: With many sites in remote
very large power systems, medium power indoor Customers use our high efficiency products to locations, how does DPC’s solution allow
systems, compact rack-mounted systems, wall- cut capex and reduce energy consumption. The for effective monitoring and what kind of
mounted type, remote DC powering solutions, extremely high deployment level of our products maintenance is required?
modular outdoor systems, mini outdoor power cells, globally over a number of years is testament to the
hybrid power system et cetera. high reliability of our products and demonstrates Thomas Liu, Deputy Director, Sales, Beijing
their performance in the field. Dynamic Power Co.: DPC’s remote integrated
Over 500,000 systems within 2,400,000 rectifier intelligent monitoring system (RMS) can effectively
modules are operating on MNO and towerco Our high efficiency rectifier modules rating monitor and manage power systems located in
networks globally. Our products are highly range from 48VDC 1kW, 2kW, 3kW to 6kW with remote sites globally through an online user-
regarded by our esteemed telecom customers a high efficiency performance approaching friendly management interface, typically based
globally such as China Tower, China Mobile, China 97%. Meanwhile along with DPC’s continuous on Ethernet communication by wireless channel.
Unicom, China Telecom, Telecom Italia, MTS, STC, investment in and development of cutting edge, An all-in-one compact design with multi-ports and
Ethio Telecom, Tanzania Telecom, LG U+, Sri Lanka energy efficiency technology with fully independent a highly-integrated 19” rack-mounted type core
Telecom, Lao Telecom, Nepal Telecom and Yemen IP rights, we will soon release higher efficiency monitoring unit enables low cost maintenance with
Telecom amongst others. products (approaching 98% efficiency) to help easy operation.
our customers reduce the capex and opex of their
TowerXchange: How is Beijing Dynamic Power networks. TowerXchange: Finally, please can you sum up
able to help towercos and operators tackle how you differentiate Beijing Dynamic Power
escalating energy costs at cell sites across Africa? TowerXchange: How scalable is your solution for from your competitors?
What kind of efficiency improvements can be the addition of further tenants at sites?
obtained? Thomas Liu, Deputy Director, Sales, Beijing
Thomas Liu, Deputy Director, Sales, Beijing Dynamic Dynamic Power Co.: DPC is committed to
Thomas Liu, Deputy Director, Sales, Beijing Power Co.: DPC’s power solution is specialised the continuous design and manufacture of
Dynamic Power Co.: Based on the idea of in catering for multi-tenant use. Every tenant’s innovative and competitive products with robust
environmental protection and energy savings, DPC power consumption is metered by an individual reliability, customer-oriented flexibility and
developed a series of high efficiency rectifiers with energy meter which is individually monitored highly competitive prices to bring benefits to our
typical technology such as Intelligent Directional and managed by the system controller without customers and partners. We listen to our customers
Dormancy, by which the power system will tenants interfering with each other. DPC’s multi- needs and ensure that we understand them,
automatically choose the normal-working high tenant management and LVD individual solution making sure that we are around for support from
efficiency modules in the case of mix-use module can record the different power consumption and the very beginning

ieng Group report great
TowerXchange: Please can you introduce
Codefish to TowerXchange readers unfamiliar
with the company and explain who some of the
results with Codefish’s customised clients are that you have worked with (both in
and out of the telecoms sector).
site management solution Kamel Semakieh, Managing Partner, Codefish:

Codefish is an IT consulting and software
How Codefish rolled out their tailor made Smart Telecom Site Management
development company with global delivery
solution across the telecom services company’s African footprint capabilities. Codefish provides a variety of
homegrown turnkey solutions along with custom
In late 2014, IT consulting and software development
software consulting and development services.
company, Codefish, was approached by ieng Group
Our services are vast and range from outsourced
to design a customised site management system as
IT to in-house staff augmentation, consulting
the telecom services company was unsatisfied with
services to business process automation, website
existing platforms in the market. TowerXchange speak
development to ecommerce solutions, mobile apps
to Codefish to understand how the system was designed
to TV web. To sum it up, we consider ourselves to
and rolled out and ask how ieng Group’s management
be problem solvers with an expansive technology
have responded to the new system.
toolkit.
Keywords: Africa, Codefish, Fuel Security, ieng Group, Job Ticketing, KPIs, Logistics, Managed Services, Some of our clients include: Nestle Waters, ieng
Monitoring & Management, Multi-Country Partner, NOC, O&M, Operational Excellence, Opex Reduction, QoS,
Group, Samsung CTC, Mazda Lebanon, GlobeMed,
RMS, ROI, Site Level Profitability, Site Management System, Site Surveys, SLA, Spare Parts, Stakeholder Buy-In,
Starbow.
Towercos, Warehousing, Who’s Who
TowerXchange: We understand ieng Group to

have approached Codefish to develop a solution
for them; why did ieng Group look to Codefish
< Limitations that ieng Group found with site management systems and the reason why they approached
and what challenges did they want you to
Codefish address?
< How the Smart Telecom Site Management (STSM) customised solution was developed and rolled out and
in what timeframe this was achieved Kamel Semakieh, Managing Partner, Codefish: In
< Codefish’s flexible pricing solution and how they are incentivised to support clients late 2014, ieng Group were looking for a
< How STSM and Codefish’s strategy is differentiated from other suppliers on the market telecom site management solution. After evaluating
< How Codefish’s system is scalable to enable rapid deployment across new operations already existing solutions at that time, they were
not satisfied with what was being offered in the

market for the following reasons: center of Samsung CTC in Lebanon, a project that < Spares management
shares several commonalities with the system that
< The current systems were technologically ieng Group were looking to build. This solidified < Revenue management
outdated and not cloud based ieng Group’s trust in Codefish’s ability to deliver on
their promise. < Contract configuration management
< They lacked main processes and didn’t cover the
whole scope of the work TowerXchange: Can you explain a little bit about < Sites inventory configuration management / asset
the Codefish system and how this was customised management
< Had way too many features that are not needed to meet ieng Group’s requirements?
anymore in today’s environment and thus made < On the ground maintenance mobile app (Android
them very hard to implement Kamel Semakieh, Managing Partner, Codefish: and IOS)
Codefish’s System is a cloud based framework,
< Were designed for a specific market and needed built with Java at its core and embedding the latest < Reporting and analytics
a lot of alteration to fit other markets and clients software engineering design patterns and best
STSM provides a simple, effective and low cost
since ieng Group were in over 13 countries. practices. The platform was built to accommodate
solution which does not use the hardware at remote
multiple modules, serving multiple companies
sites. Rather it concentrates on getting information
< Wouldn’t allow you to monitor different and operations, with multiple access levels. This
and real time analysis, hence enabling the client
operations at once, which means no in turn allows our clients to run consolidated
to react promptly; for example, the client will be
consolidation at group level. Group members reports at group level while ensuring the security
notified of high fuel consumption at a site in order
were not able to view the KPIs on a single and integrity of their data. ieng Group needed to
handle the issue immediately and avoid losses.
dashboard for all operations add a managed services module to complement
Benefits of this include, but are not limited to, the
the existing modules (warehouse management,
following:
< Very expensive to implement and maintain. invoicing and HR) to help manage their
maintenance operation. We called the full turnkey
< Revenue increase
In Codefish, ieng Group found a technology partner solution STSM (Smart Telecom Site Management)
that has a track record in developing customised < OPEX reduction
solutions across several industries. Over the course The STSM solution targets managed services
of the past five years, Codefish had developed a companies and covers all aspects of telecom site < Real time notification
cloud framework built with the latest technologies maintenance including:
with integration capabilities to other modules < Full visibility over network availability/
such as warehouse management, invoicing, HR, < NOC management/network performance and SLA
performance
and accounting. The platform was rich in visual breach management
dashboards with a solid reporting engine. < Full drill-down from operational, technical,
< Preventive maintenance management
financial and business managerial levels per site/
Furthermore, Codefish had developed the service < Fuel Management region/network

“
< SLA enforcement
< Customisation of the portal in accordance with the

client’s needs
< Business intelligence - real time focus on P&L of The best compliment we ever received though was when I learned that
network
< Minimisation of theft and leakage

ieng are pitching STSM to their clients. Their clients loved the solution
and as a result ieng Group are now adding STSM in their bids to win
new contracts
“
< Integration with Codefish accounting, warehouse
management and invoicing modules
TowerXchange: How long did the process take to module that could cater for all different scenarios first three operations, ieng were having mixed
integrate this into ieng Group’s operations and and business processes across multiple markets. emotions over STSM because implementation was
what were some of the challenges along the way? Furthermore, adapting to different cultures and taking some time and management could not yet
environments was also a tough exercise. Our team measure the benefits of the solution. However, once
Kamel Semakieh, Managing Partner, Codefish: physically went on the ground with ieng field the first three operations were done, the remaining
There were three phases for STSM. Phase one was representatives to perform maintenance visits in operations became very easy to roll out and the
the development stage where we built the managed order to fully understand how the process works in benefits were starting to show with the early
services module. It took us around fifteen months to different regions. operations.
complete the product and integrate it with existing
modules. Once we finished the first three operations, the Soon, our reputation within the management of
success and speed of phase three was decisive in each country was so positive that other country
Phase two was the implementation of the first three our decision to transform STSM into a resalable heads were so eager to have the solution that
operations, which was the biggest challenge we faced product. The speed of implementation in each they would call me in person to ask me about
during the full project lifecycle and lasted around new operation meant that we now have a scalable the timeline of their respective operation. Now,
six months. Implementing the solution in different solution. In fact, some operations took just one eight months after going live, management have
operations was very challenging as contracts week to be fully operational. witnessed an increase in revenue by an average of
in Uganda, for example, were very different to 19%. Theft was significantly reduced and controlled
contracts in Ghana in terms of maintenance TowerXchange: What has been ieng Group’s and team leaders were able to considerably
pricing, fuel, spares parts management and SLA feedback on the system? optimise their workforce.
configuration. We had to thoroughly analyse more
than ten different SLA contracts between ieng Kamel Semakieh, Managing Partner, Codefish: To The best compliment we ever received though was
Group and its clients in order to generate a contract be fully honest, during the implementation of the when I learned that ieng are pitching STSM to their

“
to have a generic solution adaptable to different fully utilise and understand STSM and most
countries, different processes and different cultures importantly report anomalies that we find.
and environments.
5. Mobile App: Our solution is complemented with
2. Our pricing model: We understand that this a mobile application that runs on both Android and
We charge a minimal one time industry is very competitive and it is very easy for a IOS. The mobile app helps field representatives such
setup/license fee and then charge client to easily lose a contract. As such, our strategy as maintenance technicians and fuel supervisors
per site per month. This way, is to align our interest with the client’s interest. with their on the ground tasks. This helps automate
We do this by charging a minimal one time setup/ the process from one end but more importantly
if our clients are dissatisfied or license fee and then charge per site per month. allows management to have real time notifications.
for some reason lose a contract, This way, if our clients are dissatisfied or for some
they will not be stuck with a reason lose a contract, they will not be stuck with TowerXchange: What’s next for Codefish in the
a large investment. Furthermore, we believe that telecoms sector?
large investment. Basically we
grow with our clients or we
lose with them. It’s as close to a
partnership as possible
“ with our solution, our clients will be able to better
respect their SLAs and provide better quality of
service to their respective clients, allowing them to
increase their site portfolio. Basically we grow with
Kamel Semakieh, Managing Partner, Codefish:
Our short term goal is to establish ourselves in
managed services. From a business perspective,
our clients or we lose with them. It’s as close to a we want increase our market share and establish
partnership as possible. an office most probably in Ghana in order to
expand our sales and customer support teams
clients. Their clients loved the solution and as a 3. Flexibility: Our aim with every client is of course and consequently, cement our presence in Africa.
result ieng Group are now adding STSM in their to offer them best practice for the industry, however From the technology perspective, we are currently
bids to win new contracts. we are aware that sometimes clients have strict integrating with existing RMS and RMMS suppliers
processes that are working well for them. Hence in order for our data to be automatically synched
TowerXchange: What differentiates Codefish’s instead of forcing our clients to adapt to our process, with the site.
solution from others in the market? How does we customise our solution to fit their needs.
your solution avoid the limitations of other Our long term vision is to create an all in one three
products on the market? 4. Customer support: I always tell our client “We are layer solution that will cater not only to managed
not a software provider, we are a service provider”. services companies but also to tower companies
Kamel Semakieh, Managing Partner, Codefish: Implementing and deploying the software for our and MNOs. Our managed services module will
I believe there are 5 major factors that could client is just the first step in our collaboration. Our be complemented with tower asset and capacity
potentially differentiate us from our competition. aim is for our clients to take full advantage of our management modules. Once these modules are in
solution and as such we assign a dedicated account place, STSM will have a big centralised site database
1. Our solution was built in collaboration with a manager to each of our clients that constantly that could generate crucial business intelligence and
client that has thirteen operations. This allowed us monitors the team’s performance, ensures users data mining to network operators

Smarter, greener, together
TowerXchange: Can you introduce to Delta
Electronics and how widely their products are
being used by towercos and MNOs in the EMEA
Delta Electronics bring intelligence, R&D and successful partnerships to power the region?
telecom industry more effectively
Andreas Grewing, Head of Telecom Power Solutions
Through it’s strongly vetted global EMEA, Delta Electronics: Delta is a Taiwanese
partner network, holistic approach company and was founded in 1971. Today, we
to energy generation systems are the number one provider of power solutions
and commitment to R&D and the worldwide. Our energy conversion products are
used everywhere in people’s daily lives– there is a
environment, Delta Electronics’ business
good chance that you are using one of our solutions
lives up to its reputation of “stronger,
right now without knowing about it. Virtually
greener, together”. TowerXchange
every type of charger and server is powered by
speak to Delta’s Head of Telecom Power
Delta equipment. In the telecoms sector we provide
Solutions for EMEA to discuss the a whole array of solutions from rectifiers and
challenges that MNOs and towercos controllers through to cooling systems and cabinets.
face in powering increasingly complex
networks and how Delta and its Just for the EMEA region alone, the output of our
partners are working with them to factory in Slovakia is around 10,000-12,000 systems
Andreas Grewing, Head of Telecom Power Solutions EMEA, Delta Electronics overcome such hurdles. a year which are deployed to all major operators.
We are not only using our factory in Slovakia but
Keywords: Africa, Africa & ME, Batteries, Delta, Delta Electronics, Energy, Energy Efficiency, Energy Storage, also our factories in China and India to supply
Europe, Hybrid Power, Monitoring & Management, NOC, O&M, On-Grid, Off-Grid, Opex Reduction, Shelters, solutions into the region. I would say that all
SLA, Unreliable Grid, Uptime, Who’s Who operators, at least the top 30, are using systems from
Delta.
Read this article to learn: We have over 70,000 employees and a strong
< Delta’s scope of solutions and investment in R&D and the environment network of local partners in which we operate.
< How Delta ensure strong on the ground local support from such a global company We invest six per cent of our turnover into R&D to
< Tips for improving energy efficiency on cell sites ensure that our products are cutting edge and also
< Details of Delta’s new 3kW 98% rectifier set to be launched have a very strong commitment to protecting the
< How operators can regain the big picture of what is happening in their energy networks environment.
< Key steps to meet MNO carbon commitments
Our company slogan is “smarter, greener, together”

“
and this is what is really driving us every single day.
TowerXchange: How does Delta manage such a

global business effectively, still bringing support
to customers on a local level?
Andreas Grewing, Head of Telecom Power Solutions Partner selection is a very critical issue for us. We want to work with
EMEA, Delta Electronics: When it comes to our
power solutions, the business is separated into
three different regions; Asia, the US and EMEA.
As a business, we understand that the different
regions have different product needs and that each
partners that have a lot of experience in telecom infrastructure as
powering the telecom sector is very different to other branches of
power infrastructure
“
region requires local support. In some regions we
have a direct office staffed with our own people,
and in others we have a strong partner network
which helps to support our clients, with our partner very critical issue for us. We want to work with network. All partners that we work with in the
network being particularly strong in the Middle partners that have a lot of experience in telecom Middle East and Africa are long term partners.
East and Africa. infrastructure as powering the telecom sector We don’t choose partners that will save us a few
is very different to other branches of power cents on installation costs; this never works in
Our products are produced in our factories in infrastructure - our partners need to know, for the long term, quality is much more important.
Slovakia, India, China or Thailand and our local example, how to work with batteries and how to Power provision to telecom sites is critical, with
partners do the distribution, installation and change and replace them. They also need to know 99.9% uptime required by MNOs and towercos, no
commissioning and provide a local presence. how to work with the complete site infrastructure, interruption is allowed.
Having local relationships and a local set up is not just the power systems, but also the gensets
essential in order to provide the best level of service and fuel detection systems; they need to know TowerXchange: What elements of a power system
to towercos and MNOs; you cannot manage the how to connect solar panels to the tower so that at do you see as particularly critical in improving
region sitting from your office in China or Taiwan. the end they can create one complete system that site efficiency and uptime?
is improving efficiency and saving the customer
TowerXchange: How do you go about selecting money. Andreas Grewing, Head of Telecom Power Solutions
your partners and ensuring that they have the EMEA, Delta Electronics: Rather than looking at a
right skills for the job and complete it to the When Delta work with the operators and towercos, single component to generate energy savings, it is
highest standard? we want to approach them as a kind of joint venture more important to look at the system as a whole. If
with our local partners - the clients must know we are to break it down however, it all starts with
Andreas Grewing, Head of Telecom Power Solutions exactly who they are working with and as such, the rectifier which is the heart of the system. Delta
EMEA, Delta Electronics: Partner selection is a we need to have full confidence in our partner are excited to launch a new rectifier this November,

“
TowerXchange: On the generation side, what
equipment do Delta have in house?
Andreas Grewing, Head of Telecom Power Solutions

EMEA, Delta Electronics: In designing power
systems for cell sites we have access to our own
A good controller must be a very intelligent, powerful, small products which as mentioned previously and even
computer, not only controlling the power system, the controller
should also be able to do full site monitoring and control - Delta’s
controllers are capable of doing both
“ solar panels can be sourced from Delta in China. We
use third parties for gensets and batteries and here
we want to make sure we have the right suppliers
and expertise in house to oversee the deployment
and integration of these systems. We, in conjunction
with our partners, need to know how to bring these
into a systems concept that will ultimately bring
savings to the tower companies and operators, this
which is reaching over 98% efficiency (compared to So, if I have a fully standardised system where I is our responsibility.
the industry standard of 96-97%); this is the heart of know the rectifier, the controller and power system
the system which we are using for our mass rollout it is quite easy for me to come with real energy TowerXchange: Where do you think the
already in the entire EMEA region. saving features like hybrid solutions using solar inefficiencies come in when people are creating
for on- or off-grid locations. It is even possible to hybrid systems?
The second, very important component is the create a solution for wind, although our experience
controller. A good controller must be a very is that wind does not make commercial sense at Andreas Grewing, Head of Telecom Power Solutions
intelligent, powerful, small computer, not only present; we are mainly focused on solar power. EMEA, Delta Electronics: I think at the end it’s all
controlling the power system, the controller should The controller can control the full site architecture, about defining the right parameters. Just adding
also be able to do full site monitoring and control - knowing when to switch on the genset, when to a solar panel to a mobile outdoor solution will not
Delta’s controllers are capable of doing both. use solar and carry out other actions; it really is a really bring the right efficiencies or the right energy
holistic system. savings to a customer, you need to take a bigger
You also need to consider indoor and outdoor picture view. You have to check, for example, if
cabinets for power systems. The trend in the market We are very aware that the key mobile operators there are trees which will create shadows on the
over the last year has been towards highly flexible, expect a return on investment within three or five solar panel; you need need to find out if there is
full standardised outdoor systems which allow years maximum. Based on standardisation and enough wind on the site; you need to understand
operators to expand and modify sites after the site economies of scale, we are able to reach a return what kind of genset is in operation and if, from
has been in operation for a number of years. When of investment below five years, even in European a size point of view, it is too big or whether it is
new radio equipment is added, it is easy to connect countries. running on an non optimal mode; are the batteries
Delta outdoor cabinets side by side. are the right size, can they be changed to lithium

“
ion batteries? All of this needs to be configured and of 5G we will have a lot of small cells and a more
you need to put some intelligence on this. complicated and distributed energy network.
Then there is the factor of scale. It is easy to do this When it comes to energy management, I tend to
for one site, but if you want to do it for a thousand think most of the operators have lost the big picture
sites you need to have intelligent software in place. and this provides us with a big opportunity. Our
The software needs to be able to tell you which The telecom energy networks controller, which is called Orion, is a very small
sites are performing well, setting the KPIs for other but powerful tool that you can programme like a
sites in the cluster and providing recommendations
are becoming very complex, computer to be able to do a wide variety of jobs
on how to achieve these KPIs, copying and pasting especially with the launch of 5G on site. We are controlling the power systems,
what is working between different sites. we will have a lot of small cells the rectifiers and the batteries and are doing
Again, it is not just a case of putting the

components together, but also controlling
these components on a given site, and here,
unfortunately, I have to say all sites are different.
and a more complicated and
distributed energy network
“ extensive tests; we can also measure all kinds of
different energy values on site, it might be the air
conditioning, the lighting or the alarm systems.
All of these systems can be controlled by the Orion
product.
So if you compare a site in Germany to a site in the
UK or Algeria or Nigeria all of the parameters are One of the challenges for the industry moving
different, and these need to be configured. On the forward will be how to collect all of this data on site
plus side, we have all of the experience to do this produce it at scale, anyone can produce a single and bring it together in such a form that it can be
for our customers. high efficiency rectifier in a lab, but manufacturing analysed and interpreted in a meaningful way. It
it to the same quality and standard in mass can be done by an engineer on one site, but it isn’t
TowerXchange: You mentioned launching a production is a challenge. Our ability to do this possible for an engineer that is covering a thousand
new product shortly. Are you able to share any demonstrates the technical leadership of Delta and sites a month. In essence, we are talking about big
details with us about the new product and some I see a big rollout of these in 2016/17. data analysis; a single site generates about 15,000
of the advantages of it? energy values a month, so you get an idea of the
TowerXchange: You discussed the monitoring scale of the challenge.
Andreas Grewing, Head of Telecom Power capabilities of your system, what challenges do
Solutions EMEA, Delta Electronics: I can only give MNOs and towercos face when it comes to the We are of the view that the analysis needs to be
you a small taster because the official product monitoring and management of their systems? done on site. Our Orion controller, for example,
launch will be in November. It will be a 3kW 98% can test a battery and send a message informing
efficient rectifier; the first to reach such efficiency, Andreas Grewing, Head of Telecom Power Solutions someone on site that the battery is faulty and
and one that will be tested by an external EMEA, Delta Electronics: This is a very interesting needs to be replaced; or for example, the controller
laboratory. Not only are we able to produce such question because the telecom energy networks are can examine the impact of changing from air
a high efficiency rectifier but we are also able to becoming very complex, especially with the launch conditioning to free cooling. If you relied on

can start to address these challenges and bring
“
knowledge to the sector. As well as bringing cost
savings, this is also important because MNOs have
often given commitments to local governments
to reduce their CO2 emissions. When I look at
operators today they have all made commitments
to reduce CO2 by between 30-50% by 2020-2022 and
When I look at operators today they have all made commitments to governments now want to see results. Many of the
reduce CO2 by between 30-50% by 2020-2022 and governments now operators have yet however not taken significant
action or developed methodologies to measure their
want to see results. Many of the operators, however, have not yet
taken significant action or developed methodologies to measure their
carbon emissions and reductions effectively
“ carbon emissions and reductions effectively.
One of the biggest opportunities for MNOs in Africa

is to find the right mix of solutions that can tackle
their escalating energy costs and carbon emissions.
One of the difficulties is in finding the right
companies that can support them in this endeavour;
and in this instance, Delta is well positioned to
labour alone to carry out all these individual EMEA, Delta Electronics: I think there are a number assist.
measurements and analysis, the cost of such labour of different factors, perhaps the main one being the
would mean that you would never gain a return on cost of energy. There is a clear energy gap in the TowerXchange: Lastly, what makes Delta
the investment. An intelligent platform is essential the market; we are not producing enough energy Electronics stand out from its competitors in the
for analysing all these data in a cost-effective way. or distributing it efficiently enough, particularly in market?
As a company, this enables us to be able to bring Africa. As such, the cost of energy and the energy
expertise to the operator and give them clear gap is likely to rise. This is one of the biggest Andreas Grewing, Head of Telecom Power Solutions
recommendations on how they should be managing challenges for tower companies and operators. With EMEA, Delta Electronics: I think Delta has a clear
their energy in order to bring in savings. the sheer number of sites in Africa in poor grid commitment to the environment. Our founder built
areas, there is a huge opportunity to upgrade these up the company aiming at producing energy saving
TowerXchange: It is a broad question, but sites and bring state of the art technologies, be it products for a better tomorrow, and still mentions
when we are speaking about the Middle East solar, wind or hybrid solutions. this frequently and puts a lot of R&D and resources
and African region, when it comes to energy into this topic. Energy demand will increase for
management, what do you think are the key Because of the size of the challenge and the business sure and our planet needs the best environmentally
issues at present? model of MNOs, many have lost the understanding solutions to address this in the best manner. Our
and control of their energy networks. Towercos brand promise is ‘smarter, greener together’ which
Andreas Grewing, Head of Telecom Power Solutions in conjunction with energy equipment providers really sums up our ethos

Elektroskandia China on the TowerXchange: Please introduce yourself and
tell us about your role and background in
telecoms.
importance of supply chain management
Robert Lindell, Director, Sales & Business
for operational efficiency Development, Elektroskandia China: My name

is Robert Lindell and I’m from Sweden, but have
Robert Lindell discusses how to work with customers for mutual success been working outside Sweden since 1997 in
different regional and global roles within telecom
With competition in the telecoms market at Ericsson, Ascom, Dingli Communications and
continuing to increase, towercos and MNOs since 2014 at Elektroskandia China.
are looking for every possible edge to

I’m now the Director of Sales and Business
reduce time to market, and increase overall
Development at Elektroskandia China and I’m
opex while limiting capex. We spoke with
based in Shanghai.
Robert Lindell at Elektroskandia China
to discuss their background in telecoms TowerXchange: Please introduce your
and learn how they are partnering with company – where do you fit in the telecoms
telecoms companies and more recently infrastructure ecosystem?
towercos to increase their operational
efficiency. Robert Lindell, Director, Sales & Business
Development, Elektroskandia China:
Keywords: Alcatel Lucent, Capex Elektroskandia AB was founded in 1904 in
Reduction, Elektroskandia, Ericsson, Fibre, Sweden and was a part of ABB under the
Nokia, Opex Reduction, Solar Power, name Asea Skandia until 1997. In 1999,
Robert Lindell, Director, Sales & Business Development, Supply Chain Management Elektroskandia AB extended its footprint to
Elektroskandia China
China, Elektroskandia China has established
its leading position in integrated supply of
Read this article to learn: telecommunication installation materials, key
< The background of Elektroskandia China and its offerings components and materials related to new energy
< Elektroskandia China’s experience as a telecoms supplier ever since its startup in Shanghai in 1999. Since
< Achieving on time delivery and managing high and low seasons 2008, Elektroskandia China is part of the French
< Increasing supply chain efficiency to remain competitive privately held Sonepar Group, a leading global
industrial distributor.

Being an industrial distributor and supply Robert Lindell, Director, Sales & Business market and customer has different business
chain specialist, the products we distribute can Development, Elektroskandia China: The processes and workflows and because we are
be divided into the following areas: telecom telecom industry has high pressure to part of the global Sonepar group we can easily
network site material solutions & supply chain deliver solutions that are cost effective adopt to the customer’s needs.
management, wind power installation material with high capacity to fulfil the customers’
solutions and solar panel installation material needs and working with companies such as TowerXchange: How can a robust approach
solutions. Within telecom we distribute site Elektroskandia China can help them with to supply chain management improve the
material, cables, fibre solutions, antennas and the on-time delivery, high product quality, valuation of tower assets?
towers. managing high and low seasons and most
importantly we can help them to reduce the Robert Lindell, Director, Sales & Business
TowerXchange: The first question our readers working capital. Development, Elektroskandia China: In today’s
will want to know is ‘how proven is the competitive landscape with high volume, but
solution in the field’ – please tell us about TowerXchange: How does your solution decreased margins, the companies with the
the performance of your solution in the field help manage different stakeholders within most efficient supply chain will be the winners.
– who is using it and what results have been the tower supply chain, from tenants to Elektroskandia China has a long history in the
achieved? subcontractors? telecom world and will continue supporting
current and new customers for mutual success.
Robert Lindell, Director, Sales & Business Robert Lindell, Director, Sales & Business
Development, Elektroskandia China: Development, Elektroskandia China: TowerXchange: Please sum up how you
Elektroskandia has more than 30 years’ Elektroskandia China has a wide portfolio would differentiate your solution from your
experience working with customers like for of telecom site installation materials, cables, competitors’?
example Ericsson, Nokia, Alcatel among others antennas and towers and depending who the
and has throughout the years developed to one of stakeholders are we can support with good Robert Lindell, Director, Sales & Business
their most important partners in supplying site quality products from China or other markets. Development, Elektroskandia China: We have
material and other equipment. During the last several competitors, but no one with the global
few years we have also been working in the tower TowerXchange: How can your solution be presence as Elektroskandia and Sonepar.
industry with a lot more new customers which configured to adapt to different towerco’s
are one of the reasons why we are participating unique business processes and workflows? We have been working more than 30 years
at the Towerxchange event in Singapore. with the major telecom suppliers to provide
Robert Lindell, Director, Sales & Business our services all over the world with good
TowerXchange: How can supply chain Development, Elektroskandia China: We quality, speed and price. The tower companies
management be integrated with tower supply products all over the world from are our latest customer segment and we
portfolio management to support towercos Elektroskandia China or through our sister believe it will support our growth over the next
and MNOs? companies within the Sonepar group. Each couple of years

Enatel’s SYNERGi solution
TowerXchange: Please give us a brief overview
of your company for our readers that aren’t
familiar with you.
achieves 90% less genset runtime Murray Wyma, CTO DC Systems, Enatel Energy:
Opex and efficiency boosted with Enatel Energy’s power solutions Enatel Energy is a division of Enatel, which was
founded 14 years ago by the same personnel
Enatel Energy offers an expansive portfolio of fully customizable that created Swichtec Power Systems, a company
DC power systems and industrial battery chargers, designed to meet successful in designing and manufacturing
every power conversion requirement. Solutions offer flexibility and switch-mode power solutions, primarily for the
scalability by way of rack-mount, hot-pluggable combinations of telecommunications industry. Based on over 30
modular AC-DC rectifiers, DC-AC inverters and DC-DC converters with years’ of experience, our core business is the
advanced monitoring and control. design and manufacture of power conversion
products for the telecommunications, IT, utility,
In this interview, Murray Wyma, CTO DC Systems, Enatel Energy, talks materials handling and renewable energies sectors.
about the work that the business has done recently in Mexico, explains Headquartered in Christchurch, more than 90% of
why MNOs are likely to see energy costs go down in the future, and everything we design and manufacture is exported
gives an insight into what makes Enatel Energy’s products so unique. internationally to over 70 countries throughout the
world.
Keywords: 3G, Africa, Americas, Asia, Australia, Batteries, Central
Competing with the best in the world, our products
America, Chile, Colombia, Enatel Energy, Energy, Haiti, Hybrid
include a range of high-efficiency rectifier and
Power, Interview, Kenya, Madagascar, Mexico, Myanmar, New
converter modules, hybrid power systems, and
Zealand, Nigeria, North America, Off-Grid, Opex, Pacific Islands,
rack and compact power solutions, supported by
Renewables, Solar, South Africa, South America, South Asia,
Murray Wyma, CTO DC Systems, embedded and GUI-based software, along with a
Southeast Asia, Tanzania, Unreliable Grid
Enatel Energy range of ancillary products. We also participate
in the renewable energies sector with a range
of high-efficiency solar inverters and modular,
Read this article to learn: high-efficiency battery chargers for the material
< How Enatel Energy went about upgrading the Sinuoso site in Mexico handling equipment industry.
< About Enatel Energy’s installed global base at cell sites
< Why energy costs are coming down for MNOs At Enatel, our core focus of research and
< How Enatel Energy provisions high 9s reliability in its products development is utilizing creative, cutting-edge
< How to handle power requirements on a site with multiple tenants technology so we can offer our customer’s better
products, performance efficiency and value

“
for money. This approach ensures that we stay
committed to the continual development and
enhancement of our suite of AC and DC power
systems, intelligent modular rectifiers, DC-DC
converters, control and monitoring options as well
as motive power and solar energy solutions.
TowerXchange: Could you share some details of

one of your more challenging projects since we
last spoke?
we’ve reduced the genset runtime hours by 90%, the usage of diesel
and the CO2 emissions by 87% and the maintenance costs by 83%.
This means annual CO2 savings of 56,052kg and monthly savings in
excess of US$3,400
“
Murray Wyma, CTO DC Systems, Enatel Energy:
The Sinuoso site, located in North-West Mexico,
on the edge of the Sonora desert, is challenged by
its environment and is a fully off-grid site with 2G efficiency power range for longer periods. The ‘solar deciding on the best battery fit – a lithium battery
(including air-conditioning) and 3G cellular loads in optimization’ feature also ensures that the genset solution is currently being considered.
self-contained cabinets. does not run if solar power is available. SYNERGi
incorporates its own self-learning algorithm to track Over the month of August 2016, SYNERGi delivered
A hybrid system had previously been deployed sunrise through the seasons, to give well-defined some remarkable results. In fact, we’ve reduced the
with a mix of DC rectifiers, solar converters stop conditions to the generator to ensure it does genset runtime hours by 90%, the usage of diesel
and AC inverters, from a range of suppliers, not run unnecessarily during the ‘solar day’. It does and the CO2 emissions by 87% and the maintenance
with a third party PLC controller for supposed not require connection to external date or time costs by 83%. This means annual CO2 savings of
hybrid functionality. This was a good example references, and does not require links to weather 56,052kg and monthly savings in excess of US$3,400.
of an attempt to pull together a hybrid system, forecasting web pages. It operates autonomously.
including solar from a disparate array of different ROIs and paybacks are site dependant, but in most
manufacturers’ equipment that never worked as The SYNERGi solution is modular, requiring cases full payback on these sites can easily be
intended. The decision was made to upgrade the about a quarter of the space, and represented a achieved in less than twelve to eighteen months.
site with our SYNERGi solution with five 2kW solar harmonized, single-controller solution where all
converters, nine 2kW rectifiers (phase-balanced) the power modules work in a unified, coordinated TowerXchange: What is your installed base
and six 1.2kW inverters, to provide the necessary manner to optimize Opex. at cell sites worldwide, and what is the
efficiencies and cost savings. approximate energy mix within that installed
The battery is usually the crucial element in a base?
The SYNERGi hybrid power system cycles the hybrid system, but in this instance a reconditioned
batteries, saving diesel and maintenance expenses set of 1500Ahr AGM batteries was supplied to Murray Wyma, CTO DC Systems, Enatel Energy:
by operating the existing generator in its optimum analyse cyclic performance over time before Enatel Energy systems have been installed within

hundreds and thousands of cell sites globally, with agnostic with respect to the energy solutions owner. TowerXchange: SLAs often demand 99.5% or
numerous hybrid systems deployed through a As time progresses, we are obviously seeing more higher uptime – tell us about the reliability and
network of integrators. These systems are located of a shift from MNOs towards towercos and ESCOs. autonomy of your solution.
in Kenya, Madagascar, Chile, Tanzania, Colombia, This enables more efficient use of tower space,
South Africa, Myanmar, Nigeria, Mexico, Haiti, and energy as now many sites are multi-tenanted. Murray Wyma, CTO DC Systems, Enatel Energy:
Australia, Pacific Islands and New Zealand. Ultimately, this must lead to lower costs for the Our designers come from a long history of DC
MNOs and consumers. However, for MNOs who power in the telco space (since the mid 1980s).
All conceivable climates and conditions are already own the tower infrastructure, retaining The telco uptimes typically required are greater
encountered in such diverse geographic locations, ownership of the tower can ensure fixed levels of than 99.9999%. The best way to describe how we
everything from integrated generator solutions tower (and power) servicing cost, rather than be provide high 9s reliability is through the quality of
and outdoor cabinets to walk-in shelters and exposed to the risk of rent increases. We are also design in our products, redundancy and plurality
buildings. We see energy mixes from the normal focussed on next generation power architectures for of supply. The other factor is fail-safe operation.
single cell/single tenant sites with average loads initiatives that migrate a towerco into a powerco, No matter the state of any controller/monitor, the
of approximately 1kW through to large sites (as in allowing monetization of those traditionally core power system operates autonomously. This is a
the Sinuoso example) and multi-tenant sites of 4 or distributed stranded assets. This applies similarly cornerstone of telco DC power system design.
5kW. for an MNO looking to diversify – as some are.
We include patented features such as dynamic
Lately, we are seeing requirements for off-grid The other factor in the equation is the ease of generator anti-stall in our products to ensure higher
solutions approaching 9kW load. In sites this size, deployment and monitoring of the power solution. uptime. As a result we can raise alarms if the
the use of cyclic batteries becomes uneconomic, This is where Enatel Energy differentiates itself by generator goes into a ‘low power’ state, possibly due
often forcing the owner to once again consider offering scalable solutions that monitor and report to poor fuel quality, blocked air filter et cetera.
24/7 operation of the generators unless large full energy logging of all system parameters (loads,
renewable energy sources are available. This battery, charge/discharge, genset kWhrs, solar The other benefit of detecting the generator’s peak
could be a controversial statement, but as long as kWhrs et cetera., hourly, daily, and monthly). power capability is that we can then programme the
a genset is operating at maximum efficiency, then genset to operate at its peak efficiency during the
no amount of cyclic charge/discharge would deliver We are seeing a big increase in solar power battery recharge.
comparable fuel use in terms of overall litres per supplementation for remote sites and our easily
kWhr of energy. integrated converters offer clever functionality such Enatel Energy offers optimal dynamic phase-
as solar optimization (minimizing genset run-time) balancing where we can adjust rectifier output to
TowerXchange: Should cell site energy solutions as mentioned in the Sinuoso example. ensure the phases on the generator are balanced
be owned and operated by MNOs, towercos or (within the scope of the applied load/battery
ESCOs? For us, it is all about making life easier for the recharge).
energy solution owner, and of course, providing
Murray Wyma, CTO DC Systems, Enatel Energy: secure power with high 9s uptime to meet the most The intention of the SYNERGi hybrid solution is
As an embedded power system provider, we are demanding SLAs. to ensure that the generator will run efficiently.

A further line of defence to prevent the site in full SNMP functionality through to SNMP simultaneously and alternate their cycles to
collapsing is the ability to control load shedding. V3. This includes a full suite of traps, gets and synchronise their services.
SYNERGi has the ability for the operator to sets. This enables easy integration of third party
shed their loads and maintain critical site and SNMP managers. This is advantageous due to Users can also seamlessly include green energy
transmission capability. These features are unique their well-proven legacy and in many cases sources through solar and wind converters and take
to Enatel Energy and demonstrate Opex savings SNMP managers are already in use by our clients advantage of true plug-and-play power modules
through optimized functional capabilities which and end-users. Further to this, we have built in (rectifiers, solar and wind converters) with self-
maximize uptime and avoid unnecessary truck UDP communications for use with our craft tool setting addresses. The system also provides full
rolls. which enables set-up, log access and bootloading kWhr logging of all energy sources (grid, gensets,
facilities across a narrow bandwidth (sometimes solar and wind) on an hourly, daily and monthly
TowerXchange: How is your solution scalable 2G) sites. Designing ‘narrow band capable’ remote basis. Just as importantly, the solution can be
to accommodate the increasing power communications is essential to the developing accessed remotely through via HTTP, SNMP (v2C
requirements as multiple tenants are added to nations market. and V3) and UDP scripting.
a site?
It is vitally important to be able to maintain the SYNERGi features a one-step front-panel control that
Murray Wyma, CTO DC Systems, Enatel Energy: communications channel to the device from the provides a battery initialization (commissioning)
Allowing space for extra power modules and equipment manufacturer remote control facility. charge to enable installation technicians to set the
battery connections can be easily catered for at the Monitoring solutions, where third party site control system and walk away without the need to return
time of design for minimal cost. When a site is first systems have been added to our monitoring, limited to site. Generator start-up has adjustable settings
deployed, the system frame can be supplied with access to our equipment, blocking visibility, and the that can be based on time of day (up to two periods
a minimal number of power modules. This can be ability to change key system parameters. per day), battery voltage, battery Ahrs (battery
done through modular configurations that support capacity) and periodic genset tests (independent
the use of wind turbines and expansion shelves. TowerXchange: Please sum up how you of other settings). The start and stop functions can
would differentiate your solution from your be enabled simultaneously to provide maximum
We are also currently addressing multi-tenant competitors’? security.
metering of up to six or more.
Murray Wyma, CTO DC Systems, Enatel Energy: If a battery is stolen, disconnected, lost, or found to
TowerXchange: Should M2M technology be Enatel Energy presents the most complete, be ineffective, the system will detect the problem
built into energy systems, or should third party comprehensive telco hybrid system on the market and notify the user. Battery history can also
remote monitoring be used to provide visibility with the SYNERGi system. With SYNERGi, users be logged to enable battery warranty claims if
into performance? can automatically generate maximum power necessary. As previously mentioned, the system
tracking and anti-stall. They can automatically set can be optimized for solar use to ensure that the
Murray Wyma, CTO DC Systems, Enatel Energy: their generator loads to a predefined optimum generator does not run unnecessarily by predicting
Certain levels of M2M technology are already level and carry out dynamic phase balancing. Our the ‘solar day’ and limiting the use of the system to
built into Enatel Energy systems. We have built solution also allows users to control two generators ensure maximum possible solar harvest

Energy Vision: the first ESCO
TowerXchange: Please introduce Energy Vision
to our readers.
of scale in SSA Ofer Ahiraz, CEO, Energy Vision: Founded two years
ago, Energy Vision is an Energy Services Company,
Energy Services Company takes on 400+ sites in Gabon or ESCO/RESCO, providing Energy as a service on
a pure opex model with zero capex to MNOs and
towercos currently focusing on the African telecoms
MNOs in Africa seeking to reduce operational complexity have to date
market. Our team has many years of experience in
tended to focus on strategic partnerships with tower companies. But when
the telecom market from business sectors including
the tower sale process of one operator in Gabon faltered, they sought an
at an MNO, a towerco, turnkey provider, and a
alternative strategic partner: pioneering ESCO Energy Vision. Africa’s first
network and infrastructure engineering company.
ESCO project of scale, Energy Vision are currently managing the first 50 of
what will become over 400 towers, 30% of which are off grid. To find out
Our vision is simple: to offer MNOs or towercos
more, TowerXchange spoke to our old friend Ofer Ahiraz, who readers will
reliable energy at a reasonable, predictable, fixed
recognise as former CEO of Leadcom, who is now Co-founder and CEO of
monthly price. We deploy the capex to modernise
Energy Vision.
sites’ power systems to the latest technology
including RMS, and undertake maintenance,
Keywords: Africa, Africa & ME Insights, Airtel, Ausonia, Azur, upgrades and refueling to offer -48VDC to power
Batteries, Business Model, DG Runtime, Debt Finance, ESCOs, Eltek, telecom equipment.
Energy, Energy Efficiency, Energy Storage, Energy Vision, Fixed Price,
Flexenclosure, Gabon, Gabon Telecom, Hybrid Power, Insights, KPIs, We are vendor agnostic, so have the freedom to
Logistics, Market Overview, MOOV, NOC, O&M, Off-Grid, On-Grid,
select the best, most reliable and cost effective
Opex Reduction, Outdoor Equipment, RMS, ROI, SLA, Site Management
technical solution for the specific use case,
System, Site Visits, Skilled Workforces, Solar, Spare Parts, Tower Count,
country or environment. We measure total cost of
Unreliable Grid, Warehousing, Who’s Who
Ofer Ahiraz, CEO, Energy Vision ownership (TCO) over a ten year period.
TowerXchange: First please give us some context

Read this article to learn: by introducing the structure of the mobile and
< Energy Vision’s simple proposition: reliable and environmental friendly energy at a reasonable, tower markets in Gabon.
predictable, fixed monthly price
< What proportion of Gabon’s cell sites are on-grid, on bad grid and off-grid Ofer Ahiraz, CEO, Energy Vision: In Gabon there
< The scope and current progress of SSA’s first ESCO project of scale were four MNOs, led by fixed line incumbent Gabon
< How the project staffed and financed Telecom, which trades under the Libertis brand,
< Which solutions technology agnostic Energy Vision chose to deploy which is being privatised and is consolidating
networks with MOOV, now also owned by Maroc

more than 20 years. Prior to my time at Leadcom,
Gabon mobile market context I worked for 18 years for Motorola and in the early
90’s we were rolling out OPT Gabon’s analogue
8% 1.7mn ARPU 162% cellular network.
population $8.20
34.7% 42.3% SIM penetration TowerXchange: What is the scale of the project?
50% on And how has it been financed?
grid
15% Ofer Ahiraz, CEO, Energy Vision: The scope of
project will include over 400 sites and the contract
20% Gabon Telecom $18,600 GDP has a nine year duration.
bad-grid Moov per capita
30% Airtel (PPP) The venture is financed by our equity shareholder
Allied Group, a multi-billion-Euro private European
off-grid Azur ~1,000 towers,
Sources: TowerXchange, GSMA trust, and we got also the support from GIEK, the
Intelligence, ARCEP, CIA Factbook 40% transferring to ESCO Norwegian export credit agency, via one of our
partners Eltek.
Telecom. Their main competitor is Airtel Gabon, Ofer Ahiraz, CEO, Energy Vision: The MNO we
joined by Azur, a new small operator. are working with were seeking to reduce opex TowerXchange: What is the current state of the
while securing a commitment to improve power project? How many sites do you have under
There are around 1,000 cell sites in Gabon, most availability. Energy Vision now gives them a single management?
of which are in the main cities, with the usual point of responsibility for power availability; we
blend of rooftops and light towers in urban areas. have clear KPIs governing power availability with Ofer Ahiraz, CEO, Energy Vision: By the end of
While Airtel did try to sell their towers, 100% of the penalties if we were to fall short of our Service October 2016 we will have 50 sites running our
country’s towers remain owned by the MNOs. Very Level Agreement. The SLA KPIs vary between 99.75- equipment (full hybrid outdoor systems, most with
few towers are shared. 99.95% depending on the site priority/category. solar) connected to our NOC via Remote Monitoring
This partnership relieves the MNO of the financial System (RMS).
4G was launched last year and there is reasonably burden to investment in power equipment, freeing
good coverage and QoS in the main cities. Gabon their budget to invest in their network. We have already driven DG runtime on some sites
was the first country in Africa to have mobile down from 24 to 1.8 hours per day.
coverage; they’ve been pioneers in Digital TV, fiber Our client was impressed with the level
and cellular coverage. The country has near 100% of professionalism Energy Vision showed TowerXchange: Tell us about the operational
economic coverage. regarding our proposed solutions, and by our environment in Gabon, for example what
fast implementation schedule. They were also proportion of the sites are on good grid,
TowerXchange: What have been the drivers for impressed by our familiarity with the country: unreliable grid and off grid? How spread out are
the MNO in Gabon to partner with an ESCO? myself and my colleague have worked in Gabon for the sites and what are the implications for the

The Energy Vision NOC
autonomy necessary to maximise uptime? At just over 250,000sqkm, Gabon is slightly smaller that our guys are local and well trained – they
than the State of Colorado, but sites are still quite understand the technology, they understand ours
Ofer Ahiraz, CEO, Energy Vision: Around half the broadly dispersed, so we organise our O&M team and our client’s expectations.
sites, mostly those in the main cities, are on good into nine regions, each taking a cluster of towers
grid connections, with around 30% off grid and such that they are able to reach the site in a time Yes we’ll outsource some mechanical installation
a further 20% on bad grid connections, where consistent with our SLA commitments. labor, or outsource transportation to serious
more than six hours of grid power is not usable. logistics companies with the right cranes and
Generally the grid is relatively good in Gabon TowerXchange Who undertakes the installation, trucks to do the job, but energy management is the
compared to elsewhere in SSA; with enough battery operations and maintenance of the power core competence of an ESCO, so that’s all in-house.
backups, urban and suburban sites should not be systems at the sites – what capabilities have you
a major problem. However, we have started with kept in-house and what is outsourced? The solutions we offer to the market are much
the most complicated sites in remote areas, where more advanced than what is typically on today’s
there is the greatest necessity to have reliable power Ofer Ahiraz, CEO, Energy Vision: All our O&M cell sites. Our equipment is IP controlled and
solutions. and NOC staff are in-house. It’s part of our vision remotely monitored, which means our technicians

of the field technician team, and our Technical
Director, who oversees training, the NOC,
performance stats, benchmarking and reports.
When the technicians escalate an alarm or technical
issue, it goes to him.
We also have finance and admin, warehousing and

logistics – our headcount will be 35+ once we take
over all the sites.
Within the mother company, there are a further

six people: myself, our CTO, two in business
development, a CFO and a Supply Chain Manager.
TowerXchange: It’s notoriously difficult to retain

scarce skills in SSA – how will you minimise staff
turnover?
Ofer Ahiraz, CEO, Energy Vision: Staff retention

is a challenge at every level and company. From
my previous experience, by creating the right
Mechanical strengthening example: metal belt added atmosphere and company’s DNA we can keep them
motivated and committed to the company.
need a level of competency and skills way beyond it is resourced. Please take us through your
We will invest in and promote our people as we
oil changes. Our field technicians are using their organisation chart.
believe in our people.
laptops to configure controllers and communicate
with different elements of sites. Without the right Ofer Ahiraz, CEO, Energy Vision: Today we have
We are very open in our communications – our
training, support and information refreshment, we a team of 25, but that will increase as we take on
team can call me anytime – we are quite informal.
won’t achieve the necessary talent level, so we have more sites. Each cluster has a dedicated technician
We’re developing a warm, family environment.
no option to outsource. and an engineer equipped with spare parts. Each
Yes people might leave, but we want to build an
of these were formally trained by our equipment
employer of choice – for everyone who leaves, two
This competence will be our main asset in a few manufacturer’s experts, both theoretical training
to three other talented people knock on our door.
years. and on the job training at two or three sites.
For our first round of recruitment in Gabon, we
TowerXchange: As this is the first ESCO of Back in the control centre we have our GM, our were still a new company in the market, but today
scale in SSA, it will be interesting to learn how Operational Director, who is effectively the leader

we’re already getting good CVs from candidates who We are using integrated RMS aggregated into our
see we’re serious and committed to the market and own platform in the NOC to see the total network,
the unique technology we used is challenging them. enabling us to integrate different suppliers in the
future. We wanted to avoid the finger-pointing and
TowerXchange: We understand Energy Vision are blame game that comes with using third party RMS!
technology agnostic; what technologies are you In phase two we will collect and group information
deploying and why? into a master NOC platform.
Ofer Ahiraz, CEO, Energy Vision: In any project TowerXchange: What has been the thinking
we will use at least two or three suppliers to behind deploying relatively capitally intensive,
benchmark equipment performance, diesel premium energy solutions?
consumption and after-sales service. So if we have
two 1.5kW sites, we have real fuel consumption Ofer Ahiraz, CEO, Energy Vision: As a serious and
benchmarks from the field to compare supplier X responsible company, we selected tier one suppliers and that has fast tracked our entry into the market.
versus supplier Y – partner selection isn’t about that are proven in tough market conditions and We’ll take some of our proven team in Gabon to
slides and lab test results, but proven results on our tough environments. We have past experience, ramp up in other countries like I did at Leadcom –
own sites. This creates healthy competition, and if long and extensive business relations with those develop a pool of local African people to support the
suppliers deliver good results, we will keep using suppliers. growth of the company.
them in the future.
We build configurators and evaluate ROI over a In Gabon there are still two MNOs who have their
At some off-grid sites we are using Flexenclosure ten year period. We know where we expect our own towers – they are target customers for our
with their controller and DGs from Grupel, while at suppliers to be, and partner with them to achieve proposition. We believe in the potential for further
other off-grid sites we are using Ausonia’s all-in-one the performance goals necessary to support our deals in the Gabon market, but in parallel we’re
system with DC DG in one compartment and the DC business model. developing discussions with different carriers in
system in another compartment. With the help of different countries. We hope by Q1 2017 we will
the Norwegian export credit, we use Eltek systems We are cultivating long term relationships with our have a second country in our portfolio, and we’re
at on-grid and bad-grid sites. technology partners – we hope they take up the targeting a third country before the end of 2017.
challenge to support us in our ambitious expansion
Generally we prefer to use proven technology and plans within and beyond Gabon! We will synchronise raising further investment and
solutions, adding some mechanical strengthening to vendor finance with the growth of the business as
equipment to prevent theft and sabotage. TowerXchange: What is your vision to drive we continue to increase capex.
expansion in Gabon and beyond? And how will
We’re using full hybrid solar and CDC batteries. We you finance such growth? Currently we are finding MNOs more receptive to
use as much solar as we can even though Gabon our vision than towercos, but it’s only a matter of
is not one of the best countries in SSA for solar Ofer Ahiraz, CEO, Energy Vision: We have good time – the market will come once ESCOs prove they
irradiation, and we’re satisfied with results so far. relationships with the MNOs and OEMs in Gabon, can do it as well if not better!

Uncontrolled cyclic use of TowerXchange: Please can you provide an
introduction to EnerSys® for those who are not
familiar with the company?
batteries and deep discharge recovery Anssi Laitinen, Marketing Director, Reserve Power
EnerSys bring their Genesis EP battery to the poor/unstable grid telecoms sector EMEA, EnerSys: EnerSys is the global leader in
stored energy solutions for industrial applications.
In poor or unstable grid scenarios, batteries installed We manufacture and distribute reserve power
and motive power batteries, battery chargers,
on cell sites are regularly subjected to uncontrolled
power equipment, battery accessories and outdoor
partial state of charge (PSOC) conditions and medium
equipment enclosure solutions to customers
to high cyclic use. This, coupled with the often high
worldwide.
ambient temperatures at such sites, puts significant
stress on the energy storage system in place. Enersys’ Motive power batteries and chargers are utilised
deep discharge capable batteries have had significant in electric forklift trucks and other commercial
success in other applications and the company is now electric powered vehicles. Reserve power batteries
introducing their PSOC capable Genesis EP battery to are used in the telecommunication and utility
the telecom market. TowerXchange speak to Enersys, industries, uninterruptible power supplies, and
one of the global leaders of energy storage solutions numerous applications requiring stored energy
to learn more. solutions including medical, aerospace and defence
systems. Outdoor equipment enclosure products
are utilised in the telecommunication, cable, utility,
Keywords: Batteries, Capex, Energy, Energy
transportation industries and by government
Efficiency, Energy Storage, Enersys, Monitoring &
and defence customers. EnerSys also provides
Management, Outdoor Equipment, ROI, Unreliable
Anssi Laitinen, Marketing Director, aftermarket and customer support services to
Reserve Power EMEA, EnerSys Grid, Who’s Who customers from over 100 countries through our
sales and manufacturing locations around the
world.
< Enersys’ history and experience in the telecom sector We have extensive long term experience in power
< How Enersys’ Genesis EP battery is ideally suited for unstable grid conditions management in Middle East and African telecom
< Key factors to consider in TCO calculations and battery selection backup power applications. EnerSys has also
< Theft protection systems inbuilt into Enersys’ cabinets introduced many innovative solutions, such as SBS®
< How remote monitoring and control systems enable better battery management EON Technology® batteries that provide up to four
times more cycles than the standard Absorbent

“
Glass Matt (AGM) batteries in hybrid applications.
TowerXchange: Why is it imperative for tower
companies and operators to consider the
location of the towers when deciding on their
choice of batteries? How does grid availability
and reliability affect battery choice?
We have recently introduced a PSOC capable Genesis EP® battery
Anssi Laitinen, Marketing Director, Reserve Power
which is based on thin plate pure lead technology and has enhanced
EMEA, EnerSys: In general, the grid connectivity
or lack of it can be divided to three main areas: in
the stable grid environment there is only minimal
cyclic use for batteries and a relative stable ambient
temperature. The stable grid does not necessarily
the ability to recover from deep discharge. This helps in case the
battery has entered to this state of discharge, which is quite common
in these grid type conditions
“
demand a battery compatible with harsh
conditions.
The unreliable grid may need a battery capable of

withstanding partial state of charge and to handle solutions are available for sites situated on poor- type of deep discharge capable batteries in other
more repeating cycles. grid? How extensively have these been deployed? applications such as renewables and home energy
storage, and now we are introducing this to the
In the off-grid scenario we typically find a diesel Anssi Laitinen, Marketing Director, Reserve Power telecom environment.
generator and battery as a ‘hybrid’ solution. EMEA, EnerSys: When there is a poor or unstable
The hybrid solution can also incorporate grid this often means that there is a condition TowerXchange: In terms of reducing the total
renewable energy sources such as a wind that we call uncontrolled cyclic use of batteries. cost of ownership of power management there
turbine or photovoltaic array. Warm ambient Very often there is also a warm ambient climate. are multiple choices available for equipment
temperature and regular cyclic use in the off-grid The battery solutions available should match to such as cabinets, cooling and rectifiers. How
scenario place again different demands for the the uncontrolled partial state of charge (PSOC) does the choice of each affect costs and what
battery. Understandably it is challenging to choose conditions and the medium to high cyclic use of recommendations does EnerSys have?
the right battery, and in addition one needs to the battery. We have recently introduced a PSOC
also consider related equipment such as outdoor capable Genesis EP® battery which is based on Anssi Laitinen, Marketing Director, Reserve Power
enclosures. A one fit for all approach does not work thin plate pure lead technology and has enhanced EMEA, EnerSys: This is a question that may need a
in these scenarios. the ability to recover from deep discharge. This webinar or a lecture to answer in detail, but I will
helps in case the battery has entered to this state of try to provide a short answer here.
TowerXchange: Considering that poor-grid is still discharge, which is quite common in these grid type
quite common in most parts of Africa what new conditions. EnerSys has earlier introduced these In general, the Capex (Capital Expenditure) costs for

batteries consist of the battery costs, transportation, EMEA, EnerSys: There are two ways to look at
installation and overheads. The Opex (Operating battery theft from the site operations perspective.
Expenditure) costs then cover energy consumption If the strategy is to retrofit existing sites with
and maintenance of the backup power solution. battery protection, then we have battery protection
We have TCO (Total Cost of Ownership) calculators alternatives. If however you want to start a green
in place for discussion with our customers to assist field operation and need both new battery cabinets
them with their choices. and batteries, our outdoor enclosures can provide
However, in the hybrid scenario, the generator anti-theft features today. Meetup Europe 2017
maintenance costs and the fuel savings and site
visit costs are important considerations. The battery There are more than half a dozen different
4-5 April, London
needs to recharge quickly and withstand the high protection features available in our cabinets. Thus
cyclic use. The EnerSys hybrid calculator provides if you are considering a new site with new cabinet
guidance for even the most complex total cost of
ownership questions.
options then you should look at the anti-theft
features available both in the cabinet and in the
Meetup Americas
The cabinet TCO calculations are covering the
batteries. 2017
capital and operating expenditures but are also TowerXchange: Should tower companies look 7-8 June, Boca Raton
based on the following criteria: need for equipment at remote monitoring of batteries and what
protection in general, free cooling, air conditioning benefits this will bring?
and need for anti-theft features. The outside
temperature places demands for the cabinet Anssi Laitinen, Marketing Director, Reserve Power Meetup Africa
and cooling method choices. In comparison with
batteries, one deployment strategy rarely fits. You
EMEA, EnerSys: Most definitely they should. With
remote monitoring, one reduces the need for site
& ME 2017
will need to consider the need for cooling batteries visits. Many industries are already using remote 3-4 October, Johannesburg
and other equipment such as rectifiers and power monitoring of their equipment. The benefits are
equipment. Some batteries can withstand higher key here with the protection of assets. This can
temperatures so you may not want to have the most be 24/7 and this can be crucial for instance in the
expensive cooling method, however, in the hybrid hybrid-off grid scenario as in these sites the backup Meetup Asia 2017
scenario the cycles may kill the battery before the power solutions provide for the real operation
temperature element starts to affect the battery life. of the site, hence the need for better monitoring. 12-13 December, Singapore
There are additional benefits available if one wants
TowerXchange: Battery theft is a major issue at to consider even more advanced solutions: remote
the moment. Are there new ways to combat this? management. Instead of sending someone on
site, the voltage of a battery can now be corrected www.towerxchange.com
Anssi Laitinen, Marketing Director, Reserve Power remotely, saving an unnecessary site visit

Exide Technologies sees a
TowerXchange: Who is Exide Technologies?
Stanislas Verdonckt, Director Strategy and

great future in TCO-driven power Business Development, Exide Technologies: Exide
Technologies is one of the world’s largest producers
management solutions for BTS of lead acid batteries. We have 127 years of industry
experience and operate in more than 80 countries
around the globe with almost 10,000 employees
TowerXchange worldwide. GNB Industrial Power is part of Exide
speak to the leader Technologies and offers a comprehensive range of
in high temperature stored electrical energy solutions and services for
batteries (HTB) industrial and transportation applications.
and high cycling
batteries (HCB) to Our industrial solutions include batteries for
discuss how Exide motive-power applications in lift trucks and other
Technologies HTB/ commercial vehicles, and solutions for backup
HCB lead acid power and energy management applications in
batteries are driving telecommunication, electric utility production
down TCO and and distribution, grid control power, railway
what the company rolling stock and infrastructure, time-shift self-
has planned for consumption of renewable energy, industrial and
Left to right: Stanislas Verdonckt, Director Strategy and Business Development, Martin Sinz, their lithium ion commercial UPS, emergency and security and other
Director Product Application and Baidy Kaba Bah, Sales Manager Africa
technology. areas.
Keywords: Air Conditioning, Batteries, Capex, DG Runtime, Energy, Energy Efficiency, Energy Storage, Exide, TowerXchange: How important is the telecom
GNB Industrial Power, Lithium-Ion, Off-Grid, Opex Reduction, Renewables, Unreliable Grid, Uptime, Who’s Who market for Exide Technologies?
Stanislas Verdonckt, Director Strategy and Business

Development, Exide Technologies: Very important;
< How Exide Technologies view the challenges that the telecom industry is facing globally
Exide Technologies has been a global market leader
< The battery requirement for green deployments versus traditional telecom applications
in the stationary battery business for decades
< Deployment figures for Exide’s high cycling high temperature batteries
and telecom has always been a strategic market
< Features of the GNB PowerCycle battery that make it suitable for harsh environments
for us. We have been working with UPS OEMs,
< How GNB lead-acid and lithium batteries can be used to obtain the lowest TCO in class
infrastructure vendors, system integrators and

telecom operators on all continents and supported
our partners throughout the changes, challenges
and opportunities that the industry has been facing.
TowerXchange: What are the challenges and

opportunities that you see for the telecom
industry?
Stanislas Verdonckt, Director Strategy and

Business Development, Exide Technologies: Key
opportunities are the internet-of-things and the
huge potential of the emerging markets around
the world. The growth of data traffic in so-called
mature markets continues to be very significant,
requiring more infrastructure. And the ongoing
cellular coverage of emerging markets will be an
opportunity for years to come. Almost a billion
people live in Sub-Saharan Africa, two times more
than in Western Europe. Less than 10% of them networks in emerging markets is a technical and Martin Sinz, Director Product Application, Exide
used a cell phone 10 years ago and today it is major economic challenge, due to the absence Technologies: Traditional VRLA telecom batteries
approximately 70%, still far away from the average of (stable) power grids, the remote locations, the are designed for backup power in cool and stable
cell phone penetration levels in Western Europe. harsh climatic conditions and often the absence of grid environments. For many years the main focus
Investments in telecommunication infrastructure qualified personnel on the ground. of the telecom industry was on regions with well-
will continue to be very significant and energy developed electrical grids. As such, battery products
backup and storage solutions are required Energy management requirements of wireless served as a back-up only. The energy throughput
everywhere. networks in Africa are therefore completely in these so-called float applications was very
different from Europe. Traditional VRLA AGM and limited, with stress caused by elevated ambient
TowerXchange: What about the challenges? pure lead batteries that are a suitable solution for temperatures as well. Air-conditioning to maintain
stable grid networks in most of Western Europe are the ideal battery temperature is a very significant
Stanislas Verdonckt, Director Strategy and Business an inefficient and costly solution for off-grid BTS in operational cost, and to operate a 24/7 genset to
Development, Exide Technologies: We see a number Africa. power the BTS is not only a huge cost and a hassle,
of big challenges for the industry. To manage but also a missed opportunity.
more traffic and data requires more infrastructure TowerXchange: Why are traditional VRLA AGM
and more efficient solutions. To deploy telecom and pure lead batteries less suitable in Africa? Stanislas Verdonckt, Director Strategy and Business

“
Development, Exide Technologies: Different
challenges require different solutions; a smart BTS
power solution allows a very significant economic
saving and reduction in carbon footprint. Our
target is to allow BTS operators in the future to run
their operation with significantly less or no use of We are delighted to see a strong shift from capex based purchasing
a genset, thanks to the generation of renewable
energy and an efficient energy management
solution. We are delighted to see a strong shift
from capex based purchasing decisions, to power
decisions, to power solution-designs based on reduction of opex and
therefore a significant reduction of the total cost of ownership
“
solution-designs based on reduction of opex and
therefore a significant reduction of the total cost of
ownership or TCO.
quite different profiles, so let me just underline a The performance, quality and reliability of our
Martin Sinz, Director Product Application, Exide few things that customers expect and that make us offer, both products and services, is our most
Technologies: In such a so-called green deployment stand out. important asset: we deliver what we claim. We
the battery requirement profile is very different to often see remarkable product performance claims
that for traditional telecom applications. The system We have a very significant industrial supply chain in our competitor benchmarks, in particular
requires a long life in cyclic application at elevated and commercial footprint in the regions where we in terms of in-the field service life, cycling
temperatures, therefore high energy throughput sell, which allows us to be close to our customers, performance and temperature resistance. These
during its life, high energy efficiency, robustness to be very responsive and to ship products quickly, characteristics are vital for the TCO of an operation,
in general and especially in partial-state-of charge as required. This is a clear advantage vis-à-vis but customers unfortunately cannot always do their
operation, fast rechargeability, reliability, ease of competitors that manufacture for instance in China, own tests.
installation and service are key parameters for low the USA or Mexico.
total cost of ownership. And finally I would also mention our
We see new competitors entering the market, comprehensive product portfolio and our strong
TowerXchange: What differentiates Exide especially in the energy management segment. product brands like GNB Sonnenschein, Absolyte,
Technologies from its competitors? Our company has been around for almost 130 years GNB Sprinter, GNB Marathon and GNB PowerCycle.
and our teams have application and R&D know how This makes us more attractive for our distribution
Stanislas Verdonckt, Director Strategy and that you just cannot get “off the shelf”. Particularly partners in all channels to the market.
Business Development, Exide Technologies: Exide when it comes to Gel VRLA technology we have
Technologies successfully supplies energy storage always been a leader with the GNB Sonnenschein TowerXchange: Why do you think Exide
solutions on all continents. There are just a few product ranges that are particularly suitable for Technologies is a valuable partner for tower
competitors playing in this league and they have harsh cyclic applications. operators in Africa?

and with dedicated sales resources we are confident
“
to see further acceleration of our growth in Africa.
TowerXchange: Can you tell us a bit more about

the Sonnenschein PowerCycle?
Martin Sinz, Director Product Application,

The combination of our experience in telecom Exide Technologies: The GNB PowerCycle is a
maintenance-free (no topping-up of water is
infrastructure and applying the right product solution with required) VRLA front terminal battery that was
GNB lead-acid batteries and Lithium Ion technology can be

a great recipe for the lowest TCO in class
“ designed specifically for telecom BTS applications
in the most harsh environments. It is not a backup
battery, but an energy storage solution with high
cycle ability, fast rechargeability, robustness at
elevated temperatures and in PSoC operation.
TowerXchange: What is the next step for Exide

Technologies?
Baidy Kaba Bah, Sales Manager Africa, Exide That is what made our GNB Sonnenschein gel Martin Sinz, Director Product Application, Exide
Technologies: For almost 130 years our company batteries and GNB Classic OPzS cells so famous. Technologies: For several years Exide Technologies
has been a specialist in energy storage solutions Our strength is also to be close to the customer, with has offered Lithium Ion batteries for material
and a leading supplier of motive and stationary application engineering, project teams and R&D in handling applications and this technology provides
batteries. Cycling applications in harsh conditions Europe for the EMEA market and dedicated sales features that can be beneficial for the high cycling
are our core competence and this allowed us to be staff to support our customers and partners on- the- high temperature telecom tower market. That
a global market leader in motive power and so- ground across Africa. is why we are looking forward to discussing
called high cycling and high temperature stationary this with telecom stakeholders at the upcoming
applications. Stanislas Verdonckt, Director Strategy and Business TowerXchange conference in Johannesburg.
Development, Exide Technologies: Our focus on
Our batteries are often preferred for installations high cycling high temperature applications in The combination of our experience in telecom
in the most challenging and remote environments, emerging markets is paying off. infrastructure and applying the right product
with extreme temperatures, with very poor solution with GNB lead-acid batteries and Lithium
or without power grid and a lack of qualified Thousands of towers in Africa are already powered ion technology can be a great recipe for the lowest
technicians. with GNB Sonnenschein PowerCycle HTB/HCB blocs TCO in class

Zinc-air batteries set to displace TowerXchange: Please introduce Fluidic Energy
and the products that they supply to the telecom
infrastructure industry.
diesel generators in poor grid areas Dennis Thomsen, Chief Marketing Officer, Fluidic
Fluidic Energy enter the African market with their revolutionary technology Energy: Fluidic Energy was formed in 2006 in
Scottsdale, Arizona, USA. The key shareholders
Having deployed over 100,000 batteries and include the Walton family, Caterpillar, the
40MWh+ of energy storage worldwide, Fluidic International Finance Corporation (IFC) and the
Asian Development Bank (ADB).
Energy entered the African market in early
2016. Their zinc-air battery, with its ability to
Fluidic’s main breakthrough was the invention of
store large amounts of energy, capable of being
the rechargeable zinc air battery, which is capable
released over very long periods of time, offers
of storing massive amounts of energy. Because
a unique solution for areas with poor grid of its ability to release the energy over very long
availability. TowerXchange speak to Fluidic periods, the Fluidic system has become known as
Energy, Chief Marketing Officer, Dennis Thomsen the “Marathoner”, capable of fully replacing diesel
to learn more. gensets in many poor grid areas.
Keywords: Africa, Batteries, Capex, Energy, Fluidic also designed a vertically integrated solution,
Energy Efficiency, Energy Storage, Fluidic, with hardware, software, and remote control
Fluidic Energy, Off-Grid, Monitoring & capabilities on a single “plug & play” platform,
Management, Outdoor Equipment, ROI, enabling us to provide our customers an SLA based
Dennis Thomsen, Chief Marketing Officer, Fluidic Energy Unreliable Grid, Who’s Who power backup solution with full performance
transparency.

In 2015 Fluidic then launched the proprietary and
< How Fluidic’s zinc-air battery and hybrid architecture are ideally suited to applications with poor grid
breakthrough “hybrid architecture”, which enables
availability and variable ambient temperature
seamless integration of power batteries, with the
< The scalability and integrability of Fluidic’s systems
long duration energy capabilities of the zinc-air
< Monitoring capabilities and inbuilt intelligence that can detect warning signs and mitigate the impact
technology. This combined solution, leveraging
of cell failure
the best of the two chemistries, has provided our
< How Fluidic’s design helps mitigate theft
customers with a state of the art solution that covers
< The progress of Fluidic’s African NOC and plans for local manufacturing
all the needs for both peaking capabilities and long
< Fluidic’s track record in the telecom sector and how it is differentiated from its competitors
duration backup requirements.

Fluidic now holds more than 100 patents and
continues to expand its IP position.
Our systems are modular and fully scalable at any

time from 1kW to MWs, and from kWh to MWh. In
other words you only install the power and energy
capacity you need from day one, and then scale
these as your demand goes up.
With no depth of discharge limitations, no state of

charge issues, an operating temperature window
from 0C to 50C without any need for external
cooling, and designed as a drop in replacement of
lead acid batteries working seamlessly with existing
power infrastructure, the Fluidic solution is easy to
deploy in both greenfield and brownfield sites.
TowerXchange: What applications are Fluidic

batteries useful for in terms of grid availability?
Dennis Thomsen, Chief Marketing Officer, Fluidic

Energy: Fluidic Energy is a full solution provider,
delivering both on-grid and off-grid solutions.
Having said that, if an MNO or towerco is looking for Energy: Since our first commercial installations in tell you that everyone one of them ranks among the
a solution that delivers guaranteed power backup early 2011, we have more than 100,000 batteries largest MNOs in the two regions.
for more than 4, 6, 8 or even 16 hours every day, and and 40MWh+ of energy storage worldwide. I believe
do so for 5 years or more (up to 10 years), the Fluidic that makes Fluidic Energy the most successful new Typically, we enter into long term agreements under
solution is probably the only one on the market battery company since the launch of the lithium which, Fluidic guarantees to deliver a power back
capable of truly meeting such promises. battery some 20+ years back. availability in accordance with an agreed SLA. It’s
not without some pride that I can tell you that we,
TowerXchange: How widely installed are Fluidic We have over recent years been very focused on over a period of more than 5 years, have never
batteries and who are your key clients? What successfully supporting and executing on our missed the promised targets and nor have we been
results have been achieved? promises to our key customers in Southeast Asia and hit by an SLA penalty. The result for the customer
Central America. I cannot disclose the name of these is a guaranteed availability level, which directly
Dennis Thomsen, Chief Marketing Officer, Fluidic as we are under NDA with each of them, but I can translates into higher revenue, lower supporting

to each cell, ensuring that if for whatever reason a
single cell failed, the system would intelligently latch
around that cell and maintain its performance level
until we had a service tech in the area.
Backed by our 24/7 Network Operating Centre in

the USA, Southeast Asia, and soon to come in Africa,
we monitor and control each and every system
deployed, ensuring we never miss a promised
performance SLA.
Our customer also has full access to the integrated

monitoring system, and some have even integrated
this into their own NOCs. This ensures total
transparency and provides a platform from where
we can build a long term relationship with our
customer partners.
cost and more satisfied customers. In regions where is the typical lifecycle of your solutions and how With regard to lifetime and lifecycle, then we
customer churn is a real issue (SIMs are being can this be maximised? typically enter into long term solutions with our
swapped in a heartbeat), loyal customers are worth customers, during which we guarantee an SLA based
a fortune. Dennis Thomsen, Chief Marketing Officer, Fluidic performance of the deployed systems, eliminating
Energy: One of the key challenges we faced in the all customer uncertainties related to system
TowerXchange: How does the TCO of a power early days as we started out deploying across the performance, supporting cost, spare part availability
system incorporating zinc-air batteries compare Indonesian archipelago, was how to ensure that we and so forth.
to that with lead or lithium ion? never had a system failing, and if one was about to
do so, we needed to know well in advance allowing In some instances, and in particular when we are
Dennis Thomsen, Chief Marketing Officer, Fluidic us to proactively respond before this impacted the talking about larger deals, we are also providing
Energy: Measured over periods of 5 years or more, customer network availability. the long term financing of the deployed assets and
and typically in areas with frequent outages of 4 typically under a capital lease agreement.
hours or more, or where a guaranteed availability is The answer for us was to go all out and vertically
absolutely critical, the Fluidic solutions and business integrate hardware, software and controls on a TowerXchange: Battery theft is a major problem;
model delivers an unrivalled TCO. single platform, allowing us to control and monitor how has the Fluidic system been designed to
the performance down to the cell level of every reduce theft? Has this shown proven results in
TowerXchange: Why is it that batteries fail? What deployed system. In addition, we added intelligence lower levels of theft?

Dennis Thomsen, Chief Marketing Officer, Fluidic
Energy: Theft is a big issue across Southeast Asia, but
it’s a massive issue on a scale that’s hard to believe
in Central America.
We probably have gotten a little lucky here, because

over the 5+ years we have been in commercial
operation, our systems have proven to virtually
eliminate theft in both regions.
There are two main drivers behind this fact; firstly,

when removed from their position our cells will
not deliver any power and as such, are useless for
powering home applications; and secondly because
our systems hold no valuable materials such as lead
or copper, they therefore have no resale value.
If someone tries to break into a system, given the

integrated monitoring and controls, we know the
moment anyone is opening a door without proper
authority, and we know instantly if a cell or two
has been vandalised and needs replacement during
the next scheduled visit. This helps ensure that the
network availability is not negatively impacted even
in the event of a site being vandalised.
TowerXchange: What differentiates Fluidic from

their competitors? The key word here is “people”, because nothing people across business development, operation
happens on its own, it’s all down to having the and customer support, who all share our desire to
Dennis Thomsen, Chief Marketing Officer, Fluidic right people. We have been very fortunate to have make a real difference and help provide clean and
Energy: You can point to a number of key technology shareholders that have the vision and stamina to reliable energy to the more than 1.2mn people living
advantages over incumbent solutions as described see this through, we have some of the smartest across Africa and Asia currently with no such access,
earlier, but at the end of the day it all comes down to scientists on the planet that provided us the you have a very powerful cocktail that can indeed
the combination of; technology, people, strategy, and technology breakthroughs when we needed these. deliver game changing solutions. Along with our
the ability to successfully execute. When combining this with talented and passionate key vendors we now directly and indirectly employ

almost 1,000 people spread over three continents.
Besides possessing extraordinary technology and

people, we have also been very disciplined in how
we go to market and followed the strategy we put
in place more than 5 years ago almost to the last
comma. We do not try to be all things to all people,
and we understand as well as anyone that having
the best technology alone will not get you there.
If you want to build sustainable and long term
customer relationships, you must be willing to put
your money where your mouth is, dedicating the
necessary support resources, and delivering on your
promises day in and day out.
Although we have been asked for several years to

enter into the African market, we only decided to do
so early 2016, and are now engaging with the major
MNOs and towercos of the continent.
We are fully committed to the African continent,

and are currently in the process of setting up our
local Network Operating Center, and are actively
engaged with several governments on where to set-
up our local manufacturing facility on the continent.
We are, so to speak, putting our money where
our mouth is, pursuing the same strategy that has
proven so successful in Southeast Asia.
We are looking very much forward to be part

of and exhibit at the TowerXchange Meetup in
Johannesburg this coming October. We look
forward to learn from the best, and engage with the
attending MNO and towerco representatives

Fuel monitoring and
TowerXchange: Please can you provide an
introduction to Galooli and their solutions for the
telecom sector.
preventative maintenance reduces Ohad Polinovsky, Director, Galooli Telecom:
fuel consumption by up to 40% Galooli Telecom provides innovative Bottom Line

Solutions™ (BLS) – the market leading practical
business intelligence solution. Galooli’s unique
Galooli’s integrated site management system brings financial savings to tower owners
strength is its ability to convert big data into reliable
and useful tools to achieve real opex savings. From
Used by personnel from technicians to CEOs, Galooli’s
full-site remote monitoring and management to
RMS system and its intelligent data analysis platform
workforce and fleet management, our customisable
offers MNOs and towercos a fully comprehensive solutions cover all operational aspects for towercos
system to manage fleet, workforce and operating and operators. Instead of reacting to events that
efficiencies. Enabling fuel reductions of up to 40% have already happened and alerts available on any
and equipping tower owners with the tools to take standard monitoring systems, Galooli promotes the
a preventative rather than reactive approach to site use of prevention. Galooli is actively operating in
management, Galooli works hard to deliver financial over thirty territories with in-country services and
results to its clients. support as an integral part of the offering.
TowerXchange: Galooli have been specialising

Keywords: Change Management, Data Room,
in fuel monitoring for a number of years, how
Dimensioning, Energy, Energy Efficiency, Fuel
have you seen strategies used by thieves change
Security, Galooli, Galooli Telecom, Job Ticketing, KPIs,
and how does Galooli’s platform meet these
Monitoring & Management, NOC, O&M, Off-Grid, QoS,
challenges?
RMS, Site Level Profitability, Site Management System,
Skilled Workforces, Who’s Who
Ohad Polinovsky, Director, Galooli Telecom Ohad Polinovsky, Director, Galooli Telecom:
The main change we saw over the years is that
fuel theft carried out by “insiders” is almost not
Read this article to learn: happening anymore. The thieves understand that
< How Galooli’s system offers a truly end-to-end experience for all levels of the business the organisation can easily cross reference the
< Strategies and success rates in tackling fuel theft information from our system and understand who
< Moving from reactive to preventative maintenance through the use of Galooli’s system was part of a fuel scheme. Moreover, the MNOs and
< How data is being used to inform business decisions towercos are no longer responsible for the fuel in
the tank, using our system they can pay only for the

“
fuel that was actually consumed since our system a number of limitations. What do you see as the
can separate between normal consumption and fuel limitations of site management platforms and
drops even when the generator is running. how has Galooli’s platform evolved in recent
years?
Galooli’s reliable fuel monitoring platform enables
the MNOs and towercos to agree on common Ohad Polinovsky, Director, Galooli Telecom: One From information gathered for
consumption scales and transfer the responsibility of the limitations is that MNOs and towercos need
for the fuel in the tank to the fueling contractors.
several years we saw that a 30-
to work with several different systems. Galooli
Nevertheless, as fuel is the main expense and main
concern, there will be always new challenges to cope
with, so we keep developing new technologies to
overcome them.
develops its solutions to provide a complete offering
that anyone in the organisation has use of, from the
filing technician with our workforce management
mobile app up to the CEO with our analysis and
40% in fuel reduction can be
achieved by using our solution
in a very short time
“
dashboard tools.
TowerXchange: What kind of reduction in fuel
theft have your customers seen? How does this Having all of the information from the technicians
compare to other monitoring system providers? and site equipment on the same database enables us dashboard is one of the examples of this; we try to
to present it on one platform. On top of that, Galooli make sure alerts pop up before a malfunction or
Ohad Polinovsky, Director, Galooli Telecom: From enables integration of any equipment on site that bad event happen. We don’t only invest a lot in the
information gathered for several years we saw has a communication port, in order to use all the technology to be able to do this, but we also invest
that a 30-40% in fuel reduction can be achieved by information we can get from the site and provide heavily in creating reliable and professional teams
using our solution in a very short time. Additional our clients with a one stop for all the data they need. on the ground; workforce quality is critical to the
reductions are also observed as time goes by as well, success of the operation.
but this is not as dramatic as the initial impact. I Another limitation MNOs and towercos experience
cannot tell you about our competitors’ performance is interpreting the collected data. Besides building TowerXchange: Finally, with so many site
but what I can is that Galooli is constantly looking dashboards for analysis, Galooli develops prediction intelligence system providers to chose from, what
for ways to reduce MNO and towerco opex by and prevention solutions to enable bigger savings. differentiates Galooli from its competitors?
providing bottom-line solutions. This means
analysing tools that help in taking operational TowerXchange: How is Galooli assisting its Ohad Polinovsky, Director, Galooli Telecom: Galooli
decisions that also contribute to a reduction in fuel customers to react in a preventative rather than provides bottom line solutions, meaning effective
consumption, for example by optimising hybrid reactive manner? information that leads to real opex savings. We
cycling time or air cooling system operation. are committed to financial results more than just
Ohad Polinovsky, Director, Galooli Telecom: to data. Galooli has vast experience, its solution is
TowerXchange: There have been criticisms Galooli takes data collected from sites and provides flexible and customisable to meet the client’s needs
from some towercos and MNOs that current site effective dashboards and reports which help the and the company has outstanding after sales support
management systems on the market still exhibit operation managers make decisions. The NOC alerts to ensure the client gets the most out of the system

Ganges Internationale delivers TowerXchange: Please reintroduce Ganges
Internationale for readers unfamiliar with your
company.
total tower solutions worldwide Nitin Goyal, Director, Ganges Internationale: We
Experienced tower manufacturer leverages proven manufacturing quality are from Chennai, India. We are manufacturers of
processes to supply over 45,000 towers to 25 countries telecom towers with over 45,000 towers supplied in
25 countries. Our products have a track record of
Ganges Internationale is an award winning being robust and high quality.
Indian tower manufacturer with a global
client base. Ganges takes a client-centric TowerXchange: What are Ganges
approach to offering total tower solutions: Internationale’s product and service offerings
from ground based and rooftop towers to beyond your core, renowned telecom tower
accessories and fencing. TowerXchange manufacturing business?
spoke to Ganges Director Nitin Goyal to
learn more about the company’s product Nitin Goyal, Director, Ganges Internationale:
range, manufacturing and logistics Our product portfolio broadly includes ground
processes, and how they see tower design based and rooftop towers, poles, RDS, canopies,
evolving in an era of infrastructure sharing. fences, equipment platforms as well as antenna
mounts. We also offer total tower solutions by
including accessories such as aviation lamps, fall
Keywords: Ganges Internationale,
arrestors, ground earthing kit, paints, et cetera.
Fencing, Who’s Who, Infrastructure
Sharing, Masts & Towers, Rooftop, Spare
TowerXchange: What is the balance of your
Nitin Goyal, Director, Ganges Internationale
Parts, Steelwork
business between domestic Indian customers
and international export?
Read this article to learn: Nitin Goyal, Director, Ganges Internationale: Our
< Ganges Internationale’s credentials and product range business ratio is around 70% domestic and 30%
< How Ganges have applied proven manufacturing quality processes to ensure products are export.
“100% Right First Time”
< How Ganges ensure they are able to expedite delivery to meet urgent orders TowerXchange: How have you applied
< Telecom structure and site design is evolving in the era of shared infrastructure proven manufacturing quality processes and
philosophies to ensure your products are “100%

Right First Time” (as recognised by an award
from Bharti Infratel)?
Nitin Goyal, Director, Ganges Internationale:

Our quality system is driven by an ERP process
whereby stage by stage clearance of production
has been made mandatory.
Our machinery, be it welding, CNC and the

galvanising plant itself are of state-of-the-art
technology and are imported from the best
globally. We have a professional and well trained
team to ensure smooth and efficient execution and
monitoring of quality systems.
TowerXchange: How are Ganges Internationale

able to meet urgent orders and ensure timely
delivery of your products?
Nitin Goyal, Director, Ganges Internationale: Our

geographical location near the sea port is in itself
a blessing for us to provide ease of delivery. We Nitin Goyal, Director, Ganges Internationale: Yes are partially SS, high tensile et cetera are also being
generally hold inventory of 100 towers, besides, we of course as in any other product, there has been a implemented for better quality and ease of erection.
have our in-house tube mill manufacturing unit constant demand to upgrade the design of telecom
and have a standardised MOU with our suppliers structures. We are constantly pushing our design to TowerXchange: What demand have you seen for
to ensure a quick lead time for raw material be in commensurate with the techno-commercial camouflage towers and other telecom structures
supply. demands that arise from market needs. to blend in with the urban environment?
TowerXchange: How have you seen telecom Ganges are constantly working on technological Nitin Goyal, Director, Ganges Internationale: We are
structure and site design evolve in the era innovations in our design. For instance, we have certainly observing demand for urban poles and
of shared infrastructure and with the need evolved from the angular to tubular design which camouflage towers and have already brought poles
for more, lighter towers for infill sites? And in total (including foundation costs) offers around into our manufacturing range. Camouflage is also
how has that been reflected in your product 25% savings. We are also coming up with lighter under our consideration to be introduced in due
development? and narrower base towers. Usage of material which course

The next generation of network TowerXchange: Please can you introduce Huawei
and their energy division.
and site level energy intelligence Wang Zhiwu, General Manager, Huawei Telecom
Energy: Huawei is the largest telecommunications
Huawei drives energy efficiency and eases the transition to hybrid systems company in the world with revenues of over
US$60bn last year. The network energy business is
Since entering the market 7 years ago, Huawei one of 7 huawei product lines, which is divided up
Telecom Energy has become the number into four units; telecom network energy, data centre
one supplier in the telecom energy industry. energy, solar power stations and secondary power
supply.
Investing over 10% of revenues into R&D,
the company is focussed on ensuring their
For the network energy division we have nine
products are at the cutting edge of technology,
energy centres; seven in China, one in Japan and
of the highest quality and future proofed to one in Germany. We employ over 2,000 energy
be ready for changing requirements in the engineers and 10% of our revenue we invest in
telecoms sector. TowerXchange speak to Wang R&D.
Zhiwu, General Manager of Huawei Telecom
Energy to learn more. Our energy division entered the
telecommunications field back in 2009 and since
Keywords: Air Conditioning, Batteries, China Tower Company, DG Runtime, Energy, Energy Efficiency, then we have become the number one supplier in
Energy Storage, Huawei, Hybrid Power, Monitoring & Management, O&M, On-Grid, Off-Grid, Operational the telecom energy industry in terms of market
Excellence, Opex Reduction, Rectifiers, Renewables, Site Level Profitability, Solar, Unreliable Grid, share (as highlighted in an independent study
conducted by Frost & Sullivan). We work in over 170
Uptime, Who’s Who
countries and so have an extensive footprint.
TowerXchange: As such a global organisation,

Read this article to learn: how have Huawei observed the switch to
< Attitudes towards renewables deployment globally renewable energy to power cell sites amongst the
< How Huawei’s product line is equipped to ease the transition to renewables when MNOs and towercos world’s MNOs and towercos? What rate do you
decide to make the switch see this trend progressing at?
< Strategies to tackle the high cost of energy associated with cooling
< How intelligence is being developed at both the network and site level to improve energy efficiency Wang Zhiwu, General Manager, Huawei Telecom
< What differentiates Huawei from its competitors Energy: In my opinion, renewable energy in the
MNO and towerco space is at a very early stage, only

“
an estimated 2% of sites have renewable energy as
a source of generation. This means that most sites
in poor grid areas are reliant on diesel generators
at present and there is a huge opportunity for
renewable energy as the costs come down. In some
countries, the cost of renewable energy generation All of our energy solutions have the ability to support all energy inputs, be
is approaching grid parity and so the business case it solar, wind, grid or any other source of generation. The system is ready
is becoming more compelling.
In addition, renewables offer a good backup option

even for grid connected sites, offering that level
of security in the event of grid failure. There are
to accept whichever generation technology and so when the time is right
for a company to make the switch to renewables, the integration will be as
seamless as possible
“
cases even in the UK where MNOs are looking at
renewable energy on their cell sites.
A further driver in the move towards renewable and so when the time is right for a company to as the next cheapest power generation source
energy is in the reduction of carbon emissions. In make the switch to renewables, the integration will before relying on the diesel generator. The ability
China and other developing countries where the be as seamless as possible. to move between different sources of generation
economy is growing rapidly, pollution is becoming automatically in order to ensure the lowest cost of
a major concern and so governments are investing Secondly there is a high degree of flexibility in our electricity is one of the key features of Huawei’s
heavily in renewable energy. In China, China Tower systems. Due to space constraints for example, not system.
Company has a portfolio of over one million sites all cell sites have a big enough footprint to handle
and have plans to deploy solar on a large scale in the size of the solar system that is required to power TowerXchange: Typically what proportion
line with objectives from the government. the site. Our power systems have the ability to of costs/ energy usage is attributed to air
support different power generation capacities and conditioning and what strategies are being
TowerXchange: How does Huawei’s solution so are suitable for all scenarios. deployed globally to bring this down?
support the use of renewable energy at cell sites?
Thirdly, we have intelligence built into our network Wang Zhiwu, General Manager, Huawei Telecom
Wang Zhiwu, General Manager, Huawei Telecom management systems and controllers which Energy: In the past five years I have travelled
Energy: The deployment of renewable energy on automatically can select the best power setting. For very widely and seen lots of different scenarios.
cell sites has stalled because of the costs but this will example, with hybrid sites, when the sun is shining In Saudi Arabia, for example, temperatures can
change. All of our energy solutions have the ability the controller will prioritise power generation rise to over 50°C in the daytime, in this instance
to support all energy inputs, be it solar, wind, grid from the solar panels as this is the cheapest form we found in our test lab that up to 40% of power
or any other source of generation. The system is of energy, when power is being generated from usage will be due to air conditioning to bring this
ready to accept whichever generation technology solar, the system will switch to grid (when available) temperature down.

Companies need to rethink their cooling strategies dependent on the temperature inside and outside tower owners. Huawei’s control system enables this
in order to control costs and we see three key ways the cabinet. automatic switching, ensuring that the cheapest
they can tackle this. source of energy is used be it solar, grid or diesel.
TowerXchange: How is energy being more
Firstly, MNOs and towercos need to assess and effectively controlled and managed at cell sites, TowerXchange: What makes Huawei stand out
reduce the susceptibility of equipment to high what intelligent solutions do you see being built from its competitors in the field?
temperatures. A lot of equipment can operate into systems and how has this evolved?
at temperatures up to 60°C, yet MNOs are still Wang Zhiwu, General Manager, Huawei Telecom
cooling it to 25°C; equipment that can withstand Wang Zhiwu, General Manager, Huawei Telecom Energy: There are three key areas where we feel
the higher temperatures should be kept in separate Energy: When we talk about intelligent solutions Huawei stands out from its competitors. Firstly, in
compartments to that which needs to be cooled and there are two levels; network level intelligence and the past seven years, over 10% of Huawei network
this will reduce the cooling requirements. site level intelligence. energy product line revenue has been invested
into energy R&D. This is a much larger investment
than any of our competitors and it ensures that
It is usually only the battery that exhibits strong At the network level I believe that in the future, all
our technologies are always at the cutting edge of
sensitivity to high temperatures and as such, we sites will be fully integrated into an energy network
research, bringing innovative solutions to improve
have been working for the past three years on management system which enables tower owners to
network efficiency.
how to increase the performance of batteries look at the bigger picture in terms of energy usage
at these extremes. In 2014 we launched a new on their networks. This is particularly important
The second area is in regards to quality. Huawei
high temperature battery that can operate at for towercos who have much higher power usage
have very strict processes in place to guarantee
temperatures up to 45°C. This means that the due to the presence of multiple tenants on their
that our products are manufactured to the highest
aircon system in the aforementioned case where sites. With a single tenant a site may use 5kW but as
standard. We have adopted systematic managed
temperatures reach 60°C, will only need to bring you add further tenants this could go up to 15kW.
processes, like the Integrated Product Development
the temperature down by 15°C rather than 35°C and With an energy management system, towercos can
(IPD) process learned from IBM, which helps control
this can equate to energy savings on a cell site of up spot weakness of their energy system, looking at our production processes and ensure that we are
to 30%. which province or which district within a province always reaching the highest quality levels.
has the highest power consumption. Having this
A second area that tower owners should consider is information, helps inform towerco decision making Finally, Huawei bring an understanding about
cooling on demand. Whilst aircon may be essential when it comes to investments and energy efficiency the telecoms sector that other energy equipment
in the height of summer, in winter or cooler improvements. providers simply do not have. The tower industry
evenings, a simple fan will provide the cooling has changed as towers have moved into the hands
required. Switching from aircon to a hybrid system When it comes to site level intelligence, the usage of independent towercos and with this new
will enable a reduction in power consumption of hybrid generation systems is at a very early energy requirements have been created. Huawei’s
used by cooling by as much as 20-35%. Huawei’s stage but intelligence built into the system that understanding of the telecoms sector allows us to
controller has the ability to intelligently switch enables switching between each generation source tailor our solutions to ensure that we stay aligned
between the two cooling systems automatically, automatically will bring considerable savings to with the future shape of the industry

Intelligent preparation and
TowerXchange: An increasing number of RMS
platforms, either as standalone systems or built
into different equipment on cells sites gives
use of data for more proactive towercos and operators a wealth of data with
which to monitor operations. Can you explain
network management some of the challenges that are presented to

tower owners and operators by this?
Infozech’s iTower suite tackles the huge volume of variable data being generated
Ankur Lal, Founder & CEO, Infozech: RMS systems
by diverse RMS systems
are increasingly being deployed by towercos and
MNOs with a view to increase site visibility. This
The multiplicity of RMS systems, coupled with communication need is especially large with new sites (where RMS
errors, presents a major challenge to MNOs and towercos comes built in) or retrofitting existing sites. In the
looking to obtain a “single source of truth” regarding their retrofit scenario, one emphasis is on gaining better
operations. TowerXchange speak to Infozech Founder and visibility of source of power and visibility of fuel
CEO, Ankur Lal to discuss how the company is working with consumption.
customers to better handle raw data and analyse it in a
structured way to equips MNO and towercos with the tools to Towercos believe that once they have the necessary
take action on their sites. RMS deployed, they will get authentic information
and achieve a single source of truth. On the ground
Keywords: Africa, Capex, Data Room, Energy, Energy there are multiple systems, some standalone and
others which are integrated. Due to multiplicity
Efficiency, Fuel Security, Infozech, Job Ticketing, Monitoring &
of systems and on the ground realities, often the
Management, NOC, O&M, Operational Excellence, QoS, RMS,
sought-after “single source of truth” through RMS
Ankur Lal, Founder & CEO, Infozech Site Level Profitability, SLA, Uptime, Who’s Who
deployments is not achieved.
Each RMS system produces data in its proprietary

Read this article to learn: protocol. There are multiple challenges being faced
< Challenges that towercos and MNOs face in obtaining a “single source of truth” from their RMS systems by the towercos with an increasing number of RMS
< How Infozech are working with customers to improve the handling of raw data including the use of platforms and collection of data from RMS.
“smoothing” and “fill-in” algorithms and data verification against the norm
< Key metrics Infozech recommend capturing to improve energy efficiency and cost savings The communication between site and server
< How Infozech’s iTower platform assists operators and towercos in capturing and analysing data in a consists of four steps:
structured way
1. RMS controller capture and relay: RMS controller

captures information at site and relays it. of the aforementioned reasons, ensuring you are alarm packets. If an alert is passed on every time
getting all the data is absolutely critical. such event occurs, the end user mailbox is flooded
2. SIM/ and mobile modem transfers information with messages and it becomes difficult for the user
from site While looking at this we also saw sites which were to handle. The Infozech itower (Tower Product
sending 155 packets or more a day – We found that suite) comes built in with “intelligent filtering” to
3. Mobile network establishes connectivity between some of the data is erroneous and did not provide assess if this event is due to malfunctioning at site,
site and server, a consistent trend, rather it led to confusion of the and sends only the relevant notifications to the user.
receiving system. We explained this phenomenon
4. Server: Set up to receive information from RMS as noise which was due to unpredictable events at 2. Fuel sensor calibration: Each site has different
controller and auto correct any transmission errors site or in transmission of data and as such it resulted types of fuel tanks (of all sizes and shapes) and
in us building sophisticated proprietary solutions there are multiple types of fuel sensors which can
In the event that any of the above four steps fail to parse the data in such a way that noise reduction be fitted. While some newer ones like Capacitive
to work, or do not work in tandem, the desired happens. maybe more reliable, others are less so. RMS
outcome of receiving data on server is not achieved. vendors need to calibrate the sensor with the
Whilst this seems simple and should always work, TowerXchange: Can you share the work that tank and the equipment to ensure the readings
in reality, due to multiple choices for each of the Infozech is doing to better prepare the raw data are accurate. In the event that a sensor or tank is
above, getting all of them to work reliably needs that is being received by towercos and MNOs on changed, recalibration is required.
focus and review. their sites? What further steps are required by
different stakeholders to assist in this? Besides recalibration we noticed that even the
TowerXchange: Please can you explain a case best of sensors have fluctuations due to external
where customers had experienced challenges in Ankur Lal, Founder & CEO, Infozech: The raw data temperature and other factors. At times, this
this area? packets being received by the server may contain fluctuation is so significant that it may cause the
alarm information, data value or both. Some of the receiving system to misinterpret the information;
Ankur Lal, Founder & CEO, Infozech: Our customer functionality which helps us in better handling of in case of fuel, such as a normal fluctuation may be
experienced a case where the RMS was configured raw data are: misinterpreted as theft or vice versa. Infozech has
to relay energy data every ten minutes, meaning developed a proprietary “Smoothing Algorithm”
six times an hour or 144 times a day, as such, the 1. Handling alarm fluctuations: Alarms are which helps normalise the data and show the
expected number of data packets for energy data configured for key events such as door open, low correct trends without fluctuations.
was 144 per day. When we looked at this analysis fuel, low voltage, fire et cetera. Some of them need
across sites we found a large number of sites doing immediate action while others are not so critical. 3. Missing data – correction: At times the data
this, however for over 30% of the sites, the number At times, the information received may not be fully may be missing in a data stream. Infozech has a
of data packets received was under 135 (i.e. they accurate, for instance an alarm fluctuation due to a mechanism to identify and highlight any missing
were not 95% compliant). When we delved further malfunctioning of a sensor or controller can result in data parameters in the raw packet. Infozech has
we realised that this was happening due to one the central server starting to receive a flood of these built proprietary algorithms to “fill-in” for missing

data depending on the type of data missing and the Infozech recommends the use of a standard sites with lesser load by managing one genset with
number of instances in which it is missing. This platform which can reconcile data from any proper battery cyclic operation
helps autocorrect a data stream. sources based on:
< Type of data (instantaneous value or cumulative 4. Periodic analysis of runtime distribution
4. Business rule: When raw data is received, it needs value) across the grid, battery and genset based on load
to be verified against permissible ranges and likely < Business rules applied on the data and battery capacity which can then lead to up
values. Infozech’s system validates every raw data Infozech’s platform has been precisely designed gradation if required.
packet and each value in the data packet against its to achieve this objective for towercos. Infozech 5. Maintenance results of battery (e.g. discharge
defined type and permissible value and filters out provides a platform where it reconciles data from test) periodically can suggest enhancement or
any garbage value from the system. It is possible to any source or platform. The system automatically replacement of battery bank.
configure multiple types of business rules to identify eliminates repetitive inflow of the same data,
data and depict business scenarios. selecting the best value and capturing it. Users 6. CPH establishment based on site category based
can then have an option to approve the best value on load, temperature, colocation and other known/
Based on these findings, towercos and the RMS based on their business requirement for future unknown factors. This can be then improved based
vendors should acknowledge and rectify these use. on a feedback from the system correcting variances
data discrepancies highlighted by the system in a between actual and theoretical values.
time bound activity; any loss of data packet due TowerXchange: With the number of parameters
to rejection of garbage values will lead to loss of that can be measured on a cell site being Infozech’s i-Analytics solution helps customers
information and indirectly hamper other day to day seemingly endless, what metrics do Infozech carry out such analysis easily and repeatedly
processes linked with those data values. think are particularly important for tower thus helping them take much more informed and
owners to measure that may not be widely optimal decisions.
TowerXchange: In the instance where there monitored currently?
are multiple images of the same data from the TowerXchange: Preparing the data into a
different systems, or where there is a gap in data, Ankur Lal, Founder & CEO, Infozech: Key things manageable format is the first step but turning
what are Infozech’s recommendations on how to which can be implemented as energy/cost saving data into intelligence that can be used by the
best manage this? measures include: client is key. Where are we today in being able to
consolidate and analyse all the different inputs
Ankur Lal, Founder & CEO, Infozech: The ultimate 1. Where there is high genset run hours, battery into real intelligence? How do Infozech see this
objective is to treat RMS data as a single source. backup hours should be monitored being built upon in the short, medium and long
However, the challenges enumerated above term?
while collecting and validating data leads to 2. Where there is high grid availability, generators
compromisation of the objective. This happens can be removed by enhancing the battery bank Ankur Lal, Founder & CEO, Infozech: “Improving
because towercos are collecting data from multiple Profitability through ‘Discipline of Action”
sources. 3. Second (spare) gensets can be removed from (TowerXchange Issue 17, August 2016), focuses

on how to assist customers take action. Taking Ankur Lal, Founder & CEO, Infozech: Infozech
action is often associated with higher risk or has been working with one of our clients to help
effort. Infozech’s iTower platform assists operators them to get more value from the data which they
capture and analyse information is a structured receive from RMS systems for cross functional
Meetup
way. consumption.
Once actions are taken, they are fed back in the
system for further assessment of the quality of One of the challenge faced by the client was the
action. This helps assess action effectiveness.
The analysis provides trends which can indicate
ability to obtain accurate and complete data
for energy billing from the RMS system. Major
Europe 2017
short, medium and long term actions. One area challenges included:
which Infozech has started engaging in, is the 4-5 April, Business Design
optimal mix of capex – opex. Often a large number 1. Missing /Garbage data packets Centre, London
of capex measures, such as long lasting batteries,
need effective systems which can monitor and 2. Incomplete data packets
measure energy spend and battery life over
multiple years to determine: Incomplete data packets: The Infozech System
derives the possible value based on trends in the
1. Whether the initiative itself was right (i.e. historic data. There are sites where the data is not
switching to long lasting batteries), or was it available for the complete month, for instance,
fraught with failures, site downtime issues or energy billing cannot be done for site where data
difficulty in maintenance. is only available for 25 days. In such scenarios of
incomplete data, Infozech help in determining those
2. In case the initiative was a success which battery values based on Infozech’s proprietary algorithm
provider gave the best service – in which case “Fill in”.
was the yield the most – this may not have been
in the lowest cost one. In absence of such analysis After applying the above functionality, the customer
companies lean towards the lowest cost alternative is now able to bill the sites accurately based on the
which at times could even be the highest cost one. RMS data.
TowerXchange: Can you share some examples We have also been providing solutions where data
A unique networking opportunity with 200 leaders of the
where Infozech has worked with a client to get has been missing for 15 days or there is no data for
European telecom and broadcast tower industry
more out of the data that they are generating? the month. These functionalities can be reapplied to
What improved efficiencies, cost savings or fuel sensor data, genset run hours and other data www.towerxchange.com/meetups/meetup-europe
timelines has this afforded the client? sets

IPT Powertech on what it takes to TowerXchange: Please share an update on
some of your latest offerings, projects and
developments since we last spoke.
offer guaranteed savings and T-ESCO
Khaled Habbal, VP & COO, IPT Powertech: This was
Khaled Habbal discusses how a talented workforce, commitment to local communities an exceptional year across all our geographies,
and twenty years of experience combine to deliver guaranteed 30% opex reduction including Africa, Middle East and Asia. We engaged
in two large projects for IHS in Nigeria, supplying
Over the last twenty years IPT energy efficient power solutions including
PowerTech’s business model has management and long-term maintenance, and
evolved as fast as their business has OPEX optimization exercise under a long-term
expanded geographically, and kept contract. We also signed a long-term contract with
up with all of the latest technical and Ooredoo in Myanmar, providing managed services
business model developments in power for the power of their entire network.
provision for telecoms infrastructure.
We recently spoke with Khaled Habbal, With offices in 11 countries, we serve top clients in
VP & COO of IPT Powertech to hear the region, and it is with the dedication of our 2,500
about their continued expansion into experts that our portfolio encompasses thousands
new markets, and their continued of implemented projects, delivered to more than 60
investments into their workforce operators in more than 50 countries such as Ghana,
and commitment to community Nigeria, Niger, Sierra Leone Algeria, Morocco, Iraq,
Khaled Habbal, VP & COO, IPT Powertech
engagement.
Jordan, Afghanistan and many more.
Keywords: Afghanistan, Africa, Algeria, Asia, Batteries, DGs, ESCO, Ghana, Hybrid Power, IHS, IPT While we have an operational presence in 11
Powertech, Investment, Managed Services, Myanmar, Nigeria, O&M, Off-Grid, Ooredoo, Opex Reduction, countries in the MEA, Africa and South East Asia,
R&D, Solar, Who’s Who we also have our own manufacturing facilities in
Romania and Lebanon.
Read this article to learn: TowerXchange: How is the evolution of ‘energy

< IPT Powertech’s latest successes in Myanmar and Nigeria as a service’ business models progressing in
< The evolution of the energy as a service model developing markets?
< The importance of acquiring local talent and community engagement
< IPT Powertech’s vision for global expansion Khaled Habbal, VP & COO, IPT Powertech: The
energy as a service business model is a very

interesting one. Some markets have stable, TowerXchange: Could you give us an update on transferring knowledge whereby we ensure they
widely available grid access, such as Europe, your activities in Myanmar? How are things are empowered with knowledge and experience to
North America, the Gulf region and many parts changing on the ground and what impact do you be leaders of the local organisation in the future.
of Asia and Australia. In these markets telecom expect the arrival of the fourth operator to have?
infrastructure has 99% grid connectivity and On the other hand, our group is keen on putting
there are only battery backups which are rarely Khaled Habbal, VP & COO, IPT Powertech: We CSR (corporate social responsibility) initiatives
used; there isn’t much change in these areas in established our business there 18 months ago, just at the heart of its business strategy within the
terms of energy requirements. before signing our first contract with Ooredoo. community by helping the local authorities
during the monsoon season, contributing to local
In markets like Myanmar, West Africa, Central Myanmar has interesting potential for the future, communities including material and financial
Africa, East Africa and Lebanon and others, and our growth there is stimulated by this investments.
grid stability is still a major challenge due to region’s need for energy-efficient products and
the quality of the grid and is undergoing a big infrastructure services coupled with managed Since more than 70% of sites in Myanmar are
evolution. Initially the majority of sites had services and a guaranteed savings model /T-ESCO, off grid, generators are used, creating noise
two generators, and would run 24 hours a day adapted to the local market’s requirements. and air pollution which are disturbing to local
in six hour shifts, requiring considerable focus communities. Since we are conscious about this
on maintenance, extremely high level diesel The overall performance of the network has environmental challenge, we are investing in our
consumption leading to high costs. Over the past progressed tremendously, reaching more than 99% solutions and maintenance cycles to ensure optimal
few years, the price of diesel has increased a over the past period, by providing tailor-made, reduction in generator runtime, making sites
great deal, along with pressure to comply with reliable, energy efficient hybrid and renewable more efficient in terms of cost, pollution and noise
carbon emissions standards. This has led to the energy solutions for more than 3,000 sites for reduction. We are working closely with operators
introduction of batteries and hybrid systems to Ooredoo Myanmar coupled with rollout services, and tower companies to provide power co-location
save on opex and reduce carbon footprints. Solar operation and maintenance, fueling services, power wherever possible to reduce CO2 emissions; instead
power is playing an increasing role in markets management and power sharing, all while reducing of two to three generators per tower, power co-
such as West Africa and the Middle East. DC carbon emission and being environmentally location enables the allocation of the optimal
generators, operating under variable speeds, conscious. number of generators on each site given the power
solar panels, and different battery technologies needs of each operator.
have all been combined to reduce runtime and We have established offices across Myanmar, with
make systems more cost-efficient and more more than 280 professionals who joined our team. As for the arrival of the forth operator, we are still
environmentally friendly. The most important We are very keen not only on recruiting top notch in primary stage of the discussion. We are keen
element in this evolution is the provision of people, but a lot of the best local talent. More than on proposing eco-friendly power solutions to all
proper, timely and professional maintenance 85% of our Myanmar team members are locals, existent operators by suggesting a new concept:
services to achieve a cost-efficient and optimal and we are planning to increase this to 99% over power co-location, mentioned above. This concept
Total Cost of Ownership (TCO). the next two years. We are recruiting locals and focuses on sharing the same power solutions and

infrastructure between the operators, guaranteeing maintenance, and a pioneer in combining our
reduced capex and opex, while ensuring optimal product R&D to our assembly facilities, has made
TCO. IPT Powertech Group well positioned to become
a leader in the implementation of the guaranteed
TowerXchange: And what can you tell us about savings model in Nigeria.
the project in Nigeria?
TowerXchange: Do you have any upcoming plans
Khaled Habbal, VP & COO, IPT Powertech: Given IHS for expansion of your footprint? Meetup Europe 2017
Nigeria’s size as the largest tower company in Africa,
4-5 April, London
we are working closely with the group in Nigeria and Khaled Habbal, VP & COO, IPT Powertech: Our
other African countries. presence in Myanmar and our success in the
relatively short period of 18 months made us keen
We are engaged in Nigeria with IHS on the largest on expanding further in Asia. IPT PowerTech’s team Meetup Americas
guaranteed savings project across the African is always seeking new challenges where we can
continent. We are proud to be the one of the largest recreate new power solutions and add advanced 2017
suppliers of power efficient solutions and one of the features to our wide portfolio, and redefine new
main contractors ensuring the guaranteed savings added services to guarantee optimal performance
model. at lower cost possible in addition to adding value to
our customers.
The guaranteed savings model is a combination of Meetup Africa
the design, manufacturing, supply and deployment As for the geographic footprint, we are always
of energy efficient solutions along with field looking forward to expand geographically into new & ME 2017
maintenance service and continuous opex and capex territories as long as that growth is aligned with
optimisation. The guaranteed savings model is a risk- our strategic direction of the business and makes
free approach ensuring the operators and towercos us able to expand and build our unique strength of
full economisation/savings while maximising combining the power expertise in telecom, service
the lifetime of the equipment. We guarantee the expertise in telecom and managed service expertise Meetup Asia 2017
performance and savings of our own solutions while to deliver significant cost savings for our customers
respecting the contractual KPIs and SLAs. across the world. 12-13 December, Singapore
The fact that our group is the only solution Finally, our appetite for expansion and growth is
provider in the region offering and merging hybrid driven by the hard work of our 2,500 specialists,
and renewable energy solutions with telecom the reason behind the strength, success and www.towerxchange.com
infrastructure and field managed services and differentiation of the group

Jabil Inala launch a new site
TowerXchange: Since we last spoke, certain
assets of Inala have been acquired by Jabil, a
Fortune 200 NYSE listed company. Please can you
monitoring and analytics platform introduce readers to Jabil Inala and the scope of
the products and services that it now offers.
Developments in miniaturisation, ease of programming and intelligent analysis
Howard Earley, Managing Director, Jabil Inala:
Inala had been operating for the past 19 years in
Jabil Inala are launching a new site monitoring and
various industries including telecommunications.
analytics platform with major improvements in both
It had a number of product offerings, the most
the hardware and software which will take over from
important of which being its remote monitoring
their existing SAM product line. The new platform
and hybrid management system, SAM (Site
will incorporate Telemisis’ SiteNode controller and
Asset Management). Inala had a long history of
a new web-based analytics platform developed with
developing the product, bringing it to market and
South African software provider, IMQS. We speak to
ensuring that it was fully operational.
Jabil Inala’s Managing Director, Howard Earley and
learn about the brand new product line and some of
There are currently more than 30,000 active SAM
its most exciting features.
units in the field, monitoring sites for towercos
and GSM operators predominantly on the African
Keywords: Africa, Data Room, Energy, Energy continent, but also in South East Asia and other
Efficiency, Jabil Inala, Monitoring & Management, parts of the world.
NOC, O&M, On-Grid, Off-Grid, Operational
Excellence, Opex Reduction, RMS, Site Level Jabil, a Fortune 200 product solutions and
Profitability, Site Management System, SLA, electronics manufacturing services company,
Howard Earley, Managing Director, Jabil Inala Telemisis, Uptime, Who’s Who acquired key assets of Inala to establish Jabil Inala
after it evaluated a number of companies in the
region and sector. Its decision was in part due
Read this article to learn: to the telecom assets Inala had in place and also
< The five focus areas of Jabil Inala’s business because of Inala’s African team and strong client
< How Telemisis’ SiteNode controller will be incorporated into Jabil Inala’s new monitoring platform relationships.
< Details of Jabil Inala’s new web-based site analytics platform and its ability to recognise trends
across a network The deal went ahead and on the 5th November
< The principal improvements on Jabil Inala’s existing SAM platform 2015 we became Jabil Inala. We are focused on the
< How the new product line will affect existing customers and how extensively tested it has been energy sector, predominantly telecoms, because
that’s where we come from.

“
Jabil Inala is an energy solutions business, we are
technology agnostic, we are customer focused and
consult, design and deliver energy solutions to our
customers. As a business, Jabil Inala is focused
on five main areas. The first is generation; we
offer energy generation products, predominantly The Telemisis controller is miniaturised, easy to install and program.
solar and fuel cells, but extend beyond renewable
energy products to source and supply other
generation solutions.
The second business area we focus on is storage.

The controller occupies a third of the space, which gives us more
flexibility. The system is configurable without having to open the unit
allowing for much easier operation
“
We offer solutions from basic lead-acid batteries
to lithium-ion and flow batteries as well as new
technologies which are continuously reducing in
cost. We sell storage from tens of kWh capacity, A fourth business area is energy efficiency formally announced at this year’s TowerXchange
which are ideal for the telecoms market, through solutions. These solutions are focussed on reducing Meetup Africa & Middle East; can you explain
to larger units which have capacities of several energy consumption by using energy more details of the partnership and the benefits that it
MWh which are ideal for grid storage. efficiently. Customers are generally large energy will bring?
consumers and vary from large industrial power
The third aspect we focus on is monitoring. As you users to hospitality, healthcare and even health Howard Earley, Managing Director, Jabil Inala:
know, in the past we had the SAM controller, a clubs. Whilst Inala’s SAM controller had been around for a
unit that could take multiple supported peripheral number of years and continues to be deployed with
devices inputs and alarm inputs and feed them The fifth area is data analytics; whilst analytics customers, there were certain areas where it was
back to the Network Operations Centre. There will be part of the new Inala site monitoring and clear it could be improved. We realised that to stay
were various methods through which these analytics platform we also offer this as a separate ahead we needed to invest in new technology. As
inputs were fed back, initially this was via SMS service, enabling businesses to analyse their energy such we’ve joined forces with Telemisis, a venture
and then it became more sophisticated as the usage. There is a lot of talk at the moment about which we’re very excited about. The venture will
bearer networks evolved from GPRS to 2G, 3G “big data”, but not only do you need someone to see Jabil Inala incorporating Telemisis’ SiteNode
and now LTE. Of course we can also communicate collect that data and harvest it, it is even more controller, an ultra-low-power remote telemetry
directly through any IP link available, whether it is important for someone to analyse it and give node into the Inala site monitoring platform. The
satellite IP or an IP router. We’re now taking this management comprehensive reports on which they Telemisis controller is miniaturised, easy to install
to a higher level with the launch of the Inala site can base key decisions. and program. The controller occupies a third of the
monitoring and analytics platform in conjunction space, which gives us more flexibility. The system
with Telemisis - something that I will return to TowerXchange: You mentioned a new is configurable without having to open the unit
later. partnership with Telemisis which is being allowing for much easier operation.

in conjunction with IMQS, a large South African processing to give a current view and also to predict
“
software company out of the EOH stable. future trends.
The system has a much improved graphical
interface and has intelligence built into it, analysing Again, what I want to stress is that our software
the information and allowing you to work in a more suite is vendor agnostic. Whilst of course, we would
proactive than reactive manner. like to sell the complete Inala site monitoring &
analytics platform, if you have an operator with
Whilst we have always been able to produce other equipment out there, our software suite
A significant advance in the customised reports, we now have additional can harvest the data from that equipment and
capabilities of our software is intelligence built into it, allowing clients to from other third party sources. It isn’t just other
customise reports based on their own operating Remote Management Systems (RMS), but also the
that it has evolved from being style and therefore be better equipped to address gensets, inverters and battery management systems
a reporting tool over to a problems before they become service affecting. that have their own intelligence and reporting
equipment which can feed into the system. A huge
system with the capability of The Inala Site analytics platform can, for example, amount of data points are generated by these
recognising trends allowing compare the efficiencies of different diesel different devices, many of which add little to the
clients to rectify issues at

their root cause
“ generators being used across a network, informing
the client which are costing them more. It can also
identify areas where you have fuel theft issues,
providing the hard data to back up the findings.
crucial metrics an operator requires, but our system
will have the intelligence to determine which pieces
of intelligence are important and adapt this as the
monitoring requirements of the operator change.
A significant advance in the capabilities of our TowerXchange: Have different monitoring and
software is that it has evolved from being a energy equipment providers been receptive to
reporting tool over to a system with the capability of integrating their systems with Jabil Inala’s?
recognising trends allowing clients to rectify issues
The Telemisis controller is in integral part of the at their root cause. Howard Earley, Managing Director, Jabil Inala:
Inala Site monitoring platform, adding further Generally, the companies we work with see our
levels of processing power to our capabilities. It has an advanced on site controller, not only system as a useful tool which enables them to
capable of gathering information but also capable obtain data for their own purposes. There is very
TowerXchange: How have things evolved on the of locally analysing the data to perform necessary little equipment out there that we have not been
software side of the business? client configured controls, such as automated able to interface with and obtain data from. There
stopping and starting of generators. The operator will always be some companies who are reluctant to
Howard Earley, Managing Director, Jabil Inala: To always has the ability to remotely override the share information on their equipment performance
complement our hardware platform, Jabil Inala has control when necessary. All data is passed onto the and in this instance we would attempt to bring a
also developed a web-based site analytics platform analytics platform for storage and further advanced win-win outcome for all parties involved.

When we read the information generated by mitigate risk and identify root causes, ultimately
different technologies, we want to ensure that improving operational efficiencies as well as
the information we are obtaining is accurate. reducing costs. Towercos have very strict SLAs in
Sometimes one company’s interpretation may be place, and we need to help them meet these SLAs,
Meetup
slightly different from another’s and so we need to improving site uptime through acting in more of a
ensure that this is standardised in order to develop proactive manner.
useful analysis.
TowerXchange: What is Jabil Inala’s proposition

TowerXchange: Whilst Jabil Inala are launching
the Inala Site monitoring and analytics platform
Americas 2017
in terms of helping towercos and MNOs analyse and partnership with Telemisis at this year’s
their data? Meetup, how proven is the solution in the field 7-8 June, Boca Raton Resort
and how does this affect existing customers?
Howard Earley, Managing Director, Jabil Inala: We
and Club, Boca Raton
very much support the MNOs and towercos in using Howard Earley, Managing Director, Jabil Inala: A
the system, be it training their NOC operators or lot of the monitoring and analysis as mentioned
providing our own NOC operators who work with previously has been done over a number of years in
them. We are known for our ongoing support and multiple networks, with 30,000 systems deployed.
commitment to our customers, it is a long term This experience combined with that of Telemisis
working relationship. is now contributing towards this new platform
solution.
Over the longer term we want to help our clients
reduce their overall CAPEX and OPEX, being We have been working with a number of clients
able to make recommendations, for example, on who have been happy to work with us as our test
maintenance schedules or technology upgrades bed, giving us substantial field testing for our new
which will ultimately save them money. We cannot platform. Through this process, the MNOs have
of course provide insights into solutions that other offered a number of suggestions which we have
clients are using but we can suggest that there may taken on board to adapt and improve the system.
be a better option they need to consider.
We have one new customer who is going to be the
We also want to ensure that the system has an first to receive the entire new system, completely
excellent uptime. One of the biggest concerns raised from end to end. We have a migration plan for those
A unique networking opportunity with 250 leaders
about RMS solutions in the market, on both the clients wanting to migrate to the new system. There of the CALA telecom tower industry
hardware and software side, is that the systems are a handful of customers who are very happy
are not communicating back to the operators NOC, with the existing equipment and for these we will www.towerxchange.com/meetups/meetup-americas
we want to avoid this. We work with operators to continue to support them

LockedUp: Combining advanced TowerXchange: Please introduce your company
and tell us about your background.
security software with custom made David Coode, CEO, LockedUp: We’re a three
hardware year-old Canadian company providing secure

distributed access solutions, born out of the ashes
An innovative approach to tower security of Blackberry. The founder of the company is also
our CTO, and he worked on Blackberry’s wireless
Security continues to be a major technical team. The security technology that
challenge for businesses in every Blackberry is famous for is the same that we use to
sector, especially when valuable manage remote locks which can be accessed using
equipment out in the field is at risk
smart phones.
of theft or vandalism. No security
measure is 100% reliable, and
Towercos have been among our first clients, and
electronic solutions present some
we have been operating with telecoms companies
risk of being vulnerable to hacking.
in LatAm which is helping us learn the niche and
Many towercos are striving to
eliminate the need for physical local needs of the companies there and the value
keys that can be copied, and to that the solution brings. Our clients had towers that
combine advanced electronic were being vandalised and robbed quite frequently,
security measures with sturdy and they were happy with the ROI of our solution
doors, gates and locks. We recently as it is a fraction of the cost of vandalized tower
spoke to David Coode, CEO of equipment.
Keywords: Who’s Who, Access Control, LockedUp, NOC, RMS, LockedUp, an exciting new security
Data Room solution provider that traces its My background is in medical electronics. I spent
roots back to Blackberry. over a decade at ON Semiconductor, the tenth
largest semi company in the world, focussing on
Read this article to learn: electronic solutions at board and system level. The
< The benefits of providing site access through a mobile API medical electronics industry is highly regulated
< Creating a custom-built physical security solution for each site and requires very high reliability and security. The
< Tracking site access through an online NOC skills learned there translate well into industrial
< The importance of putting electronic security first electronics. I understand how different it is to work
in high-reliability industrial electronics; the entire

approach to business is different from consumer TowerXchange: What differentiates your product often sell through integrators who do the ironwork.
electronics. from others on the market? We charge per site and per installation, and there
is usually no fee up front. Again, our clients are
TowerXchange: Tell us about your solution and David Coode, CEO, LockedUp: Most of happy since the cost of the solution is a fraction
some applications in the field. our competitors in LatAm are selling a complete of the cost of a site, or potential theft of copper,
locking cylinder or a specific type of hardware. batteries, electronic equipment and damage that
David Coode, CEO, LockedUp: The solution has three They’re basically lock companies selling hardware can be done to a site. We can provide security for
components; we provide a cloud-based Network with an added electronic component. We’re selling access to whole site or it can be on specific specific
Operations Center (NOC), electronic controllers an electronic solution based on many layers of cabinets with equipment. Towers are often a shared
and smartphone apps that provide access. Keys are abstraction, that provides data capture and is access space so customers often use our solution on
provisioned to end-user smart phones via the NOC, usable out of mobile coverage. We then work just their cabinet or rack and it can sit inside other
then used via a secure Bluetooth protocol encrypted with integrators and installers to create different locking systems.
security certificates unlock the mechanism in the mechanisms tailored to a client’s physical needs
lock. The keys can be programmed at the NOC to from a security perspective and based on the size
TowerXchange: How can data from access
expire, and the locks keep a log of every use, letting and layout of their facility. It works with cabinets,
control systems be integrated with maintenance
clients know who has entered and at what time. doors, and gates, which can all be connected to the
workflows and job ticketing to reduce O&M
This makes it much more difficult for contractors same system. We sell a powerful security technology
costs?
to pull off inside jobs as all movements are tracked that can be integrated with any physical lock.
and linked with a smartphone. We also integrated
David Coode, CEO, LockedUp: A big strength of
some electronic and hardware features on the locks We work with partners to do custom ironwork; as
smart locks is the simplicity of contractors not
to keep people from getting locked out. an example for a cabinet they would install a three
having to go pick up a physical key, and in addition
foot angle bar which would take ten minutes with
it’s risky when multiple people hold keys to the site;
The main feature is the security software behind a grinder to get through. We work to integrate our
there’s always a risk associated with this. On our
the mechanism, which is so important in this era. technology into existing small locking mechanisms
There was a competition at this year’s DEF CON like drop bolts and swing locks. Our premium system the keys sent out to the end users’ mobile
conference in which hackers were given fifteen solution for towercos is a small black box with sis 72 phones are typically active for a couple of hours,
minutes to open sixteen smart locks. When the time volt high-power lock actuators and sensors built-in and data logs are maintained to see who’s been in,
was up, twelve out of the sixteen locks had been to detect unauthorised access. and for how long. Our clients have access to this
compromised. We did an analysis of the methods data through the NOC and can use it as they need
that were used to hack the locks, and we’re happy to TowerXchange: What is the typical capital outlay to to improve efficiency. It also gives updates on the
say that ours would have been invulnerable to any per site to install your solution? location of the lock and sends alerts if a door or lock
of the attacks used. To date none of our locks have are open when they shouldn’t be and someone has
been hacked successfully, but that’s not to say that it David Coode, CEO, LockedUp: This varies a lot gained unauthorised access. Sometimes a door isn’t
hasn’t been attempted. because our solutions are often customised and we closed properly or something makes it jam, but the

clients and the NOC staff will be alerted.
TowerXchange: What else can you tell us about

your NOC?
David Coode, CEO, LockedUp: We operate a NOC

that supports all of our clients, with back-end
technology and servers running for our global
customer base. NOC support is optional with our
solution and clients can manage site security
in-house, but most of our clients prefer having
security experts like LockedUp managing and
maintaining the service. The portal that they
access the NOC through can be customised
and branded or re-skinned. The NOC is a cloud
management service and clients that access it
always have the most up-to-date version.
TowerXchange: Please sum up how you

would differentiate your solution from your

competitors’?
David Coode, CEO, LockedUp: Our company is

about technical leadership and our goal is bringing < A comprehensive archive of TowerXchange’s
< Access to the “Internet of People” in the global tower
industrial apps up to date and bringing the latest industry – a trust web of over 35,000 decision makers interviews and analyses, searchable by topic, country,
technology to bear on the challenges being faced in telecom and broadcast infrastructure company or grouped by category (e.g. interviews or
how to guides)
by our clients. We deliver the best in security,
features and ease-of-use to any lock. We are not a
prospects for tower transactions in selected countries < The latest news and registration information about
lock company who is adding electronics to extend TowerXchange’s Meetups.
a traditional product line. Over the next six to < The latest industry emerging market tower industry
twelve months we will push the edge even further
and will stay ahead of the curve based on this
technology, which is the core of our business

How to develop and retain
TowerXchange: Please can you introduce NETIS,
their size, geographic footprint and track record in
the telecoms sector.
a highly skilled workforce Sean Alborough, CEO, NETIS: NETIS is a service and
Combining a strong skills base with excellence in standardisation, customisation infrastructure provider for the telecom industry
in Africa which was founded in 2009. With its
and community relations headquarters in Abidjan, NETIS operates permanently
in 7 countries namely; Ghana, Côte d’Ivoire, Burkina
Faso, Bénin, Kenya, Uganda and Tanzania. NETIS
Keywords: Africa, Bénin,
has 4,555 sites under passive and active maintenance
Burkina Faso, Capacity
management in five countries for the main African
Enhancements, Change towercos, these being for IHS, Eaton Towers, Helios
Management, Co-locations, Towers and American Tower. Our branch in Côte
Côte d’Ivoire, East Africa, d’Ivoire also has a tower manufacturing facility from
Energy, Ghana, Kenya, which we are able to supply our customers with all
KPIs, Managed Services, their monopole and other tower items.
Monitoring & Management,

Hundreds of sites and power solutions have been
Multi-Country Partner, NETIS,
built and deployed all over the African networks and
O&M, Operational Excellence, NETIS has built strong partnerships with vendors
Opex Reduction, QoS, Site specialised in power solutions, RMS, RDUs, COWs and
Level Profitability, Site other areas.
Surveys, Skilled Workforces,
SLA, Tanzania, Uganda, West TowerXchange: In our previous interview with
Africa, Who’s Who NETIS we spoke about investment unlocked in site
Sean Alborough, CEO, NETIS
upgrades following transactions between MNOs
and towers. With much of the emergency upgrade
work being done on sites that have been acquired
Read this article to learn: a few years ago, what trends do you see in order to
< The varying appetites of different towercos and MNOs to upgrade sites to different levels enhance the performance of integrated sites?
< How to balance standardisation and customisation in site works
< Strategies for training and retaining a skilled workforce Sean Alborough, CEO, NETIS: The situation and the
< How to effectively engage local communities surrounding cell sites strategies vary from one towerco to the other. Some
< What differentiates NETIS from its competitors are very keen to upgrade sites to state of the art
level whilst others prefer to refurbish to a minimum

acceptable level in order to just meet a functional temptation to standardise the designs and the have strong human resource management to create
level. works in order to minimise the costs. This often leads the sense of belonging and ownership towards the
to mistakes which not only do not minimise costs company. This is a long and ongoing process.
We have seen the same trend within the same but actually increase them beyond the set budgets.
tower companies, depending on the available Therefore it is necessary to have a hybrid approach TowerXchange: Management of community
budgets and the financial situations. Generally with standard designs being tailored to individual relations is critical in ensuring that sites are
speaking, there is no doubt that after handover to sites. It might appear contradictory at first sight built in a timely manner and are able to be well
the towercos the general condition of the sites have but it is not. To implement this model, we look for maintained - what experiences can NETIS share
remarkably improved in terms of performance. This and deploy well trained and competent staff in the with us on this front?
is thanks to upgrades relating to power solutions field. Staff trained to respect and strictly implement
(including hybrid systems and genset upgrades and the standards but also capable of analysing every Sean Alborough, CEO, NETIS: One of the major
replacement), tower refurbishment and other factors. single site and deciding if it requires a particular challenges in the industry is managing the noise
action and/or set up. In doing so, we aim to avoid pollution, especially with sites that are in small
TowerXchange: In some countries in sub-Saharan mistakes and multiple site visits thus controlling rural villages where the grid is not reliable. NETIS
Africa, we have seen operators starting to function costs. In addition, supervision remains a key factor. has to work closely with the community to not only
more like towercos, actively pursuing co-locations. ensure that the site is accepted but that the site is
Have NETIS observed any changing trends in how TowerXchange: Finding, training and retaining well maintained and that generator runtime is at a
well maintained and highly specified operator a skilled workforce has been cited as one of the minimum. Secondly, a cell site has become an “ATM”
owned sites are? biggest challenges in carrying out civil work and to criminals as diesel fuel and batteries are easily
O&M in Sub-Saharan Africa, how does NETIS accessible making them prone to theft. Engaging
Sean Alborough, CEO, NETIS: From what we could address this challenge? with the local community in terms of having a
observe, when an operator enters into a co-location caretaker guard responsible for the site has reduced
program, the commercial aspects are predominant. Sean Alborough, CEO, NETIS: Situations vary from some of the theft. NETIS plans to set up community
We do not really see a will to improve the site one country to another. Some countries have more security forums to eradicate theft on a bigger scale.
efficiency. advanced education systems than others, thus internal
training is not so strongly required. In these countries TowerXchange: What is NETIS’ niche over some
TowerXchange: To what extent can structural it is easier to find skilled personnel available and of the larger players offering managed services
works be standardised across a portfolio of sites in as such, these regions are less problematic. In some in the market and what differentiates it from its
order to control costs and increase the efficiency countries it is indeed very difficult to find experienced competitors?
of works? How do NETIS balance the need to tailor technicians and consequently the operation cost
works for specific locations versus standardising is higher because of the need of ongoing internal Sean Alborough, CEO, NETIS: NETIS has achieved
works to improve efficiency? training to build in-house competence. At the same a first in Ghana where a towerco has placed all its
time it is necessary to have higher salaries in order sites under the maintenance of a single partner, that
Sean Alborough, CEO, NETIS: We believe that to retain the staff and prevent poaching from the partner being NETIS. This was due to the following
each site must be treated as an individual site. In competition or any other industry. In parallel and in strategies which placed NETIS above its competitors
large deployment projects, there is usually a great order to minimise the cost inflation it is important to in the region:

< Structure: Operational support structures
were developed which enabled the operation and
maintenance staff to concentrate on their core
business.
< Ownership: Instilled a sense of ownership in all
NETIS O&M staff by means of improving working
conditions, valuing our staff and creation of a NETIS
brand in all that we do. This means the teams do more
than just maintenance and it has created healthy
Meetup Meet up
Europe 2017
competition between the teams.
< Operational support: NETIS’ strategy in terms of
support has been a priority and forward support to
Americas 2017
operations was created by developing regional offices
with Logistics Officers, Administrators, SHERQ Officers 4-5 April, 7-8 June,
and warehouses in each region. This gives the field London Boca Raton
teams the time to concentrate on their core business
(operations) whilst the support from the back office is
maintained 24/7 (which is controlled by the head office)
< Process driven: Processes were developed for all
activities in O&M and implemented with the key of
improving and maintaining operational support at all
times.
< Real-time reporting: All activity is reported in real
time, utilising software developed and media platforms
available. & ME 2017 2017
< Training and development: The NETIS HR
department developed programs to ensure the NETIS 3-4 October, 12-13 December,
staff are well equipped for the task and we have a
working succession program. Johannesburg Singapore
< Quality: QA officers are deployed in each region to
ensure the highest quality of work is maintained during
PM and CM.
< Teamwork: From management to field engineers,
all NETIS staff are fully involved with the company’s www.towerxchange.com
daily activities; SLA performance and continuous
improvement in the workplace is visible

Perkins’ extend the product
TowerXchange: Please can you introduce
Perkins, including the role it plays in
telecommunications infrastructure?
range and service interval of their Richard Hemmings, Business Development
400 Series range Manager, Electric Power, Perkins: Perkins is one

of the world’s leading suppliers of off-highway
The diesel and gas engine supplier enhances its solutions for the telecoms sector diesel and gas engines in the 8 – 2000 kW market.
Trusted by more than 1,000 leading manufacturers
in the electrical power generation, industrial,
Perkins are a leading supplier in diesel and gas
construction, agricultural and materials handling
engines. Powering the telecoms sector through
markets, Perkins tailors its engines precisely to
their 400 Series range, Perkins have recently meet customers’ requirements.
added two new variable speed models meaning
the company can now offer fixed speed and For many years Perkins has supported the telecoms
variable speed engines from 0.5 litres to 2.2 sector, as our 400 Series range of compact and
litres, meeting all the key power nodes between reliable engines are particularly suited to powering
5-40 kVA. Extending service intervals and small generator sets, often sited in harsh and
introducing new hybrid solutions, Perkins are remote environments.
helping MNOs meet the increasing financial and
environmental pressures they are facing. TowerXchange: How proven is Perkins’ solution
in the field, who is using it and what results have
Keywords: DG Runtime, Energy, Hybrid Power, been achieved? And how has the system been
O&M, Off-Grid, On-Grid, Opex Reduction, designed to minimise the number of site visits
Perkins, Renewables, Solar, Unreliable Grid, and amount of maintenance required?
Richard Hemmings, Business Development
Manager, Electric Power, Perkins
Uptime, Who’s Who
Manager, Electric Power, Perkins: With the
introduction of two new variable speed models
Read this article to learn: added to our 400 Series, 1.5 litre and 2.2 litre, and
< Perkins’ range of products relevant to the telecoms sector extending our service intervals, we have a complete
< Service intervals for the 400 Series and how they have been improved product line-up that make us the perfect partner
< How Perkins are helping MNOs meet carbon reduction commitments for telecoms projects. By choosing Perkins engines,
< What differentiates Perkins from its competitors customers get quality, reliability and consistency
as standard. Our engines are ideal for reducing

owning and operating costs, with excellent fuel
consumption and the durability to operate in any Reasons to choose Perkins as a telecoms partner:
territory.
< Proven 400 Series engine with more than one million engines sold
Through our 400 Series, we offer a complete engine < Broad engine platform capable of meeting all key power nodes
range for telecoms towers. The recent addition of < Available from four global facilities with global product support coverage
two new variable speed models to the range means
< Fixed and variable speed engines to meet different requirements
we can offer fixed speed and variable speed engines
from 0.5 litres to 2.2 litres, which meet all the key < Excellent performance at high and low load points
power nodes between 5-40 kVA. < Extended service intervals to reduce operating costs
< Proven in the field to deliver consistent high performance and meet the most stringent emission
We understand the industry and know towers standards
in different areas have different requirements.
< Switchable 50/60 hz ratings to minimise inventory costs
Whether the customer is on grid and requires a
generator set back-up; or is off grid and needs a integrate seamlessly into the telecoms solution Richard Hemmings, Business Development
continuously running generator, our engines will that’s being installed. Manager, Electric Power, Perkins: Perkins 400 Series
is proven in the field to deliver consistent high
“
Recognising the intense focus on reducing owning performance and meet the most stringent emission
and operating costs for telecoms towers in the field, standards. With fixed and variable speed options
our investments in extending our service intervals available, our 400 Series offers best in class fuel
are one step to helping customers achieve that goal. consumption and extended service intervals.
With the introduction of
two new variable speed We also know regulators globally are demanding We know regulators globally are demanding that
that telecoms businesses minimise the telecoms businesses minimise the environmental
models added to our 400 environmental impact of their operations. We impact of their operations. We also support these
Series, 1.5 litre and 2.2 litre, support these goals by providing hybrid solutions, goals by providing hybrid solutions, suitable
and extending our service suitable for hybrid generators with a battery and for hybrid generators with a battery and hybrid
intervals, we have a complete

product line-up that make
us the perfect partner for
telecoms projects
“ hybrid generators with battery and solar power.
These solutions can directly help meet the required
standards whichever territory our customers are
doing business in.
generators with battery and solar power. These
solutions can directly help meet the required
standards whichever territory our customers are
doing business in.
TowerXchange: Many MNOs have carbon TowerXchange: We hear discussion of diesel

reduction commitments in place, how can generators being very much a commodity item
Perkins help them to reach these targets? in the off-grid power space, what differentiates

Perkins from its peers?

Manager, Electric Power, Perkins: Perkins is one of
the world’s leading suppliers of off-highway diesel
and gas engines, offering power up to 2500 kVA in
diesel or 1000 kWE prime in gas. Our cost effective
solutions, from competitive fuel consumption
to ease of maintenance, whatever the power
requirement, add real value to our customers’
equipment.
Dependable, reliable and cost effective engines are

essential requirements for the power generation
market. Our engineering expertise means Perkins
engines are designed for life, engineered without
compromise and are built for instant response
with thousands of hours of dependable running,
regardless of the environment or location.
Its trusted performance borne out of thousands of

hours of validation in the real world, working with
electric power providers who value the reputation
and expertise of an engine manufacturer who
is continually focused on delivering the right
technology solutions to meet your requirements.
Each and every one of our engine solutions from the

400 to the 4000 Series range are backed by Perkins
global service and support network which operates
in more than 180 countries around the world.
So when it comes to dependable, cost effective
performance, Perkins engines have and continue
to be the engine of choice for the power generation
market

Site design and deployment best TowerXchange: Can you please introduce your
company?
practices for on time project delivery Tan Weimin, Manager, Tower Business Group,
SPTDI: Shanghai Posts & Telecommunications
Supplier to China Tower and Vodafone projects balances costs, quality, appearance, Designing Consulting Institute, SPTDI, is a wholly
and capacity for site success owned subsidiary of China Comservice, one of the
leading service providers for telecommunications
Shanghai Posts & Telecommunications Designing Consulting infrastructure. China Comservice is listed on
Institute (SPTDI) is one of China’s major players, designing over the HK stock market and revenue for 2015 was
10,000 sites in the country on top of their international portfolio. US$11,802mn. SPTDI was established in Shanghai
With over ten years of experience, SPTDI leverages the best of in 1964 offering contracting, consulting, survey, and
locally sourced materials while adopting international standards design services. SPTDI employs more than 1,000
and service concepts to help its customers optimise spend, employees and 80% of them are technicians.
maintain quality, and ensure project success. As it evolves to
become a full-service provider, SPTDI remains anchored through TowerXchange: Can you tell us a little about your
its experience in integrating different international requirements international work?
with Chinese solutions and resources.
Tan Weimin, Manager, Tower Business Group, SPTDI:
Keywords: Asia Insights, Brazil, CMPAK, CTC, Cambodia, For the past ten years, we have designed or supplied
China, China Comservice, China Tower Corporation, different telecom towers in 32 countries across
Construction, Ethiopia, Installation, Leasing & Permitting, Asia, Middle East, Africa and South America. We
Masts & Towers, Multi-Country Partner, Myanmar, Pakistan, follow international standards (TIA-222-G, AU/NZS,
SPTDI, Saudi Arabia, Shanghai Posts & Telecommunications Eurocode) and use Chinese steel materials to save on
Designing Consulting Institute, Site Surveys, Skilled costs. We’ve done work in Saudi Arabia, Myanmar,
Workforce, Small Cells, Sri Lanka, Tanzania, Vodafone Fiji, Sri Lanka, Tanzania, Ethiopia, Brazil and many more.
Tan Weimin, Manager, Tower
Vodafone New Zealand, Who’s Who
Business Group, SPTDI
A few years back between 2007 and 2009 CMPAK in
Pakistan was investing in about 6,000 sites around
Read this article to learn: the country. We were the biggest contractor and did
< SPTDI’s work in China and around the world more than 1,600 sites, with the scope of work to do
< Ways to ensure adherence to quality and safety standards within the field workforce network planning, site acquisition, soil test, survey
< Success factors to minimise mean time to response and design, and network optimisation. During this
< Site design best practices, including small cells project, nearly 100 engineers were sent to Pakistan
and more employees hired locally.

Beginning in March 2012, we provided turnkey TowerXchange: What has been your experience
service for a new operator in Phnom Penh, of the challenges of site acquisition and
Cambodia, and that was for site acquisition to permitting within your target markets?
commissioning. We delivered 64 sites within ten
months. There we used our patented product New Tan Weimin, Manager, Tower Business Group,
Triangular Tower, with 5-15% weight reduction to SPTDI: The challenges are different from country to
save costs. country.
Most recently we are the provider of monopoles In China, the biggest challenge is widespread
and lattice towers to the projects of Vodafone radiophobia amongst the public. The
New Zealand and Fiji. Those are just some select neighborhoods are sometimes very sensitive when
examples on the work we’ve done globally. a telecom tower is being constructed in sight. We
must be quick and low-profile during construction,
and sometimes we must disguise the tower as some
TowerXchange: Can you describe some of the
other non-related light pole or billboard.
work you do in China?
In some developing countries, a stable power supply

Tan Weimin, Manager, Tower Business Group,
would be the primary concern. Negotiations with
SPTDI: As we are a joint venture of all three major
the landlords can also be exhausting, in which case
operators, and the preferred supplier of China
a local agency can help greatly.
Tower Corporation (CTC), the new established
consolidated operator of telecom sites, we are
In New Zealand, the local councils are very detailed
designing over 10,000 sites each year in China over
with site appearances, such as shape, colour,
ten provinces. environment visibility, construction method, and
its impact to the surroundings. Our presented
We also did tower rentals in Shanghai as a pilot documents need to be comprehensive in addressing
project before CTC was founded. We built 180+ each and every single one of their concerns.
shared towers and then rented to the operators.
We rented not only the towers, but also the site TowerXchange: How do you ensure quality and
equipment and shelters. safety standards within a field workforce which,
by it’s nature, tends to be characterised by a
Meanwhile we also built some iconic landmark level of staff turnover and use of contractors?
towers such as the Yangshan Harbour Telecom
Complex Tower, Expo Park Scenery Towers, and the Tan Weimin, Manager, Tower Business Group,
East Sea Bridge Complex Tower. SPTDI: Subcontractors are not always negative

factors in a project, especially for our projects that of designing and deploying small cells and ‘street modeling. This meant the final results were barely
require targeted expertise. The key is to have the furniture’? noticeable to the public.
supervisors as the tie between the sub-contractors
and the management team. Tan Weimin, Manager, Tower Business Group, For sites in residential blocks, as I mentioned
SPTDI: Shanghai is a crowded city with so many before, to ease the neighborhood’s radiophobia,
A well-trained and locally connected supervisor underground structures so most of the new build camouflage is also important. So we must have
team is essential. They must be highly trusted and sites are small cells or street furniture. The major some compromise in the cost. It would be better
authorised to handle all on-site issues. And on the concerns of this site type are uniform series design to build something than nothing at all. Or if the
basis of trust, the management team would back and quick deployment technology. conditions permitted, we would shift from a normal
them on different difficult situations. A clear and self-supported tower to small cell sites.
balanced reward and fine system aligned with the As the sites are numerous, the configurations are
supervisors’ personal interests has also proved to be varied, and under a very compacted deployment TowerXchange: What do you feel differentiates
quite effective.
schedule, uniform series design helps to ease both your solutions from your competitors’? What do
the fabrication and assembly since it will have you feel SPTDI do really well?
TowerXchange: What are the critical success
similar interface and inherited and exchangeable
factors in minimising Mean Time To Response
parts. Combined with some fast deploying Tan Weimin, Manager, Tower Business Group,
(MTTR) within widely distributed cell sites
technologies, like pressed pre-cast pile, steel tubular SPTDI: We are backed by a strong comprehensive
or sites in markets with poor transport
pile, container cabinet, and commercial concrete group that covers the complete chain from the very
infrastructure?
module, we can minimise the deployment process beginning part of financial arrangement to the final
and traffic interference. stage of post-delivery monitoring and maintenance.
Tan Weimin, Manager, Tower Business Group,
Our solutions are more practicable, more flexible,
SPTDI: We have some experiences in western China,
TowerXchange: When designing new sites, how and more reliable.
where the transportation is still quite poor. And
by its nature, the projects in the lower-developed do you balance the concerns of camouflage, cost
regions are budget-driven. and structural capacity? We are also located in Shanghai, one of the most
open and internationalised cities in China. This
Localisation is the critical factor, which means Tan Weimin, Manager, Tower Business Group, means that compared to other competitors in
including local sub-contractors and local SPTDI: It depends on the site, as each has its own China, we have adopted more of the mainstream
supervisors as our employees. We may only hold character. international technology standards and service
several highly experienced and locally connected concepts. We were a design and consulting institute
supervisors for a provincial region, but a wide For the sites where camouflage is the major before and now we are transitioning to be a turnkey
network of resources and knowledge could be concern, like one of our projects in Disneyland, we supplier. Compared to other providers such as
accessed through this small team. cooperated with the leading architecture design tower plant or construction firms, our distinguished
firm at a very early stage to integrate our telecom advantage remain in technical and advisory
TowerXchange: What has been your experience site requirements into the complete architecture services

Tarantula provides the
your background.
go-to product for all things Felix Chan, Director - Strategy, Tarantula: I have
over fifteen years of direct experience with mobile
shared infrastructure operators and towercos, working primarily in

strategy, commercial and finance roles over that
time. I started off with Vodafone in Australia,
Felix Chan explains how Tarantula integrates all aspects of site management
then went on to co-found a towerco, Insight
into one enterprise product Infrastructure, in India where I worked until it
was acquired by American Tower Corporation. I
Thanks to its highly flexible workflow platform and then returned to Australia and took on the role of
portfolio management system, Tarantula supports General Manager of the Commercial Strategy group
around 350,000 towers worldwide with a value of of NBN Co. Finally, I’ve been with Tarantula for the
approximately US$25bn and tracks over 6mn assets. past three years as Director - Strategy and CFO.
In this interview, Felix Chan, Tarantula’s Director of
Strategy, shares details about the company’s latest TowerXchange: Could you give us an update
projects and the successful utilisation of the Red on some of your recent activities in the Asian
Cube and Orange Cube solutions in the Asian telecom market? What have been the highlights of the
tower market. past year?
Keywords: Asset Register, Health & Safety, Felix Chan, Director - Strategy, Tarantula: At
Interview, KPIs, Operational Excellence, QoS, ROI, Tarantula, our mission is to help our customers
Revenue Assurance, Security, Site Management succeed. The past year has been all about this —
System, South Asia, Southeast Asia, Tarantula, working on supporting the goals of our towerco and
Felix Chan, Director - Strategy, Tarantula Valuation telco clients. To do this, we leverage the experience
of our team and their backgrounds in telecom
companies and towercos and distil this knowledge
Read this article to learn: into our products and relationships with our clients.
< Tarantula’s latest projects and the evolution of their products We don’t offer generic solutions, so we’re always
< Adapting Red Cube and Orange Cube to the Asian tower market looking for the next opportunity to create value for
< The benefits of linking contractual obligations and commercials with site inventory our customers.
< Managing multiple stakeholders onsite and adapting to different processes and workflows
This has been a pretty busy year for us; we engaged

in a long-term integration project for two of our information maintained by the individual Red Cube Felix Chan, Director - Strategy, Tarantula: We are
clients and combined two Tarantula systems into systems. constantly adding new innovations to our product
one merged solution. To do this, we consolidated capabilities, be it to cater to the dynamic industry
reports and data and merged management of the Orange Cube is another main product offering for changes, to create value for various types of markets
sites together. This was a full-on project for the telcos, and it enables monitoring of more assets, and stakeholders, or to address specific problems.
delivery team over a three-month period, during including active equipment; we can tailor this to the Asia is a very diverse region and the evolution of
which the data from all the sites was scrubbed and telco’s specific requirements. the industry varies from country to country. You
made consistent so that it could operate across have everything from very mature and stable
both systems. This requires a good knowledge of The focus on active equipment can help telcos tower markets in India to totally new and growing
the customer’s business and how they operate, review the spectrum of options available and markets like Myanmar which is just a few years
and this is a key strength of ours. When launching identify the best solution for a given area. It can old now. There are big differences in operating
a new process, there is always a risk of “garbage determine whether a new piece of equipment can and commercial environments across Asia, and
in, garbage out” if the wrong approach is taken. be added to an existing site, whether it would be Tarantula has the ability to cater to different
It requires detailed knowledge of how the client better to lease a tenancy from a towerco or telco, or requirements across a broad spectrum. We leverage
operates, and knowledge about the way the whether a new ground-based or rooftop BTS site is our telecoms experience to learn from our clients
industry works that only comes with experience. the way to go. and adapt our solutions to work around their
After integration, users from both client companies roadmap to best support them.
were able to continue working with a consistent We also undertook a client project to push data
way of working with the same data sets. collection out into the field with our mobility tool A big innovation this year involved the billing
to provide much more useful information to the module and how it ties in with our clients’
We also engaged in separate installations across engineers responsible for operations. This tool was contractual obligations and asset entitlement.
six markets for one of our key clients so that their used to complete over 21,000 actions in the field and This enables us to link commercial deals with a
group headquarters could see what was happening made life easier for our customer by streamlining co-location process and the existing capacity on
across all of them. We rolled out country-level Red the collection of data into mobile devices. This a given site. A lot of tools on the market keep a
Cube systems that can operate as independent data could then be synchronised with the system record of what assets are present on the tower, but
entities, and then on top of that we integrated a in a controlled manner to ensure that it is accurate we are able to manage the broader commercial
reporting system to oversee the activities of the six and reliable at all times. Our clients received the relationships. When a new tenant is ready to be
underlying businesses. Red Cube helps towercos immediate benefit of higher efficiency in field added, we can look at how to manage site access for
balance the management of network uptime operations with accurate data being captured at all multiple tenants, how much physical space there
versus the management of individual sites. It’s times. is on the site, and what adjustments are necessary.
part of an overall vision that enables our clients It also enables the integration of pricing from the
do everything from managing lease services to TowerXchange: We know that your products are MLA to the co-location and manages this all the
ensuring backhaul connectivity for each site. The continually evolving to meet the needs of the way through. Our product is very flexible and can
group-level reporting added immense value to the market; how has it changed since we last spoke? support companies with a big customer base and

a lot of MLAs to manage. Again this is where we is involved in what, and provides a project contact requirements. They can slim down the processes,
leverage our knowledge of different MLA scenarios; list with all stakeholders recorded so it is clear who make them more complex, and then break them
for example, I’ve negotiated between fifteen to is involved. Sometimes our clients find stakeholders down again if necessary; since the core processes
twenty of them and Udhay has negotiated even that they weren’t aware of and unauthorised are available out of the box, it’s easy to change
more. This feeds into the adaptability of the product equipment that has been installed. The product them.
for a wide range of commercial scenarios. Through enables them to do a match-back with the asset
our normal customer engagement process, we have register and identify any unauthorised equipment The biggest complexity in tower portfolio
received a lot of feedback and input in Asia and so they can decide the necessary action such as management usually involves the different legal
Europe into how the product works and this has increasing the lease rate or moving the equipment and commercial regulations in each country. Again,
contributed to its evolution. Our customers can see elsewhere. our experience in different markets has enabled
that we take the feedback from our discussions with us to create solutions that minimise problems
them, and insights into how their businesses run, The product also enables work orders such as site for end-users and this is integrated with all the
and these are integrated directly as features in our inspections, diesel checks, or asset counts to be other elements such as billing, capacity on site,
products. allocated on the mobility app; this enables proactive discounts for existing tenants, tax, et cetera. Any
management of subcontractor work and allows of these features can be dragged and dropped in
TowerXchange: How does your products help our clients to know that the work orders actually or removed as necessary to create the necessary
manage different stakeholders within the tower happened. Red Cube tracks milestones so that all overview of the project. Our products integrate with
supply chain, from tenants to subcontractors? stakeholders know what they need to do, what’s the multiple systems that towercos use, including
next, and whether any changes are required. trouble ticketing, ERPs, remote monitoring systems,
Felix Chan, Director - Strategy, Tarantula: There are and document management tools; this full data
a lot of different stakeholders in a site and many TowerXchange: How can your product be integration across all these systems enables
users that require site access. There can be many configured to adapt to different towercos’ unique towercos to maintain a single source of truth.
different protocols for this in different jurisdictions; business processes and workflows?
for instance, in some cases health and safety TowerXchange: How can a robust approach to
documents must be received to permit site access, Felix Chan, Director - Strategy, Tarantula: Red Cube asset registers and asset lifecycle management
and this needs to be managed. Contractors need to has over thirty real-world processes included out improve the valuation of tower assets?
be given time slots to access the site to avoid overlap of the box; a start-up towerco could take this and
and crowding. use it right away. Having these processes makes a Felix Chan, Director - Strategy, Tarantula: I would
good baseline to configure for different clients. They say the question is how can it not? The more you
Our products can create different user groups to could split one process into two steps, creating a know about your assets the better valuation you’re
issue approvals in line with different processes, and legal and financial component for example. They going to get. The key parameters are tracking,
provide electronic approval of requests to protect can configure processes into layers, change what managing assets on site, creating a matrix,
the integrity of the assets. This enables towercos to different roles in the company do, split one task into knowing what’s there and being able to create a
manage multiple tenants, allows them to know who two, or combine three into one depending on their direct link between these and the MLA and billing

“
Stop press: Volaris Group acquires
Tarantula
January 3, 2017 - Tarantula, the leading provider

of telecom site management software, today
The more you know about your assets the better valuation you’re announced that it has been acquired by Volaris
Group, an international company with deep
going to get. The key parameters are tracking, managing assets
on site, creating a matrix, knowing what’s there and being able to
create a direct link between these and the MLA and billing system
“ experience in growing vertically focused
software companies such as Tarantula. The
Volaris Group is a wholly owned division of
Constellation Software Inc., which is listed on
the Toronto Stock Exchange with a market
capitalisation in excess of US$12bn. This
is Volaris Group’s fourth acquisition in the
Communications vertical.
system. One of the biggest elements in valuation is model, including towercos and telcos. To achieve
recurring cash flow, and this can integrate all of the this, we have rolled out Orange Cube, which is a Udhay Mathialagan, CEO, Tarantula, said, “We
necessary elements of site management and link product tailored to the needs of mobile network are eager to grow our business further in our
them together: this asset belongs to that company, operators. We’re driving project management and core tower markets and to expand our presence
this is their lease, we bill them this and this is their asset reporting to include commercial management in other high-growth wireless infrastructure
interplay with the site. functionality for MNOs to help them improve markets. We are excited about Volaris’ long-
valuations and ROI. We have implemented partner term commitment to our business and the
TowerXchange: What are your plans for growth and relationship management so that we empower opportunity to access industry best practices
and expansion, and what is your future vision our customers, and in turn, their customers to and synergies that exist within their emerging
for the company? succeed. Communications vertical. Volaris’ approach
of permanent ownership of a business will
Felix Chan, Director - Strategy, Tarantula: Our focus There is a lot of growth ahead on both sides of the provide long-term stability to our customers
is purely on all aspects of shared infrastructure. infrastructure sharing model with the advent of and staff. With this commitment to the long
We’ve developed Red Cube, the go-to product for 4G and later 5G. More sites will be required with term and Volaris’ investments, we can continue
managing shared telecoms infrastructure. We’re the more capacity, more small cell coverage and all to grow our business to better serve our
market leaders in the towerco space and our aim is operators and infrastructure providers need to start customers worldwide and the aspirations of our
to get there in the telco space as well and provide thinking about the new demands of this changing international employee base”
coverage of both sides of the infrastructure sharing marketplace

Telemisis to supply SiteNode TowerXchange: Firstly, congratulations on
your agreement with Jabil Inala. Can you
explain a little bit more about the agreement?
hardware to Jabil Inala’s new remote
Chris Begent, Commercial Director, Telemisis:
monitoring and analytics platform After Jabil’s acquisition of Inala, they approached
Telemisis to supply SiteNode®, our industry
Two major players in RMS join forces to improve management of the world’s leading ultra-low power remote telemetry
node, for use in the new Inala Site Monitoring
telecom towers
& Analytics platform. Effectively the Telemisis
Two of the leading players in remote SiteNode 3G enhances the capabilities of the Inala
Site Monitoring platform.
monitoring and control systems have
announced an an exciting new agreement
We will be supplying them with SiteNode
to bring Telemisis’ SiteNode hardware to
hardware and middleware for use in the new
Jabil Inala’s new remote monitoring and
Inala Site Monitoring & Analytics platform on a
analytics platform. Telemisis share the
non-exclusive basis, for use initially in Africa.
drivers behind the arrangement, how this
will affect and bring benefits to customers Outside this agreement Telemisis will continue
in the telecoms sector and plans for to invest in and develop SitePro, our own remote
development of the partnership. monitoring and control solution, which continues
to be available for use in all markets and industry
Keywords: Africa, Jabil Inala, Monitoring sectors.
& Management, Multi-Country Partner,
RMS, Site Management System, Telemisis, TowerXchange: Why did Jabil Inala choose the
Chris Begent, Commercial Director, Telemisis Ltd Who’s Who Telemisis SiteNode?

Chris Begent, Commercial Director, Telemisis:
Read this article to learn: Telemisis bring over 100 years of experience in
< Why Jabil Inala chose Telemisis’ SiteNode hardware to replace their SAM2 system designing and manufacturing remote monitoring
< How the two companies will work together in the African market and control solutions and have the industry’s best
< How Telemisis’ existing customers will be affected by the agreement on-site hardware in the form of SiteNode and
< Telemisis’ plans for continued investment in improving the functionality of SiteNode the recently released SiteNode 3G which have an
outstanding reputation for reliability.

SiteNode for use in Africa, as our preferred, but levels of support they’ve come to expect from us.
“
not exclusive partner. SitePro and SiteNode continue to be available to
them for extended roll out and upgrades.
TowerXchange: What industry sectors are
covered by the agreement? TowerXchange: Are Telemisis still selling SitePro
Chris Begent, Commercial Director, Telemisis: The to customers?
Both Telemisis and Jabil view the primary market focus is on telecoms but there are
relationship as a long term one no restrictions to how they can deploy SiteNode as Chris Begent, Commercial Director, Telemisis:
part of their RMS solution. Telemisis continue to invest in the development of
and are already planning the
enhancements for SitePro, to meet the needs of both
next generation of enhancements TowerXchange: Will both companies compete developing and mature markets. As an example
to ensure that our respective against each other in competitive bids in of this, we’ve just launched the next generation of
systems stays ahead of the Africa? SitePro and a new 3G version of SiteNode. We’re
competition and maintains their

compelling advantages
“ Chris Begent, Commercial Director, Telemisis: It
is our intention that Jabil Inala take the lead in
Africa, given their local sales and support presence
looking forward to delivering new and exciting
functionality to customers over the coming months.
Telemisis’s philosophy has always been to focus on

across the region. Jabil Inala will continue to delivery of the most reliable, scalable end-to-end
develop their analytics platform and we will solution. We will maintain this focus on quality
continue to work with Jabil Inala to develop the and will continue to invest in developing our own
TowerXchange: How do you see the relationship SiteNode to adapt to the evolving needs of the portfolio of sensors and peripherals as a key strand
developing? market. to this strategy.
Chris Begent, Commercial Director, Telemisis: Telemisis will continue to develop the SitePro We are continuing to support and acquire
Both Telemisis and Jabil view the relationship as a system and provide exciting new features for customers in a wide range of sectors, from telecoms
long term one and are already planning the next mature markets and new sectors, where the to remote process operators and look forward to
generation of enhancements to ensure that our emphasis is on system reliability and quality. making some exciting announcements across a
respective systems stays ahead of the competition range of sectors in the coming months.
and maintain their compelling advantages. TowerXchange: What will happen to Telemisis’
existing customers in Africa? TowerXchange: Who should African towercos or
TowerXchange: Which territories are covered MNOs contact for more information?
by the agreement? Chris Begent, Commercial Director, Telemisis:
Our existing customers are not affected by the Chris Begent, Commercial Director, Telemisis: Tower
Chris Begent, Commercial Director, Telemisis: agreement with Jabil Inala. We will continue to companies and MNOs should continue to contact
We will initially be supplying Jabil Inala with provide customers with the same high quality their local Telemisis or Jabil Inala representatives

ZTE proposes integrated
TowerXchange: Please tell us about ZTE in
general and your specific department.
end-to-end solutions and project Qiao Fengjiao, Technical Director, ZTE

Infrastructure Auxiliary Product Department:
financing for towercos ZTE Corporation is a global leader in

telecommunications and information technology.
ZTE Infrastructure Auxiliary Product Department (IAP) leverages global project As part of ZTE’s mobile information communication
technologies (M-ICT) strategy, the company is
experience and Chinese production capabilities
committed to providing integrated end-to-end
innovations to deliver excellence and value to
Headquartered in Shenzhen, China, ZTE has branches in over 100 consumers, carriers, businesses and public sector
countries and is one of the world’s leading telecommunications and IT customers around the world to enable increased
providers. Its Infrastructure Auxiliary Product (IAP) Department offers connectivity and productivity.
a comprehensive suite of products and services for the tower industry.
Since 2005, ZTE IAP has constructed more than 50,000 towers and ZTE Infrastructure Auxiliary Product Department
20,000 shelters around the world. As a turnkey solutions provider, IAP (ZTE IAP) specialises in infrastructure product
helps MNO and towerco clients optimise project success from beginning and solution R&D, manufacturing, marketing,
to end, from quality tower designs to well-managed construction to and engineering services for ICT networks.
opex reduction. Through close cooperation with our customers,
we are well experienced in product design and
Keywords: Africa, Air Conditioning, Asia,Capacity Enhancements, China, project implementation, including offering rapid
Construction, Energy Efficiency, Ethio Telecom, Ethiopia, Foundations, customised solutions to satisfy a customer’s special
Installation, Interview, KDDI, Managed Services, Masts & Towers, requirements.
Myanmar, NCELL, Nepal, O&M, Opex Reduction, Project Finance, Shelters,
Qiao Fengjiao, Technical Director, Site Management System, South America, Who’s Who, ZTE, ZTE, ZTE IAP, TowerXchange: Where do you fit in the telecom
ZTE Infrastructure Auxiliary
ZTE Infrastructure Auxiliary Product Department infrastructure ecosystem?
Product Department
Qiao Fengjiao, Technical Director, ZTE

Read this article to learn: Infrastructure Auxiliary Product Department: ZTE
< Introducing ZTE IAP and its range of products and services IAP is committed to being the leading product and
< How towers can be upgraded to accommodate more tenants solutions supplier of ICT network infrastructure
< Ways to ensure deliverability and easy installation of towers in the international market. Our product scope
< What differentiates ZTE from its competitors includes a full comprehensive series of towers,
shelters, air conditioners, and accessories. We also

Qiao Fengjiao, Technical Director, ZTE giving visitors, climbers, and people living in
Infrastructure Auxiliary Product Department: ZTE the Khumbu Valley the ability to make calls and
IAP has business relationships with more than 500 wirelessly connect to the Internet. “You are on the
MNOs in 160 countries, mainly across Asia, Africa, peak of the world”, said NCELL CTO.
and South America.
TowerXchange: How should MNOs and
TowerXchange: Can you share some sample towercos strike a balance between the cost and
projects with us so we get a sense of your scope volume benefits of standardisation versus the
of work and capabilities? needs to customise structures for different
environments and wind loading?
Infrastructure Auxiliary Product Department: In Qiao Fengjiao, Technical Director, ZTE
total, more than 50,000 towers and 20,000 shelters Infrastructure Auxiliary Product Department:
around the world have been constructed by ZTE IAP In our opinion, it is better for towercos to launch
since 2005. a series of standardised products to meet the most
common requirements. For the rest of special
For example, we started working with Ethio requirements, MNOs can then address them
Telecom (Ethiopia) in 2007, with 3,000+ towers to case-by-case, for which we are able to provide
date and 1,500 of them built within the first year. customised solutions quickly.
It was a great achievement to help deliver mobile
network coverage throughout the country for the TowerXchange: What are the most economical
first time. All the towers are still working well. ways to strengthen a tower structure to
accommodate more tenants and more wind
In Myanmar, we’ve put up more than 1,000 towers load than it was originally designed to
Ethiopia for KDDI. With this project, it is worth mentioning accommodate?
offer tower construction, design consultation, tower that our R&D team needed only 30 days to complete
reinforcement, site temperature control solutions, 15 different kinds of custom towers’ calculation and Qiao Fengjiao, Technical Director, ZTE
O&M, et cetera. design, and these all passed a site audit conducted Infrastructure Auxiliary Product Department:
by our Japanese customers in one go. We started According to our studies, the most economical
Generally, we focus on MNO and towerco clients, this in 2014. way to reinforce a tower structure is to consider
while exploring the government and enterprise the factors at the beginning of the design, then
markets as well. On 8 October, 2010, ZTE’s blue flags were raised on you can pay just a bit more to fulfill reinforced
the tower top, as part of our project to help NCELL requirements from the customer. Of course, ZTE
TowerXchange: Can you tell us about your install the first 3G base station at the base camp IAP has developed a range of upgradable towers
international footprint? of Mount Everest (at an altitude of 5,180 meters), for customers to choose from if needed.

TowerXchange: How do you design a tower to be
more easily upgraded for multiple tenants?

Infrastructure Auxiliary Product Department: ZTE
is the major telecom equipment supplier. Based
on our understanding of wireless communications
technology development, for the new site, we will
set aside optimised expansion space to meet the
needs of multiple tenants.
As for transforming the site, we would provide

reform measures such as increasing the bracket,
replacing the antenna, reducing the tower height,
and strengthening the tower, to make the tower
meet the demands of multiple tenants.
TowerXchange: How do you ensure the

deliverability and easy installation of your
structures?

Infrastructure Auxiliary Product Department: ZTE
IAP has been servicing the overseas market for over
ten years and accumulated a lot of product delivery
and installation experience along the way. We’ve
documented all this and translated our learnings
into standard procedures, foolproof checklists, and
training materials.
We also consider logistics and installation from

the beginning of the tower design stage. For
example, our design rule defines that all members’
length should be less than 5.6m for convenient
Mount Everest
transportation and installation; there should be

integrated with our O&M system, which will issue
alerts accordingly, so staff are deployed to the site
only when necessary. This helps with resource
optimisation.
In order to reduce the opex of shelter, we developed

a new type of energy-saving air conditioner which
can reduce energy consumption by more than 20%
compared to the traditional air conditioner.
TowerXchange: What innovations in foundation

materials and design can be leveraged to
accelerate time to market, reduce costs and
improve the re-usability of towers?

Infrastructure Auxiliary Product Department: It is
well known that foundation construction takes the
most time in the tower construction process, and
the foundation is not reusable.
For a quick construction site, we developed the

Myanmar precast foundation which can be concreted in
less than four bolt types in each tower; only choose Infrastructure Auxiliary Product Department: the factory with reliable quality. It can reduce
simple cross sections to reduce the number of From the perspective of customers, we like the period of tower construction significantly.
members; optimise the packing method to make it to introduce new technology and continuous For remote sites with difficult transportation, we
visual and countable, et cetera. innovation. developed the counter weight foundation which
uses local materials (sand or macadam, et cetera) to
Through the above measures, we can ensure For example, in order to reduce opex of the tower, complete the foundation construction.
transportation safety and the installation efficiency. we developed a tower online monitoring system
which provides information in real-time on things TowerXchange: When it comes to your workforce
TowerXchange: How do you help your clients such as deflection angle, foundation settlement, and for overseas projects, what’s the split between
reduce opex? external invasion. It also has the ability to collect ZTE headquarter staff, ZTE local staff, and use
other data around the site such as wind speed, of local contractors? How do you ensure quality
Qiao Fengjiao, Technical Director, ZTE temperature, humidity, and air quality. This is and safety standards?

Confidential▲
Confidential▲
ZTE Infrastructural products

ZTE Infrastructural products certification to conduct on-site guidance.
Thirdly, we have real-time audit and strict process
and final acceptance check to ensure the quality
Tower and safety will meet our customers’ requirements.
Tower
TowerXchange: How would you differentiate
your solutions from your competitors?

Infrastructure Auxiliary Product Department:
Lattice tower Monopole Guyed mast Rooftop pole Camouflaged tower FXS tower Firstly, we can provide end-to-end service from
Lattice tower Monopole Guyed mast Rooftop pole Camouflaged tower FXS tower
Shelter&Cabinet R&D, manufacturing, to engineering and consulting
Shelter&Cabinet
services. We also have mature QMS to ensure the
stability of product and delivery.
Title: of our R&D team have a

Secondly, all members
Type: Arial
Title:
master’s degree and moreArial than ten years of design
Size：24pt
Type:
Traditional shelter Container shelter Easy Extensible High corrosion resistant Multifunctional experience. We have
Color：The ZTE blue
Size：24pt
established
High corrosion resistant Multifunctional Color：The ZTE blue a complete
Traditional shelter Container shelter Easy
DietExtensible
shelter Diet shelter Diet shelter Subtitle:
A/C &others Diet shelter Diet shelter product series including self-support tower, guyed
Diet shelter Type：Arial
Subtitle:
A/C &others Size：18pt
mast, rooftop pole,Type：Arial
monopole, camouflage tower,
Color: The ZTE green
Size：18pt
et cetera, as well asColor:
shelter
The ZTE product
green series and air
conditioner product series. G143, B212
G143, B212
Thirdly, we are familiar R140,G198,

with the B62mainstream
High efficiency design standards across R140,G198,

different B62
markets, such as
Precise A/C Common A/C High efficiency
DC A/C Cabinet A/C ACS solution Distribution frame
Cabinet A/C in China, the U.S., UK, Europe, South Africa, India,
Precise A/C Common A/C DC A/C ACS solution Distribution frame R90,G203, B245
et cetera, that helps us toR90,G203,
satisfy various customised
B245
Qiao Fengjiao, Technical Director, ZTE When it comes to quality and safety standards,
© ZTE All rights reserved requirements from customers all over the world.
1
1Infrastructure Auxiliary Product Department: firstly, we have strict end-to-end project
© ZTE All rights reserved
In general, employees from headquarters management system that covers R&D, Fourth, we are able to leverage Chinese mass
are responsible for the overall guidance and manufacturing, logistics, and installation. Each production capability and low labour costs.
professional technical support; local staff are process has its own quality management system to
responsible for project management and quality ensure execution compliance. Fifth, ZTE is the one of the few suppliers who can
control; and the subcontractor is responsible for the execute global projects (we have branches across
project implementation. Secondly, we have professional technical staff with more than 107 countries) and project financing

Tower Xchange
TowerXchange brings the tower industry to you! TowerXchange Meetup calendar

TowerXchange Meetup Europe 2017,
Connect with us today and discuss available opportunities for our Meetups across Africa, Asia, April 4-5, Business Design Centre, London
Europe, Americas and China! Exhibiting or sponsoring at TowerXchange Meetups is the best TowerXchange Meetup Americas 2017,
June 7-8, Boca Raton Resort & Club, Florida
investment you can make to showcase your products and expertise in front of the global telecom
TowerXchange Meetup Africa 2017,
tower industry.
October 3-4, Sandton Convention Centre, Johannesburg
TowerXchange Meetup Asia 2017,
Email Annabelle Mayhew, CCO, at amayhew@towerxchange.com today December 12-13, Marina Bay Sands, Singapore
to find out more. Visit our website at www.towerxchange.com
Tower Xchange
© 2017 Site Seven Media Ltd Design by BLACKLIGHT Design Agency

TowerXchange-Issue 18 PDF

Încărcat de

Informații document

Titlu original

Drepturi de autor

Formate disponibile

Partajați acest document

Partajați sau inserați document

Opțiuni de partajare

Vi se pare util acest document?

Este necorespunzător acest conținut?

Drepturi de autor:

Formate disponibile

TowerXchange-Issue 18 PDF

Încărcat de

Drepturi de autor:

Formate disponibile

New site typologies and business

Tower Xchange models for 5G

Issue 18 | January 2017 | www.towerxchange.com

TowerXchange Africa and the Middle East:

5 Europe tower count, analysis and news

182 - 239 Europe: Italian towercos,

TowerXchange’s who’s who

399 Directory of over 200 vendor profiles

TowerXchange Meetup calendar

275 - 348 MEA: IHS’s rating, SSA’s latest

2 | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | XX

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 3

Connectivity is at the core of everything we do. Providing ﬁrst-of-its-kind regional accessibility,

independent tower market in EuropeRTRS 16,000

Wireless Infrastructure Group 5000

Turkcell postponed the IPO of their tower unit

Global Tower at the eleventh hour, citing global

400 860 800

political instability and the risk of cyber attacks.

200 700 377 400 377 377

120 113 100 100 100 75

TOWER OWNERSHIP | LEASING | SITE MANAGEMENT | SITE DEVELOPMENT | CONSTRUCTION

© 2016 SBA Communications Corporation. All Rights Reserved.

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 7

HTA acquires, builds, and manages

Find out more about our business at

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 9

Contact us for a demo at sales@accruent.com

CETIN (Česká Telekomunikační Infrastruktura),

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 11

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 13

Up to 70% lower Up to 60% Up to 30% less Traditio

Up to 70% lower Up to 60% Up to 30% less

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 15

Energy Efficient Products!

Find out more: www.deltapowersolutions.com

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 17

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 19

was intended to last 15 years, but there has been

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 21

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 23

Network Overview Site Status List Home Map Alarm List

Alarm Status Power Source Runtime Tenant Load Distribution

Warning: 200 Fatal: 100

System Status Diesel Consumption Tenancy Ratio

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 25

WE ARE SHAPING POWER MANAGEMENT

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 27

Totals / average 41,758 3,286,420,000 147,082

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 29

NorthStar ACE the future of energy storage management

For more information visit www.northstarbattery.com

TowerXchange research has not revealed any infracos or

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 31

Inside Towers is your source for all things towers.

Claim your complimentary annual subscription ($199 value)

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 33

FORT WORTH CONVENTION CENTER

FPS positioned themselves as a towerco with a

XX | TowerXchange Issue 18 | www.towerxchange.com www.towerxchange.com | TowerXchange Issue 18 | 35

As the wireless industry Manage Build

At Viavi, we’re constantly

Only Viavi provides the advanced tools