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LTE Network Technologies

LTE costs will transform the cell tower market in 2016

The vast cost of keeping up with demand for mobile data is intensifying the pressure on mobile operators’ capex budgets and accelerating their moves to improve their infrastructure cost base. Major agreements to share passive and active cell site equipment are becoming commonplace as regulators ease up on previous restrictions, accepting that, in the age of the MVNO, a common network need not reduce consumer choice at the services and pricing level.

The need to reduce network costs is also driving operators to outsource their towers or their whole RANs, and to seek new mechanisms to acquire and manage sites – a trend now extending from macrocells to small cells amid the move towards densification, as Sprint’s new site leasing initiative illustrates. And in turn, all these changes are creating significant upheaval in the tower business itself, with a trend towards towercos, rather than operator-owned sites, being offset by the revenue squeeze that sharing can create for those independent site owners.

China’s three network operators recently placed many of their towers and sites into a joint venture, and China Telecom and China Unicom followed that with a more extensive RAN sharing agreement, particularly targeted at rural areas.

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