28-29 January, Le Meridien Hotel & Conference Centre ... · 50 2020 Demand forecast Who to meet at TowerXchange Meetup MENA 59 Companies attending 60 Sponsor profiles 67 Meetup Europe

| TowerXchange MENA Special Edition 2020 | www.towerxchange.com/meetups/meetup-mena1

Special edition journal: TowerXchange MENA market analyses, delegate list, towerco, MNO and exhibitor interviews

Meetup MENA 202028-29 January, Le Meridien Hotel & Conference Centre, Dubai

The 2nd annual retreat for 200 leaders of the Middle East and North Africa telecom tower industry

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Our informal network of advisorsAbout TowerXchange

Founded in 2012, TowerXchange is your independent community for operators, towercos, investors and suppliers interested in EMEA, CALA and Asian towers. We’re a community of practitioners formed to promote and accelerate infrastructure sharing. TowerXchange don’t build, operate or invest in towers; we’re a neutral community host and commentator on telecoms infrastructure.

TowerXchange produces a monthly newsletter and quarterly journal, both available to subscribers, which cover industry news and provide deep insights into telecoms infrastructure worldwide. We also host annual Meetups on each of four continents to bring together the leading tower industry stakeholders.

TowerXchange was founded by Kieron Osmotherly, a TMT community host and events organiser with 21 years’ experience, and is governed with the support and advice of the TowerXchange “Inner Circle” – an informal network of advisors. TowerXchange was acquired by Euromoney Institutional Investor PLC on December 1, 2017

TowerXchange’s “Inner Circle”

© 2019 Site Seven Media Ltd. All rights reserved. Neither the whole nor any 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 source. TowerXchange is a trading name of Site Seven Media Ltd, registered in the UK. Company number 8293930.

(Chairman) Charles GreenCEO, International DigitalInfrastructure Alliance

Zhiyong ZhangChairman & PresidentMiteno

Akhil GuptaChairmanBharti Infratel

Nat-sy MissamouSharing New Business Program Director, Orange

Nina TriantisManaging Director, Global, Head of Telecoms & MediaStandard Bank

Terry RhodesCEOEaton Towers

Marc GanziManaging Partner & InvestmentCommittee Member, Digital ColonyCEO, Digital Bridge Holdings

Arun KapurCo-FounderIrrawaddy Green Towers

Pat CoxenManaging DirectorMBNL

Dagan KasavanaCEOPhoenix Tower International

Daniel Lee Managing DirectorIntrepid Advisory Partners

Suresh SidhuCEOedotco Group Sdn Bhd

Rhys PhillipChief ExecutiveCornerstone

Ted ZhongFounder & CEO,Astro Tower

Hal HessExecutive Vice President & Chairmanof Latin America and EMEAAmerican Tower

Nobel TanihahaPresident DirectorPT SOLUSI TUNAS PRATAMA (STP)

Umang DasChief MentorAmerican Tower

Gilles KuntzCEOTowerCo of Madagascar

Maria ScottiCEOTorrecom

Tilak Raj DuaDirector GeneralTAIPA

Dimitris LiouliasGM of StrategySaudi Telecom Company

Kurt BagwellPresident InternationalSBA Communications

Jim EisensteinChairman & CEOGrupo TorreSur

Bimal DayalCEOIndus Towers

Inder BajajAdvisor, Helios Investment Partners & former CEOHTN Towers

Tunde TitilayoVice ChairmanSWAP International

Peter BendallSenior Vice PresidentMacquarie Infrastructure and Real Assets

Jeffrey EldredgePartnerVinson & Elkins RLLP

Enda HardimanManaging PartnerHardiman Telecommunications Ltd.

Adeel BajwaCEODhabi Group

Scott CoatesCEOWireless Infrastructure Group

Carlo RamellaCOO, EI Towersand Chairman, Towertel

Alexander ChubPresidentRussian Towers

Steve WeissCFOProtelindo

Toni BrunetCorporate & Public Affairs Director,Cellnex Telecom

Manish KasliwalVP and Chief Business Development Officer, C&SE Asia, American Tower

Carlos KatsuyaChief Investment Officer & Head TMT Asia, Europe and MENA, International Finance Corporation (IFC)


Interviews, market analyses & focus articles

68 Exclusive TAWAL interview71 Saudi Market Overview76 Exclusive IHS Towers interview79 Oman Tower Company83 Asia Consultancy Group86 Egypt Market Overview90 Morocco Market Overview93 Bahrain Netco97 Pakistan: AWAL Telecom103 Smart Cities and towercos106 Tower investability in MENA109 MNO towerco models112 Rural Connectivity116 Data collection and utilisation at edotco119 Getting regulation right

125 Al-Babtain LeBlanc 129 Bladon134 Byrne Equipment Rental136 Caterpillar140 EnerSys143 Enetek Power, An Eltek Holding Company146 GRIDSERVE Sustainable Energy150 House of Invention (HOI)153 ieng Group156 Infozech160 IPT PowerTech163 ITD / ClickOnSite167 Metalogalva170 NEXSYS-ONE175 Northstar Battery180 Polar Power Inc185 Ramboll189 Salasar Techno Engineering Pvt. Ltd.192 Sera4195 SerEnergy198 Sitetracker201 Vinson & Elkins RLLP

Contents

124 TowerXchange Meetup MENA exhibition preview

Introduction to the MENA tower market

4 TowerXchange’s analysis of the MENA tower industry28 Who’s who in MENA towers39 The turbulent history of MENA tower transactions50 2020 Demand forecast

Who to meet at TowerXchange Meetup MENA

59 Companies attending60 Sponsor profiles67 Meetup Europe preview

4-58

59-67

68-123

TowerXchange Meetups calendar

< ESCO Roundtable 2020, Casablanca, March 24-25< TowerXchange Meetup Europe 2020, May 19-20< TowerXchange Meetup Americas 2020, June 23-24< TowerXchange Meetup Africa 2020, October 13-14< TowerXchange Meetup Asia 2020, December 8-9< TowerXchange Meetup MENA 2021, January 26-27


TowerXchange’s analysis ofthe tower market in the Middle East & North Africa

The Middle East and North Africa is the region the least penetrated by the towerco business model globally. With the exception of Pakistan (which TowerXchange has grouped into our regional coverage), there have been no tower transactions of scale, and whilst a handful of build-to suit towercos have emerged, fewer than 6% of the region’s 275,104 towers sit in independent towerco hands, largely belonging to STC’s captive towerco, TAWAL.

In North Africa, some operators have embraced

infrastructure sharing more readily than their counterparts in the Middle East, with an active sharing agreements in place in Tunisia and approximately one third of towers in Egypt being shared, but on the whole infrastructure sharing between MENA’s MNOs has been limited.

We continue to await final regulatory approval for the IHS Towers deal negotiated with Zain in Kuwait for 1,700 sites. Meanwhile in Saudi Arabia 8,100 towers remain on Zain’s balance sheet,

pending resolution of dialogue between the MNO, prospective buyer IHS and the regulator. In Oman, Oman Tower Company has been established with plans to build hundreds of sites for the country’s three mobile operators and an appetite to acquire and manage some of the thousands of ground-based and rooftop sites in the Sultanate.

In April 2019 in Saudi Arabia, Saudi Telecom Company formed TAWAL, its own captive-towerco, which will own, manage and commercialise 14,200 of STC’s towers. TAWAL is currently setting its strategy, but it will be aiming to become a major regional player in some capacity in the not too distant future.

Further MNOs in the region are also understood to be studying tower sales closely, attracting the interest of towercos and investors in this virgin territory. Rumours have circulated that Tunisie Telecom may consider a sale of their tower portfolio, Djezzy (in which VEON are major shareholders) is known to have previously explored a tower divestment and is rumoured to retain the appetite to sell, and should Zain Group’s transactions go ahead successfully in Kuwait, one can expect their tower divestment strategy to spread to other markets.

Some operators have explored different paths. In Iran, MCI and RighTel came together to form joint venture towerco Iranian Towers, in partnership with domestic towerco Fanasia, which is believed to be nearing an MLL deal with MTN-Irancell.



The ESCO model is also gaining traction in MENA as an alternative outsourcing strategy. In Lebanon, both Alfa and touch have signed ESCO contracts with IPT PowerTech, whilst In Egypt, Orange (which in 2016 under the MobiNil brand had reached an agreement to sell 2,000 towers to Eaton Towers; a deal which didn’t obtain regulatory approvals) has issued an ESCO RFP. TowerXchange has also been made aware of further MNOs on the cusp of announcing ESCO RFPs.

In markets where new build is required, operators who may not necessarily be considering a tower divestment, are opening up to the idea of working with independent towercos in a bid to rollout new sites in a less capitally intensive manner. Several

major towerco names have been linked to the Egyptian market, where new build requirements are particularly high, both for established operators and new market entrant, Telecom Egypt. New build to suit players are also starting to emerge across the region, some of which have an appetite for tower acquisitions, should towers come to market.

As the region begins to open up to the independent towerco model and infrastructure sharing, there is a pressing requirement for governments and regulators to create supportive legislation. In this regard, progress in many markets has been slow and continued support and education on the merits of shared infrastructure and towercos remains key. Whilst a small market, with just

1500 towers, Bahrain’s regulator has been one of the most proactive. In early 2018, the country’s Telecommunications Regulatory introduced the Public Radio Communications Stations Regulation, designed to regulate the deployment of new towers and encourage infrastructure sharing in the country.

The advent of 5G and the move towards smart cities is necessitating major investment in densifying telecom networks in many of the most developed countries in the MENA region. How to achieve such densification, whilst often contending with declining ARPU and increased taxation, is causing operators to consider new business models and potential infrastructure sharing strategies.

Figure one: Tower counts across MENA markets

Source: TowerXchange

Saudi Arabia35,500

Iran37,106

Pakistan 35,043

Morocco19,054

Algeria19,000

Egypt22,704

Iraq14,769

UAE13,000

Tunisia8,383

Afghanistan6,645

Qatar5,000

Jordan6,836

Kuwait4,100

Lebanon 2,600

Bahrain1,500

Oman8,000


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Whilst the MENA region has a number of common threads including a number of operators active in multiple markets, a central role of government in business, a strong Arabic influence and similar climates and geographies, it is also important to note the stark differences across different markets; From the highly developed GCC countries pushing

towards 5G and decommissioning of parallel infrastructure, through to the war torn countries of Iraq, Afghanistan and Syria where network rollout, restoration and power remain top concerns in operationally challenging markets.

TowerXchange examine the dynamics at play in

16 countries across the MENA region, exploring key MNOs and their tower portfolios, the level of infrastructure sharing and presence of towercos, network expansion required and operational challenges present.

Country analyses

Afghanistan Subscribers: 33.5mn Tower count: 6,917 MNOs: Five Towerco activity: Asia Consultancy Group

Afghanistan has five MNOs, Afghan Wireless (AWCC) which is the country’s fastest growing MNO, Roshan which is funded by the Aga Khan Development Fund and is the country’s largest MNO, multi-national players MTN (which has hinted at exiting the market) and Etisalat, and newcomer Afghan Telecom which is part of the Ministry of Communications and Information Technology. Telecommunications remains an important sector for the Afghan government, with Afghan Wireless understood to be the largest tax payer in the country.

Each of the operators own pretty much of all of their sites, with the MNOs understood to have between 1000-1500 towers each. The Telecom Regulatory Authority of Afghanistan (ATRA) states that there are 6,917 base stations in the country, and with limited infrastructure sharing one can assume that a rough proxy for the number of towers. As the country’s newest player with just 5% market

Figure two: Footprints of MENA’s major MNOs

Source: TowerXchangen.b. Lighter colours indicate the company owning a stake in an MNO in the country

Coutry Etisalat MTN Ooredoo Orange STC Vodafone Zain

AfghanistanAlgeriaBahrain

EgyptIranIraq

JordanKuwait

LebanonLibya

MoroccoOman

PalestinePakistan

QatarSaudi Arabia

SyriaTunisia

UAEYemen


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share, Afghan Telecom’s network is smaller than that of its competitors and the operator has recently inked a network sharing deal with Etisalat. Afghan Telecom currently uses around 60-70 of Etisalat’s towers, with plans to extend this tower sharing arrangement. Networks are better established in Northern and Central regions, although Afghan Wireless is still investing in Southern regions of the country.

Since the MNOs entered the market in the early 2000s, the security situation has deteriorated significantly. The Taliban demanded the shutdown of a significant number of sites to avoid surveillance by national and international security forces; where these demands were not met many sites were blown up. MNOs have been reluctant to invest and so there has been little activity in terms of new tower build or co-location. Frontier Tower Solutions had operated in the market in the earlier days, building, operating and maintaining sites for Afghan Wireless but the towerco has since wound up operations in the country. Afghan managed service provider, Asia Consultancy Group, owns ~100 towers which it makes available for co-location and RANsharing services.

99% of sites run on gensets – even in cities – and the biggest challenge is getting fuel delivered to sites. Solar solutions had been examined but the payback period means that MNOs have been reluctant to invest. There are few to no major international contractors operating in the market outside of the military (with foreign troops also having massively reduced their presence, a factor which caused a drop in subscriber numbers) although

Figure three: Heatmap of tower deals and towerco activity in MENA


Towerco activityTowerco activity plus tower sale process underwayRumours of a tower transaction in the past five yearsConfirmed tower sale process underwayNo towerco activity or deal rumours

TowerXchange has heard rumour about one multi-national MSP offering ESCO-like services in the market.

In spite of the challenging conditions, coverage in the market has been described as “fairly okay”. There are 33.5mn subscribers with mobile penetration sitting at 89% (source: ATRA) and 4G coverage is available in major urban areas, where data usage continues to grow faster than expected. In early 2018, the ATRA agreed to provide US$32.1mn of funding to deploy 250 base stations in rural and remote areas. Roshan will deploy 137

sites, Afghan Wireless 84 sites and Afghan Telecom a total of 29.

Algeria Subscribers: 47.0mn Tower count: 19,000 MNOs: Three Towerco activity: Some colocations on towers belonging to national broadcaster Télédiffusion d’Algerie (TDA)

Algeria has three MNOs, Mobilis (Algerie Telecom) with 41% market share, Djezzy (Optimum Telecom


Hero_TowerXchange_Advert_Landscape.indd 1 4/30/19 12:55 PM


Algerie) with 31% and Ooredoo (Wataniya Telecom Algerie) with 27%. There are 47mn mobile connections in the country, growing at a rate of 8% YoY and mobile penetration sits at 113% (Source: ARPCE – L’Autorite de Regulation de la Poste et des Communications Electroniques). Each of the MNOs obtained a 4G license in 2016 and rollout is well underway with around one quarter of the population covered as of Q1 2018.

There are an estimated 19,000 towers in the country of which 20% are ground based and the rest are rooftop or alternative site typologies. Mobilis has the largest portfolio with around 7500 sites, followed by Djezzy with 6,500 and Ooredoo with 5,000. State owned broadcaster, Télédiffusion d’Algerie (TDA) has approximately 350 towers. The country needs an additional 2,000-3,000 new sites to be added in the next 18-24 months, and what’s

more, a significant proportion of existing sites need to be dismantled and replaced. Mobilis has long had plans to deploy 1,200 to 1,400 sites but repeated changes in management have stalled rollout plans in recent years.

Less than 2% of sites are currently shared, with many lacking the structural capacity for additional tenants and MNOs failing to agree what constitutes a fair swap. In late 2016, the regulator introduced plans for active sharing and in a short period of time, Ooredoo and Djezzy started sharing around 1,000 sites. In mid 2017 however, the regulator did a u-turn, prohibiting active sharing although provisions for active sharing are however laid out in the 4G license conditions.

No tower transactions have been carried out in the Algerian market, although Djezzy, in which

VEON are major shared holders, carried out an exploratory study into a potential tower sale (VEON, formerly VimpelCom, has experience in tower divestments having previously sold their Italian towers to Cellnex and looked at the sale of their assets in Russia, Pakistan, Bangladesh and the CIS). Limits on foreign direct investment in Algeria (limiting international players to a 49% stake) however meant that there was a lack of appetite from most international towercos to enter the market.

In terms of site operations, 99% of sites are on grid with generators used for backup on core sites. With comparably cheap fuel prices the case for hybrid solutions is reduced.

Bahrain Subscribers: 2.2mn Tower count: 1,500 MNOs: Three Towerco activity: None

The Kingdom of Bahrain has three mobile network operators; Batelco, Saudi Telecom Company owned Viva and Zain serving a subscriber base of 2.2mn (source: TRA Q2 2018). In February 2019 Viva inked a deal with Huawei to launch 5G and in April 2019 Batelco signed a deal with Ericsson to roll out a 5G network over three years. Batelco’s 5G network went live in June.

In spite of its small landmass, Bahrain has a total of 1,500 sites of which around 12% are currently

Figure four: Tower ownership in Algeria


Mobilis

Djezzy

Ooredoo

7,500

6,000

4,500



shared, leading to significant parallel infrastructure. In 2016, the Telecommunications Regulatory Authority of Bahrain (TRA) commissioned a study to examine the rationalisation of the Kingdom’s total tower count down to a core network of 400 sites. In early 2018, the TRA introduced the new Public Radio Communications Stations Regulation (PRS Regulation) to regulate the deployment of new towers and “rectify existing ones in accordance with best practice”. The new detailed legislation lays out key specifications for new and existing towers, specifying everything from the type of concrete used in the foundations to key health and safety requirements. The rectification plan is to take place over the next 15 years, with more than 90% of the towers requiring modification and the TRA setting out a goal of increasing the percentage of sites being shared from 12% to 40% in the country.

When questioned by TowerXchange on different


Figure five: Tower ownership by Egypt’s MNOs

Etisalat

Orange

Vodafone

Telecom Egypt

6,000

2,000

8,500

6,166

business models to reach the targets set in place, the TRA stated “Currently there are three operators who are licenced to deploy masts and towers in Bahrain. As a result there are three different mast and towers networks, i.e. one for each operator. The Authority considers there is room for improvement by merging these different networks into one or at least two. This could be done either by introducing a towerco company, a joint venture between existing operators or other feasible business models.”

Egypt Subscribers: 103.2mn Tower count: 22,704 MNOs: Four Towerco activity: HOI (plus interest expressed from a number of other towercos)

Egypt now has four MNOs (each with 4G licenses) with Telecom Egypt joining Vodafone, Etisalat and

Orange after having obtained a license in 2017. With 90.7mn subscribers (source: Fitch Solutions, 2019) and just over 24,000 towers, Egypt has nearly 4,000 subscribers per tower, the highest in the MENA region. A new towerco licence will issued soon.

Tower ownership is fairly evenly split amongst the three established MNOs with new market entrant, Telecom Egypt lagging behind with just 2000 towers. Four infraco licenses also having been awarded to Alkan, Mobiserve, EEC and HOI to enable them to own towers, although only HOI has built and retained a portfolio of towers with their current site count sitting at 38. Rumours had circulated that HOI were looking for a buyer for their towers.

There have been no tower transactions of scale in the market. MobiNil (now Orange) reached a deal back in 2016 to sell 2,000 of their sites to Eaton Towers for $131mn although the deal was cancelled and does not look like it will return to the table any time soon. Infrastructure sharing between the MNOs is relatively widespread, with Orange reporting that over a third of the towers they use are shared with other operators. In early 2018, Telecom Egypt reached a wholesale agreement with Vodafone to utilise its transmission and infrastructure services for a three year period whilst it establishes it network.

Each of the four MNOs were awarded an 4G license in 2016, and whilst 4G coverage is relatively extensive in Cairo, major rollout is still required



elsewhere. Collectively, Orange, Vodafone and Etisalat are understood to be adding 300-500 new towers per year, whilst Telecom Egypt has initiated the next phase of their network rollout, requiring the addition of 1,000 new sites (GBTs, rooftops and IBS). Such high requirements for new build and co-locations has attracted the interest of international towercos, with American Tower, TASC Towers, Digital Bridge and Eaton Tower all being linked to potential opportunities in the market. A new licence is expected to be issued to an international towerco imminently.

Grid connection for tower sites is slow and expensive and so generators are widely used, often two per site due to the high loads. Fuel remains cheap by international standards and so the case for hybrid solutions is reduced; although fuel subsidies


Figure six: Tower ownership in Iran

MCI

MTN Irancell

Rightel

Iranian Towers

Fanasia

21,000

11,000

4,000 1,000106

are gradually being phased out. Orange has issued an RFP for an ESCO to take over power for a portion of their towers in the market, with a goal of improving energy efficiency at sites. At least one of the other MNOs is expected to follow in Orange’s footsteps.

Iran Subscribers: 118mn Tower count: 37,106 MNOs: Three national plus FCP and WiMAX players Towerco activity: Iranian Towers and Fanasia

Iran is the Middle East’s largest mobile market with 118mn subscribers. There are three national operators in the country of which MCI (Mobile Communication Company of Iran) is the largest with

61.3mn subscribers and 43% of the market share. MTN-Irancell, a joint venture in which MTN holds a 49% stake, is Iran’s second largest operator with 45.5mn subscribers and 40% of the market share; and RighTel is the third largest operator with 9.5mn subscribers and around 8-9% market share. In addition to this there are a number of FCP players and WiMAX operators who make up the balance of the market share.

There are currently around 37,000 towers in the Iranian market and with very little infrastructure sharing between the operators there is a significant degree of parallel infrastructure. In 2014, Fanasia, an Iranian company with a background as a turnkey service provider to the country’s MNOs, started their own towerco business. Their first project on Kish Island, conducted with the support of the Kish Free Zone Organisation, was to rationalise the number of towers on the island. With 110 sites on the Island, each with a single tenant and unsuitable for the addition of further tenants, Fanasia built 27 new sites which the operators were mandated to use, whilst existing sites were decommissioned. The municipality benefited from a revenue sharing model on top of the land rental fee and further benefited from the freeing up of land under the old towers. Following the success of the Kish Island project, Fanasia reached a similar agreement with the municipality of Mashhad, Iran’s second most populous city to develop a core network of 350 sites in March 2016. Fanasia currently owns 106 towers.


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In early 2017, in response to the growing trend towards infrastructure sharing in Iran, a new tower company, Iranian Towers, was formed. The three shareholders in the company are MCI and Rightel, Iran’s number one and three MNOs, and Fanasia, Iran’s first towerco. The first phase of Iranian Towers’ operations will be the construction of approximately 1,000 new sites which are capable of accommodating multiple tenants. These sites will be constructed primarily in the major cities in order to accommodate 4G and 4.5G rollout. The new rollout will include both ground based and rooftop sites and will be conducted with the coordination of municipalities who will benefit from revenue sharing on the sites. Iranian Towers now own around 1,000 sites. Iranian Towers is closing in on a Manage with License to Lease deal with MTN-Irancell and a build to suit deal with MCI.

Iraq Subscribers: 36.7mn Tower count: 14,769 MNOs: Three national plus several LTE only players in Kurdistan Towerco activity: None (although rumours circulating)

Iraq has three nationwide MNOs which own 2G and 3G licenses; Zain, Asiacell (owned by Ooredoo) and Korek Telecom (Korek was once part Orange-owned, but Orange’s stake was confiscated and awarded to local shareholders – litigation is ongoing). Zain has the largest mobile market share, with Asiacell close behind, whilst Korek Telecom is the country’s fastest growing operator which is dominant in the Kurdistan region. In addition to


Figure seven: Ownership of Iraq’s 14,769 towers

Zain

Asiacell

Korek Telecom

Fastlink

Tishknet

Other 4G LTE players

4,5515,200

3,669850 300

200

the three nationwide operators, there are a host of 4G LTE players in the Kurdistan region, Fastlink being the largest with Tishknet, Goran-Net and Mobitel amongst the other players. The government had proposed the introduction of a fourth national operator (in which the ruling government would have a stake) although further details are yet to emerge with political issues thought to be holding the process up.

There are 14,769 towers in the market split between the national and Kurdistan operators (figure seven). Approximately 10-15% of the country’s total stock was understood to have been destroyed or damaged during the conflict over the past three years, with power systems particularly damaged, and so major reparatory works have been underway.

There has been significant under investment

in networks in recent years with 3G coverage understood to be particularly poor and so significant network expansion is required; Korek Telecom forecast that they need to build a further 2,500 sites. Major investment has been pledged by international investors and donors in a bid to rebuild Iraq’s economy, with significant funds expected to be channeled into telecoms.

Iraq’s MNOs are struggling with high opex, attributable in large part to security and logistics issues across the country. Power remains a major challenge and whilst figures for power availability vary by region and by time of year (ranging from zero grid to 16-18 hours in Kurdistan in summer), the vast majority of sites are reliant on two diesel generators. Hybrid solutions are yet to have any large scale trials in the country, and whilst fuel is not expensive by a global comparison, the costly



and difficult logistics associated with fuel delivery and generator maintenance means that a switch to hybrid solutions is attractive.

Jordan Subscribers: 11.7mn Tower count: 6,836 MNOs: Three Towerco activity: TASC Towers

There are three MNOs in Jordan; Orange, Zain and Umniah (owned by Batelco) which have a roughly similar mobile market share and as such, the market is highly competitive. There are just over 7,000 towers in the country, roughly split between the three MNOs, and towerco, TASC Towers, owns a modest portfolio of sites.

Jordan’s Telecommunications Regulatory Commission (TRC) is in the process of creating a centralised database of fibre optic networks in a bid to limit duplication of infrastructure and encourage network sharing. Whilst no such scheme currently exists for towers, infrastructure sharing does exist between the MNOs with Orange reporting that just under 15% of the sites that it uses are shared with other operators.

The telecommunications sector is subject to heavy taxes in Jordan with operators having been exposed to increased electricity prices which has had an impact on operator profits. Orange have invested in a 33.7MW solar PV plant to produce the electricity it requires.


Figure nine: Site ownership by MNOs in the Kuwaiti market

Zain

Ooredoo

Viva

1,700

1,200

1,200


Figure eight: MNO tower ownership in Jordan

Orange

Zain

Umniah

2,136

2,500

2,200

Kuwait Subscribers: 7.2mn Tower count: 4,100 MNOs: Three Towerco activity: IHS Towers (pending closure of the Zain tower deal)

There are three MNOs in the Kuwaiti market where intense price competition has driven data costs

down drastically, putting pressure on the country’s operators. Decreasing ARPU has made justifying investment in rolling out new sites tough, with each MNO focussing on implementing cost optimisation initiatives to enable 5G roll-outs. All three Kuwaiti MNOs are offering 5G router packages for home internet, and mobile 5G-networks are imminent.

Market leaders Zain have reached an agreement



to sell 1,700 towers to IHS Towers for US$165mn. The deal is expected to close imminently, with just a couple of minor regulatory issues to be finalised. When completed, the deal will mark the first major tower transaction in the Middle East (excluding Pakistan). The entrance of a towerco will provide a more cost effective means to expand networks in a market where infrastructure sharing has been limited to date. There are approximately 4,100 towers in the Kuwaiti market with significant parallel infrastructure existing. Decommissioning is expected to play a significant role in IHS’ business model in the country.

Lebanon Subscribers: 4.6mn Tower count: 2,600 MNOs: Two Towerco activity: None

There are two state owned MNOs in Lebanon, touch and Alfa, for which Zain Group and Orascom have management contracts. The two operators have a roughly equal market share in a country which has some of the highest mobile tariffs in the world. There are approximately 2,600 towers evenly split between the two operators, with no independent towercos operating in the country. Whilst subject to budget approval from the government, plans have been announced to add between 700-800 new towers before the end of 2019.

Of the 2,600 towers, approximately 15% are on good grid with 24 hours of availability, 73-75% are on poor grid (with availability ranging from 6-18 hours) and 10-12% of sites are completely off-


Figure ten: Tower ownership by Morocco’s MNOs

Maroc Telecom

Inwi

Orange

10,000

5,000

4,054

grid. IPT PowerTech have signed ESCO contracts with both operators in the market, taking over management of power across their site portfolios.

Morocco Subscribers: 43.9mn Tower count: 19,054 MNOs: Three Towerco activity: None although two new towercos eyeing the market

Maroc Telecom is the leading MNO in the Moroccan market with 42% market share, ahead of both Inwi (in which Zain has a 15.5% stake) and Orange in a country with 43.9mn subscribers. Data usage continues to grow as 4G rollout progresses, with Maroc Telecom reporting 4G population coverage at 93% (versus 73% in 2016).

Maroc Telecom has the largest tower portfolio with approximately 10,000 sites, whilst Orange

and Inwi are understood to have 4,000-5,000 each. Infrastructure sharing between the MNOs exists, with approximately 15% of sites thought to be shared.

Oman Subscribers: 6.6mn Tower count: 8,000 MNOs: Two (plus resellers); entrance of third MNO imminent Towerco activity: Oman Tower Company

Oman has two MNOs, Omantel and Ooredoo as well as two mobile resellers, Renna Mobile and Friendi Mobile. In 2017, the government introduced a tender process for a third MNO which attracted interest from parties including Zain, Saudi Telecom Company, Etisalat and Sudatel. The tender process was cancelled with the government instead deciding to award the license to a consortium involving local funds and a global strategic partner.


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The stated objective for the change in strategy was to enable the local funds to deploy their assets in Oman as part of an overarching economic diversification vision away from oil. The third MNO license was recently awarded to Oman Future Telecommunications, back by local investors, and which is in a strategic partnership with Vodafone.

In addition to the threat of a third MNO and existing competition from OTT players, Omantel and Ooredoo have felt further pressures from an increase in MNO royalty fees from 7% to 12% and a tax increase from 12% to 15%.

Oman has approximately 3,000 ground based towers and 5,000 rooftop sites, roughly evenly split between the two MNOs. Omantel are understood to be increasing their tower count by about 4-5%

per annum, suggesting an average of around 100-120 new towers are built by the operator each year. For Ooredoo, similar numbers are forecast. Infrastructure sharing has been limited to date but has started to increase as the MNOs aim to execute the rollout of 4G more cost effectively, with current estimates suggesting approximately 10% of towers are shared.

In February 2018, Oman 70 Holding Company, AktivCo and the Omani Government set up a new organisation called Oman Tower Company, which is now operational. The company plans to build hundreds of towers in the first five years, and has an interest in acquiring or managing the existing portfolios of Oman’s MNOs. Oman Tower Company has begun sharing telecoms infrastructure with local petroleum group PDO. Omantel are

rumoured to be considering a sale of their towers with a formal process expected to be announced in 2020.

Pakistan Subscribers: 147.8mn Tower count: 35,043 MNOs: Four Towerco activity: edotco, Enfrashare, AWAL Telecom (plus several other licenses held)

Pakistan has four MNOs; Jazz (formed through the acquisition of Warid by VEON’s Mobilink) leads the market, followed by Telenor, China Mobile’s Zong and Ufone (in which Etisalat has a stake). With a relatively low mobile penetration rate of ~73% and a data penetration rate of ~24%, there is significant opportunity for long-term growth in the market.

Towercos have been licensed in Pakistan since 2006 but MNO attitudes towards infrastructure sharing only started to thaw in 2011, initially seeing their networks as a source of competitive advantage.

Towershare-owned Tanzanite built a portfolio of 700 sites in the market, built largely from acquisitions, with the majority of towers coming from previous WiTribe assets. The Tanzanite portfolio, 40% of which were ground based towers, secured tenancies from all major operators, reaching a tenancy ratio of 1.6x before being acquired by pan-Asian towerco, edotco Group for US$88.9mn in 2017.

edotco subsequently joined forces with Dawood Hercules, a listed Pakistani holding company


edotco

Telenor

CMPak (Zong)

Ufone

Jazz (Deodar)

AWAL Telecom

Enfrashare

1,39845

1,300

7,400

7,100

6,100

11,700

Figure eleven: Ownership of Pakistan’s 35,043 towers


conglomerate to acquire the 13,000 Jazz towers which had been carved out into a subsidiary, Deodar. The sale has however since fallen through although rumours suggest that local investors and their partners are working to rekindle the deal, with reports Dawood Hercules’ towerco Enfrashare has acquired 1,300 towers from Jazz.

Whilst several local companies are also licensed as towercos (with 14 license holders currently listed by the Pakistan Telecommunications Authority), only AWAL Telecom appears to be trading as such.

MNOs Telenor, Zong and Ufone each retain their tower portfolios. Ufone has been exploring the potential sale and leaseback of their towers in Pakistan for some time. The process was stalled by the de facto merger of PTCL and Ufone, and associated management changes, but Ufone could yet contribute over 6,000 further assets to the pool of commercially shared towers.

China Mobile’s Pakistan opco, which trades under the brand name Zong, has around 9,100 sites, of which around 2,000 are co-locations.

Telenor is a keen advocate of all forms of network sharing; towers (sharing primarily with Jazz), fibre (sharing with Zong), and has taken a lead role in exploring active infrastructure sharing. Telenor and Zong undertook Pakistan’s first RANsharing trials across around 30 sites, while the Norwegian-owned MNO has also shared IBS, both under the MORAN model where spectrum is not shared.

There has been extensive infrastructure sharing

between operators but significant parallel infrastructure exists, especially in urban areas, implying that decommissioning is likely to be a key part of towerco strategy in the future. TowerXchange estimate the prevailing tenancy ratio (the average number of tenants across all towers in the country) to be around 1.25 in Pakistan, with a clear pathway to 1.5. Of around 10,000 co-locations in the country, most originate from barter arrangements, with some application of commercial lease rates, but more often offset against one another so no cash changes hands. These agreements will continue to be converted to commercial leases as towercos continue to become more prevalent.

Pakistan’s MNOs cite power as the number one operational challenge in the market, followed by security and landlord issues.While Pakistan’s electricity grid remains unstable, and outages can last eight or more hours, the situation has improved notably in recent years. Backup diesel genset runtime is being reduced at sites on the country’s better grid connections, with DGs increasingly being removed from such sites. edotco will offer a full tower+power service in Pakistan, meaning they will lease tower and ground space as well as providing DC energy.

Qatar Subscribers: 4.4mn Tower count: 5,000 MNOs: Two Towerco activity: None

Qatari headquartered Ooredoo are market leaders

in their home market, with 3.4mn subscribers versus Vodafone’s 1mn. Vodafone has sold its 51% stake in its opco to former joint venture partner, Qatar Foundation, with the local opco continuing to operate under the Vodafone brand via a Partner Market agreement.

There is little to no infrastructure sharing in the market, but with both operators now effectively owned by the state the government may start to view infrastructure sharing more positively.

At the end of 2017, Ooredoo launched one of the first “5G speed experiences” at select locations in Doha. Qatar is positioning itself as a front runner in the rollout of 5G, with a world class infrastructure backbone one of the key pillars of the Qatar National Vision 2030.

Saudi Arabia Subscribers: 43.9mn Tower count: 35,500 MNOs: Three Towercos: TAWAL (STC’s carve-out)

There are three MNOs in Saudi Arabia; market leaders Saudi Telecom Company, Mobily (in which Etisalat has a 27% stake) and Zain. Additionally there are two MVNOs; Virgin Mobile and Lebara.

Between them, Saudi’s MNOs own over 35,500 towers with STC having the largest portfolio. Infrastructure sharing in the Kingdom has


to date been very limited, with less than 2% of sites believed to have more than one tenant. In the major cities, Riyadh and Jeddah, there has been some infrastructure sharing as part of MNO densification plans to meet growing data usage, whilst in some of the country’s holy sites where access to land is limited, infrastructure sharing has arisen out of necessity. These infrastructure sharing arrangements are typically under bilateral commercial agreements and thus far have only covered passive equipment.

With little infrastructure sharing a high degree of parallel infrastructure has developed; 95% of Zain and Mobily’s sites are reported to overlap


Figure twelve: Tower ownership by Saudi Arabia’s MNOs

Saudi Telecom Company

TAWAL

Mobily

Zain

14,200

2,400

11,000

8,100

and as such, the government is keen to promote infrastructure sharing.

Various passive infrastructure strategies have been explored by each of the Kingdom’s MNOs in recent years. As early as 2011, Saudi Telecom Company and Mobily announced their interest in forming a towerco joint venture only for talks to stall; the MNOs revisited joint venture plans in late 2016 but once again decided not to proceed.

The first talks about tower sales emerged in late 2014, when Zain appointed Citi to oversee a potential sale of their towers. Mobily followed suit announcing a tower sale process before STC also

weighed in on the action hinting they too may look to sell their larger portfolio. Ultimately all tower sale processes were pulled, leaving bidders with their fingers burnt after so many stop-start discussions.

In late 2017, Zain announced that it had entered into exclusive negotiations with TASC Towers and Saudi based Acwa Group to sell their portfolio. Talks expired and Zain subsequently entered into exclusive negotiations with IHS Towers and Towershare, with the operator having previously agreed the sale of their Kuwaiti towers to the pair. On 28 November 2018, Zain announced that it had accepted an offer valued at SR2.43bn (US$647.7mn) from IHS Towers for the sale and leaseback of its portfolio of 8,100 Saudi towers, with a new build order for 1500 towers included in the deal, which was halted by regulator the CITC in June 2019 and announced as cancelled by Zain at the start of 2020.

In Q1 2018, Saudi Telecom Company established Communication Towers Co. Ltd., a fully owned limited liability company, with a share capital of SR 200 million which “will be responsible for owning, constructing, operating, leasing and commercialising telecom towers.” In April 2019 the company was launched as TAWAL, an STC-owned towerco managing and commercialising 14,200 towers in the kingdom. With 14,200 towers it is already one of the world’s top 25-towercos and it has expressed regional ambitions for sale and leasebacks beyond merely managing STC’s towers in Saudi Arabia.


Tunisia Subscribers: 14.2mn Tower count: 8,383 MNOs: Three plus Lycamobile Towerco activity: NATIC and Infrashare (newly formed towercos)

There are 15mn active subscribers (source: INTT Q3 2018) and three MNOs in the Tunisian market; market leader Ooredoo, Orange and Tunisie Telecom. Emirates International Telecommunications (which has a stake in UAE operator du) reached an agreement to sell its stake in Tunisie Telecom to private equity firm, Abraaj Group. Rumours had circulated that the transaction may precipitate a sale of Tunisie Telecom’s towers and whilst the takeover has since been called off, leaving the fate of Tunisie

Telecom’s towers in the balance, observers expect a tower deal to occur in the future.

There are an estimated 8,383 towers in the Tunisian market, split between the region’s MNOs. In addition, there are two new towercos eyeing up the market, NATIC and Infrashare. Whilst NATIC has an appetite for build to suit (which is understood to be somewhat limited in the country), Infrashare’s interest relates more to sale and leaseback activity should it arise. When it comes to major infrastructure projects, the government has instigated limitations on foreign direct investment, limiting international participation to 49% Such legislation is expected to be extended to towers in the country, although forthcoming elections may shake things up once again.

Infrastructure sharing exists with Orange reporting that approximately a third of its sites are shared with other MNOs. In addition to passive infrastructure sharing, Tunisie Telecom and Ooredoo have a RANsharing deal in the country into which there had initially been discussions to include Orange.

UAE Subscribers: 19.0mn Tower count: 13,000 MNOs: Two Towerco activity: None

Etisalat lead the UAE’s market where it competes with du (and new MVNO, Virgin Mobile). Emirates International Telecommunications (which has just sold its stake in Tunisie Telecom) is a shareholder in both du and Virgin Mobile in the country.

Whilst two competing entities, both Etisalat and du have a common shareholder in Emirates Investment Authority which has 60% share in the former and a 39.5% share in the latter which creates an unusual situation in the market. The two operators have a fixed network sharing deal.

There are an estimated 13,000 towers in the UAE of which Etisalat owns 8,000.

Both Etisalat and du have live 5G networks and are investing aggressively in new sites, with combined targets of nearly 1,000 new 5G sites in the Emirates


Figure thirteen: Tower ownership by Tunisia’s MNOs

Tunisie Telecom

Orange

Ooredoo4,500

2,500

1,383


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TowerXchange’s who’s who in MENA towersTowerXchange presents an A to Z of MNOs, towercos, investors and advisors who are key stakeholders in the MENA tower industry

Abraaj Investment Fund: UAE investment fund in the process of acquiring a stake in Tunisie Telecom from Emirates International Telecommunications. The stake sale may precipitate the divestment of towers from Tunisie Telecom.

Abu Dhabi Investment Authority: Investment fund which had formed a consortium with KKR, Canada Pension Plan Investment Board and GIC Singapore to buy a stake in a merged Bharti Infratel and Indus Towers deal, valued at ~US$11bn (the deal since having fallen through). Could have an interest in putting capital at work in Middle Eastern towers. Currently has a preference for tower investments outside of the MENA region but that could change.

Acwa Group: Saudi conglomerate with an interest in towers. Joined forces with TASC Towers in their bid to acquire Zain’s Saudi Arabian sites.

Africinvest: Tunisian headquartered private equity firm focussed on the African continent and rumoured to have an appetite for towers in the North African region.

Al Rahji Group: Saudi based investor which was linked with 2016 Mobily tower sale process (which was subsequently cancelled).

Al Zamil Group: Middle Eastern investor who was linked with previous tower sale processes in Saudi Arabia.

Aktivco: ECSO owned by Camusat who owns 34% of Oman Tower Company – the first towerco in Oman.

Read this article to learn:< Details of MENA’s major MNOs and their regional footprints< Independent towercos with a footprint in the region< Towercos and investors with a potential appetite for MENA tower portfolios< TMT advisory firms with experience of tower transactions

Whilst 94% of towers in the MENA region sit in the hands of the MNOs, efforts around infrastructure sharing are continuing to build, towercos and tower joint ventures are being formed and tower sales have begun. At such a pivotal time, TowerXchange examines the key stakeholders currently active in, or with a potential appetite to join, the MENA tower industry.


2,5142,210

2,6792,3661,595715

4,995

Alkan: MEA tower manufacturer and system integrator which holds one of the four infraco licenses in Egypt to build and own towers in the country. The company is yet to retain any of the towers that it has built. American Tower: The world’s largest independent commercial towerco with a global tower count approaching 150,000. Whilst American Tower do not currently have a presence in the MENA region, the towerco is highly acquisitive with a truly international footprint spanning the Americas, Europe, Africa and Asia. As a US listed company, their ability to enter some Middle Eastern markets may be challenging but where there is an interesting tower transaction of scale, American Tower is never very far away.

Asia Consultancy Group: Afghan managed service provider. Also owns ~100 Afghan towers available for co-location and RANsharing services.

Asiacell: Ooredoo’s opco in Iraq.

ASMA Capital: Bahrain headquartered Infrastructure fund managers with a known interest in the tower asset class

AWAL Telecom: Pakistani towerco with an undisclosed tower count.

Batelco: Bahrain headquartered telecommunications company with mobile network operations in Bahrain and Jordan (where it operates under the Umniah brand) and a

minority investments Yemeni operator, Sabafon. Batelco had previously explored the sale of its tower portfolios in Bahrain and Jordan to fund acquisitions. When the acquisitions fell through, so did Batelco’s appetite to sell towers.

Berkshire Partners: Berkshire backed Crown Castle during their successful foray into European towers in the late nineties, and currently has active investments in Protelindo (the largest towerco in Indonesia which had a small footprint in the Netherlands until their Dutch towers were sold to Cellnex in 2016) and Tower Development Corporation in the US and Puerto Rico.

Blackstone: Another serial towerco investor currently working with Phoenix Tower

International in CALA. Should a sizeable towerco emerge in MENA, Blackstone may well assess the opportunity.

Brookfield Asset Management: Investor with an active interest in towers which owns a stake in French towerco TDF. Brookfield entered into discussions to acquire UK based Arqiva and also recently evaluated the Indian towerco, Reliance Communications. Brookfield has an appetite for further tower investments and has increasingly been looking at MENA.

BuyIn: 50/50 procurement joint venture between Deutsche Telekom and Orange, a key client for companies looking to sell into Orange’s MENA opcos.

Figure 1: American Tower’s global footprint

Source: AMT Q3 2019 results

40,340

75,072

19,036

Brazil

Mexico

Colombia

Chile

Paraguay

Peru

Costa Rica

Argentina

USA

India

Nigeria

South Africa

Ghana

Uganda

Kenya

France

Germany

9,6235,000

1,328 1,421 1,081 619 71


Canada Pension Plan Investment Board: CPPIB is the professional investment management organisation that invests the funds of the Canada Pension Plan on behalf of its 20mn contributors and beneficiaries. CPP’s tower investments include a 10.3% stake in Bharti Infratel with KKR, bought at US$951.6mn. It was also part of a consortium led by KKR which was in talks to buy a significant stake in a combined Bharti Infratel and Indus Towers deal.

Capital Group: Investor in Eaton Towers, with Eaton in the process of being sold to American Tower. Eaton had previously explored the Egyptian market, giving Capital Group exposure to the North African tower market.

Citi: One of the world’s leading tower transaction advisory groups who have been involved in tower process in Saudi Arabia and Kuwait.

Dawood Hercules Corporation (DH Corp): Listed Pakistani investment conglomerate with a US$600mn market cap. Took a 45% stake in edotco Pakistan prior to the (now cancelled) deal to acquire 13,000 towers from Jazz.

Digital Colony/ Digital Bridge: An investment vehicle through which stakes are invested in towercos around the world. Has active investments in Mexico Tower Partners, Andean Tower Partners and Vertical Bridge and also sold Global Tower Partners (GTP) to American Tower in 2013 for $4.8bn. More recently, Digital Colony acquired Finnish towerco, Digita and acquired a number of

UK indoor and outdoor coverage businesses. Digital Bridge had expressed an interest in the deal activity in Saudi Arabia.

Djezzy (Optimum Telecom Algerie/ OTA): Algerian MNO in which Russian owned VEON (formerly VimpelCom) has a 49% stake (with the remainder held by the Algerian government). VEON has sold their WIND towers in Italy to Cellnex and initiated (and since cancelled) tower sale processes in Russia, Pakistan and the CIS. The company had conducted an initial investigation of a potential tower sale in Algeria, but with limits on foreign investment in the country, there was insufficient interest from towercos. Should a willing buyer appear, Djezzy may well move forward with plans.

dU: The UAE’s number two MNO in which the government also has a stake.

Eaton Towers: Africa’s fourth largest towerco which is in the process of being acquired by American Tower. In 2016, the towerco reached a deal with MobiNil (now Orange) to acquire 2,000 Egyptian towers (about one third of the operator’s total stock in the country) before the deal was cancelled.

edotco Group: Pan-Asian towerco with a footprint of 29,924 towers across Malaysia, Sri Lanka, Bangladesh, Cambodia, Pakistan and Myanmar. In 2017, edotco acquired Towershare’s Pakistani business for US$90mn before linking up with Dawood Hercules Corporation in a now-cancelled deal to acquire 13,000 towers from MNO Jazz. Spun

out of Malaysia’s Axiata, the MNO’s shareholding in edotco has been diluted to 62.4% following private placements by INCJ, Khazanah and KWAP. edotco has previously been linked with tower transactions in the Middle East and is understood to have an appetite for geographical expansion outside of its current markets.

EEC Group: Egyptian towerco manufacturer holding one of the country’s four infraco licenses that enable it to function as a towerco. EEC is yet to retain any of the towers it has built on its balance sheet.

Emirates International Telecommunications: Dubai Holding’s primary investment vehicle in telecoms; has a stake in UAE’s du, and Tunisia’s Tunisie Telecom. EIT is attempted to sell its stake in Tunisie Telecom to Abraaj Investment Fund in 2018, but this deal fell through.

Enfrashare: Headquartered in Islamabad, Enfrashare is a wholly owned subsidiary of Engro Infiniti Pvt Ltd which in turn is a part of the Engro Group of Companies. Enfrashare started its operations in Nov 2018 and has acquired 13,000 sites from Jazz.

Etisalat: UAE’s leading MNO with a presence in Saudi Arabia (Mobily), Egypt (Etisalat Misr), Pakistan (Ufone) and Afghanistan in addition to a 53% stake in Maroc Telecom (which itself has a presence in 15 African markets) and a presence in further Asian markets. The operator has experience of monetising tower portfolios, selling


Figure 3: Etisalat’s MENA footprint

their Nigerian portfolio to IHS back in 2014 and 2015, although the lease payment challenges which compounded their financial woes prior to their exit in 2017 are understood to have deterred the MNO from any future tower divestments. In Saudi Arabia, Mobily had explored a potential tower sale as well as a potential joint venture with number one MNO, Saudi Telecom Company although both plans appear to have been put on hold for the time being. Meanwhile in Pakistan, Etisalat’s subsidiary, Ufone has also been exploring a tower sale for a while. edotco’s entry into Pakistan (through the acquisition of the Towershare towers), coupled with IHS’ potential entry into Saudi Arabia (should their acquisition of Zain’s towers go through) will once again expose Etisalat to working with independent towercos, something which may inform its strategy going forward. In North Africa, the MNO is investigating the ESCO model as an alternative outsourcing strategy, and given the operational complexities and high opex of operating in Afghanistan, remains keen on finding an ESCO partner there too.

Fanasia: Iranian Tower builder with experience of building over 400 sites. Became the first independent tower company in Iran and currently owns 106 sites having also been heavily involved in decommissioning programmes working closely with municipalities. The towerco more recently formed a new towerco venture with number one and number three MNOs in the country, MCI and Rightel (see Iranian Towers).

GIC: Investment firm which manages Singapore’s foreign reserves through investments in over 50

Source: edotco Group

Bangladesh:10,095

Malaysia:11,677

Myanmar: 3,005

Pakistan: 1,398

Sri Lanka: 126

Cambodia:3,623

123456

Figure 2: edotco Group’s global footprint

* 53% stake in Maroc Telecom ** 27% stake in Mobily


countries including a stake in IHS Towers. GIC’s interest in towers was further confirmed by their bid to acquire a stake in Telefónica’s Telxius and the firm had also been linked to tower transactions in the Middle East.

Global Tower: MNO Turkcell’s wholly owned infraco managing the company’s tower portfolios (totalling 10,337 sites) in Turkey, the Ukraine (via UkrTower), Belarus (BelTower) and Northern Cyprus. In 2016, Global Tower postponed their planned IPO at the eleventh hour. The company is known to have an appetite for tower portfolios outside Turkcell’s home markets, targeting Eastern Europe, the CIS and the Middle East.

Helios Towers: Africa’s third largest towerco with a portfolio of 6,903 towers split across Tanzania, the DRC, Ghana, Congo Brazzaville and South Africa. The towerco has recently dropped the world “Africa” from its company name and has expressed an interest in markets outside of the African continent, suggesting that they may well have an interest in tower portfolios coming to market in MENA. The towerco has a strong grounding in operationally complex developing telecoms markets.

HOI: Egyptian managed service provider and tower manufacturer, possessing an infraco license in the country and owning a portfolio of 38 towers built for Vodafone and Etisalat. There had been speculation that HOI had been looking for a buyer of its tower portfolio.

Figure 4: Global Tower’s tower portfolio

Source: Global Tower

Cyprus: 115

Turkey:8,288

Ukraine:1,103

Belarus:828

Figure 5: Helios Towers’ global footprint

Source: Helios Q3 2018 financial results

DRC:1,821

Congo B:385

South Africa: 110

Tanzania:3,637

Ghana:950


IHS Towers: MEA’s largest independent towerco with a portfolio of 22,860 towers across Nigeria, Cameroon, Côte d’Ivoire, Rwanda and Zambia. Back in 2018, the towerco signed two deals with Zain to acquire their tower portfolios in Kuwait (1,700 sites) and Saudi Arabia (8,100 sites). Although the Kuwait deal has been put on hold and is awaiting regulatory approvals, it was confirmed in early 2020 that the Zain KSA deal has been terminated. The towerco is very much positioning itself to be a leader in the Middle Eastern market and one can expect IHS will have a strong interest in any future tower portfolios which come to market. Privately owned, IHS’ investors include MTN (with a 29% stake), Wendel and the IFC.

International Finance Corporation (IFC): The IFC is a member of the World Bank Group, the world’s leading DFI. The IFC has invested around half a billion dollars in debt and equity in eight towercos across emerging markets and whilst some of the Middle East’s more developed markets might beyond the investor’s remit, expect the investor to have an active interest in more emerging countries.

iQ Networks: Iraqi carrier with the largest independent infrastructure portfolio in the country.

Iranian Towers: Towerco venture created between Iran’s number one and number three operators, MCI and Rightel, and towerco Fanasia. The towerco will manage all new site build for the two operators with plans to consolidate much of MCI and Rightel’s existing tower portfolios into the venture.

ISON Towers: Emerging market focussed towerco

which recently obtained a towerco license in Bangladesh and has significant appetite for towers in MENA.

Jazz: Created from the merger of Warid and Mobilink (VEON) in early 2017, it is the largest MNO in Pakistan by subscribers. In late August, Jazz agreed the sale and leaseback of its 13,000+ towerco subsidiary, Deodar, to edotco, who partnered with local firm Dawood Hercules for the deal, valued at US$940mn. In October 2018, Jazz announced that the deal had been cancelled. Jazz’s portfolio was established over 20+ years of operations, featuring a balanced urban-rural mix, and mainly tracks with the population concentration of Pakistan along the Indus valley with greater concentration of sites

in the Central region, followed by the South and Baluchistan and KPK and North regions. About 80% are ground-based as opposed to rooftop structures.

KKR: Global investment firm that manages investments across multiple asset classes including private equity, real estate, credit strategies and hedge funds. KKR acquired a 40% stake in Telefónica’s infraco, Telxius, and in June 2018 acquired a 49% stake in Altice’s French SFR TowerCo as well as being linked with other tower processes including a merged Bharti Infratel and Indus Towers deal. Korek Telecom: Iraq’s fastest growing MNO with a portfolio of over 3,500 sites. The MNO has

Figure 6 IHS Towers’ tower portfolio and expected acquisitionsacross MEA

Source: IHS Towers (excluding portfolio not yet acquired)* Announced not closed

Saudi Arabia: 8,100*

Nigeria:16,466

Côte d’Ivoire:2,720

Kuwait:1,700*

Cameroon:2,220

Zambia:1,728

Rwanda:868


significant network deployment plans following a turbulent time in the war torn country, with an almost doubling of its total tower stock required.

Macquarie Group: Serial towerco investors with capital at work in Arqiva, Russian Towers, Axicom and Mexico Tower Partners demonstrating their truly global interest in the asset class. The investor does not currently have a focus on the MENA region.

Maroc Telecom: Morocco’s incumbent operator in which Etisalat has a 53% stake. The operator also has a strong West African presence through subsidiaries in nine African markets. The company remains conservative with regards to infrastructure sharing and has expressed little interest in divesting their towers to date (although rumours have surfaced of some early stage tower sale discussions by some of their West African opcos).

MCI: Iran’s largest MNO (and 15th largest operator globally) with a portfolio of 21,000 sites. Has formed a new towerco, Iranian Towers, with Iran’s number three MNO, Rightel and Iranian towerco, Fanasia.

MENA Towers: Early stage towerco with offices in the UAE, Cote d’Ivoire and Pakistan.

Mobily: Number two MNO in Saudi Arabia, in which Etisalat have a 27% stake. Had previously commenced a process to sell their portfolio of 9,600 towers before abandoning plans to focus on the formation of a tower joint venture with number one MNO, Saudi Telecom Company. Plans for a joint venture have since been scrapped with STC forming

establishing TAWAL. Mobily is yet to confirm any plans for its own towers.

Mobiserve: Egyptian system integrator which holds an infraco license in Egypt. Yet to retain any towers on balance sheet.

MTN: Africa’s largest MNO which has monetised towers in seven of their 20 markets, forming joint venture towercos with American Tower in Ghana and Uganda, completing sale and leasebacks with IHS Towers in Cameroon, Rwanda, Zambia and forming a joint venture with the former in Nigeria (prior to restructuring its shareholding in the JV for additional shareholding in IHS group level). In the MENA region, MTN has a presence in Iran (via MTN Irancell) and Syria. MTN Irancell’s competitors MCI and Rightel have formed a new towerco, Iranian Towers, which MTN has opted to stay out of.

Mubadala: Abu Dhabi’s leading investment company which is active in 13 sectors and more than 30 countries around the world. Known interest in MENA towers.

NATIC (North Africa Telecom Infrastructure Company): North African towerco part of the Asel Telecom group.

New Silk Route: New Silk Route is a US$1.4bn private equity firm that invests in private companies in India, Asia and the Middle East. Its investments in the telecommunications infrastructure industry include Ascend Telecom in India.

Newroz Telecom: A fast-growing MNO, ISP and fibre provider based in the Kurdistan region of Iraq.

Oman 70 Holding: Shareholder in newly formed Oman Tower Company.

Oman Tower Company: In February 2018, Oman 70 Holding Company, AktivCo (Camusat’s investment arm) and the Omani Government set up Oman Tower Company (OTC). The company plans to build approximately 600 towers in its first five years, and has an interest in acquiring or managing the existing portfolios of Oman’s MNOs. The launch of a third mobile operator was officially announced in September 2019, with a commercial launch scheduled for mid-2020. OTC will provide the towers needed by the third mobile operator, both ground based and rooftop, under a build-to-suit agreement.

Omantel: Oman’s incumbent MNO, 51% owned by the government. Recently acquired a 21.9% stake in Zain in a bid to diversify its revenue sources and overcome the risks of being present in a single market. The operator owns approximately 3,000 towers of which around a third are ground based.

Ooredoo: Qatar headquartered operator with a presence in Algeria, Iraq, Kuwait, Oman, Palestine and Tunisia (as well as further afield in Myanmar and Indonesia where it has extensive experience of working with towercos). Infrastructure sharing by the MNO in MENA has been limited to date but is something that Ooredoo is keen to place additional focus on both in terms of passive and active sharing;


active sharing agreements are understood to have been struck with Tunisie Telecom and Djezzy in Tunisia and Algeria respectively. Iraq represents the MNO’s most operationally challenging market where power concerns are particularly acute. Such dynamics make outsourcing to either ESCOs or a towerco particularly attractive.

Orange: Multinational MNO with a footprint in 29 countries across Europe and Africa; in MENA they have a footprint in Egypt, Jordan and Morocco (and non controlling interests in Tunisia and Iraq). The operator has monetised towers in three African markets and engaged in active sharing arrangements in Europe, at the time of going to press the operator has hinted that it may be looking at the carve out or sale of its European towers. In MENA, the operator had reached an agreement to divest a third of their Egyptian towers to Eaton Towers before the deal was cancelled. The operator has since issued an ESCO RFP in the country and appears to have limited interest in divesting any further tower portfolios.

Providence Equity: Communications infrastructure investment specialists with money at work in Indus Towers (India), Grupo Torresur (Brazil) and KIN (Indonesia). Providence had been linked with previous tower sale processes in Saudi Arabia although their appetite to invest in MENA appears to have cooled.

Quippo International: The former ownership team behind Viom Networks which was acquired by ATC India. Believed to have an appetite for opportunities in multiple markets.

Figure 7: Ooredoo’s MENA footprint

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Figure 8: Orange’s MENA footprint

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* Present with a non-controlling interest


Rightel: Iran’s third largest operator. Has joined forces with MNO MCI and towerco Fanasia to form a new towerco, Iranian Towers.

Sanabil: Saudi Arabian investor, which although wholly owned by the government’s Public Investment Fund, operates as an independent investment institution. Understood to have an interest in towers

Saudi Telecom Company: Saudi’s leading MNO which also has a presence in Bahrain and Kuwait where it trades under the name VIVA. Saudi Telecom Company had explored the sale of its Saudi towers before abandoning the sale to explore the formation of a joint venture with Mobily, a plan which was then put on hold. Saudi Telecom Company has since carved out their towers into a separate infraco, TAWAL.

SBA Communications: Publicly listed towerco with a portfolio of over 30,000 towers across North and South America and more recently South Africa. The towerco has preferred to operate a “grass and steel” model, shying away from markets where power presents a challenge to towercos. The towerco may well have an appetite for major tower portfolios in the MENA region should they come to market.

Tanzanite: Towershare’s Pakistani business which had built a portfolio of 700 towers, mostly through acquisitions and with the majority coming from previous WiTribe assets. In June 2017, edotco agreed to purchase 100% of Tanzanite for US$90mn.

TAP Advisors: Boutique advisory firm with a long history of advising on tower deals.

TASC Towers: Towerco which had entered into exclusive negotiations to acquire Zain’s Saudi Arabian towers before the MNO abandoned talks in favour of negotiations with IHS and Towershare. TASC has developed a modest tower portfolio in Jordan.

TAWAL: Saudi’s newest towerco owns with just over 14,000 sites, manages the passive infrastructure of its towers and leases space to service providers in addition to government entities and communication

businesses. TAWAL is also planning for expansions to benefit from economies of scale and develop value-added services. Looking ahead, the company is bracing for a new era of technologies and adjacent innovative services such as small cells and fiber. Furthermore, the towerco plans to extend its geography reach to cover new cities, rural areas, and remote destinations.

Telecommunications Regulatory Authority of Bahrain (TRA): Bahrain regulator which introduced new legislation surrounding infrastructure sharing and tower rollout in the Kingdom at the start of 2018.

Figure 9: SBA Communications’ global portfolio

SBA Communications Q3 2018

Colombia: 198

USA:16,249

Guatemala: 682

Nicaragua: 567

Argentina: 71

El Salvador: 754

South Africa: 901

Peru: 328

Canada: 317

Chile: 263

Costa Rica: 844

Panama: 592

Ecuador: 431

Brazil:8,571


Telenor: Norway’s incumbent MNO with a presence in 29 countries including Pakistan. Telenor is a keen advocate of all forms of network sharing, sharing towers (primarily with Jazz), fibre (with Zong), and has taken a lead role in exploring active infrastructure sharing. Telenor and Zong undertook Pakistan’s first RANsharing trials across around 30 sites, while the Norwegian-owned MNO has also shared IBS, both under the MORAN model where spectrum is not shared. In Norway, Telenor is in the process of carving out its own towerco.

Tillman Global Holdings: Investor with a broad appetite for towerco investments anywhere from early stage opportunities to sale and leasebacks in mature markets of thousands of sites. Led by Chairman and Co-Founder of Eaton Towers and ex-CEO of Orange, Sanjiv Ahuja.

Towershare: Dubai headquartered towerco which built a portfolio of 700 towers in Pakistan (mostly through acquisitions, with the majority of towers coming from previous WiTribe assets). In June 2017, edotco agreed the purchase of 100% of Towershare’s Pakistani business, Tanzanite, for US$90mn. In Kuwait, Towershare joined forces with IHS Towers reaching an agreement to acquire 1600 Zain towers, with Towershare since absorbed into IHS’ operations.

TPG Capital: Private equity firm with a known interest in towers. Has been linked to opportunities in the MENA region.

Figure 10: Zain’s geographical footprint and sites used

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* Zain operates Touch in Lebanon under a management contract Site counts obtained from Zain Q3 2019 financial results

Zain owned sites

Tower sale agreed with IHS Towers

Saudi Arabia9,447

Iraq4,786

Jordan2,926

Sudan2,670

Kuwait2,459

Lebanon*1,367

Bahrain597 sites

Site counts comprise both owned sites and those of third parties which the operator uses


Ufone: Ufone is the mobile arm of the incumbent telecoms provider in Pakistan, PTCL, and is the fourth largest operator in the country by subscribers. Ufone has been exploring the potential sale and leaseback of its towers in Pakistan for some time. The process was stalled by the de facto merger of PTCL and Ufone, and associated management changes, but Ufone could yet contribute over 6,000 further assets to the pool of commercially shared towers in the country.

Vinson & Elkins: Law firm with significant expertise in the tower sector. Manages the Middle East from their Dubai office.

Vodafone: Multi-national MNO, Vodafone is an advocate of infrastructure sharing and has entered into passive infrastructure sharing JVs in the UK (CTIL) and Ireland (NetShare), as well as active infrastructure sharing deals in Greece, Romania, Spain and again in the UK. In 2019, Vodafone announced that it was carving its European towers into a new, as yet unnamed towerco. Simultaneously, Vodafone merged their Italian towers with those of Telecom Italia’s INWIT. Apart from Vodafone India’s participation in Indus Towers in India, a sale and leaseback deal in Tanzania through subsidiary Vodacom, and a manage with license to lease deal in Ghana, Vodafone has not yet entered into deep partnerships with towercos. In MENA, Vodafone has a presence in Egypt where the company has also agreement with new mobile market entrant, Telecom Egypt, to provide transmission and infrastructure services.

Wendel: Family fund which is a leading investor in IHS Towers.

Zain: Operator which agreed the sale of their 1,700 Kuwaiti sites to IHS Towers although the deal is currently on hold due to lack of regulatory approval. The company also has operations in Iraq, Sudan, Bahrain and Jordan and could be a likely candidate to commence further tower sale proceedings, should the Kuwait transaction prove positive.

Zong: Formerly knowns as CMPak, Zong is China Mobile’s Pakistan opco. It ranks third by subscribers and has around 9,100 sites, of which around 2,000 are co-locations

Advance apologies: we’re bound to have missed one or two key stakeholders in Middle Eastern and North African towers – if so we’d like to know! If you feel your company should be profiled in the TowerXchange who’s who in MENA towers, please email Aninder Khera, Head of Research, Middle East & North Africa, TowerXchange, at:[email protected]

Who have we missed?

www.towerxchange.com

ESCO Roundtable 202024-25 March, Casablanca

Meetup Europe 202019-20 May, Barcelona

Meetup Americas 202023-24 June, Boca Raton

Meetup Africa 202013-14 October, Johannesburg

Meetup Asia 20208-9 December, Singapore

Meetup MENA 202126-27 January, Dubai

mailto:aninder.khera%40towerxchange.com


Keywords: AWAL Telecom, Abraaj, Africa & ME, Algeria, Bahrain, Build-to-Suit, Carve Out, Citi, Communication Towers, Country Risk, DH Corp, Deal Finance, Deal Structure, Deodar, Djezzy, Eaton, Eaton Towers, edotco, Egypt, Etisalat, Fanasia, HOI MEA, IHS Towers, Infrastructure Sharing, Investors, Iran, Iranian Towers, Jazz, Jordan, Kuwait, MCI, MENA, MNOs, Middle East, MobiNil, Mobily, Ooredoo, Operator-Led JV, Orange, Pakistan, Rightel, Sale & Leaseback, Saudi Arabia, Saudi Telecom Company, TASC Towers, Tanzanite, Towershare, Tunisia, Tunisie Telecom, VEON, Valuation, VimpelCom, Vodafone, Zain

The turbulent history ofMENA tower transactionsWhich deals have come and gone and which will cross the finish line?

Tower ownership and mobile market dynamics in MENA

The Middle East and North Africa is the region currently the least penetrated by the towerco business model, with fewer than 6% of towers currently sitting in towerco hands (versus the global average of 70% - see figure one). As such, with a handful of exceptions, MENA’s 275,104 towers sit in the hands of mobile network operators.

The vast majority of countries have three operational MNOs, many of which have some degree of state ownership, and there are a handful of operators with operations in multiple markets, namely Etisalat, Zain, Saudi Telecom Company, Ooredoo, Orange, Batelco and VEON. The scale of total tower counts owned by the operators in MENA varies dramatically, from over 35,000 towers in Saudi Arabia and Iran, to just 1,500 towers in Bahrain (figure two).

In spite of many commonalities between countries (a strong Arabic influence, a central role of government in the business sector, similar climates and environmental conditions and a prevalence of key telecom players across multiple markets) MENA is not a uniform market. At the one end of the spectrum you have GCC countries with European levels of affluence, at the other end of the spectrum you have developing countries with unstable geopolitical situations, a factor it is important to take into account when making statements about dynamics in the region. Whilst some countries have close to 100% population coverage, high mobile broadband penetration and are positioning

Read this article to learn:< The factors that have held back tower transactions in MENA< Tower sale processes that have been announced and cancelled and the reasons behind the decisions< Attitudes of the region’s major operators towards working with towercos and how this may impact

future strategy< Deals that are expected to close and the knock on effect this will have in the market

The MENA region has seen home grown tower companies like TAWAL and Oman Tower Company leading the way for tower transactions. TowerXchange look back on the tower deals that have come and gone in MENA, exploring factors that have contributed to the decisions and examining what the future holds for tower transactions in the region.

CONTRACT


themselves to be front runners in 5G, others are focussed on expanding or restoring network coverage and rolling out 3G in operationally complex markets.

The size, health and wealth of different mobile markets has a significant impact on MNO motivations to divest towers and work with independent towercos, whilst similarly having an impact on the appetite of towercos to enter such countries. More detail on key dynamics at play can be read in TowerXchange’s country-by-country study of the MENA tower industry.

Why haven’t we seen tower deals in MENA? What factors are at play?

There are a number of different factors which have held back the proliferation of sale and leaseback and towerco activity across the MENA region. Here we examine ten different considerations:

1. No overriding financial pressure to monetise tower portfolios

When studying tower transactions globally, one of the principle drivers behind operator decisions

to monetise their tower portfolios has been the pressure to reduce leverage, raise capital and improve their balance sheets. Many (although not all) of MENA’s operators are well financed entities with healthy balance sheets and as such, have not felt pressured to monetise their passive infrastructure.

2. The “buyer not seller” culture within mobile network operators

Historically, many of MENA’s MNOs have been buyers rather than sellers, with their healthy

Figure one: Tower ownership by business model, regional comparison

Source: TowerXchange, Q319

China

India

CALA Oceania

S & SE Asia(Exc India)

Europe

N & E Asia(exc China)

96.1% 3.9%

39.4%

15.4%9%

36.2%61.6%21.4%

17%

100%

42.5%46.6%

12.8%

87.2%

USA & Canada

6.5%

64.3%

29.2%

10.9%

SSAMENA94.2%

0.2%0.4%

5.2%4.3%

35.2%

60.5%

Operator-led towerco Pureplay independent towerco Joint venture infraco MNO-captive sites

China

India

CALA Oceania

S & SE Asia(Exc India)

Europe

N & E Asia(exc China)

97.3% 2.7%

15.4%

15.5%

9.6%

59.6%46.6%

21.8%

31.5%

14.7%66.1%

19.2%100%

11%

36.1%48.2%

13%

87%

USA & Canada

7%

66%

27%

15.6%

SSAMENA99.5%

0.01%0.04%

4.6%59.2%

36.2%

Global

55.6%

13.1%1.2%

30.2%

11.9%72.7%

15.3%


balance sheets meaning that they have focussed much more on acquisitions than divestments. With no longstanding history of selling assets, the sale of a tower portfolio requires different thinking and a different strategy to that which an operator may be used to.

3. A focus on improving top line revenues versus reducing costs

With some of the world’s highest data usage, voice still generating strong revenues and ARPU being relatively well preserved relative to other regions, many of MENA’s MNOs have focussed more heavily on improving and growing top line revenues than reducing costs. As such, the efficiencies generated

by infrastructure sharing and outsourcing to towercos have not taken centre stage on board room tables.

4. CTO-led strategies and the view that networks are a source of competitive advantage

It has been observed that MNOs in the region tend to be very much led by the CTO and only in recent years have the CFO and commercial teams become more involved in influencing the strategic direction of an operator, balancing the technical influence. Whilst in some markets, coverage might be the differentiator, in others it will be quality of service. With there often being little difference in market share between MNOs in some countries,

maintaining that competitive edge through quality of service, OTT offerings or innovative packages are key focal points for companies, something they fear may be eroded by sharing or outsourcing their infrastructure

5. Simple operating conditions

In a number of sub-Saharan and Asian countries, towers are often located in remote areas with poor road access and no grid connection. Ensuring that such towers remain operational is highly complex with generator maintenance and refuelling as well as theft on sites representing particularly acute challenges. As such, operators in those regions have been motivated to sell towers in a bid to rid

Figure two: Tower counts across MENA markets


Saudi Arabia35,500

Iran37,106

Pakistan 35,043

Morocco19,054

Algeria19,000

Egypt22,704

Iraq14,769

UAE13,000

Tunisia8,383

Afghanistan6,645

Qatar5,000

Jordan6,836

Kuwait4,100

Lebanon 2,600

Bahrain1,500

Oman8,000


themselves of operational complexities and focus more on their core business. In more developed markets in MENA where the vast majority of towers are in urban areas and the electricity grid is reliable, such motivations do not exist. The same cannot be said however for MENA’s developing markets.

6. State involvement in MNOs and the cash-cow nature of the telecoms sector

Many of MENA’s MNOs in which the state has a significant stake have been generating healthy profits, thus making significant contributions to state coffers. Governments have been reluctant to cede control of such cash-cow businesses and as such, assets have not changed hands. Decision making in the public sector is often slower and more conservative than in the private sector and as such, radical changes in strategy are less likely.

7. Lack of clear regulatory frameworks for towercos and infrastructure sharing

Whilst infrastructure sharing and the towerco business model has become widespread on other continents, there has been until recently limited regional examples and benchmarks in MENA. Familiarising governments with the merits of infrastructure sharing and the towerco business model is a lengthy process and critical to the success of a tower transaction.

8. Government concerns over security

As a region with a number of political tensions and

security concerns, governments in the region have voiced concerns about handing over control of towers to foreign entities, anxious about who could gain access to towers and the potential impact of that on national security.

9. Unfavourable political and economic conditions

Political turmoil, limits on foreign direct investment and currency devaluation in some countries has served to deter a number of towercos from entering such markets. Whilst MNOs in such countries may have been keen to sell, a lack of willing buyers has acted as the roadblock in tower processes getting off the ground.

10. A preference for doing business with known regional players

This one presents a bit of a catch 22. In all walks of life in the Middle East, business is generally conducted with the people you know. Whilst towercos have been operating globally since the mid 1990s, in the absence of local MENA towercos, the market has had to start slow while new entrants build relationships with MNOs and governments in the region.

Attempts at tower transactions in MENA

In spite of the aforementioned factors, several attempts have been made to do tower deals and stimulate towerco activity in MENA, with varying degrees of success:

2006: PTA establishes towerco licensing regime in Pakistan Select towercos active

In 2006, the Pakistan Telecommunications Authority (PTA) established a licensing regime in Pakistan, setting unofficial goals to promote infrastructure sharing in the country. Several companies have been awarded towerco licenses since then although only Tanzanite Tower, edotco and AWAL Telecom ever commenced commercial towerco operations.

2010: NTRA awards towerco licenses in Egypt HOI active

In late 2010 and early 2011, Egypt’s National Telecom Regulatory Authority issued telecommunications infrastructure licenses to four Egyptian companies, namely HOI MEA, Alkan, EEC and Mobiserve’s Mobitower. The licenses enable the companies to build, own, retain and lease space on towers in the country, effectively functioning as independent towercos.

Whilst four companies were awarded licenses, only HOI has built and retained towers, developing a modest portfolio of 38 sites built for Etisalat and Vodafone since the license was awarded. HOI have reportedly been looking for a buyer for their tower portfolio.

2011: Batelco explore the sale of tower portfolios in Bahrain and Jordan Process cancelled

In December 2011, Bahrain Telecommunications


Company (Batelco) announced plans to sell its tower assets in Bahrain and Jordan. With zero debt, the decision to explore a tower transaction related to the funding of future acquisitions outside of its domestic market in a bid to offset falling revenue in Bahrain’s already small mobile market. Batelco appointed Citigroup to run the process and reportedly received two binding bids for the tower portfolios, rumoured to be between US$200-300mn.

In May 2012, the operator announced that it had decided not to move forward with the sale and leaseback transactions, with Batelco’s then CEO, Sheikh Mohamed Al-Khalifa noting that the company had “the ability to raise funds at much lower rates than tower companies and thus could not justify the lease back arrangements.” Rumours suggested that the acquisitions that Batelco had earmarked fell through and as such, raising capital became less of an urgent priority.

Abandoning the tower sale process, Batelco announced that it had instead decided to pursue tower sharing opportunities with other operators in the market.

2015: MobiNil (now Orange) agree the sale of 2,000 towers to Eaton Towers in Egypt Process cancelled

In April of 2015, Orange (then trading as MobiNil) announced the sale of their stake in the company’s tower subsidiary, Egyptian Company for Mobile Tower Services (ECMTS) to Eaton Towers for EGP1bn (US$131.2mn). The agreement encompassed the purchase of approximately 2,000

towers (around one third of Orange’s total tower count in the country) with a 15-year leaseback contract for the operation and maintenance and also for the additional build-out of new sites. The towers purchased by Eaton were in three geographic areas: Delta, Upper Egypt and Red Sea and excluded Orange’s rooftop sites in Cairo.

Eaton subsequently entered negotiations to acquire a second tranche of Orange towers, although no deal was announced.

Following the agreement, Eaton Towers and Orange worked on the technical handover of the towers, with Eaton beginning to shadow operations from January 2016. 13 staff were recruited from Orange into Eaton’ Egyptian team whilst Karim El Azzawy (formerly of Egyptian managed service provider, Mobiserve) was appointed as the country manager.

In March 2016, the Central Bank of Egypt devalued the Egyptian Pound by almost 13% as they shifted their exchange rate policy in a bid to boost foreign reserves and increase competitiveness. As per the signed agreement between Orange and Eaton, the devaluation meant a revision to the commercial terms of the deal, with further devaluation and revisions expected.

On the 21 July, the longstop date laid out for completion of the transaction, Orange Egypt was still awaiting certain regulatory approvals relating to the change of control of ECMTS, the separate company into which they had transferred the 2,000 towers for Eaton to acquire.

With the prerequisites and conditions necessary for completion of the deal not met, the Orange Egypt board made the decision to not extend the deadline and as such terminated the agreement.

Read more on potential towerco activity in the Egyptian market in “Major new build forecast in the Egyptian tower market”.

2011 & 2016: Saudi Telecom Company and Mobily discuss the formation of a towerco JV in Saudi Arabia Talks abandoned

In 2011, Saudi Telecom Company and Mobily first entered into discussions surrounding the potential formation of a joint venture into which they would pool their existing tower portfolios in a bid to reduce passive infrastructure related capital and operating spend. The pair were understood to be considering selling off a 49% stake in the projected US$2.5bn venture but talks stalled and plans surrounding a joint venture were shelved.

The two parties once again re-opened joint venture discussions in 2016, signing an initial three month agreement to study the joint venture in the August of that year, an agreement which was subsequently extended before the pair appointed Standard Chartered as an advisor to oversee the process in 2017. Talks once again dissolved, with the two parties reportedly unable to agree on how ownership should be shared.


2016: Mobily shortlists three bidders for tower sale in Saudi Arabia Process cancelled

In between joint venture discussions with Saudi Telecom Company, Etisalat’s Saudi Arabian opco, Mobily, formally launched a tower sale process in 2016 after having appointed TAP Advisors to run the deal. Mobily’s strategy was motivated by a need to reduce their debt burden after substantial accountancy errors in 2014 led to their annual profits being revised down from a profit of SAR219mn to a loss of SAR913mn.

The tower process attracted a high degree of interest, with names linked to the transaction including IHS Towers, Digital Bridge, TASC Towers, edotco, Providence Equity Partners and Towershare plus local investors and conglomerates including Saudi Aramco, Al Rahji Group and Al Zamil Group. The deal reached an advanced stage with technical and commercial due diligence completed and with Mobily receiving three binding bids, reportedly at terms they were happy with.

However, with Mobily having managed to refinance much of their original debt at more attractive terms, the urgency to sell towers was reduced, and as such, when Saudi Telecom Company once again approached them to open joint venture discussions, Mobily abandoned the tower sale process.

2016: Djezzy study the potential for a tower sale in Algeria Formal process never initiated

In 2016, VimpelCom (now VEON), who own a 49% stake in Algeria’s Djezzy, commenced a strategy to monetise their tower portfolio globally, kicking off processes in Russia, Bangladesh and Pakistan (and later, the CIS). At the same time, a team was appointed at Djezzy to assess the business case for a sale of the company’s 6,500 Algerian towers.

With limits on foreign direct investment in Algeria (limiting international ownership to 49%) and talks around active infrastructure sharing between Djezzy and Ooredoo materialising at the time, the preliminary study revealed limited appetite amongst towercos to participate in a tower transaction in the country. With processes underway in Russia, Bangladesh and Pakistan, the M&A team at VimpelCom turned their attention to such more imminent transactions and no formal tower process was announced in Algeria.

2016: Zain enter into exclusive negotiations with TASC Towers and ACWA Group in Saudi Arabia Deal cancelled

In early 2015, Zain appointed Citigroup to study the potential for a tower sale across its operations in multiple markets. Later in 2015, Zain’s then CEO, Scott Gegenheimer confirmed the company was opening a process for a sale of both their Saudi and Kuwaiti towers and in March 2016 it was announced that they were narrowing down potential bidders.

Stop-start discussions around Mobily and STC’s joint venture and Mobily’s tower sale in Saudi Arabia delayed the sale process, however in December 2016 Zain announced that it had entered into exclusive

negotiations with a consortium involving TASC Towers and local conglomerate, ACWA Group for the sale and leaseback of their Saudi Arabian tower portfolio, with a reported deal value of around US$500mn.

With the acquirers unable to raise the necessary equity however in the desired time frame, the deal was subsequently cancelled.

2017: MCI, Rightel and Fanasia form Iranian Towers Joint venture operational

In early 2017, Iran’s leading mobile network operator MCI and number three operator, Rightel joined forces with Iran’s first towerco, Fanasia to create a new towerco going by the name Iranian Towers.

Fanasia, an Iranian company with a background as a turnkey service provider to the country’s MNOs, first commenced towerco operations in the country in 2014. Their first project on Kish Island, conducted with the support of the Kish Free Zone Organisation, was to rationalise the number of towers on the island. With 110 sites on the Island, each with a single tenant and unsuitable for the addition of further tenants, Fanasia built 27 new sites which the operators were mandated to use, whilst existing sites were decommissioned. The municipality benefited from a revenue sharing model on top of the land rental fee and further benefited from the freeing up of land under the old towers. Following the success of the Kish Island project, Fanasia reached a similar agreement with the municipality


of Mashhad, Iran’s second most populous city to develop a core network of 350 sites in March 2016.

Speaking at the time of Iranian Towers’ formation in an interview with TowerXchange, MCI’s CTO Morteza Taheribakhsh said “Iranian Towers was established to act as an exclusive towerco for both MCI and RighTel. It is expected that most new sites required by both operators will be built and operated by Iranian Towers. Furthermore, we will gradually proceed to purchase and leaseback the existing sites of MNOs. Therefore both build to suit and buy-leaseback scenarios have been considered by Iranian Towers.”

Taheribakhsh added “In Iran, as with the rest of the world, operator voice revenues and ARPU are continuing to decline whilst demand for data continues to increase. Significant capital is required to deploy 4G and 4.5G technologies which are required to support the increased data requirements. This places significant strain on mobile network operators and as such cost saving measures become increasingly important. Considering this fact, the primary motivation behind the creation of Iranian Towers is cost management. Sharing the cost of new site deployment as well as site operations will bring considerable savings to the business. Having Iranian Towers in place will enable MNOs to invest in their technological requirements without worrying about site infrastructure costs.”

The first phase of Iranian Towers’ operations was the construction of approximately 1,000 new

towers, capable of hosting multiple tenants, across major cities in the country to accommodate 4G and 4.5G rollout. The second phase of Iranian Towers operations is to involve the sale and leaseback of the operators’ two tower portfolios. With MCI owning 21,000 towers and Rightel just 4,000, the exact number of towers that will be transferred to the towerco is yet to be decided.

2017: edotco Group acquire Tanzanite Tower in Pakistan Deal completed

In June 2017, edotco announced that it had entered into an agreement to acquire Tanzanite Tower, Towershare’s towerco business in Pakistan. The deal, encompassing 700 towers and valuing Tanzanite at an enterprise value of US$90mn enabled edotco to add a further footprint to its portfolio and add instant scale to its operations in Pakistan, and marked the first in market towerco consolidation in the extended MENASA region.

2017: Jazz agree tower sale to edotco and DH Corp in Pakistan Deal cancelled

In August 2017, VEON’s Pakistani subsidiary, Jazz announced that it had reached a deal for the sale of its wholly owned tower company, Deodar, to Tanzanite Tower, a towerco wholly owned by edotco and Dawood Hercules.

The transaction, for a total consideration of PKR98,700mn (US$940mn) covering Deodar’s total

portfolio of approximately 13,000 towers was for an initial 12-year period with the option to renew for three consecutive periods of five years each.

Commenting on the transaction at the time, Jean-Yves Charlier, Chief Executive Officer of VEON, said: “This transaction is highly value accretive for VEON and GTH and a further execution of VEON’s asset light strategy. It also reflects the start of a long-term partnership with a strong counterparty with significant experience in tower management.” Proceeds from the deal were to be used for general corporate purposes, the funding of recently awarded spectrum and repayment of a proportion of Jazz’s outstanding debt.

In September 2018 however, Jazz announced that the tower sale had been cancelled due to a failure to get the necessary regulatory approvals to proceed. For further information on the cancelled sale process read “TowerXchange’s updated Pakistan tower market study 2018”.

2017: Zain agree the sale and leaseback of towers to IHS in Kuwait Process ongoing

On 10 October 2017, Zain Kuwait announced that it had reached a deal with IHS Towers for the sale and leaseback of its tower portfolio in the country. As previously mentioned, Zain began studying the potential to sell its tower portfolios back in 2015 when they appointed Citigroup to lead the process.


Whilst Zain’s larger tower portfolio (and Mobily’s concurrent tower sale) in Saudi Arabia stole much of the limelight, Zain reportedly received 15 bids for their Kuwaiti portfolio. The operator undertook a rigorous processes to narrow this down to five shortlisted bidders before finally settling the deal with IHS Towers and Towershare for an agreed deal value of US$165mn (Towershare having since been absorbed into IHS).

The deal was expected to close during 2019, but has been delayed alongside Zain’s sale to IHS Towers in KSA. For further detail on the transaction read “Zain postpones KSA tower sale to IHS, towerco remains committed to the region”.

2018: Zain agree the sale and leaseback of towers to IHS in Saudi Arabia Process ongoing

On 28th November 2018, Zain announcement that it had reached a deal with IHS Towers for the sale and leaseback of its 8,100 Saudi Arabian towers for US$647.7mn. The deal, for an initial term of 15 years also includes a build to suit component, provisioning for the addition of 1,500 new towers over the next six years. However, on the 20th June 2019, the Saudi telecoms regulator, the Communications and Information Technology Commission (CITC) wrote to Zain Saudi Arabia saying that “IHS Holding Limited has not yet met the regulatory requirements for the sale and lease back of passive infrastructure”, precipitating

the operator announcing the postponement of the tower sale.

2018: Oman Tower Company formed Independent towerco established

In February 2018, Oman 70 Holding Company, AktivCo (Camusat’s investment arm) and the Omani Government set up Oman Tower Company (OTC). Although relatively quiet through most of 2018 and 2019, the company has now received orders for 100 new sites and plans to build approximately 600 towers in its first five years. It also has an interest in acquiring or managing the existing portfolios of Oman’s MNOs.

2019: STC form new towerco carve-out called TAWAL Carve-out completed

After a number of stop-start discussions with Mobily regarding the formation of a joint venture, in Q1 2018, Saudi Telecom Company revealed that it had established a dedicated towerco subsidiarycalled Communication Towers Co. Ltd. which would be responsible for owning, constructing, operating, leasing and commercialising telecom towers for the operator. In April 2019 the company was activated and rebranded as TAWAL and 14,200 towers transferred from the balance sheet of STC to the balance sheet of TAWAL. Around 2,200 strategic sites remain controlled by STC, but the new towerco

has been created with the mandate to encourage infrastructure sharing in the Kingdom and engage in build-to-suit.

2020: Zain cancel the sale and leaseback of towers to IHS in Saudi Arabia Deal cancelled

Due to failure to obtain regulatory approval, Zain KSA has announced that the IHS deal of the sale and leaseback of 8,100 towers has been cancelled.

What towerco and transaction activity could we see moving forward?

The continued appetite for deal making in MENA, despite regulatory hurdles, and the recent establishment of two new towercos is expected to act as a catalyst for further activity and for other operators to follow. Whilst the specific nuances and dynamics of different markets play heavily on an operator’s tower strategy in a given country, figure four examines what we know about the tower strategies of multi-country operators with a footprint in the region, speculating as to what this means we could expect going forward.

In addition to the multi-country players, several single country operators have been rumoured to have an appetite to explore tower transactions. In Oman, Omantel (which now owns a 21.9% stake in Zain) is expected to announce a tower sale process and in Tunisia, the (now cancelled) sale of the business to Abraaj Group was expected to precipitate a tower sale.

https://www.towerxchange.com/zain-postpones-ksa-tower-sale-to-ihs-towerco-remains-committed-to-the-region/




As in other regions, most towercos looking at a prospective buy and leaseback opportunity will be looking for a credit-worthy seller in an attractive market. The dollar linked economies of many countries in the region present an attractive opportunity and with the MENA region seen as virgin territory for towercos, interest is stirring from towercos in all four corners of the globe.

The importance of local partners cannot be underscored enough in MENA and so it is likely that we may see partnerships between international

towercos and local companies as they aim to bring both towerco and regional expertise to a bid. In the GCC in particular, the huge wave of infrastructure development that is underway means that telecoms must compete with other infrastructure asset classes for local investment, but as companies and countries look to diversify away from their dependency on oil, telecoms infrastructure could present an attractive investment opportunity.

While progress has been moving back and forth on a regulatory front in Kuwait and Saudi Arabia,

history shows us that decision making in the region has traditionally been slow and cautious by regulators and operators alike. There is a continuing need for education of relevant stakeholders on the merits of infrastructure sharing and the importance of independent towercos and infracos in rolling out and managing the region’s communications infrastructure more cost effectively.

In a bid to support the development of the nascent tower industry in MENA and foster improved infrastructure sharing

Figure three: A timeline of tower transactions, joint ventures and towerco activity in MENA


2010

2016

2011

2017 2017 2017 2017 2019 2020

2014 2016 2016 2016

Bahrain & Jordan: Batelco explore the sale

of tower portfolios

Saudi Arabia: Zain and TASC

agree tower sale

Saudi Arabia: Saudi Telecom Company and

Mobily explore tower JV

Saudi Arabia: STC acquire GO’s

towers

Pakistan: edotco acquire

Tanzanite

2015

Egypt: Mobinil and Orange agree

tower sale

Pakistan: Jazz and edotco agree

tower sale

Kuwait: Zain and IHS Towers agree

tower sale

Oman:Oman Tower

Company established

Saudi Arabia: Zain and IHS Towers

agree tower sale

Iran: Fanasia commence commercial

operations

Saudi Arabia: Zain and Mobily commence tower

sale processes

Algeria: Djezzy explore tower sale

options

Saudi Arabia: Saudi Telecom Company and Mobily re-

open tower JV discussions

Cancelled Cancelled

Cancelled Cancelled

Mobily process cancelledAbandoned Active

Deal closed Active

2019

Saudi Arabia:STC establish

TAWAL

ActiveDeal closed Pending

Abandoned Abandoned

Cancelled

2010

2016

2011

2017 2017 2017 2017 2019 2020

2014 2016 2016 2016

Bahrain & Jordan: Batelco explore the sale

of tower portfolios

Saudi Arabia: Zain and TASC

agree tower sale

Saudi Arabia: Saudi Telecom Company and

Mobily explore tower JV

Saudi Arabia: STC acquire GO’s

towers

Pakistan: edotco acquire

Tanzanite

2015

Egypt: Mobinil and Orange agree

tower sale

Pakistan: Jazz and edotco agree

tower sale

Kuwait: Zain and IHS Towers agree

tower sale

Oman:Oman Tower

Company established

Saudi Arabia: Zain and IHS Towers

agree tower sale

Iran: Fanasia commence commercial

operations

Saudi Arabia: Zain and Mobily commence tower

sale processes

Algeria: Djezzy explore tower sale

options

Saudi Arabia: Saudi Telecom Company and Mobily re-

open tower JV discussions

Cancelled Cancelled

Cancelled Cancelled

Mobily process cancelledAbandoned Active

Deal closed Active

2019

Saudi Arabia:STC establish

TAWAL

ActiveDeal closed Pending

Abandoned Abandoned

Cancelled


Figure four: Tower strategies of MENA’s major operators

Operator Regional footprintHistory of tower deals and working with towercos

Expected activity going forward

Zain

Kuwait, Saudi Arabia, Iraq, Jordan, Sudan & Bahrain (plus management contract in Lebanon)

Deals agreed but not closed with IHS Towers in Saudi Arabia and Kuwait

High likelihood the operator will explore further deals should the Kuwait and Saudi deals prove successful

Saudi Telecom Company

Saudi Arabia, Kuwait & Bahrain

Towerco subsidiary TAWAL established inApril 2019

TAWAL has regional ambitions for buy and leaseback

EtisalatUAE, Saudi Arabia, Egypt, Pakistan & Afghanistan (plus 53% stake in Maroc Telecom)

Tower transaction completed in Nigeria (prior to exit of the market due to opco’s insolvency); experience working with towercos in select markets

Keen appetite to increase infrastructure sharing with other operators in a bid to increase utilisation of their assets. Tower deals not ruled out but given experience in Nigeria will remain cautious

OrangeEgypt, Jordan & Morocco (plus non controlling interests in Tunisia & Iraq)

Monetised towers in three sub-Saharan African markets; agreed and then subsequently cancelled a tower deal in Egypt; announced plans to carve out a towerco in Europe

Whilst carving out their European towers into a captive towerco, the strategy is not expected to be rolled out across MEA where the operator remains committed to other forms of infrastructure sharing as well as working with ESCOs.

BatelcoBahrain & Jordan (plus minority interest in Yemen)

Announced and then cancelled tower sale process in Bahrain and Jordan

Recent restructuring of the business may make doing a tower deal hard but could potentially explore the option once again

OoredooAlgeria, Iraq, Kuwait, Oman, Palestine & Tunisia

Tower sale completed in Indonesia plus experience of working with towercos in Myanmar

No serious rumours of tower deals emerged yet maintains keen focus on furthering infrastructure sharing; potential candidate for tower transaction activity

VEON Algeria and Pakistan

Commenced a major tower monetisation strategy globally but only one deal closed to date. Reached and then cancelled a deal to sell Pakistani towers; expressed an appetite to divest Algerian towers; experience of working with towercos in Russia; successfully sold Wind towers in Italy to Cellnex in 2015

Pakistan deal rumoured to be back on the table; likely to have an appetite to divest their Algerian towers should a willing buyer present themselves

Vodafone Egypt

Keen advocate of infrastructure sharing, forming tower JVs in the UK and Ireland and participating in Indus Towers in India; sold towers in Tanzania and signed MLL arrangement in Ghana; extensive experience in working with towercos across multiple markets

In 2019, Vodafone’s new CEO confirmed they were were establishing their own towerco including 61,700 European towers; no tower deal currently expected in Egypt but likely to have a strong appetite to share infrastructure and work with towercos in the market



Figure five: MENA tower heatmap


Towerco / ESCO activity Towerco activity plus major tower sale rumouredMNOs rumoured to be considering a major tower transactionNo towerco activity or deal rumours

ACG operates 100 towers; ESCO?

edotco active, Jazz mayrestart SLB

Iranian Towers 1000 sites

Could towercos help rebuild?

TASC Towers established

Zain-IHS 1700 tower SLB

Tower sale rumor; OTC est.

STC carve-out 14200 to TAWAL

Tunisie Telecom rumours

HOI-MEA 38 sites;Orange ESCO RFP;

New towerco licence imminent

Djezzy retains appetite;Infrashare established Alfa ESCO with IPT

Towerco activity

Towerco activity plus major tower sale rumoured

MNOs rumoured to be considering a major tower transaction

Confirmed tower sale process underway

No towerco activity or deal rumours


MENA represents a diverse region, from developed

markets in Gulf Cooperation Council (GCC) states

where mobile penetration is high and data usage is

growing exponentially, through to war torn regions

such as Afghanistan and Iraq where significant rollout

is required and operational challenges are high.

TowerXchange takes a deep dive into the MENA region,

exploring the current appetite for passive infrastructure

equipment and services in 16 countries.

Keywords: Access Control, Afghanistan, Algeria, Bahrain, Batteries, DAS, Egypt, Energy, Hybrid Power, IBS, Iran, Iraq, Jordan, Kuwait, Lebanon, Morocco, MENA, Middle East, North Africa, Oman, Pakistan, RMS, Site Management System, Small Cells, Qatar, Saudi Arabia, Tunisia, UAE

Demand forecasts for infrastructure equipment and services in the Middle East and North Africa - updatedYour comprehensive guide to expected procurement activities in 16 markets

Read this article to learn:< Where the volume of new build will be highest across MENA

< Countries, MNOs and towercos requiring significant investment in cell site energy

< Country by country requirements for site upgrade and turnkey infrastructure services

< Where the biggest opportunities exist for small cells and DAS deployment

< Expected investment in RMS, access control and site management systems

< Who the leading MNOs and towercos are in each country www.towerxchange.com








Vendor opportunity matrix

Energy RMS, ILM and access control

Tower manufacture

Turnkey infrastructure

Small cells, microcells,DAS and IBS*

Advisors Towercos MNOs

Afghanistan High High Medium High Low Medium

Afghanistan has five MNOs, Afghan Wireless, the country’s fastest growing MNO, Roshan which is funded by

the Aga Khan Development Fund and is the country’s largest MNO, multi-national players MTN and Etisalat,

and newcomer Afghan Telecom which is part of the Ministry of Communications and Information Technology.

Each operator owns and operates nearly all of their sites, with MNOs understood to have between 1000-1500

towers each. There are just 6,917 base stations in Afghanistan and the national fibre optic ring has yet to be

completed (Afghanistan TRA). Due to high opex costs, Asia Consultancy Group (ACG) has begun to roll-out

RANsharing sites which host a number of operators on one base station. Security still remains a major concern

across the country, commanding a high percentage on MNO capex and opex, a figure the country’s operators

are looking to reduce with remote monitoring and access control systems presenting viable solutions. 99% of

sites run on gensets – even in cities. MNOs have been reluctant to invest in solar so far, but ACG run their sites

on solar plus battery, to reduce fuel cost and exposure to security risks. The launch of 4G has commenced in

the capital Kabul, however the majority of network services run on 2G and 3G.

Asia Consultancy Group

Afghan WirelessRoshanMTNEtisalatAfghan Telecom

Demand forecasts: telecom infrastructure in MENA




Tower manufacture




Algeria Low Medium High Medium Low Medium None MobilisDjezzyOoredoo Collectively the country’s MNOs plan to add 2,500 towers to the 19,000 tower market with Mobilis and Ooredoo

planning the biggest new build. The level of infrastructure sharing is low and many sites are unsuitable for additional tenants thus necessitating strengthening and upgrade projects. The MNOs in the market had trialled outsourcing managed services to smaller subcontractors in a bid to save costs but their lack of project management capabilities mean that the MNOs are reconsidering working with larger players. VEON-backed Djezzy had looked into a tower sale but limits on foreign direct investment meant that appetite for the towers was limited; FDI rules are meant to be changing and should a company express an interest, one could expect the deal to return to the table. 99% of sites are on grid and with cheap fuel costs, generators are the mainstay technology for backup power.

Bahrain Low Low Low High Medium Medium None BatelcoVivaZainWith 1500 sites in a country that requires just 400, new legislation has been introduced to regulate the

deployment of new towers and promote infrastructure sharing. Whilst there will be little to no new build, requirements to rectify sites to better blend into the environment means there is an appetite for camouflaged towers. Major decommissioning is required in Bahrain creating opportunities for turnkey services companies. Power is not a major concern with a robust grid in place. Tower sales have previously been looked at in the country and whilst there are no active processes, rumour is that the towerco business model is being explored by the TRA and MNOs, with the help of advisory firms.




Tower manufacture




Egypt High High High High Low Medium HOI

New towerco licence to be awarded imminently

VodafoneEtisalatOrangeTelecomEgypt

Egypt is one of MENA’s largest tower markets with 24,000 towers. The NTRA, which is undergoing a review around infrastructure licensing is expected to issue a licence to a major international towerco imminently, as soon as Q4 2019 or Q1 2020. It is estimated that the towerco is looking to deploy a BTS strategy with each of the country’s four MNOs adding in the region of 1500-2000 sites. The operators are looking to add new sites themselves, with Orange estimated to be adding 700 sites (200-300 sites in 2020) and Telecom Egypt are planning to build 1000 new sites. 85% of total sites are on grid with 15% off grid, to date, operators have been reluctant to deploy capex in upgrading sites to hybrid solutions with diesel generators the mainstay of power generation. The entrance of a towerco into the market is expected to precipitate investment in new hybrid power solutions. Current sole towerco HOI with 38 sites has no plans for expansion. Orange were close to being awarding an ESCO contract however this was cancelled.

Iran Low High Medium High Low Low Iranian TowersFanasia

MCIMTN- IrancellRightel

There are currently around 36,000 towers in the Iranian market and with very little infrastructure sharing between the operators there is a significant degree of parallel infrastructure. Towerco Fanasia currently owns 106 towers whilst Iranian Towers (owned by MNO’s MCI, Rightel and towerco Fanasia) own around 1,000 sites. The construction of any new sites will be primarily in the major cities in order to accommodate 4G and 4.5G rollout, accommodating multiple tenants, which will include both ground based and rooftop sites and will be conducted with the coordination of municipalities who will benefit from revenue sharing on the sites. Iranian Towers were known to be assessing site management systems to better manage their portfolio of sites. The towerco is also exploring energy and space saving solutions including new racks and solutions for outdoorisation.




Tower manufacture




Iraq High High High High Low Medium None ZainAsiacellKorek TelecomTishknetGoran-NetMobitel

There has been significant under investment in networks in recent years with 3G coverage understood to be particularly poor and so significant network expansion is required. Korek Telecom forecast that they need to build a further 2,500 sites, indicative of the new build required across the country. Major investment has been pledged by international investors and donors in a bid to rebuild Iraq’s economy, with significant funds expected to be channelled into telecoms. Iraq’s MNOs are struggling with high OPEX, attributable in large part to security and logistic issues across the country. Power remains a major challenge and whilst figures for power availability vary by region and by time of year, the vast majority of sites are reliant on two diesel generators. Hybrid solutions are yet to have any large scale trials in the country, and whilst fuel is not expensive by a global comparison, the costly and difficult logistics associated with fuel delivery and generator maintenance means that a switch to hybrid solutions is attractive. Infrastructure sharing has begun but most existing structures are unsuitable for additional tenants, thus considerable strengthening work is required.

Jordan Medium Medium Low Medium Low Medium TASC Towers

OrangeZainUmniahThere are just over 7,000 towers in the country, roughly split between the three MNOs (with independent

towerco TASC Towers having a modest portfolio). The telecoms sector has been hit by electriciy price hikes in Jordan, negatively impacting opex. Orange have invested in a 33.7MW solar PV plant to produce the electricity it requires, and other MNOs continue to look at ways to control their power costs.

Kuwait Low Medium Low Medium High Medium IHS* ZainVivaOoredooZain’s agreement to sell 1,700 towers to IHS Towers is expected to close imminently, with just a couple of minor

regulatory issues to be finalised. Decommissioning is expected to play a key part of the towerco’s strategy in the market where significant parallel infrastructure exists. New build will be limited but expect tower strengthening and upgrade work as sites are prepared for additional tenants. IHS may look to put in place new site management systems across its portfolio as it integrates the sites into its business. 5G is in the process of being rolled out in the country with small cells and DAS solutions required. Whilst the electricity grid is extensive in Kuwait, approximately 10% of sites are understood to lack grid connections and are thus reliant on diesel generators 24/7.

*IHS has reached an agreement to acquire Zain’s tower portfolios in Kuwait. The deal is subject to regulatory approval




Tower manufacture




Lebanon Medium Medium Medium Medium Low Low None touchAlfa

A small market with just 2,600 towers evenly split between the two operators. Around 700-800 new towers were expected to be added in 2019 constituting an almost 30% increase in the country’s total tower stock. TowerXchange awaits news on whether this rollout has been completed or whether the new build will roll into 2020. Of the 2,600 towers, approximately 15% are on good grid with 24 hours of availability, 73-75% are on poor grid (with availability ranging from 6-18 hours) and 10-12% of sites are completely off-grid. The country’s two operators have signed ESCO contracts with IPT PowerTech, to take over energy management on their sites. Security is not a major concern but a need to manage power creates remote monitoring requirements. There are major fibre rollout plans and the commercial launch of 5G has been begun by both operators.

Morocco Low Low Low Medium Low Medium None Maroc TelecomOrangeInwi

Morocco’s 19,000 towers are all owned by the country’s three MNOs, with market leaders, Maroc Telecom having the largest portfolio of around 10,000 sites. Infrastructure sharing between the MNOs exists, with approximately 15% of sites thought to be shared. Etisalat are becoming increasingly involved in Maroc Telecom’s operations and whilst the country has a reliable grid, energy efficiency measures will be likely priorities to improve operating margins. 4G rollout continues thus necessitating site strengthening as further equipment is added to towers. International towercos are eyeing up the region with new opportunities set to emerge in 2020.

Oman Low Medium Medium Low Medium High Oman Tower Company

OmantelOoredooVodafone (Oman Future

Telecommunications)

A third MNO license was recently awarded to Oman Future Telecommunications who will operate in strategic partnership with Vodafone. Newly created Oman Tower Company (OTC) plans will manage new site rollout for the operator (whilst also executing new site build for Oman’s other operators). OTC expects to build approximately 600 towers in the next five years. As part of 5G rollout and the government’s 2040 vision, it is expected that 4,400 base stations need to be rolled out by the country’s operators in the next five years (with new build and site sharing required to fulfil this). Omantel, which owns 3,000 towers (of which approximately a third are ground based) are considering a tower sale, with a number of towercos (including OTC) rumoured to have expressed an interest in the portfolio – expect work for advisors should this go ahead.




Tower manufacture




Pakistan Medium High Medium High Medium Medium edotcoAWAL TelecomEnfrashare

JazzTelenorZongUfone

The Pakistani market remains a promising opportunity for long-term growth for both existing and new international players with 30-000 – 40,000 new base stations needing to be added in the next five years, creating new build and co-location opportunities. Jazz’s 10,000 sites are back on the market with a winning bidder for the towers expected to be announced imminently. There has been extensive infrastructure sharing between the region’s four operators but significant parallel infrastructure exists, especially in urban areas, implying that decommissioning is likely to be a key part of towerco strategy in the future. MNOs cite power as the number one operational challenge in the market, followed by security and landlord issues. While Pakistan’s electricity grid remains unstable, and outages can last eight or more hours, the situation has improved notably in recent years. Backup diesel gensets runtime is being reduced at sites on the country’s better grid connections, with DGs increasingly being removed from such sites. edotco will offer a full tower+power service in Pakistan.

Qatar Low Low Low Low High Medium None OoredooVodafone

Qatar is positioning itself as a front runner in the rollout of 5G, with a world class infrastructure backbone one of the key pillars of the Qatar National Vision 2030. Such goals will necessitate investments in small cell and DAS with the country likely to be one of the earliest mainstream adopters of the technology. As a small country with good coverage, new build in the market is expected to be extremely limited. There is little to no infrastructure sharing in the market, but with both operators now effectively owned by the state, the government may start to view infrastructure sharing more positively. There is a major focus on street level solutions and an interest in camouflage solutions, presenting opportunities for innovative tower manufacturers and designers. Qatar remains locked in dispute with several Arab nations and diplomatic ties have been cut and transport links severed meaning that supply chains have been shaken up.




Tower manufacture




Saudi Arabia High High High High High High TAWAL SaudiTelecomCompanyMobilyZain

Saudi Telecom Company has carved out 14,200 towers into a new captive towerco TAWAL, with the towerco having ambitions that stretch beyond Saudi Arabia’s borders. With the new subsidiary having a laser beam focus on towers, expect major opportunities for the entire supply chain as the towerco looks to professionalise the management, sharing and operations of its sites. Data usage continues to grow exponentially and c. 1000-2000 new sites are required in urban areas to meet demand. All new high rise buildings need to be built with DAS and fibre and with 5G rollout underway, alternative site typologies are growing in importance. Infrastructure sharing is becoming increasingly common meaning that strengthening will be required. In terms of power, urban towers all benefit from good grid, but rural and remote areas (approximately 25% of sites) are reliant on generators plus batteries. Batteries are reported to be performing well at high temperatures with shading and free cooling being preferred to other cooling solutions. Solar has gained little traction in the region due to the dusty conditions.

Tunisia Low Medium Low Low Low High NATIC OoredooOrangeTunisie Telecom

Rumours had circulated that following Abraaj’s acquisition of Emirates International Telecommunications’ stake in Tunisie Telecom, a tower sale would follow. Abraaj’s takeover has since fallen through and as such, talks of a tower sale appear to have cooled. A small country, the amount of new build required is limited but newly emerged towerco, NATIC, is in discussions regarding build to suit contracts with the country’s MNOs. Should towers come to market, one can expect NATIC to have a keen interest (although limits on foreign direct investment may stymie interest from international players). Infrastructure sharing is comparably prevalent in Tunisia with around one third of sites shared and a RANsharing agreement in place between Tunisie Telecom and Ooredoo.




Tower manufacture




UAE Low Low Low Low High Low None Etisalat du

The country is very much positioning itself to be a front runner when it comes to 5G. With a large proportion of high rise buildings in dense urban areas, small cells and DAS rollout are a priority in the UAE. Whilst two competing entities, both Etisalat and du have a common shareholder in Emirates Investment Authority which has a 60% share in the former and a 39.5% share in the latter which creates an unusual situation in the market. The two operators have a fixed network sharing deal. There are an estimated 13,000 towers in the UAE of which Etisalat owns 8,000. The country is less attractive to towercos and so no tower deals are expected any time soon. New build requirements are limited and power isn’t a major challenge and so there are fewer opportunities for tower manufacturers and energy equipment manufacturers in the UAE than other regions. With Dubai acting as the regional hub to MENA, companies looking to form partnerships with other suppliers would be well placed to invest time in local stakeholders based in the Emirates.


Who you will be meeting at TowerXchange Meetup MENA 2020

An Company

R

EQUIPMENT RENTAL


Our sponsors

TAWAL

TAWAL is a leading Saudi telecommunications tower company offering high-

quality solutions to corporate clients in search of a reliable and cost-efficient

wireless infrastructure that would ensure optimal operations for their

business.

Our core activities involve designing, building, and managing consolidated

telecom infrastructure facilities that enable state of the art and modular

connectivity. By enhancing tower sharing, TAWAL enables its partners to

attain operational excellence and accrue higher profits resulting from reduced

capital expenses for network rollouts and lowered operating expenses for

managing infrastructure at multiple sites. Tower sharing also provides

additional benefits for congested urban areas, including minimizing

infrastructure duplications and excessive network redundancies, as well

as reducing visual pollution that usually results from dense equipment

installations.

TAWAL owns and manages the passive infrastructure of its towers and

leases space to service providers in addition to government entities and

communication businesses, TAWAL is also planning for expansions to benefit

from economies of scale and develop value-added services. Looking ahead,

TAWAL is bracing for a new era of technologies and adjacent innovative

services such as small cells and fiber. Furthermore, TAWAL plans to extend its

geography reach to cover new cities, rural areas, and remote destinations.

http://tawal.com.sa/

Diamond sponsor


Our sponsors

EnerSys

EnerSys®, the global leader in stored energy solutions for industrial applications, manufactures and distributes energy system solutions, motive power batteries, battery chargers, power equipment, battery accessories and outdoor equipment enclosure solutions to customers worldwide. Motive power batteries and chargers are utilised in electric forklift trucks and other commercial electric-powered vehicles. Energy Systems provide highly integrated power solutions and services to broadband, telecommunication, utility, uninterruptible power supplies, renewable, medical, aerospace and defence, premium starting, lighting and ignition applications. Outdoor equipment enclosure products are utilised in the telecommunication, cable, utility, transportation industries and by government and defence customers. The company also provides aftermarket and customer support services to its customers in over 100 countries through its sales and manufacturing locations around the world.

With operating costs becoming a key issue for tower owners and telecom operators, choosing the right backup power solution is growing in importance. With variables in location, climate, budget, maintenance and deployment, choosing the right battery and cooling options to keep the total cost of ownership (TCO) to a minimum can be difficult. EnerSys® - as the world leader in this product sector – offers an extensive portfolio of energy storage solutions to serve the industry effectively, efficiently, and repeatedly.

www.enersys.com/GlobalLanding.aspx

IHS Towers

IHS Towers is one of the largest independent owners, operators and developers of shared telecommunications infrastructure, or tower operators in the world by tower count with approximately 24,000 towers. IHS Towers is the largest independent tower operator in EMEA and the third largest independent multinational tower operator globally, in both cases by tower count.

IHS Towers continues to grow and develop its business with leading market positions in Cameroon, Côte d’Ivoire, Nigeria, Rwanda and Zambia. IHS Towers has also announced agreements to acquire Zain’s towers in Kuwait and Saudi Arabia, subject to certain regulatory and statutory approvals. Upon completion of the Zain Kuwait and Saudi Arabia transactions, IHS Towers will have approximately 33,100 towers in its portfolio which will confirm IHS’ position as one of the largest independent multinational tower operators globally by tower count.

For more information, please our website.

www.ihstowers.com

Gold sponsor Gold sponsor


Our sponsorswith telecom infrastructure specialization, we are market leaders in providing energy solutions, telecom services, and managed maintenance services. The group is recognized as the global Leader of the Guaranteed Savings and T-ESCO models. Our self-manufactured enclosures allow us to create customized energy efficient/hybrid and renewable energy solutions, and to implement new concepts in site renovation. With offices in 11 countries, our solutions are delivered to more than 60 operators, tower companies and vendors in more than 50 countries.

http://www.iptpowertech.com

Bronze sponsor

NEXSYS-ONE

NEXSYS-ONE is a true telecom industrial software platform with over 18 year’s experience deploying and maintaining mobile network infrastructure. We serve Tier-one operators, Tower companies and System integrators with innovative software solutions to improve efficiencies and performance whilst eliminating unwanted costs due to operational process failures or visibility. We take pride in our software that its built around our experience of building & operating over 350 networks since 2001. We capture network requirements around quality assurance, project management, tower sharing, IFRS compliant lease management, work force management, procurement & supply chain processing, warehouse & asset management, health & safety, access & RMS supply, Fiber/TRS/RF tracking and risk management.

https://www.nexsysone.com

world’s first commercial deployments of solar energy and energy storage over 45 years ago. This rich history of product design, manufacturing and solution provision has uniquely positioned GRIDSERVE at the forefront of today’s hybrid energy marketplace. Today, GRIDSERVE’s strong pedigree is responsible for the development, construction and operation of more than a gigawatt of solar energy and energy storage solutions including over 100 utility-scale sustainable energy projects to the UK grid in the last five years alone. GRIDSERVE has combined best-in-class modular technologies and services to deliver turn-key, dependable, low cost, clean energy for critical power. GRIDSERVE’s Solar Energy Centre (SEC12) integrates the world’s highest performance and most optimised components to provide maximum efficiency hybrid power systems designed specifically for telecom BTS applications. GRIDSERVE’s latest iteration of SEC12 is configured as a modular ‘plug-and-play’ hybrid power solution that integrates the very latest advances in bifacial solar power, intelligent energy storage, ultra-high efficiency generators, into single systems complete with climate controls and fully controllable, secure, advanced remote monitoring features. GRIDSERVE is accredited to the international quality and environmental standards ISO9001 and ISO14001. www.gridserve.com

Bronze sponsor

IPT PowerTech

IPT PowerTech Group delivers specialized solutions to the power, industrial and telecom sectors in Africa, Middle East and South-East Asia. Combining power expertise

R

Silver sponsor

Bladon

Bladon is a pioneer in the design, development and manufacture of Micro Turbine Gensets (MTGs) – using high-speed, ultra reliable, low noise and clean-burning microturbines together with patented air-bearing and heat exchanger technologies that will transform distributed power generation.

Bladon is the world’s first manufacturer of microturbine gensets for the telecom market. Providing 12kW of power the Bladon MTG has upto 8,000 hour service intervals, fuel flexibility to use diesel, kerosene or mixture, secure packaging and reduced environmental impact. The Bladon MTG is the world’s only EURO V emission standard compliant 12kW diesel genset and uses no engine oils or liquid coolants thanks to its one moving part and air bearings technologies.

www.bladonmt.com

Silver sponsor

GRIDSERVE Sustainable Energy GRIDSERVE Sustainable Energy Limited (“GRIDSERVE”) is a tech-enabled international sustainable energy business which develops, builds, owns and operates solar energy & battery storage solutions for critical power infrastructure. We are seasoned sustainable energy professionals with roots that started with some of the


Our exhibitorsExhibitor

Asentria

Asentria provides solutions for mobile network and tower operators to manage power, security, and environmental issues at remote cell sites from their network operations center. Telecom sites are evolving to include many new intelligent subsystem controllers for DC rectifiers, generators, cameras, access controllers, and HVAC.

Asentria securely integrates these sub-systems into our hardware based site controller to present a single interface for management of power, security and environment at remote sites. Beyond simple alarming, Asentria generates data for comparative site analysis and provides remote access to the underlying systems for OPEX reducing cell site optimization.

http://www.asentria.com

Exhibitor

Caterpillar

When it comes to unmanned operations in remote locations you need a system you can rely on and easily access. Cat® power generation equipment is manufactured for non-stop power and customized to meet specific site requirements. We can configure and install a solution that delivers the right power for your operation. Our modular sound attenuated enclosures keep you in compliance with noise level regulations,

across Europe, Africa, Asia, the Americas and the Middle East and our team is well recognised for such transactions worldwide. Our telecommunications advice includes acquisitions and disposals, debt and equity financing, infrastructure development, operational arrangements, regulatory matters and dispute resolution. We also have significant experience in the negotiation and drafting of sale and purchase, debt and equity financing, master lease, build-to-suit, site management, site marketing and service level arrangements, fibre IRUs and other complex commercial contracts.

http://www.velaw.com/

Exhibitor

Al-Babtain LeBlanc

Al-Babtain LeBlanc, is a fully owned subsidiary of Al-Babtain Power & Telecommunication Co. it was established in late 1993 as a Joint venture between Al Babtain Power & Telecommunications and LeBlanc International Pte Ltd, to address & meet the growing Communication industry infrastructure needs and providing turnkey solutions for telecommunication, broadcast, defense, security and other integrated networks across various countries in GCC and MENA. Starting with an office in Riyadh, KSA, Al-Babtain LeBlanc has now grown into one of the largest Turnkey solutions providers in the MENA by establishing country specific local office in UAE & Egypt.

www.al-babtain.com.sa

Bronze sponsor

Sitetracker

Sitetracker, Inc. powers the successful deployment of critical infrastructure. As the global standard for managing high-volume projects, the Sitetracker Platform enables growth-focused innovators to optimize the entire asset lifecycle. From the field to the C-suite, Sitetracker enables stakeholders to perfect how they plan, deploy, maintain, and grow their capital asset portfolios. Market leaders in the telecommunications, utility, smart cities, and energy industries — such as Verizon, Nokia, Fortis, Alphabet, British Telecom, and Vodafone — rely on Sitetracker to manage millions of sites and projects representing over $19 billion of portfolio holdings globally. For more information, visit our website.

www.sitetracker.com

Bronze sponsor

Vinson & Elkins RLLP

Vinson & Elkins is one of the oldest and largest international law firms, with approximately 700 lawyers located in 15 offices around the world. Our global telecommunications team has extensive experience advising on international telecoms and telecoms infrastructure M&A transactions, including in respect of towers, data centres, fibre, wireless and wireline technology.

We have significant industry experience, advising on telecoms transactions in numerous countries, including


locate the machine at any time, fuel level alarm, remote management and remote control for gathering and recording data in real time. HIMOINSA has develops a variable speed hybrid generator sets that reduces fuel consumption by 40% and extend maintenance periods up to 1000 hours.

www.himoinsa.com/ Exhibitor

Exhibitor

ITD / ClickOnSite

ClickOnSite is a comprehensive software tool for MNOs and towercos to manage tower sites, rollouts, assets lifecycle & operations at scale. Everyone from the office to the field works on one set of data in real-time, on PC, tablet or mobile. Reports provide business intelligence. BPM automates project management. APIs connect to your other enterprise software. We have 12,000 daily users across 20 countries. ITD aims to be the #1 provider of software for managing sites and operations in Europe, Africa, Middle East and SE Asia.

We are telecoms industry experts making software optimized for the industry!

http://www.it-development.com

Exhibitor

Infozech

Infozech is IOT based cost optimization and revenue management solution provider for telecom infrastructure providers and operators since 1999. Infozech’s iTower

Exhibitor

House of Invention (HOI) Established in 1997, with an ambitious vision to grow as the region’s leading telecom services contractor, HOI quickly proved itself in the Saudi market. Carrying out the TEP-6 Project a complete turnkey rollout of the first Saudi GSM Network valued at over USD 6Bn. HOI was able to set up a manufacturing arm in 2001 in Egypt for all passive infrastructure elements, including towers and shelters. The business not only increased its footprint across Egypt, Saudi Arabia, UAE, Sudan and Morocco, but also managed to build facilities specialized in tower and monopoles manufacturing, RDUs, as well as decorative and power solutions. In 2012, HOI achieved a milestone when it became the first company in Egypt to be granted the Towerco license and the only company working with 3 operators in Egypt.

Exhibitor

HIMOINSA

HIMOINSA is a global corporation that designs, manufactures and distributes power generation equipment worldwide. It has extensive experience in the telecommunications market, having supplied equipment with power outputs ranging from 8 to 45KVA in the international market to well-known companies in the sector.

Our telecom range gensets can work remotely, providing efficient and reliable power and incorporate functionalities such as: GPS system, making it possible to

Our exhibitorsdeter fuel theft, offer protection from the elements, and still allow for easy repair and installation. All Cat generator sets come backed by our global team. Get parts, preventive maintenance, diagnostics, and emergency service specific to telecom applications. It’s our job to provide power that does its job.

www.caterpillar.com/

Exhibitor

Enetek Power, An Eltek Holding Company

Enetek, a AC and DC power specialist, methodically tailors solutions to cater to the needs of users in various industries for their critical mission applications. We aim to continuously develop technologies that encompass smart power flexibility to provide clean, cost-effective and high quality, reliable energy solutions. We engineer innovative & customized power solutions to meet stringent industry standards.

Through creative engineering, smart sourcing, targeted manufacturing, efficient logistics management and services with human touch, we aim to satisfy our customers’ business interests and enhance their growth in a sustainable way. Enetek’s power solutions offer modularity, flexibility and scalability through utilization of rack-mounted, hot-pluggable power conversion modules, smart monitoring and effective customization.

www.enetek-power.com

An Company


Product Suite helps tower companies with Asset, Billing (Infrastructure & Energy), Site uptime and Energy Management with Analytics powered approach.Infozech’s Analytics Product Suite enable consumers with meaningful insights for smarter decisions. We believe that “Data is itself a cost till it is associated to analytics to get actionable insights”.

Infozech manages over 100,000 tower sites, tracking over 42 Million litres of fuel per year, reconciling bills worth USD 23 Million, reconciling 700,000 Assets for customers across multiple geographies.

www.infozech.com

Exhibitor

Metalogalva

Metalogalva is a Portuguese steel manufacturing company with more than 47 years of activity in fields of Energy, Communication, Transport, Lighting, Renewables and Steel Protection (with own Hot Dip Galvanizing Unit and Painting). Has 5 industrial units (total area of 60000m² and total gross area of 198000m²), with a galvanizing capacity/year of 100000 tons. Metalogalva exports 80% of its own manufacturing for more than 85 different countries. Has continuously invested on new equipment to face the requirements/delivery times of the international markets.

Metalogalva promote the excellence of its services, investing in the researching, development and innovation of its products.

www.metalogalva.pt

Exhibitor

NorthStar Battery

NorthStar is a global leader in designing, manufacturing and deploying a wide range of batteries and energy storage solutions. Our mission is to deliver reliable and sustainable power to the world. Using advanced technology, our products have been built to ensure longer battery life, lower operating costs and reduced environmental impact.

We maintain a global presence with major operations in Sweden, USA, China and the Middle East and distribution and service centers in Latin America, Europe, Africa and APAC. Visit our booth for more information about our new innovative products including NorthStar ACE® – Wireless Battery Management!

http://www.northstarbattery.com

Exhibitor

Polar Power Inc Polar Power, Inc. (POLA), designs, manufactures and sells direct current, or DC, power systems, lithium battery powered hybrid solar systems for applications primarily in the telecommunications market. Polar’s systems provide reliable and low-cost energy for applications for off-grid and bad-grid applications with critical power needs that cannot be without power in the event of utility grid failure.

Our systems integrate DC Generators, Solar PV, DC Air-conditioning, and batteries. Our Hybrid Solar Systems provide reliable power with very low maintenance and operational costs. Our Prime Power DC Generators provide very low fuel consumption, low maintenance with 3,000-hour oil change interval and long generator life. Our Backup DC Generators provide compact, lightweight, minimum fuel storage providing long reserve.

www.polarpower.com

Exhibitor

Salasar Techno Engineering Pvt. Ltd.

Salasar started out with the mission of contributing towards the growth of India’s dynamic infrastructural space. Now one of the leading Steel Infrastructure Providers in the country, Salasar offers 360-degree solutions to its clients across continents by carrying out engineering, design, procurement, fabrication, galvanization, and deployment.

Three state-of-the-art manufacturing facilities boasting an annual production capacity of 1,00,000 MT, Zero Defect Production, shortest delivery windows in the industry, and the ability to ramp up operations in minimum time anywhere- make Salasar India’s preferred tower supplier. All products are fabricated as per the customer’s requirements in accordance with the strictest standards.

http://salasartechno.com/

Our exhibitors

http://www.polarpower.com


Exhibitor:

Sera4

Sera4 is a global access control leader with multiple patents that started providing keyless Bluetooth solutions in 2014. Sera4 developed the first keyless padlock for Critical Infrastructure, Teleporte was the first keyless system in mass deployment serving both cabinets and padlocks, and was the first keyless system implemented by the largest independent tower company.

The Sera4 Teleporte solution was designed for critical infrastructure to simultaneously deliver operational efficiency, audit compliance, and increased security. With Teleporte you can immediately grant and revoke access privileges, produce robust audit trails in real-time, and integrate with existing OSS, RMS, job ticketing and other solutions.

www.sera4.com

Exhibitor

SerEnergy

SerEnergy is a world-leading developer and manufacturer of power systems providing primary, supplementary and backup power for telecom and utility applications. With a system based on reformed methanol fuel cell technology, SerEnergy provides a very compact power generation system that does not generate harmful emissions, noise or vibrations. The methanol fuel cell power system is a front-runner in terms of low maintenance requirements while being environmentally friendly. SerEnergy provides premium-quality methanol fuel cell solutions with an

electrical efficiency of 40-50% and with highly skilled staff in and outside Denmark, we strive to provide all our customers with high-quality service and support.

http://serenergy.com

Hardiman Telecommunications

Hardiman Telecommunications Ltd. was established in 1994. We are a boutique consultancy specialised in strategy development, due diligence assessment and valuation support. Our clients include major TowerCos, private equity funds, corporate finance / advisory and investment functions of leading banks, and telecommunications carriers. We are particularly active in end-to-end support of mergers, acquisitions and divestitures. All of our staff have held profit-accountable positions with global telecommunications carriers, manufacturers and systems integration houses prior to joining us. This allows full support of clients across the continuum from technology through to market effectiveness, spanning engineering, commercial strategy, financial structuring and proven operating methodologies.

http://www.telecoms.net

ieng Group

I engineering Group provides end-to-end engineering infrastructure solutions to the telecommunications and power industries across Africa, the Middle East and

Southeast Asia. Employing a dynamic and personal approach, we have grown rapidly since our inception in 2007 and are now operational in 17 countries: Afghanistan, Algeria, Cameroon, Chad, Congo, DR Congo, Ethiopia, Ghana, Guinea, Kenya, KSA, Lebanon, Liberia, Myanmar, Nigeria, Pakistan and Uganda.

We offer O&M services on one hand (Active and Passive) as well as Full Turnkey Site Builds and Fiber Optic. Today, we maintain over 13,000 sites for Africa’s largest MNOs and all 4 towercos.

http://www.ieng-group.com

Ramboll

Ramboll is a leading engineering, design and consultancy company founded in Denmark in 1945. The company employs 15,000 globally and has especially strong representation in the Nordics, UK, North America, Continental Europe, Middle East and Asia Pacific.

With more than 300 offices in 35 countries, Ramboll combines local experience with a global knowledgebase constantly striving to achieve inspiring and exacting solutions that make a genuine difference to our clients, the end-users, and society at large. Ramboll works across the markets: Buildings, Transport, Planning & Urban Design, Water, Environment & Health, Energy and Management Consulting.

www.ramboll.com

Our exhibitors


5th Annual

TowerXchange Meetup Europe19-20 May 2020, CCIB, Barcelona

2020 key discussion areas include:

< Tower carve out and M&A strategies shaping the industry< Evolution of the infraco model: services, margins, valuations< Expert opinion on 5G network infrastructure design< Innovative neutral host indoor and outdoor coverage case studies< Contract renegotiations and relationship rebuilding < The future of asset management with enhanced data utilisation< Industry investment in site upgrades and site resilience

For more information visit our website:www.towerxchange.com/meetup/meetup-europe

CXOs and industry visionaries share forecasts, views and strategies for 2020 and beyond

Executive, focussed and interactive: The networking club for telecoms infrastructure professionals

40+ packed roundtables giving you a seat at the table in the industry’s biggest subjects for debate

Silver Sponsors:

Bronze Sponsors:

http://www.towerxchange.com/meetup/meetup-europe


Keywords: 5G, C-Level Perspective, Carve-Out, Decommissioning, Interviews, Middle East, NOC, O&M, On-Grid, Regulation, Renewables, Rooftop, Saudi Arabia, Saudi Telecom Company, Small Cells, STC, TAWAL, Towercos

TAWAL takes over 14,000+towers in Saudi Arabia TAWAL is MENA’s largest towerco, learn about their strategy for existing sites, lease-up, green power and regional expansion plans

TowerXchange: Please introduce TAWAL – what assets do you have on the ground? What has been the rationale for the carve-out from STC?

Richard Ltaif, Chief Strategy and Governance Officer, TAWAL: In Dec 2018, STC announced the carve-out of its towers and the establishment of a new subsidiary – TAWAL – to provide leading integrated ICT infrastructure services in the Kingdom of Saudi Arabia.

The carve-out was decided to ensure the efficient utilisation and monetisation of those valuable assets. TAWAL was launched on April 1st, 2019 after obtaining its license from CITC making it the region’s largest Telecommunications Tower Company.

Today, TAWAL owns a portfolio of more than 14,000 telecom towers spread across the Kingdom and is establishing itself as the leading player in the Saudi telecommunications infrastructure market, aspiring to extend its services and coverage across the region.

TowerXchange: What is your timeline for TAWAL to achieve operational independence from STC? And what governance frameworks have you put in place to ensure transparency and availability of sites to all KSA operators?

Richard Ltaif, Chief Strategy and Governance Officer, TAWAL: Most of the aspects of the business have already been transferred to TAWAL. There are some operational elements which are still with STC and we are working towards a complete operations handover by April 2020.

Read this article to learn:< Details on TAWAL’s governance and independence < Green energy plans and demand for solar solutions for rural sites< Commercial operations and TAWAL’s first new partner < Decommissioning and expansion plans as KSA transitions to 5G< Regional ambitions as MENA’s largest towerco

The largest transfer of tower assets to date in the MENA region took place in 2019, with STC carving-out and establishing TAWAL as its own towerco. Over 14,000 towers now sit on TAWAL’s balance sheet and the towerco has wasted no time in searching out new business, upgrading towers and defining its green power strategy. After stop-start discussions with Mobily, and delays to IHS Towers acquisition of Zain’s towers, the tenancy ratio in Saudi Arabian is still only around 1.1x. With 5G investment underway and infrastructure sharing encouraged by the regulator TAWAL plans to increase this substantially. TowerXchange speaks with Richard Ltaif, Chief Strategy and Governance Officer of TAWAL, to discuss how TAWAL is establishing itself as an independent tower manager in Saudi Arabia and its short-term and long-term priorities.

Richard Ltaif, Chief Strategy and Governance Officer, TAWAL


Providing fair access to our existing and potential customers is at the core of our business model. From a governance perspective, we have set up a robust Governance Framework to show our autonomy and are managed by a diverse Board which includes independent telecom infrastructure experts who have held leadership roles at American Tower Company and Indus Towers Limited.

From a licensing perspective, CITC mandates no discrimination and every commercial contract we sign is scrutinised by the regulator to ensure fair treatment.

At the operational level, we are developing a world-class site-request platform for our customers to have equal and transparent access to our site database and an opportunity to raise site sharing requests.

Testimony to our efforts is the recent signing of a Framework Services Agreement with Saudi internet service provider Integrated Telecom Company (ITC), just 7 months after launch.

TowerXchange: TAWAL has taken control of 14,000 towers from STC. What proportion of these sites are already shared? Is there typically structural capacity to enable co-location, or is improvement CAPEX required? Can you share your targets for increasing the tenancy ratio?

Richard Ltaif, Chief Strategy and Governance Officer, TAWAL: TAWAL currently owns around 40% of the overall tower infrastructure in Saudi Arabia.

Only 10% of those sites are currently shared. MNOs have had limited incentives to share in the past. However, with increased pressure on profitability, capacity increase requirements, and the pressure to cover rural areas, we believe the market for infrastructure sharing has promising days ahead.

Since we took over the sites, TAWAL has been investing heavily in increasing capacity of our sites to ensure they are “sharing ready” as much as possible. I can tell you that capacity will be made available for all the sharing requests.

We have set ourselves aggressive targets for sharing and you will hopefully hear more news like ITC in the near future.

TowerXchange: What’s the approximate ratio of ground-based towers versus rooftops in your portfolio? Have you taken on any of the DAS, small cells and IBS sites from STC? And how do you anticipate your blend of site typologies evolving as KSA enters the 5G era?

Richard Ltaif, Chief Strategy and Governance Officer, TAWAL: Approximately 70% of our sites are ground-based towers, the rest are rooftops. As of now, we haven’t taken up other site types from STC.

Due to higher band requirements of 5G and a small coverage area, we believe that operators will need a greater number of sites to offer the same level of coverage as they currently do for 4G. We expect that 5G may impact the blend of our site typologies as there will be a higher demand for small cells.

TowerXchange: Do you anticipate substantial decommissioning of the overlapping site in KSA, as a culture of infrastructure sharing is increasingly adopted, or will most existing sites be retained for infill/capacity?

Richard Ltaif, Chief Strategy and Governance Officer, TAWAL: Since the advent of mobile services in the Kingdom, the three main telecom operators have rolled-out their infrastructure independently with very limited sharing. This has led to the build-up of sites very close to each other in many cases. With the emergence of an independent operator like TAWAL, we believe that there is an opportunity to promote sharing which will hopefully lead to decommissioning of such sites.

On the other hand, the launch of 5G may create densification requirement and may require some of the sites that are in relative proximity to remain for infill use.

TowerXchange: Will TAWAL be keeping construction and O&M in-house, or do you plan to outsource?

Richard Ltaif, Chief Strategy and Governance Officer, TAWAL: The project management of both construction and O&M will be in-house. However, on-the-ground execution will be outsourced to suitable expert vendors in tower building and site O&M.

For site construction, TAWAL will be responsible for project management, procurement and quality assurance. For O&M, TAWAL is building


a state-of-art Tower Operating Centre (TOC) for 24/7 monitoring. Our goal is to embrace Digital and Automation from the start to ensure efficient operations and serve our customers better.

TowerXchange: Can you share some highlights of TAWAL green energy initiatives?

Richard Ltaif, Chief Strategy and Governance Officer, TAWAL: Renewable energy is one of the key initiatives identified under “Vision 2030”. The government has already taken the necessary steps to improve the power mix at the national level.

We at TAWAL have identified diesel reduction and green energy use as important pillars of our strategy. We are currently executing multiple initiatives to minimise our diesel consumption and to promote green energy.

We have identified sites where the grid is not very far and are making efforts to get these sites connected. Secondly, for few remote sites which were earlier running on diesel, we have changed them to solar and are monitoring their performance.

TowerXchange: Do you have ambitions outside of the Kingdom? If so, how is TAWAL financed and what does this mean about your capacity for buy and leasebacks in other markets in MENA?

Richard Ltaif, Chief Strategy and Governance Officer, TAWAL: TAWAL’s vision is to become the leading provider of infrastructure services in the region. We intend to expand geographically in the medium term once we have established TAWAL as the partner of choice for infrastructure sharing in KSA.

The structuring of any deal in the region will be decided based on the discussions with our shareholders and financial advisors.

TowerXchange: Please summarise your vision for the role of TAWAL in the 5G era in the Middle East and North Africa.

Richard Ltaif, Chief Strategy and Governance Officer, TAWAL: We expect that substantial investments will be required to offer higher speeds powered by the latest technologies. We believe that TAWAL will be a key enabler for this technology advancement by providing cost effective and timely infrastructure sharing services to network operators

The project management of both construction and O&M will be in-house. However, on-the-ground execution will be outsourced to suitable expert vendors in tower building and site O&M









Keywords: 5G, Analysys Mason, Carve-out, Co-location, Introduction, Joint venture, License, MNO’s, Mobile data, Opex, Passive infrastructure, Renewable energy, STC, Saudi Arabia, Spectrum, TAWAL, Towerco, Towers

The birth of the towerco market inSaudi Arabia and its role in the potential disruption of the regional status quo Written by Analysys Mason - Jacopo Pichelli, Rohan Dhamija and Andres Flores

MNOs in Saudi Arabia have been contemplating the creation of a towerco for years, with potential additional tower transactions still in the pipeline

The three MNOs in the Saudi Arabian market, STC, Mobily and Zain, have been considering the selling or carve-out of their tower assets for the past several years. STC and Mobily had originally engaged in discussions for the creation of a joint venture, while Zain reached an agreement to sell its tower portfolio to IHS in November 2018, although the latter has not obtained regulatory approval yet, with a first rejection by the national regulator back in June this year. Following a lengthy series of developments and changes in the strategies of the three large MNOs, STC was the first to take an initiative by carving out the majority of its tower portfolio and establishing TAWAL, the first mobile passive infrastructure player of the country.

The market has positively reacted to the new potentials offered by TAWAL. In November of 2019, only few months after the launch of the new towerco in April, ITC secured a significant contract from TAWAL for colocation space on more than 150 existing sites, making it the first operator in the country to do so. The agreement will help ITC expand its network in a manner much quicker than what it would have been able to achieve on its own, thus giving concrete proof of the benefits that towercos can bring to mobile markets in the Middle East.

Read this article to learn:< The creation of STC’s carve-out < Saudi Arabian market overview and future outlook < Mobile growth, 5G and the demand for data and connectivity < Saudi’s smart city project – NEOM

2019 has been a vital year in the telecommunication sector in Saudi Arabia. The creation of an infrastructure player is a matter that the market has been working on for the past years, and that ended with the creation of one of the biggest towercos internationally – TAWAL, with more than 14,000 towers that were carved-out from the incumbent operator Saudi Telecom Company (STC).


Saudi Arabia is indeed a very promising market for towercos

1. Demand in the market for data and connectivity will trigger a new cycle of high investment for telcos

Mobile data traffic is expected to grow steadily in the next few years, especially with the adoption of 5G. The various concerned stakeholders in the telecommunications industry have already taken significant steps towards this evolution. On the forefront, MNOs in Saudi Arabia have already launched 5G services, offering generous data packages and unlimited plans. Only a handful of 5G handsets are available in the market today, but more devices are expected to be released later by all major manufacturers. In parallel, the National Regulatory Authority CITC, together with the Ministry of Communications and Information Technology are joining efforts to make the country 5G-ready and have imposed a roadmap of targets for 5G speed and coverage, with the first milestone set at the end of 2020.

To cater for the growing demand for data and service availability, operators will have to increase their points of presence (POPs) and densify their networks. This will be done not only by means of deploying traditional macro-cell sites but also by complementing the existing macro-cell networks with small cells and DAS, particularly in congested areas. By 2024, the total traffic carried on Saudi Arabian mobile networks is expected to grow by 21%. Despite the increase in spectrum efficiency brought by the deployment of new technologies such as 5G, massive MIMO and beamforming techniques, there will still be a need for an additional 2,000 POPs.

2. Operators are required to invest in both active equipment and passive infrastructure, thus need to be capable of support a significant pressure on their cash flows

Besides the need for new POPs, operators will also be required to upgrade their existing network in order to offer 5G services. Looking at the next 12 months solely, a large effort for a network upgrade

is required in order to comply with the obligations given with the recent 3.5 GHz spectrum license, requesting operators to cover 35% of the population in the five largest cities by September 2020 and 50% in the eighteen largest cities by 2025.

For operators to meet these obligations, no new sites will be needed, but rather existing sites will have to be quickly upgraded. What implications does that have on operators’ capex plans? The upgrade will require a significant amount of capex for new active equipment such as new radios and new massive MIMO antennae, but also significant investments in the existing passive infrastructure in order to accommodate this equipment, which will require additional space and additional power supply. Many of the existing towers will have to be strengthened, modified, or substituted, with the vast majority requiring their power systems to be upgraded.

Will operators be able to support heavy investments in both passive infrastructure and active equipment with the looming expectations on the revenue upside of 5G and with demand still not

Source: Analysys Mason, 2019Figure 1: Major milestones in the creation of the first towerco in Saudi Arabia

2011-16 July 2018 Nov 2018 June 2019 Nov 2019

Mobily and STC engage in negotiation

for JV creation

CITC issue T&C of TowerCo licence in

Saudi Arabia

April 2019

TAWAL creation after STC's tower

portfolio carve-out

IHS - Zain deal transaction is

formally announced

IHS is not granted regulatory approval and licence in KSA

TAWAL and ITC sign the first major infrastructure

agreement


mature enough to ensure quick return on these investments?

3. Under this financial pressure, operators may find in towercos the right partners to achieve quick expansion and upgrade of their networks, allowing them to invest only in the active equipment

Passive infrastructure sharing already exists in Saudi Arabia as a site-swapping concept between operators. However, this model has not yet witnessed exceptional success since operators in the Middle East have not been historically financially constrained to the same extent as operators in other geographies.

As discussed earlier, when upgrading their networks to 5G, operators are now required to invest on two fronts: upgrading their existing sites and expanding their networks by adding new sites. Both fronts will put additional pressure on operators’ cash flows. Within this, lies towercos’ opportunity to ease the financial burden and ensure a faster implementation of operators’ expansion plans.

Towercos can help rapidly add new network sites without the need for upfront capex disbursement or to deal with cumbersome site acquisition processes. Additionally, towercos can help operators achieve Opex savings by allowing them to share the space on a site. This is particularly fitting for the new sites needed by the three

Figure 2: Total annual mobile traffic forecast and estimated new POPs from MNOs required to attend this increasing demand of data and connectivity

Figure 3: Where can towercos help to relief operators from financial burden?

Figure 2: Total annual mobile traffic forecast and estimated new POPs from MNOs required to attend this increasing demand of data and connectivity [Source: Analysys Mason, 2019]

Forecast

2014 2016 2018 2020 2022 2024

5

0

10

20

15

Exa

byte

s

+21%

+2.000 new POPs annually

upgraded. What implications does that have on operators’ capex plans?

Figure 3: Where can towercos help to relief operators from financial burden? [Source: Analysys Mason, 2019]

Capex Opex

Active equipment upgrades

Electro-mechanical upgrades

Upgrades of other passive components

Overall Opex reduction through site sharing?

Can towercos help relief operators’ financial burden?

✖ ✔ ✔ ✔

fronts will put additional pressure on operators’ cash flows. Within this, lies os’ opportunity to ease the financial burden and ensure a faster implementation of operators’ expansion plans.

os help at all with the upgrade of operators’ existing sites? The benefits in this case are

–

o’s.

Source: Analysys Mason, 2019



operators in case they are located in overlapping areas.

Can towercos help at all with the upgrade of operators’ existing sites? The benefits in this case are not as straightforward as the benefits for newly built sites and would require a more attentive cost-benefits analysis. However, operators might find it beneficial in the specific cases when an existing site cannot support the upgrades and needs to be relocated, or when most of the site equipment needs to be substituted – in some cases even the mast would require to be substituted and rebuilt. In such instances, an operator is right to wonder whether it makes sense to rebuild the site or relocate to a towerco’s.

4. Large and ambitious mega projects will represent a big opportunity for towercos to provide greenfield, state-of-the-art infrastructure – will they be able to do it? A future, forward-looking mindset will be the key

A recently popular topic of discussion is the launch of Neom project, the 26,500 sq. km mega city to be entirely powered by renewable energy and served by driverless vehicles. However, Neom is just one of the several mega projects currently underway throughout the Kingdom. Other examples include King Abdullah Financial District (a massive complex composed of nearly 60 towers in the city of Riyadh), King Abdallah Economic District (a newly built city on the west coast near Jeddah) and the Red Sea touristic project among many others.

The scale and number of these projects are ambitious and unprecedented. Adequate infrastructure represents the key enabler for any and all of the digital services at the core of the projects’ strategies. Therefore, a large effort is required from all the players in the telecom industry to efficiently supply these projects with greenfield, state-of-the-art infrastructure, technologies and services.

Will operators follow the old school model of building their own overlapping, competing infrastructure, or will they collaborate to share it? Will infrastructure providers be able to offer a compelling product to operators and capture all

their infrastructure needs? The value at stake is of incredibly large proportions. Towercos have their chance to grab a good share of it, but only if they will be able to adapt their mindsets to the futuristic ambitions of Neom & Co. A future, forward-looking mindset will be towercos’ key to success.

Establishing operations in Saudi Arabia would give any towerco the critical mass to operate subsidiaries in other smaller countries in the region, without incurring excessive overhead costs

The paradox that tower companies need to win over is that by establishing their own organisations, they

Figure 4: The six most important mega projects announced in Saudi Arabia

–

represents the key enabler for any and all of the digital services at the core of the projects’

os’ key to success.

Figure 4: The six most important mega projects announced in Saudi Arabia [Source: Analysys Mason, 2019]



need to be able to offer operators services with an attractive price while helping them reduce their total cost of ownership of a mobile site.

When a tower company is initially created, its critical functions are established by hiring new staff. The size of certain teams in a towerco are dependent on the number of towers, whilst that of some other teams do not necessarily change as the number of towers increases. This means that a large tower company can largely benefit from economies of scale, while a small tower company can hardly operate in an efficient manner, especially when its strategy is to provide services to operators with an established large tower portfolio up and running.

Within the Middle Eastern context, this is the fundamental reason for which establishing

towercos in markets other than Saudi Arabia would prove challenging, whilst the size of the Saudi Arabian market allows towercos to reach the critical mass needed to operate efficiently. Moreover, establishing operations first in Saudi Arabia allows towercos to expand to other smaller regional markets without the need to re-establish a local core team, but rather to leverage the synergies between a smaller local team and the Saudi Arabian one. Towercos could then start operating in those other markets at much lower marginal costs than in Saudi Arabia, and potentially at lower marginal costs than operators.

That’s why 2019 has been a pivotal year for the tower industry in the Middle East, and why Saudi Arabia has the potential of being the birthplace of the regional tower revolution

About Analysys Mason’s tower experience

Analysys Mason is a leading commercial and technical advisor with exclusive focus on telecoms, media and technology (TMT) and has supported over 350 transaction support assignments in the industry worldwide during the last 5 years, of which more than 100 were tower-related assignments, including the support to STC with the carve-out of their tower portfolio and subsequent creation of TAWAL, the first towerco in Saudi Arabia. Analysys Mason has a 360-degree view of the towerco industry and an in-depth knowledge of the commercial, technological, operational and regulatory aspects of the business. This unique positioning makes Analysys Mason the ideal partner for towercos www.towerxchange.com








Keywords: 5G, Africa, Camouflage, Debt Finance, Fibre, IHS Towers, In-building solutions, Infrastructure Sharing, Investors, Kuwait, MENA, Middle East, Refinancing, Saudi Arabia, Spectrum, Towerco, Zain

IHS Towers poised for growthin African and Middle East marketsTowerco seals largest ever bond issuance

TowerXchange: Congratulations on your US$1.3bn bond issuance, why did IHS Towers raise capital in this way and what does it mean for your ‘digestive capacity’ to acquire or build more towers?

Sam Darwish, Group CEO, IHS Towers: We were really pleased with the support we received during our recent recent bond issuance – the largest issuance ever by an African corporate. We set out to capitalise on our three-year track record of performance in the debt capital markets despite challenging conditions over that time. This and greater familiarity with our Nigerian business helped deliver the largest high yield corporate African bond. We achieved numerous objectives with the refinancing including reducing our cost of debt, significantly extending and splitting the maturities of the bonds, simplifying our Nigeria capital structure and increasing our borrowings a little in the most mature business within the broader IHS Group. Our strategy is to continue growing through a combination of building additional towers in existing markets, introducing innovative solutions for existing clients and executing acquisitions in new markets – we are always evaluating our options and determining where best to deploy our capital.

TowerXchange: Do you think the entry of SBA, the exit of Eaton and Helios going public mark a significant shift for the African telecom tower market?

Sam Darwish, Group CEO, IHS Towers: These recent developments are evidence of strong and growing

Read this article to learn:< IHS Towers plans on increasing infrastructure sharing amongst MNOs

< Their plans to assist 5G roll-out and commitment to the MENA region

< Transfer of IHS’s innovations from Africa to the Middle East

< The continued use of Network Operating Centres

< Towercos ambitions for market growth and investment in MENA

In Q3 of 2019 IHS Towers announced a successful refinancing deal of its 2021 bond, raising a record US$1.3bn. The telecoms infrastructure giant is poised to take advantage of the robust market conditions in the African market and new areas of growth in the Middle East and North African territories. TowerXchange talk to Sam Darwish, Group CEO on the towerco’s plans to deploy this new capital and ambitions for future growth.

Sam Darwish, Group CEO, IHS Towers


appetite for access to the African towerco market – a trend that we have witnessed for several years now. Large US-listed businesses such as American Tower and SBA Communications deploying billions of dollars into Africa, and Helios Towers attracting further institutional investors through its London listing, provide validation of the African towerco business model and underline the interest in the sector. We remain excited about the market prospects going forward.

TowerXchange: You’re Africa’s largest towerco, but can you tell us why an expansion into the Middle East fits your investment thesis? How do you assess which Middle Eastern market is appropriate?

Sam Darwish, Group CEO, IHS Towers: Investing in the Middle East is another important step in our growth strategy to apply the expertise and capabilities that we have developed over the past 18 years to additional global markets. Upon close of either the Kuwait or Saudi Arabia deals with Zain Group, we could be the first independent towerco in the region and are well-placed to serve the increasing demands of a tech-savvy, data hungry population.

As the roll-out of 5G services continues across the region, many anticipate exponential demand for new spectrum frequencies that travel a shorter distance, which will require additional towers. GSMA estimates a 16% 5G adoption rate among Gulf States by 2025 – the highest in the MENA region

– with 81% of the population using smartphones. At least 15 MENA countries, including Kuwait and Saudi Arabia, are expected to have rolled-out 5G commercially by then. We are keen for IHS Towers to be one of the key enablers of this technological revolution.

TowerXchange: What lessons from Africa can IHS Towers bring to the Middle East to accelerate the adoption of infrastructure sharing in a new region?

Sam Darwish, Group CEO, IHS Towers: IHS Towers has a unique African success story with ambitions

to duplicate this success outside of Africa, including the Middle East.

IHS Towers is working to be the first independent tower operator in the Middle East, and the lessons we are bringing to this market first and foremost include helping MNOs become comfortable with the tower sharing model, given we are an independent operator of infrastructure. This does not exist in the Middle East today. Additionally, we will introduce the value of bespoke Network Operating Centres to optimise solutions, radio-frequency planning teamwork with specific operators, as well as innovative tower solutions e.g. in-building solutions,

Figure 1: IHS Towers’ tower portfolio and expected acquisitions across MEA

Source: IHS Towers (excluding portfolios not yet acquired)* Announced not closed

Saudi Arabia: 8,100*

Nigeria:16, 495

Côte d’Ivoire:2,719

Kuwait:1,700*

Cameroon:2,216

Zambia:1,724

Rwanda:865


street furniture antenna and camouflage towers in urban areas, the roll-out of fibre to support MNO customers’ digital solutions and a myriad of green energy solutions.

TowerXchange: How can IHS Towers transfer energy innovations and other operations from Africa to markets in the Middle East?

Sam Darwish, Group CEO, IHS Towers: The energy solutions that are required are bespoke to each and every market. The energy innovations we deliver can cover all geographies, and we are confident the technologies we deploy – including our hybrid and solar solutions – can be transferred to the Middle East and beyond, where required.

Moreover, the IHS Academy online training platform also remains a popular, dynamic and accessible learning platform for employees and vendors. This year we surpassed our 2018 course completions and new courses are being continuously added to the 1,800 existing courses.

We are also proud of our Group-wide Sustainability Strategy, focused on four key pillars: Education, Environment, People and Ethics, and based on the UN Sustainable Development Goals. As we expand into the Middle East, we will look to bring that same ethos. By investing in our tower communities through multilateral partnerships and educational initiatives we have helped push STEM initiatives to help create the next generation of technology and infrastructure talent. Talent which will be the enabler in an infrastructure sharing landscape.

TowerXchange: The Gulf States are developed telecom markets and MNOs are less capital constrained, how have you adjusted your offer for those markets?

Sam Darwish, Group CEO, IHS Towers: MNOs in the region are on the cusp of multi-billion investments in upgrades and 5G roll-out and are looking for ways to optimise this network roll-out. We will help MNOs achieve their infrastructure goals quickly and efficiently by bringing the independent tower sharing model to the region. Additionally, our strategy in the Gulf States seeks to support local initiatives — such as Saudi Arabia’s Vision 2030 – and promotes the purchase of physical tower infrastructure, enabling MNOs to expand their networks quickly and at a lower cost, while receiving best-in-class service.

Our services are aligned with our mission to help accelerate the development of telecommunications

infrastructure throughout the region, which includes expanded coverage and capacity to further improve network quality and 5G upgrades.

TowerXchange: How are towercos going to need to change in the 5G era? What will be the role for street furniture, small cells and inbuilding solutions?

Sam Darwish, Group CEO, IHS Towers: 5G presents a tremendous growth opportunity for towercos because it requires investment in new and upgraded sites that are able to broadcast signal better in order to meet increased data usage demand. For towercos, this requires fast adaption and the ability to deploy 5G spectrum bands across cell sites. The towerco service offerings will evolve with 5G, but these are products we already offer today at IHS Towers. We are at the forefront of this changing era

We will help MNOs achieve their infrastructure goals quickly and

efficiently by bringing the independent tower sharing model to

the region


Keywords: 4G, 5G, Build-To-Suit, Business Model, Consolidation, Fibre, Infrastructure Sharing, Interviews, MNOs, Middle East, Oman, Oman Tower Company, Research, Towercos, Towers

Reshaping the Oman telecom towers market Unlocking tower investment opportunity; Oman Tower Company at the forefront of regional change

TowerXchange: Please introduce Oman Tower Company to readers who may not have heard about your launch in Oman.

Majid Al-Kharoosi, Managing Director, Oman Tower Company: Oman Tower Company was established in early 2018 by local investment entities and pension funds with an international strategic partner, for the purpose of building, operating and leasing telecommunication towers and associated infrastructure including rooftop towers, equipment shelters, distributed antenna systems and power systems.

TowerXchange: Why and how has the Omani government supported infrastructure sharing in the country?

Majid Al-Kharoosi, Managing Director, Oman Tower Company: The Government of Oman, represented by the Ministry of Transport and Telecommunication and the Telecommunication Regulatory Authority, is concerned about the multiplication of telecom towers, often redundant, built by mobile operators or government agencies, with limited coordination and sharing. Towers are often built with capacity to serve only the needs of their owners. With a third MNO in its launch preparation phase and other ongoing telecom projects in the public sector, it has become critical to coordinate and rationalise tower construction, to avoid double investment, excess usage of land and visual pollution.

The Government has supported the creation of OTC, which is 70%-owned by various public entities, and

Read this article to learn:< Drivers behind the initiation of Oman Tower Company < The dynamics of infrastructure sharing in Oman< Future BTS partnerships with the region’s current and new MNOs< Principal challenges of building and maintaining towers in the region < The future vision and strategic direction of Oman Tower Company

In February 2018, Oman 70 Holding Company, AktivCo (Camusat’s investment arm) and the Omani Government set up Oman Tower Company (OTC). The company plans to build approximately 600 towers in its first five years, and has an interest in acquiring or managing the existing portfolios of Oman’s MNOs.

There are approximately 5,000 ground based towers in Oman. In terms of rooftop sites there is some variation in the figures being reported to TowerXchange, with lower end estimates suggesting 5,000 rooftop sites and upper end estimates suggesting 10,000. Omantel are understood to be increasing their tower count by about 4-5% per annum, suggesting an average of around 100-120 new towers are built by the operator each year. For Ooredoo, similar numbers are forecast. Infrastructure sharing has been limited to date, with current estimates suggesting approximately 15% of towers are shared. Sharing has now started to increase as both MNOs aim to execute the rollout of 4G more cost-effectively.

A third MNO license was recently awarded to Oman Future Telecommunications, which is in a strategic partnership with Vodafone. This presents a further build-to-suit opportunity for OTC. Rumour has it that Omantel might be selling their tower portfolio. We take a closer look at the monetisation opportunities of this future sale together with infrastructure sharing, rollout of 4G in rural areas and more for Oman Tower Company.


has fostered negotiations with mobile operators for build-to-suit agreements. The Government has also supported OTC in entering into tower management agreements with owners of several public tower portfolios.

TowerXchange: What is the current status of Oman’s third MNO? How do you anticipate Vodafone’s partnership with Oman Future Telecommunications accelerating rollout? And how what role would Oman Tower Company like to play in supporting their rollout?

Majid Al-Kharoosi, Managing Director, Oman Tower Company: The launch of a third mobile operator was officially announced in September 2019, with a commercial launch scheduled for mid-2020. OTC will provide the towers needed by the third mobile operator, both ground based and rooftop, under a build-to-suit agreement. This agreement may cover other infrastructure required for 5G like street light poles, micro-cell locations, DAS, et cetera. OTC will also play a role in the co-locations of the third MNO on other operator’s towers.

TowerXchange: Please introduce the tower market structure in Oman.

Majid Al-Kharoosi, Managing Director, Oman Tower Company: There are more than 5,000 ground-based towers in Oman and a similar number of rooftop sites, mostly owned by MNOs, with the rest being owned by various governmental entities. To our knowledge, less than 1,000 of them are currently shared. OTC aims at building the majority of future towers in the country, mainly as build-to-suit, but also under other business models including capex/management and revenue sharing.

TowerXchange: Is it correct to characterise Oman’s 4G network rollout as mature and almost complete?

Majid Al-Kharoosi, Managing Director, Oman Tower Company: 4G rollout is mostly complete in urban areas, but the country has vast rural areas currently under 2G coverage, where 4G is still being rolled out progressively.

TowerXchange: Congratulations on the MOUs Oman Tower Company signed with the country’s two MNOs, Omantel and Ooredoo earlier this year. Can you share a little about what you will be building for them, and the vision for the partnership?

Majid Al-Kharoosi, Managing Director, Oman Tower Company: Oman Tower Company has signed a full Master Lease Agreement with Omantel and Ooredoo, covering the build-to-suit of ground based and rooftop sites and collocation on managed sites.

Oman telecoms market

Oman has two MNOs, Omantel and Ooredoo as well as two mobile resellers, Renna Mobile and Friendi Mobile. The two key operators, Omantel with 42.7% market share, Ooredoo Oman with 44.7% and the two resellers with 12.6% (TRA Oman, Q2 2019). Oman remains behind its neighbours Kuwait and Bahrain in terms of internet usage as mobile broadband penetration of 89% of total population and fixed broadband of 72%. Broadband service is getting momentum in Oman with key investments in fibre and some internet of things trials.

ARPUs remain under pressure for both operators due to tough macro-economic conditions since the 2014 oil crisis and regulatory changes with OMR 6.6 (US$17) reported by TRA Oman in Q2 2019. With a Vodfone-linked third operator entering the market in Q1 of 2020 we expect to see more pressures on APRUs. Omantel and Ooredoo have also felt further pressures from an increase in MNO royalty fees from 7% to 12% and a tax increase from 12% to 15%.

The rollout of 4G into rural areas is underway and Oman Broadband’s mandate to allow fiberisation to all operators is significant to the success of 4G rollout. As part of the county’s 2040 strategic vision, Oman’s Telecommunications Regulatory Authority (TRA) granted Omantel and Ooredoo rights to use a 100MHz block of 5G spectrum to introduce a range of advanced and innovative services in the coming years. It is expected that in the next five years, 4,400 base stations will be constructed by Omantel and Ooredoo and 1,000 new BTS will be deployed in 2019-2020


OTC will be building and leasing the majority of their future towers. OTC expects to extend this partnership to in-building solutions and off-grid power systems. OTC believes that such partnerships will add value to the Omani telecom market and make it easier for all MNOs to provide high quality services at an optimised cost, especially in rural areas.

TowerXchange: What is the current extent, and future vision for, the fiberisation of your towers? And how does Oman Tower Company’s partnership with Oman Broadband feed into that vision?

Majid Al-Kharoosi, Managing Director, Oman Tower Company: Oman Tower Company has signed a

partnership agreement with Oman Broadband to accelerate the connection of existing and future towers to fibre optic, allowing fibre to be accessible to all operators under Oman Broadband’s equal-access terms. The dual objective is to increase transmission capacity and reliability, while freeing up tower space for future radio antennas.

Oman Broadband has a mandate similar to Oman Tower’s; rolling out telecom infrastructure and leasing it to all operators, in an open access, equitable and affordable manner. OTC and Oman Broadband’s interests are aligned and the collaboration is very close, especially in preparation of 5G rollout by MNOs.

TowerXchange: What are the principle operating challenges to building and maintaining towers in Oman?

Majid Al-Kharoosi, Managing Director, Oman Tower Company: Oman has a very challenging geography and climate. It is a vast country with a relatively significant and scattered rural population, with a 700km long, 3000m high mountain range in the North, sand dunes in most of the South, exclaves (Madha and Musandam), islands and fjords accessible only by sea. It also has oil & gas fields spread across large areas which would otherwise be uninhabited and now require mobile coverage. The so-called “Empty Quarter” (which is empty only in name), is regularly shattered by sand storms. The coastline of more than 2,000 km is exposed to corrosive maritime air, tropical storms and the Salalah region receives a three month annual monsoon. For all these reasons, Oman faces

a very high telecom infrastructure cost in relation to its population, which is also an opportunity to encourage infrastructure sharing.

TowerXchange: Have you been able to use local partners to manufacture, install and maintain your towers? Has there been opportunity for international suppliers to participate in your rollout and in Omani towers in general?

Majid Al-Kharoosi, Managing Director, Oman Tower Company: Oman Tower Company is working with local partners to build and maintain its towers, with focus on supporting small and medium enterprises. OTC is reviewing the options for local tower manufacturing, although limited volumes will be a challenge.

TowerXchange: How have you found the business model, operations and culture of your towerco has had to be adapted from towercos in the rest of the world to suit Omani requirements and culture?

Majid Al-Kharoosi, Managing Director, Oman Tower Company: The Omani business culture values the ownership and control of fixed assets. It has required time and pedagogy to convince our partners of the benefits of the “towerco” model, similar to that of other countries. As a publicly-controlled entity, OTC pricing has to be cost based, with a higher pricing granularity than usually seen elsewhere. The OTC business model is also more collaborative than the typical build-to-suit model, with significant tenancy discounts.

Majid Al-Kharoosi, Managing Director, Oman Tower Company


Oman Tower Company proudly supports the Government’s objective of local employment and training of young graduates. OTC’s “omanisation” rate exceeds 95%. We also have a large number of fresh graduates under publicly sponsored training programmes.

TowerXchange: There has been speculation that Omantel might sell up 2,500 ground based towers, and up to 5,000 rooftop sites. Would Oman Tower Company be interested to acquire such assets, if they did come to market?

Majid Al-Kharoosi, Managing Director, Oman Tower Company: Oman Tower Company is working closely with MNOs to work out a solution that will optimise the value of their tower portfolios, while serving Oman as a country and generating savings to the telecom sector as a whole. OTC is ready for any tower monetisation options that would suit the portfolio owners and add value to the country.

TowerXchange: Finally, please sum up Oman Tower Company’s future vision of your role within, and the development of, the country’s mobile infrastructure.

Majid Al-Kharoosi, Managing Director, Oman Tower Company: Oman Tower Company’s objective is to contribute to the development of the Sultanate by mutualising, optimising and consolidating the existing and future tower infrastructure in the country, thus freeing up investment capacity for telecom operators to accelerate the rollout of new wireless technologies, while reducing the cost to the end user







See you at our future events!



Keywords: Active Infrasharing, Afghanistan, Asia Consultancy Group, C-Level Perspective, Data Centre, Fibre, Infraco, Masts & Towers, Middle East, Off-Grid, RANsharing, Solar, Towercos

Building a 21st century telecoms infrastructure in Afghanistan Asia Consultancy Group is investing in digital infrastructure, tower co-location and RANsharing in Afghanistan

TowerXchange: For the purpose of our readers please introduce Asia Consultancy Group and tell what assets you have on the ground? What is the blend of macro towers versus rooftops, DAS, small cells and IBS in your portfolio?

Hussein Abdulkader, Chief Operations Officer, Asia Consultancy Group: Asia Consultancy Group (ACG) is a privately-held company in the ICT sector providing hosting, manages services and also acts as a towerco.

ACG is engaged in facilitating the development of 21st century digital telecommunications in Afghanistan. We provide premier telecommunications engineering and consultancy services, microwave network planning and design, infrastructure construction, cell tower co-location leasing, radio access network (RAN) sharing, and digital television broadcasting services throughout Afghanistan. We also have other active projects and services in many telecommunications subsectors in Afghanistan: < Recently entered the civil radar surveillance sector as the local partner to Thales France< Won a nationwide fibre optic license to provide carrier grade data services< Own and operate a 150+ site microwave cell tower network, available for leasing between Kabul–Mazar, Kabul–Pakistan, and Kandahar– Herat backbone routes< Operate digital TV transmitters, repeaters, and gap filler sites in Kabul< Own and operate 250 RANsharing virtual

Read this article to learn:< Asia Consultancy Group’s portfolio of services

< Investment plans for digital infrastructure in Afghanistan

< Rural-rollout and RANsharing

< Energy strategy on Asia Consultancy Group’s sites

Hussein Abdulkader, Chief Operations Officer, Asia Consultancy Group

There are just 6,917 base stations in Afghanistan (Source: Afghanistan TRA) and the national fibre optic ring has yet to be completed. One firm taking a multipronged approach to solving Afghanistan’s connectivity headaches is Asia Consultancy Group, which provides hosting, managed services and telecom towers in the country. TowerXchange sat down with Asia Consultancy Group’s Chief Operations Officer Hussein Abdulkader to discuss the group’s strategy, before he appears at the TowerXchange Meetup MENA 2020 in Dubai, on the 28th and 29th January.


network sites throughout Afghanistan to expand the reach of the country’s mobile operators< Run VSAT hub stations and uplink services in five major cities< Manage aircraft surveillance and the air traffic control network at Mazar-e-Sharif International Airport

TowerXchange: How is the business financed and what does this mean about your capacity to acquire and build more towers? How many BTS and are you looking to build in the foreseeable future and which parts of the county will see the most investment?

Hussein Abdulkader, Chief Operations Officer, Asia Consultancy Group: ACG has been mostly self-funded so far, but as we grow, we are looking for financial institution and/or private equity funding.

We plan to build or acquire a minimum of 100 sites per year, but this would be complemented by building over 3,000km of fibre network over the next four years. The cell sites would be spread across the country for rural coverage to low revenue areas where MNOs don’t want to invest.

TowerXchange: What is ACG’s tenancy ratios, and how is that affected where you facilitate RANsharing?

Hussein Abdulkader, Chief Operations Officer, Asia Consultancy Group: On our backbone

sites we have a tenancy ratio of 2.3, while on our RANsharing sites we have a tenancy ratio of 1.5 where we host Roshan, Etisalat, Salaam and MTN.

TowerXchange: We understand that a new licence has been awarded. What opportunities do you anticipate this will provide besides enhancing market competition in the region?

Hussein Abdulkader, Chief Operations Officer, Asia Consultancy Group: The new licensee has yet to start operations, but it is showing an interest to co-locate on our sites.

TowerXchange: What are AGC doing to facilitate the rollout of 4G? Is there significant demand for 4G in a predominantly 2G market?

Hussein Abdulkader, Chief Operations Officer, Asia Consultancy Group: To launch pure 4G and

to enhance 3G the country needs stable internet services and a wider reach of fibre aggregation nodes. ACG is strategically placed to provide these services and infrastructure in Afghanistan.

TowerXchange: In early 2018, the ATRA agreed to provide US$32.1mn of funding to deploy 250 base stations in rural and remote areas. You and Roshan were to deploy 137 of those sites. Tell us about your joint bid.

Hussein Abdulkader, Chief Operations Officer, Asia Consultancy Group: As joint bidder with Roshan, 120 sites have been deployed and are now on air, but the remaining 13 have a serious security risk and are being reviewed as force majeure¸ meaning due to unforeseeable circumstances we are unable to fulfil the contract. The other sites in the programme were awarded to Afghan Wireless, 84 sites, and Afghan Telecom, 29 sites.

“ “ACG has been mostly self-funded so far, but as we grow, we are looking for financial institution and/or private equity funding


TowerXchange: Please tell us about your strategy of rolling out fibre to the home (FTTH). When is the first phase expected to be released?

Hussein Abdulkader, Chief Operations Officer, Asia Consultancy Group: The first phase should be launched in Q1 of 2020, this would link our northern border with the CIS States to the under-sea cable in Pakistan and to the regional Point of

Presence. Our strategy is to be a carrier of carriers and setup a fibre transit backbone network. FTTH is our future plan for in four years’ time, dependent on funding.

TowerXchange: In Afghanistan 99% of sites run on diesel gensets, but ACG is different. Which energy efficient solutions are you currently using?

Hussein Abdulkader, Chief Operations Officer, Asia Consultancy Group: On most of our RANsharing sites we now run solar plus backup systems as we control the power consumption and only have one set of BTS equipment there. This keeps power consumption low and reduces site visits.

TowerXchange: How does ACG manage the difficult security situation in Afghanistan?

Hussein Abdulkader, Chief Operations Officer, Asia Consultancy Group: We involve the community by providing employment and training to support the sites and, in turn, they secure the sites because they understand the value of keeping the sites on air for their connectivity. This does not work all the time, but it is the best option.

TowerXchange: Please summarise your future vision for Asia Consultancy Group?

Hussein Abdulkader, Chief Operations Officer, Asia Consultancy Group: Asia Consultancy Group aspires to be the carrier of carriers by choice and deliver not just FTTH in Afghanistan’s five major cities but provide triple play services to homes and content services via a Tier 3/4 Data Centre in Afghanistan for all cloud hosting for corporates.

We at ACG aspire to serve Afghanistan’s ICT needs with state of the art technology through innovation, advanced technology, training locally; providing excellence through customer satisfaction and focus<

The Afghanistan market

Afghanistan has five MNOs; Afghan Wireless, the country’s fastest growing MNO, Roshan which is funded by the Aga Khan Development Fund and is the country’s largest MNO, multi-national players MTN and Etisalat, and newcomer Afghan Telecom, which is part of the Ministry of Communications and Information Technology. Afghanistan is home to 32.5mn subscribers, but only 23% of them have access to 3G. And barely 1% of connections are 4G (data from Afghanistan TRA, Q2 2019). In a country of 36mn people, telecoms infrastructure is still some years behind its neighbours; in Pakistan over 40% of connections are 3G/4G, and in Iran nearly 60% of subscribers are 3G/4G.

Each operators owns and operates nearly all of their sites, with MNOs understood to have between 1,000-1,500 towers each. The Telecom Regulatory Authority of Afghanistan (ATRA) states that there are 6,917 base stations in the country, which due to limited sharing we are treating as a proxy for tower count, although this obviously means a higher margin for error.

Due to high opex costs, Asia Consultancy Group (ACG) has begun to roll-out RANsharing sites which host a number of operators on one base station.

The security situation has deteriorated significantly since mobile operators entered the market in the early 2000s. 99% of sites run on dual diesel gensets – even in cities. MNOs have been reluctant to invest in solar so far, but ACG run their sites on solar plus battery to reduce fuel cost and exposure to security risks. There are few major international contractors operating in the market outside of the military, but i-eng are one of the few international engineering firms working in the country, where they suggest they are running many sites on an Energy Services Company (ESCO) contract<


Keywords: 4G, ARPU, American Tower, Build-to-Suit, Capacity Enhancements, Co-locations, Construction, Decommissioning, Digital Bridge, Eaton Towers, Egypt, Energy, Etisalat, Fitch Solutions, HOI-MEA, Infrastructure Sharing, MENA, MNOs, MobiNil, MobiTower, Mobiserve, Network Rollout, New Market Entrant, North Africa, Opex Reduction, Orange, Sale & Leaseback, TASC Towers, Telecom Egypt, Tower Count, Vodafone

The New Egypt – BTS opportunitiesand new infraco licences The North African telecom giant hots up with new towerco licences to lead to a new telecom tower boom

Egypt’s tower landscape

There are around 24,000 sites in Egypt with an even split between Vodafone, Orange and Etisalat. Telecom Egypt (through the brand WE) had built 1,300 by the end of 2018 (data from Telecom Egypt 2018 Annual Report), and are working on reaching 2,000 sites today. Approximately two thirds of Egypt’s sites are ground based towers, with one third being rooftop sites, primarily in major urban areas. In 2010 and 2011, five Egyptian companies were awarded licenses to lease space on towers. The five companies were EEC, Alkan, ECMTS, Mobiserve’s Mobitower and HOI MEA, with each being awarded a license for a 15 year period. Of those five licensed towercos, only HOI MEA built and retained a portfolio of towers, with HOI MEA reportedly looking to sell its 38 sites.

There has been much bilateral sharing between operators in the market. For example, of the 6,166 towers that Orange owns, they share 20% (1,208) with other MNOs. They also lease space on 1,071 towers owned by other operators in the market. Most of the towers built in Egypt are thought to be relatively robust structures and so capable of carrying two or three tenants and so additional co-locations are thought to require only minor structural modifications. Rooftop sites are prevalent in the major cities, with over 90% of Cairo’s sites being rooftop structures. These structures are inherently less suited for co-location and so much of the opportunity for increasing tenancy ratios will be outside of the major metropolises.

Read this article to learn:< New build potential and international towerco interest< Challenges towercos will face in the market< Which MNOs operate in the country and market structure< Subscriber, mobile broadband and ARPU growth in Egypt < Energy demand and demands for site resilience < Opportunities of Egypt’s ICT 2030 Strategy

The Egyptian telecoms market is one of the largest in the MENA region, presenting considerable opportunities for growth. 4G will underpin future investment coupled with opportunities for new build, co-locations, tenancy amendments and rural connectivity. Such opportunities have recently piqued the interest of international tower companies who are vying for two newly issued infraco licences, which TowerXchange expects to be issued by early 2020. TowerXchange examines the tower landscape and growth opportunities, putting Egypt in the spotlight.

Aninder Khera, Head of Research, Europe & Middle East, TowerXchange


Grid connection for tower sites is slow and expensive and so generators are widely used, often two per site due to the high loads. Fuel remains cheap by international standards and so the case for hybrid solutions is reduced; although fuel subsidies are gradually being phased out. MNO’s are looking to attract international investment into green energy with the operators looking to deploy hybrid/green solution in the coming years.

Towerco opportunities

There have been no tower transactions of scale in the Egyptian tower market. Back in 2016, MobiNil (now Orange) reached a deal to sell 2,000 towers (approximately one third of its total tower portfolio) to Eaton Towers, but the transaction was cancelled after the long stop date on the deal expired. In spite of no further sale and leaseback processes being announced, Egypt has continued to attract the interest of international towercos, with companies including American Tower, IHS Towers, Digital Bridge and Eaton Towers all reportedly having spent significant time on the ground in the country.

Towercos are known to have applied for infraco licenses in the country, with the NTRA (the Egyptian regulator) due to issue two new licenses, one to a major international towerco, by Q1 2020.

With one of the highest number of SIMs per tower in the world, a growing subscriber base, rollout of 4G just beginning, and operators in need of expanding their network, the potential for new

build in the market is high. In order to increase 4G capability and capacity, all four MNOs are planning new build sites. In a bid to raise its profile and market share, Orange is looking to add 700 new sites starting with an estimated 200-300 sites in early 2020. Whilst Telecom Egypt currently has up to 2,000 towers it has recently entered its second phase of network rollout with a deployment of an additional 1,500 sites. The operator is also projecting 1,000 new build sites to be rolled out starting with 200-300 in early 2020. Etisalat and Vodafone are expected to be planning to add 300-500 new towers per year over the medium term.

With devaluation of the Egyptian Pound, a need to invest in 4G equipment and potentially buy additional spectrum to keep up with 4G demand,

Egypt’s MNOs are looking at how to best manage their capex: giving towercos build to suit contracts instead of investing in new site build themselves represents one such strategy.

For a towerco, this presents an exciting proposition; a potential of 1,500-2,000 new BTS sites with the four MNOs. There is a healthy co-location potential on sites and opportunities for decommissioning also exist with significant parallel infrastructure in the country.

Egypt’s mobile market

The mobile market in Egypt is one of the largest in the region. There are four mobile network operators serving a combined market of 93.986mn

Source: Fitch Solutions Figure 1: Total number of mobile subscribers

100,000

80,000

60,000

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20162017

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2024f

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40

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100

4G Subscribers (000)3G Subscribers (000)Mobile penetration/100 inhabitants (%)


subscribers as of June 2019 (source: Fitch solutions) Disruption following the launch of new 4G-only WE (Telecom Egypt) led to market turbulence and from 2017 to 2019, and the introduction of SIM development fees caused the number of subscribers in the Egyptian market to drop by 10% to just over 90 million, but growth is expected to resume sometime during 2020 with mobile subscriber growth to increase from 2021 onwards at a rate above 3% annually. According to Telecom Egypt, 61% of population is below 30 years and c.2mn new customers enter the market annually and Fitch Solutions expect 4G to reach 90% penetration by 2025. There has been competition on pricing amongst the operators, in an effort to defend their established businesses from Telecom Egypt-backed newcomer WE, however operators are also

conscious as to not sacrifice too much revenue by competing too aggressively on pricing.

State owned fixed telecommunications operator Telecom Egypt being the newest market entrant, directly launched 4G mobile services in September 2017. Telecom Egypt, which operates under the brand “WE” joined established operators Vodafone, Etisalat and Orange in the country. The award of a mobile license to Telecom Egypt was given as part of a new regulatory framework approved in 2016 by the National Telecommunications Regulatory Authority (NTRA).

According to this regulatory framework, the existing mobile operators Orange, Vodafone and Etisalat were allowed to introduce 4G service beside their

2G and 3G services, and the incumbent operator Telecom Egypt (TE) was allowed to provide 4G services and provide 2G and 3G services through national roaming with the existing mobile licensees. In addition, the regulatory framework allows Orange, Vodafone and Etisalat to provide virtual fixed-line services using Telecom Egypt’s network.

Telecom Egypt-controlled WE is still rolling out its infrastructure and it will be several years before it can claim to have a fully national presence of its own; in the meantime, it is using the networks of Etisalat Misr and Orange Egypt to fully service its customers’ 2G/3G/4G connectivity needs.

Market leader Vodafone saw a fall in its subscribers from 42.3mn to 39.5mn in June 2019, giving them a market share of 42%. Although its share is declining, it leads by a considerable margin and is shrinking at a slower pace than second-ranked Orange. Orange (which operated under the Mobinil brand until 2016) has dropped it market share by 2% in a 12 month period to 30.3% as of June 2019 (source: Fitch Solutions).

Etisalat, which has been steadily losing market share, has 21%. Commercial launch of 4G networks by all four MNOs was achieved in 2017, although 4G coverage is primarily only available in Cairo with major rollout still required elsewhere, including rural areas. It is expected that 3G will be phased out and the rollout of 4G will be widely available within all areas of the country.

Figure 2: MNOs Market Share

Vodafone

Orange

Etisalat

WE

42.0%

30.3%

21.3%

6.4%

Source: Fitch Solutions


With high demand for 4G services expected to keep increasing, each of the operators requested additional spectrum from the regulator. The agreements Telecom Egypt had in place while it builds out its 2G, 3G and 4G networks will come to an end by 2022, meaning the next couple of years are crunch time for reaching national scale through its own network.

Egypt’s ICT 2030 Strategy

Egypt’s Ministry of Communications and Information Technology (MCIT) has plans to build a new telecoms network at an estimated cost of EGP40 billion (USD2.44 billion) as part of the first phase of development of the country’s proposed new capital city. Financed by the Administrative Capital for Urban Development (ACUD,) the new capital’s owner and developer, the work is expected to begin over the next six months. The MCIT is striving to achieve a digital economy and Egypt’s Information and Communications Technology (ICT) 2030 strategy supports the development of the communications sector both regionally and internationally which will undoubtedly contribute to the economic growth of the country.

The NTRA is also currently developing telecom infrastructure in several smart cities within the framework of announced national strategic projects. In 2017, Egypt announced plans for 5G trials, further underscoring the importance of digital transformation in their future. In March 2019 Telecom Egypt and Nokia signed a MoU to introduce a 5G network and test use cases










Keywords: 3G, 4G, 5G, ARPU, Connectivity, Etisalat, Fibre, Fitch Solutions, INWI, MENA, MNOs, Market Overview, Maroc Telecom, Morocco, North Africa, Orange SA, Subscriber Growth

Fitch Solutions: Morocco Mobile Market OverviewA deeper look into Morocco’s mobile market and outlook for future growth

Market Overview

The Moroccan mobile market plays host to three mobile network operators (MNOs), all of whom have built and operate their own infrastructures, including towers. All three offer 2G, 3G and 4G voice and data services, with the focus currently on 4G which was only introduced in 2015. Network sharing is yet to occur in Morocco, meaning that the capex burden for all three players is very high.

The largest player is the incumbent, Maroc Telecom, which also owns the country’s largest wireline voice and broadband services networks. It is 53%-owned by UAE-based Etisalat and, in turn, holds a number of Etisalat’s African mobile and wireline businesses. The Moroccan mobile business is, by far, its largest operation in terms of customer numbers and revenues. With 19.5mn subscribers as of June 2019, it accounts for an estimated 43.1% of the local mobile market.

In second place is Meditel, 49%-owned by Orange SA of France. A consortium of state owned banks and financial institutions is the majority owner, but it is Orange that has managerial control of the operator and it is through Orange that Meditel can avail a broad range of value-added services, ranging from social media and entertainment-orientated offerings through to more practical products such as lifestyle services. Meditel accounted for 34.8% of the market in June 2019, with 12.68mn customers.

Read this article to learn:< Market share of Morocco’s three MNOs

< Insights into subscriber growth and ARPU

< Challenges of 4G and 5G

< The future growth projections of the mobile market

The Moroccan telecoms market is now quite mature, with growth in the mobile sector being driven by a move to post-paid premium services, but seasonal spurts mask underlying dynamics. Data usage is growing rapidly, but average revenue per user is seeing flat growth as a result of price competition. Local loop unbundling is still absent and this is holding back the development of the wireline market. Fibre is yet to become a commercially viable proposition, so broadband development is contingent on the continued rollout of 4G services.


The smallest player is Wana Telecom, which operates under the Inwi brand name. Its principal shareholder is another state investment company, Societe Nationale d’Investissement (69%), and it is the least transparent of the three operators, offering up no financial or operational metrics for analysis. It is estimated to have accounted for 22.1% of the market as of June 2019.

Mobile Subscriber Growth

The mobile market has reached a point where organic subscriber growth is now very difficult to come by; with few new customers coming into the market, operators have been engaging in price competition to take customers from one another, while new services and applications are leveraged as far as possible to retain customers and encourage greater spending. One major barrier to more dynamic growth could be the inefficient mobile number portability (MNP) platform, which serves more as a disincentive to switch networks. A new MNP system is being sought after as part of the government’s new 2019-2022 telecoms sector development plan.

As just 10% of customers were on postpaid plans as of June 2019, operators are clearly finding it challenging to improve their value proposition. Nevertheless, Inwi made a minor breakthrough in the value-added services field when, in early September 2019, it launched a limited mobile money service, the first of its kind in Morocco.

Maroc Telecom

Meditel

Inwi

Figure 1: Mobile Market Share, June 2019

Figure 2. 10 year Mobile Subscriber Forecast Source: Source: Fitch Solutions, ANRT

Total Mobile Subscribers (000) Mobile Subscriptions/100 inhabitants (%)

2016

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Source: Source: Fitch Solutions, ANRT

43.1%

34.8%

22.1%


Orange – which has had considerable success with its proprietary Orange Money offering elsewhere in Africa – has been unusually reticent about extending accessibility to its Moroccan unit beyond a basic money transfer facility it launched in 2013, although that may be down to its part-ownership by banks that would be threatened by such a service.

ARPU

Neither Meditel nor Inwi disclose financial data, including metrics such as average revenues per user (ARPU) or voice/data usage, but Maroc Telecom’s ARPU numbers show that monthly spending on mobile services has dropped appreciably in the last four years and now stands at MAD57.5 (June 2019). Its ARPU has hovered around this mark over the last 24 months, suggesting that price competition has stabilised, although in the incumbent’s case the decline may be being held in check by its ability to bundle its mobile offering with its wireline voice and broadband services.

With its superior subscriber mix (11.2% of its total mobile user base), we believe Maroc Telecom’s mobile ARPU is a little above the national average and therefore broadly indicative of the relative health of the other players.

4G & 5G Migration

Data from the national telecommunications regulatory authority (ANRT) suggest that migration to 4G-based networks is proceeding steadily but

slowly, presenting further challenges to upselling new services and improving return on investment. Although 3G usage is on the decline, 2G connectivity remains in demand as rural users cannot reliably connect to or afford more expensive connections, while the older technology remains useful for utilities’ basic Internet of Things applications such as smart meters.

Maroc Telecom is the leading 3G/4G provider, accounting for just over 50% of the market as of June 2019. The remainder is split almost equally between the two smaller players. Around 75% of Moroccan mobile subscribers use smartphones; clearly, many of these do not fully avail the operators’ mobile broadband platforms.

5G concessions are not yet planned, although the government’s telecoms sector development plan for 2019-2022 takes into account the future licensing of 5G and Maroc Telecom has been trialling the technology in partnership with Ericsson. Even

though the regulator has not announced the auction of 5G spectrum, we expect this to happen in the next four-to-five years.

Outlook

In the short term, volatility for operators is likely to continue as they look to migrate consumers to 4G through price-led promotions, but profitability will need to improve in the long term if they are to transition to 5G. It is forecasted that by 2028, the Moroccan mobile market will support 51.3mn subscriptions.

The demand for mobile data services has been fuelled by strong price competition between the operators, as well as the growing affordability of smartphones which means data access is now done through smartphones as opposed to through dedicated mobile broadband devices, such as dongles. 4G mobile subscriptions will reach 50.1mn subscribers, or 97.8% of the mobile market<

Morocco highlights

< Organic mobile subscriber growth is proving elusive, owing to market saturation. The underlying

trend is one of 4G migration, with a commensurate but modest improvement in post-paid usage,

which now stands at 10% of the overall user base.

< Mobile subscribers numbered 44.7mn in June 2019, a y-o-y increase of 2.4%, but flat growth on a

quarterly basis. The penetration rate reached 122.1%, a sure sign that the market is mature<


Keywords: 5G rollout, Active Infrastructure, Batelco, MENA, MNO, NBN, Netco, Passive Infrastructure, Sale and Leaseback, Towerco

NetCos may provide aclever way to jump start 5G deployment across MENA/GCCHow lessons from National Broadband Networks and Tower Sharing Companies can inform regulators about the potential creation of 5G NetCos (network sharing companies)

Aimed at accelerating deployment of Fixed Broadband infrastructure (GPON/FTTH) in a market, NBNs consolidate all fibre infrastructure under a new licensed operator that then sells wholesale infrastructure services to all licensed operators.

The Telecommunications Regulatory Authority of Bahrain (TRA) has been careful not to specify whether they are encouraging the entry of an independent towerco into the market, a joint venture between the MNOs, or another ‘feasible business model’, but the recent formation of the NBN NetCo BNET can be seen as a first step towards mobile network infrastructure sharing for 5G deployment; something that would be truly pioneering in the region, and which may be of great interest to other telecom stakeholders in the region. TowerXchange speaks with Batelco’s former Group Chief Wholesale Officer Ahmed Abdel-Latif, who thinks the region’s regulators’ experience with various NBN models and operators’ openness to explore more active network sharing will both be key factors in the region’s 5G rollout race.

TowerXchange: Please tells us about the creation of Batelco NBN and why it was split from Batelco Retail.

Ahmed Abdel-Latif, former Group Chief Wholesale Officer, Batelco: In May 2019 Batelco Bahrain was broken into two separate businesses, Batelco (a RetailCo), and BNET (the Bahrain NBN – the NetCo in charge of the National Broadband Network). This was implemented in accordance with Bahrain TRA’s stipulated separation of national fixed broadband

Read this article to learn:< The drivers behind new infrastructure carve-out models

< The development of the first MENA Structural Separation National Broadband Network (NBN)

< Challenges affecting 5G deployment

< How 5G network sharing may very well be the way forward for 5G

Ahmed Abdel-Latif, former Group Chief Wholesale Officer, Batelco

The large capex and opex requirements for rolling out 5G mobile networks across the Middle East markets are giving MNOs and regulators reason to rethink their strategies, and discussions are taking place about the possibility of forming a NetCo as a means to enable 5G network build-out on a more reasonable cost basis.

NetCos can be viewed as a natural extension of the already-established towercos, which have been increasing in popularity over the past few years. The difference is that towercos share passive infrastructure elements across all MNOs in a given market, while a NetCo aims at sharing active elements as well. An interesting stepping stone between the towerco and NetCo is the newly introduced concept of a National Broadband Network (NBN), recently seen in Bahrain – BNET was formed in May 2019.


assets (Gigabit Passive Optical Networks (GPON) and mobile backhaul fibre) to establish a National Broadband Network, as captured in the fourth version of the TRA’s National Telecommunications Plan (NTP4).

With the national GPON infrastructure now under a separate company (BNET), with its own separate board of directors, managed separately from Batelco, all the ISPs and MNOs in Bahrain (collectively called OLOs; or Other Licensed Operators) can procure fibre-based high-speed internet infrastructure services from the BNET at standard regulated rates.

This provides a level playing field in the retail and enterprise markets, compared with an effective monopoly for Batelco had those infrastructure assets remained under its sole control. This structural separation is unique in the MENA and GCC region; the results of which - I am certain - will be closely monitored by the region’s regulators over the next few quarters.

TowerXchange: Can you tell us a bit more about the status of tower companies in the MENA region; in the current light of new carve-out business models what pressures are they facing?

Ahmed Abdel-Latif, former Group Chief Wholesale Officer, Batelco: As they face increased competitive pressures from their in-country rivals and in many cases even from their Telecoms Regulator, MNOs in some MENA markets have moved to consolidate their passive infrastructure – mainly consisting of telecom towers – into a separate entity that is then able to serve all operators across their footprint.

The model has already been implemented in the biggest MENA markets such as Egypt and the Kingdom of Saudi Arabia, and some smaller markets like Oman. MENA’s remaining markets are likely to move towards that setup at various speeds.

TowerXchange: Other than the valuation arbitrage benefit of removing assets from its balance sheet, what do you see as the main drivers and benefits for the MNO in carving-out the Towerco?

Ahmed Abdel-Latif, former Group Chief Wholesale Officer, Batelco: It makes financial sense for an MNO to spin-off its towers into a separate towerco and then lease it back. The towerco is able to leverage the redundancy and duplication of tower locations across the MNOs’ operating footprint and offer the single best location to all MNOs, while retiring the least optimal locations. Besides getting a sizeable one-off revenue from the sale transaction, the MNO also saves on the opex associated with tower O&M (staff costs, spares, logistics, et cetera.) and it also

Creating a NetCo

There are four accepted models for establishing a national broadband network in a given competitive market with multiple operators:A. No new NBN licensee: In this model the regulator encourages all licensed operators to ramp up their fibre infrastructure deployment independently. No new licenses are awarded and no new companies are set up. The UAE is the closest example of this model.B. A new NBN licensee: The regulator opts to set up a new company (shareholding structure may vary) and awards that new company a new wholesale license to become the NBN in that market. Qatar NBN (qnbn) is an example of such an approach.C. Functional Separation of the NBN from the incumbent: Here the regulator orders the incumbent operator (with FTTX already deployed or under deployment) to internally treat that Business Unit as a separate entity, meaning it treats the incumbent’s own retail division as it would treat any other competing retail services provider, selling the same infrastructure service to all retail channels while still being owned by the incumbent. BT’s Openreach (in its early days) is the primary example for this implementation.D. Structural/Legal Separation of the NBN from the incumbent: In this model, the regulator essentially orders the incumbent to “carve-out” its broadband fibre unit and sets it up as a new company with separate legal structure, which is then awarded a new wholesale infrastructure services provider (meaning they only sell infrastructure services at regulated rates to licensed operators, not end customers). The case of BNET in Bahrain (which was carved out of Batelco) is the most recent example<


saves the depreciation cost of the towers on its balance sheet (though that cost saving can have an adverse effect on the tax front, if there are taxes applicable on the MNO’s profits in that market, of course).

The MNO can fix the amount it pays the towerco on an annual basis, allowing for predictability of a substantial and previously variable opex line item over time. Additionally, as it has a service level agreement (SLA) in place with the towerco, it is assured of a minimum acceptable service level. Most importantly, the MNO can eliminate all capex related to telecom towers, which is not an insignificant amount over the 10-20 years lease contract they commit to with the towerco.

The towerco is capitalised through the aggregation of all (or most, depending on scope and other technical considerations) of the legacy MNOs’ 2G/3G/4G tower assets across the footprint. The towerco commits to a service level agreement (SLA) for the operations and maintenance (O&M) of its towers. Depending on the market dynamics, a towerco can absorb some or all of the MNO’s existing towers and O&M teams. The towerco would then have a steady revenue stream over the lifetime of its contracts with its MNO customers.

Furthermore, following the spin-off of its passive infrastructure, each MNO still retains control of its own active infrastructure elements, including their valuable spectrum and base stations. As a useful abstraction, one could argue that the towerco is providing a “Towers as a Service” or TaaS to the MNOs.

TowerXchange: How do you see the role of regulators as game changers for the MENA tower market?

Ahmed Abdel-Latif, former Group Chief Wholesale Officer, Batelco: Telecom regulators have started to view the creation of towercos favorably as it maintains the number of MNO players in the market, and is effectively transparent to the customer. More recently, regulators regard towercos as critical enablers for achieving key environmental benefits.

However, very few regulators – if any – have built tower companies into their market regulation plans in a proactive manner. When an opportunity presents itself, it is usually the MNOs approaching the regulator, rather than the other way around. This passive role for regulators may need to be re-examined as the industry moves from its current 2G/3G/4G environment to 5G networks. There is surely a critical industry leadership role that only the telecom regulators are able to play.

TowerXchange: What do you see are the challenges for MNOs surrounding the rollout of 5G networks, and are we likely to see any increase in infrastructure sharing?

Ahmed Abdel-Latif, former Group Chief Wholesale Officer, Batelco: 5G uses much higher frequencies (typically ~3.4 GHz), therefore the radio propagation characteristics for 5G signals are more challenging to manage. As these signals cannot penetrate walls or concrete in general, a much higher number of cell sites is needed (estimated to be up to 10x that of 4G).

At the moment, there are generally two to three MNOs per market across MENA. The question that regulators have yet to answer is “what is the practical probability of having two to three independent 5G networks rolled out nationally across each MENA market, when each 5G network can have 10k-20k cells, if not more?”

Because of this sheer number of sites and the associated supporting infrastructure in terms of power, backhaul et cetera, it is clear that a higher level of sharing is needed to make 5G successful and profitable for MNOs, as mere tower sharing won’t be enough in a 5G environment.

TowerXchange: Will the formation of an NBN in a specific market act as a catalyst to the creation of a 5G NetCo at the national level?

Ahmed Abdel-Latif, former Group Chief Wholesale Officer, Batelco: The concept of “5G Network Sharing” can be seen as taking forward the lessons from NBN, and moving the model from the fixed to the wireless segment.

Instead of awarding MNOs new 5G licenses and then setting up separate 5G networks at great expense, of course, or letting MNOs pool their resources together in an ad-hoc manner and at their own pace (thereby possibly delaying 5G network rollout and risking vendor mismatch down the line), the regulator could award 5G frequency spectrum and coverage rights to a NetCo (or two NetCos to maintain competitive market forces, but that can be debated separately). In turn the NetCo could rollout a unified 5G across the


designated coverage areas and can then support two or more MNOs on its network.

The NetCo would effectively be providing a “Network as a Service” or NaaS to the MNOs, who then compete not on an infrastructure basis but on a service basis (bundles, value added services, platform services, specialised industry solutions, IoT services, security, and others).

TowerXchange: What is benefit of a NetCo model as a carrier of 5G spectrum?

Ahmed Abdel-Latif, former Group Chief Wholesale Officer, Batelco: This can be regarded as a necessity both from the financial and operational standpoints. As both governments and regulators plan in many cases to sell 5G spectrum via auctions, this entails a huge capex upfront on the MNO’s part even before the network rollout commences. If regulators opt to award the spectrum to NetCos (or allow two or more MNOs to form a NetCo that bids in the auction) then the financial burden per MNO can be halved or reduced even further.

The fundamental and major market architecture decision that faces all regulators when it comes to 5G deployment is the separation of infrastructure from services in the mobile space. Network ownership and customer ownership are essentially two different sets of activities in this model. Through a NetCo, infrastructure becomes available to multiple operators at the same time under a specific SLA, so it no longer becomes a source of competitive advantage in the consumer or enterprise markets. NetCos would have a higher

incentive to provide a better coverage in their designated areas, because they have multiple revenue streams from their MNO customers. Also, in some cases where you have more than one NetCo, MNOs would be able to tender NetCos against each other seeking out the best deal allowing their infrastructure costs to be continually optimised.

TowerXchange: How should regulators apply the lessons of NBN implementation to the challenges of rolling out 5G?

Ahmed Abdel-Latif, former Group Chief Wholesale Officer, Batelco: It should be said here that the case of a 5G NetCo is much simpler to implement than that of an NBN NetCo, like Bahrain’s case. This is because there is no separation aspect in the 5G case and you are basically building a new entity from scratch, whereas the Batelco NBN (BNET) case needed three years of careful planning to carve-out an existing business and set it up as a separate company.

The key point to consider here is that 5G is radically different from any mobile technology that preceded it, and it will need to co-exist in the market with 4G as a base-layer for many years to come. Regulators therefore need to take that uniqueness into account as they contemplate proposed market structures to ensure this technology delivers on its promise. On the plus side, regulators already have all the learnings from the tower sharing (towercos) and fixed broadband sharing (NBN NetCos) to tap into as they design the new 5G Network Sharing companies/licenses for 5G NetCos<









Keywords: AWAL Telecom, Build-to-Suit, Business Model, C-Level Perspective, Country Risk, First Mover Advantage, Greenfield, Hybrid Power, Market Entry, Masts & Towers, Middle East, Network Rollout, New Market Entrant, Next Billion, Pakistan, Towercos

Zero to hero: The Pakistani towerco ripping up the rule bookAWAL Telecom built its network without an anchor-tenant, now it’s targeting a 2.0x tenancy ratio

TowerXchange: First of all, can you please give us a brief introduction to AWAL Towers, how long have you been active and how many assets do you have on the ground?

Akbar Shaukat, CEO & Executive Director, AWAL Telecom: AWAL Telecom is a towerco company focused on building and managing telecommunications and cellular tower infrastructure nationwide in Pakistan. The company provides full turnkey capabilities to all cellular and broadband operators with an interest in the regions where AWAL towers are located.

We set up the business in January 2014 and received an operating license from the Pakistani regulator in November 2014. AWAL began talks with Pakistani MNOs in early 2015, pioneering a true-to-definition build-to-suit (BTS) concept of tower, space and power. Given the enormous potential of BTS requirements in the country, AWAL’s focus has remained on building BTS assets in unserved markets with great market potential for cellular operators.

What makes AWAL different is that we are the first operator in Pakistan to first build infrastructure then seek tenants. This meets our Corporate Social Responsibility (CSR) goal of bringing quality, affordable service and choice to mobile subscribers in a manner that is also profitable to our stakeholders.

AWAL’s plans in the Federally Administered Tribal Areas (FATA) and Khyber Pakhtunkhwa are fully

Read this article to learn:< The potential of the Pakistani tower market < How to make a success of risky tower development strategies < Potential investment targets in Pakistani < How to take advantage of unserved and unconnected areas

Even in countries with developed telecoms markets there remain significant areas underserved by existing providers; Pakistan connections are growing at over 5% year-on-year but its penetration rate is still 76%. Despite this strong growth the country will never reach full penetration while large areas of the country lack coverage. AWAL Telecom took the unusual approach of making a speculative investment to fulfil latent demand in an underserved market. If towercos are going to help plug-in the least connected communities there are important lessons which can be taken from their experience. From 2015 until December 2019 AWAL has built a 50 tower portfolio of well-engineered, ready-to-share towers which approach a tenancy ratio of two. With 20% year-on-year growth predicted and the capacity to do much more with the right investment, AWAL Telecom is breaking the mould and showing the versatility of the towerco business model and the advantages.


aligned with the Pakistani Government Peace Restoration and Rehabilitation efforts in these areas. The Pakistan Telecommunication Authority (PTA) and Ministry of IT & Telecom have a keen interest in provision of telecommunication services in these areas. And Pakistani Prime Minister Imran Khan himself visited our areas of operations pledging support for mobile connectivity in the region. So we are well placed to ride this rising tide of development and investment.

We currently have 50 completed sites and are undergoing a circa 20% site inventory expansion.

TowerXchange: What is the background and calibre of your management team and investors? Do you have a long history in the telecoms or tower industry?

Akbar Shaukat, CEO & Executive Director, AWAL Telecom: Marius Armeanca, CEO of AWAL’s investment backer Progressive Technologies Investments, which is based in Dubai, and myself as founders of AWAL Telecom have a shared professional relationship for over 14 years. We have a solid understanding of the local environment, operators’ needs, and the overall telecommunication industry’s pain points. We are true believers in the concept of network infrastructure sharing, like most of your readers are.

The first 50+ site sharing agreement between two Pakistan MNOs was also initiated and implemented by Marius during his time working as CTO for a

Pakistani MNO. Subsequently, Marius was a key promoter and facilitator of the BTS concept in Canada, where he was the first ever independent operator for the country which has a very rigid and complex telecoms regulatory environment.

With extensive experience to draw on from time spent within MNOs in various parts of the world – including Europe, Africa, Asia, and the Middle East – AWAL’s management team understands and promotes the benefits of BTS to its MNO clients.

AWAL puts particular emphasis creating a positive relationship with each client MNO and reducing the environmental and visual impact of the networks’ infrastructure, as well as significantly reducing the cost of their networks.

TowerXchange: Your initial strategy to build a network without an anchor tenant was unusual and risky, what made you confident enough to go ahead? How did you convince investors to back you?


Akbar Shaukat, CEO & Executive Director, AWAL Telecom: We decided that if we invested before the area was fully pacified, AWAL could effectively dominate a large portion of a large unserved sector in the Pakistani market, allowing the company to define the buildouts to the benefit of all its then-prospective tenants as well as unserved, potential customers.

There were several key factors that together convinced our investors the strategy would work. The region includes over 7mn uncovered and unconnected consumers, more than many countries. Therefore it was clearly a promising market with no MNO present or willing to take the

risk of building infrastructure in the area. We were not exactly sure about the time to profitability, but we were certain that any infrastructure established in this area would be of high interest to all telcos given the untapped market. With AWAL shouldering the primary risk, coming into the market was a lot easier for the telcos. And, by taking the initiative, AWAL could ensure that each site was properly constructed with sufficient tower strength, available power and able to accommodate up to four tenants per site.

Once we found the right area we had to judge the right time to invest. Leading to our launch in 2015, the Pakistan Government had announced

an intention to change the social, political and economic climates in the area we had identified. The skilled team AWAL had assembled gave us the ability to build and operate in the more challenging areas where we now operate. We carefully selected our team to allow us to achieve the company’s performance targets without stressing the budget objectives.

We are convinced that shared tower infrastructure is the wave of the future and by providing infrastructure already engineered to be shared, AWAL could bypass the need to acquire existing infrastructure and upgrade it. Having a clean slate to build upon is an almost non-existent possibility in today’s crowded telecom market. The western area of Pakistan was one of only a few regions where a rational approach could be taken from day one.

TowerXchange: What more can you tell us about the market situation in Waziristan and the western area of Pakistan more generally? How many MNOs are active? How much investment will be required to close coverage gaps?

Akbar Shaukat, CEO & Executive Director, AWAL Telecom: AWAL covers not only North and South Waziristan, but other areas such as Orakzai Agency, parts of the Khyber and Mohmand Agencies, Frontier Region Dera Ismail Khan, Frontier Region Bannu, Frontier Region Tank, and Frontier Region Hangu. Our deployment plans are to continue to try to close the gap in a contained region that has never been served.


Currently, only two MNOs are active on AWAL’s platforms in Waziristan, three MNOs on platforms outside of this area. Once the 4G service is allowed in Waziristan, we should see three MNOs active on the majority of our sites in the area. Negotiations continue with the 4th MNO to come on board and reap the benefits of this market before it too becomes saturated.

AWAL’s efforts currently remain oriented to the western area of Pakistan. Our RF Planning and Transmission team have planned on the range of 100 additional sites in order to properly serve the coverage gaps which will provide service for an additional 5-8 million population. Depending on

the cost effectiveness of alternative power for each site, additional investment of some US$8mn will be required to finish our current areas of interest. Another circa US$8mn will be required to build out a new area which we are considering with an anchor tenant already expressing interest.

Beyond the above-mentioned areas and once additional funds are identified, there remain other, promising areas of the country which could benefit this now-proven business model.

TowerXchange: Could you also provide some more information on the energy set-up on your sites?

Akbar Shaukat, CEO & Executive Director, AWAL Telecom: Overall, during the planning phase we have created a must do list in order to accomplish AWAL’s mission. The right design for the power plant provisioning was one of the top items on our priority list. Accordingly we have engineered and implemented the power solutions with clear requirements in mind.

The prime inputs considered for the design stage were:1. The area where we operate (remote locations, lack of basic infrastructure i.e. commercial power availability, access restrictions)2. The need to provide reliable power supply as our clients are delivering telecom services to a large population, so stability and reliability are a must.

In addition, and with environmental concerns like air pollution and fuel use in mind, our power plant has to be diversified so that we minimise the hours of operation for the gensets. The solution selected is equipped with controllers that accommodate alternate power solutions like wind or solar in addition to the traditional ones.

Even though the capital expenditure was higher, the energy setup for AWAL sites fulfils all our high standard requirements and nothing has been left behind. The outcome of our design solution resulted in a robust platform able to cover all technical, environmental and operational aspects:< High efficiency solar panels - for a clean and better environment

“

“

Depending on the cost effectiveness of alternative power

for each site, additional investment of some US$8mn will be

required to finish out our current areas of interest. Another

circa US$8mn will be required to build out a new area

which we are considering with an anchor tenant already

expressing interest


< Good quality batteries with high amount of recharging cycles - to ensure a longer back-up autonomy with the aim to minimise the Network Unavailability Rate for the services provided by our clients< Remote monitoring - to allow our maintenance teams to acquire information and received alarms about the status of our platform< Enough capacity for the current and future needs - knowing that our clients will continue to add equipment for diversified telecom services< Redundancy for each module of the platform - to ensure maximum up-time< Last, but not least, our teams have been trained extensively, so that planned and unplanned interventions will be executed with maximum efficiency

TowerXchange: Your operations are away from the major commercial hubs of Pakistan. How does the terrain, weather and security situation in affect your opex?

Akbar Shaukat, CEO & Executive Director, AWAL Telecom: We encourage local hiring for our local offices and maintenance purposes. The people we engage are great resources; they are disciplined, eager to learn and develop their technical skills. Working with local crews also means we have excellent response times in what is otherwise an area with major access problems. Working for local people using local people to support the sustainable development of the areas where we are located helps us keep our costs under control

too. We organise on-the-job, local training sessions for our staff, but hope that with the introduction of 3G and 4G services we can switch to online, in-house training modules which have recently been developed.

Knowing that power is the biggest challenge to operate in remote areas, our AC/DC platforms are properly dimensioned, and we have installed batteries that ensure 100% uptime for our clients where O&M is challenging. Our AC/DC platforms are also equipped with remote capabilities for alarm monitoring and operational management.

Last, but not least, AWAL is involved in the local/tribal communities – we have a great sense of what it means to live, work and operate in the area where we do our business and we are often perceived as a part of the Federally Administrated Tribal Areas family.

TowerXchange: Do you think your strategy of forward investment can be replaced in other areas, or is there something about your regions in Pakistan that makes it particularly suitable?

Akbar Shaukat, CEO & Executive Director, AWAL Telecom: Our model is not without its risks, but we can show now after four years that we have built a profitable and highly investable business. The western area of Pakistan is an excellent region for us to deploy capital into build to suit towers, but there are other regions in the world where this greenfield model would work too. If anybody is

interested in bringing this model to a new market then we would be happy to discuss, but I am sorry I don’t want to give away the next great investment location to your readers!

TowerXchange: There is a problem in many markets or smaller tower companies building poor quality towers or writing bad contracts with ground lease holders or MNOs. How do you avoid these pitfalls?

Akbar Shaukat, CEO & Executive Director, AWAL Telecom: AWAL’s principal officers have extensive experience with network buildouts throughout the world. This diverse experience has been put to use to ensure that our infrastructure is top notch and more than meets industry standards. Our tenants have nothing but praise for the quality of our sites since establishing service on our towers.

One clear value add AWAL offers is solid ground leases. We have thus spent extra time securing leases, ensuring proper titles, ownership, et cetera, often to the expense of deployment timeframes, to ensure that this would not become a problem in the future.

TowerXchange: You have now passed a 1.0x tenancy ratio after starting at zero; how much higher do you expect your tenancy ratio to rise on your existing sites?

Akbar Shaukat, CEO & Executive Director, AWAL Telecom: With existing occupancies and ongoing


installation of committed leases, we are currently above 1.35x and we forecast by the end of 2019 to be at 1.9x and will grow from there once 4G is approved for areas where our sites are located.

TowerXchange: What are your plans for further new build? Will you build with an anchor tenant, or build towers in similarly underserved areas? To what extent can you be self-financing versus requiring additional external financing?

Akbar Shaukat, CEO & Executive Director, AWAL Telecom: We are open to both build outs for anchor tenants or to options to continue our current model of building out in advance of MNO contracts, depending on the situation. We currently prefer to maintain a regional focus to keep our costs in line rather than expanding nationwide before we have sufficient financial footing to undertake such an expansion. As detailed above, we are undergoing a 20% site inventory expansion and once completed we can self-finance a 30-40% annual increase in inventory but would prefer to make the next major site inventory increase in coordination with a new investment source to allow us to continue exercising market domination in areas where we are located.

TowerXchange: Please summarise the future for the company, and where you would like to make progress over the coming years.

Akbar Shaukat, CEO & Executive Director, AWAL Telecom: Overall, the Pakistani market offers huge opportunities. 30-40,000 additional towers will be required over the next five years. The introduction

of 4G will introduce demand for extra space on towers. And less than 15% of the existing 45k towers see sharing. Another opportunity we are exploring is active sharing, which is due to be introduced in the very near future. There is ample opportunity for existing and new players in Pakistan.

With the increase in the demand for data, passive optic fibre infrastructure as both backbone and tower-to-tower connectivity also offers significant opportunity. While we are considering servicing more tailored requirements from individual MNOs,

we see plenty of growth left in our current business model of bringing affordable wireless service to unserved communities. We provide power to all our tower sites, and expansion of alternative power sources on our sites as part of our buildout plans remains a top priority too, for both environmental and cost-savings benefits.

We have ambitious plans and AWAL is actively seeking the right partner or partners who can help expand the company to make it one of the dominant Pakistani players in the BTS market

“

“

Overall, the Pakistani market offers huge opportunities. 30-

40,000 additional towers will be required over the next five

years. The introduction of 4G will introduce demand for

extra space on towers. And less than 15% of the existing 45k

towers see sharing. Another opportunity we are exploring

is active sharing, which is due to be introduced in the very

near future. There is ample opportunity for existing and

new players in Pakistan


Infrastructure for smartcities and 5GBusiness models, partnerships and technologies to deliver efficiencies

Is a smart city an evolution of urban networking or a step change?

Millennials want data at their fingertips, and smart city programmes will provide a way to capture data in real time, analyse and understand it. In this context, infrastructure becomes a great challenge as cells need to be densified, a small cell layer needs to be introduced and cloud companies have to enter the arena. 60-70% of the cost of building this infrastructure will be on the ground.

A smart city is an umbrella group of solutions. Firstly they’re supposed to ensure a city’s resources are managed in an efficient way, with things like traffic energy lighting and routes for busses. All this is possible if you add a layer of automated efficiency that’s at the core of smart cities. Secondly it’s about how users interact with those interfaces.

If you break it down, smart cities are a group of use cases, some of which can be satisfied with 4G infrastructure, while others require shorter latency, more bandwidth and more connections and for those we might need 5G to power massive IoT, which will power every trash can or lamppost. For operators who are being compelled to invest capex, there needs to be clear visibility into the use cases which will drive it. Virtual reality, augmented reality, remote factories, healthcare and other use cases are all being pushed as the future of 5G, but is there money to be made in each specific use case, and if yes, what’s the best way to do it? Does each use case support an operator’s investment in a specific area?

Read this article to learn:< How MENA infrastructure owners view the demands of smart cities

< The decision making process around capex deployment in 5G

< The role of government in helping and supporting 5G rollout

< 5G economics and making the business case for investment

Keywords: 5G, Capex, Consolidation, DAS, Data Centre, Digital Colony, edotco, Etisalat, Fibre, IBS,

Investment, IoT, Middle East, North Africa, Saudi Arabia, Small Cells, Smart Cities, The Future Network, UAE

MENA is such a diverse region, with some countries barely achieving full 3G rollout and others aiming to lead the way in 5G and smart cities over the next few years. At last year’s TowerXchange Meetup MENA Smart Cities and 5G’s role in enabling urban superconnectivity was a major topic of discussion, including some of the more innovative 5G solutions in the region and what the incentives and obstacles are to achieving smart city infrastructure. This article draws on insights shared by speakers from Digital Colony, edotco and Etisalat at last year’s TowerXchange Meetup MENA.Tel Aviv, Israel


Making long term capex decisions for smart city infrastructure

When deploying technology in certain areas, it all boils down to the basic business case. Ideally, operators want to be able to build technology that can be shared across multiple use cases, but in some cases, say when connecting gas meters, a certain capex is required, which the operator won’t be able to monetise in any other use cases. For more general IoT networks, it’s about putting in a layer of connectivity and trying to work with partners to ensure the network is full while developing use cases together and collecting data on how users behave.

Investors need to go back to first principles. If we look at why towers are a popular investment vehicle, it’s because they are similar to real estate with strong, investment grade counterparties and long term leases. When you move this into smart cities and converged infrastructure you have to get more comfortable with how the economics change. Digital infrastructure providers have to invest in smart infrastructure in a way which keeps the characteristics their investors are looking for in terms of risk and returns.

In the USA Digital Colony has over 30,000 small cell nodes in New York, they are rolling out smart city infrastructure with AT&T in San Francisco and their venture with Uber in Pittsburgh is pushing forward with automated vehicles. In Europe, Finnish Digita

is looking into waste management with sensors on bins and evolving further.

The most important principle is to look at whether they can maintain an economic model with long term leases, steady income and CPI related escalators. Smart cities are moving beyond just having mobile network operators as the counterparty. In building systems will see huge growth, often due to the fact that modern buildings are poor for connectivity and in these cases the real estate operator is the counterparty. For Digital Colony, they feel they can focus on the key criteria which drove them into the market in the first place, treating every small cell like a macro tower from an economic point of view.

Are the key challenges in 5G rollout technical or thrown up by the shift in economics?

The main challenge is working out who will pay for it. edotco’s solutions are closer to the towerco model, creating multi-purpose infrastructures in places like Sri Lanka for real estate agencies or traffic control purposes. They barter with the municipal council for access and offer services based on this. In some cases edotco installs structures on behalf of the local authorities and then the location is available to lease up rent free. The impending 5G infrastructure and densification will result in a bigger role for independent towercos as smart city programmes will need to be driven by independent parties. MNO financials will

make it impossible for them to pay for parallel infrastructure in smart cities, whereas the towerco model is return based and focusses on sharing the infrastructure.

What is the role of government in smart city rollout?

Etisalat owns a very diverse group of companies. In countries like the UAE and Saudi Arabia, there are high ARPU levels and a large share of public sector involvement in the economy, where small cells are more advanced and the government is often quite involved in the process. MENA governments often see the telecoms sector as a powerhouse for rolling out new technology. MNOs are currently tasked with taking on the infrastructure needed for the next generation of technology as there are so few independent infrastructure players in the market at the moment. When thinking about traffic per customer there are two ways of approaching it – either increasing the number of cells or the amount of available spectrum. In some markets it’s possible to obtain more spectrum and in others there are many new sites going in – it’s often a very different discussion market by market, and given the specifics of the region governments tend to take a much more active role than in the US or Asia.

Government involvement (and a push for funding small cells) will stimulate demand. The question will be whether independent players, MNOs or the government themselves will drive the rollout. There are still unresolved questions around regulatory


frameworks and the role of the public sector in the digital economy. It’s feasible that in the Middle East a government could take a large role in developing telecoms infrastructure, or at least will make street furniture available to whoever is willing to roll out the small cell layer.

What kind of towercos will succeed?

The towerco activity in the region will be a combination of local expertise and international independents with processes and backing coming in, each with their own sets of skills and knowledge to share. In terms of smart cities and converged spectrum, markets are becoming more similar – edotco in Asia is doing what Digital Colony are doing in London, and towers are evolving in stages. While some towercos will stick to the knitting, others will enter more and more into the converged world. From an investment point of view, this means it’s easier to get into new markets, as long as towercos are prepared to start small and grow as long as there is access to strong counterparties, escalators and long term leases.

5G economics

Much of the challenge of urban infrastructure is that municipalities and local government can view it as a way to earn money, mistakenly assuming that operators have large budgets allocated to smart cities and digital infrastructure. This isn’t just the case in MENA and Transport for London are on their seventh attempt to make the London

Underground a smart transport system while operators are struggling to make the economic case for investment. Governments need to make the journey from seeing 5G as a cash cow to conceiving it as essential for economic development. The benefits for governments aren’t through the rental of street furniture, but through reducing digital inequality and boosting economies. We need to see an increase in partnerships between private and public bodies rather than just form filling for permits if this is going to work.

When you look at the value chain of smart cities, operators have only won a small part of that market, in a digital economy it’s the OTT players, not the mobile network operators, who have captured most of the value. When it comes to solutions for smart cities, mobile network operators want to be sure they can play a more relevant role in the value chain before committing huge amounts of capex. They are still trying to see which verticals are the most effective for them, and which models will work.

Statistically 5G will roll out in urban areas first, using existing street furniture to do so. It’s imperative that towercos and MNOs work with government to find a commercial model which stands up, to allow a balance between towercos, MNOs and investors. MNOs need locations to provide speed and towercos must find pricing models which their investors are comfortable with, it will take time to get the balance right<









The investability and investmentcase for towercos and infracos in MENA How the investment landscape in this developing region is shifting

Setting the scene

Like other infrastructure assets, telecom towers need patient capital. There is a tension between private equity investors seeking higher returns when measuring risk in certain markets versus an asset class which doesn’t produce massive returns. Although the first movers in the market can generate those kind of returns, generally towers don’t meet private equity return profiles. An issue in the larger markets such as Pakistan, Egypt or Iraq is that sellers know the value of what they have and this often comes up against what private equity investors require.

Discussions at our last event saw two issues: one being how the investor sees the investment - for more patient capital towers won’t give a private equity return, but they do offer a tried and tested model. ASMA Capital’s Abu Bakar Chowdhury told us they have been doing things in MENA infrastructure in a private equity style, entering Pakistan and Egypt in power where they built assets and were able to get a return. With pension funds and well established capital behind them, they can get into assets, shake them up, take out the inefficiencies and hand them to long term patient capital within the same ‘family’. The second issue is that MNOs, in the GCC in particular, aren’t crying out for cash but increasingly they are considering models like edotco’s, which have worked well, and ASMA Capital expects to see opportunities

Read this article to learn:< Value drivers in MENA towers

< Opportunities in different markets

< Differing investor profiles in the region

< The need for regulation and the role of government in tower development

Keywords: 5G, ASMA Capital, Acquisition, Africa & ME, Carve Out, Deal Structure, Egypt, Exit Strategy, Fibre, First Mover Advantage, IFC, Infrastructure Funds, Infrastructure Sharing, Investors, Iraq, iSON Towers, Market Overview, Middle East, North Africa, Pakistan, Private Equity, Sale & Leaseback, Saudi Arabia, Small Cells, TAP Advisors

International investors are highly interested in investing in the telecom towers of Middle Eastern and North African mobile carriers, but the feeling has not always been mutual. Because of healthier balance sheets and domestic political and economic backing telecom towers have been slow to come to market in the region. However, with 6% of the region’s towers now in towerco hands, more mobile operators are examining monetisation strategies and towerco partners.


for MNOs to go that way, with partners for governance and capital structures.

What’s going to drive value in MENA tower investments?

Towers can be hard to categorise; they don’t fit neatly into the infrastructure vertical and yet also aren’t a traditional private equity play, particularly in more developed markets. Typically infrastructure projects have returns which look flattish, with a good IRR and predictable returns. What’s unique about towers is the equity bump you get when a tenancy ratio hits 1.5x, and when it hits 2x the payoff is impressive, meaning towers deliver the flat line of infrastructure but also additional equity kicks if you can deliver the tenancy.

There are still pockets of activity within towercos where efficiency can be driven, in terms of design, tower build, replacement capex, air conditioning and batteries as all of these elements can drive down the cost for the operator. In addition, sharing in the MENA region hasn’t been where it could be, in a 5G world where small cell infrastructure will be more prevalent there will be a huge potential for a towerco to drive rollout. It’s much harder for operators to share networks belonging to each other than it is to share via a trusted independent party.

Despite the fact that many operators don’t need cash, the region is undergoing a strategic shift. MNOs are still around 60% owned by governments, but governments are reluctant to keep funding capex and to be the financial investor in towers and digital infrastructure. Once towers are carved out and national security issues are addressed, cautious investors will be more able to get involved, it’s just a matter of time.

Emerging market opportunities

Eric Crabtree of the IFC has told us it is keen to be more involved in the region. They are working closely with the Egyptian government on the Digital Africa programme and having discussions about national infrastructure. Egypt needs to deliver more fibre, including FTTT, which represents an opportunity for the IFC to get involved. In markets in this area all parties have to be comfortable with the process, including the government, and in countries like Pakistan and Egypt the governments are well aware of processes which didn’t result in a victory.

Sovereign wealth funds

The appetite of big investors like sovereign wealth funds depends very much on the strategic view. In markets like Saudi Arabia the government has decided to keep STC’s towers owned by an STC-owned carve-out, TAWAL, but

whether the sovereign wealth fund is tapped for development capital depends on how TAWAL decides to raise capital in the future.

For funds which have invested in the space before, they will want to look closely at the local management team, at what kind of infrastructure they’re inheriting, who their local partners will be and who will manage the towers. In terms of governance, they won’t want the shareholding to be too complicated, as when shareholders try to limit risk they can often end up creating a cumbersome and complicated shareholding structure. For many investors simplicity is key right now, and they will only choose to provide capital where there’s a clear structure and defined goals.

Regulation

MENA governments have a role to play in regulation, it can’t be left to market dynamics alone. Where the tower industry has emerged late, or behind the rest of the world (as is the case in MENA), governments have needed to play an active role in regulating and driving infrastructure sharing. In countries like Bangladesh or the Philippines this may have also started out with governments putting more pressure on using capital in an efficient manner, but this pressure is increasing in the Middle East due to falling oil prices. Logically, whatever their financial state governments should want more


efficient use of capital and should be encouraging infrastructure sharing.

Many of the larger markets have a gap between current infrastructure and what they will need as data consumption grows. In Egypt and Pakistan there are as many as 4,000 subscribers per tower already, with 4G not yet fully rolled out, and in Iraq and Egypt there is limited, if any, fibre coverage. In markets like these infrastructure sharing needs to filter down from government policy on digital economy, and regulators need to play their role.

Exiting tower investments

One critical element of tower strategy is to ensure that all stakeholders are well aligned on exit strategy. Everyone needs to understand timeframes and constraints, along with a dose of realism about the likelihood of an IPO as an exit option – IPOs are a valid alternative but are also a timely and costly affair. Consolidation has occurred in other markets, which is probably the most profitable form of exit for a non-strategic towerco, but for strategic investors they need the ability to exit into the liquid instrument.

There’s also a challenge presented if the mobile network operator holds a share of the business, as may well be the case in the first few deals taking place in the MENA region. Shared ownership with a MNO can make agreeing on a suitable exit more complicated, and towercos need to be prepared for that dynamic<










If towercos are so great, whywouldn’t an MNO want their own one?With equity stakes and operator-captive towercos common in the rest of the world, Middle Eastern MNOs are still deciding how independent they want their region’s towercos to be

MNO involvement and incentives

If TowerXchange has an editorial evangelical objective, it is to promote that independent towercos offer enormous value to the telecoms industry and regional economies generally. But we don’t align ourselves with any belief that one towerco business model is inherently superior to another. Despite being advocates for the independent towerco model, we agree with the industry that there is noone right model for tower sales or carve outs, and that the economic and political case will vary from market to market and from operator to operator. The decision of STC to carve out their towers and establish a captive towerco is part of a wider trend that includes Telefonica, Vodafone, Hutchinson and others. But it is also a long-established first step as regions adopt the towerco model.

In Crown Castle’s original sale and leaseback deal with Verizon, Verizon retained a minority equity stake in their towers. So even back to the early days of the industry there has always been a balance between independent operations and MNO’s retaining an interest in their towers. The same was true for Helios Towers in their early sale and leasebacks with Vodacom and Millicom, where both MNOs retained minority interests. So it is little wonder that MNOs examining tower sales or carve outs are exploring options for retaining an interest in their towers in MENA.

Therefore, the decision by Saudi Telecom Company to carve-out its towers into captive towerco TAWAL makes sense. The government wants to diversify the economy, rapidly deploy 5G, and optimise the

Read this article to learn:< The different tower ownership models being considered in MENA

< What are the drivers for MNOs for retaining a captive towerco?

< How to overcome the governance issues of captive towerco models

< The financial and operational constraints of MNO-owned towercos

< The likely trajectory for shared infrastructure business models

Keywords: Business Model, C-Level Perspective, Carve-out, Deal Structure, edotco, Global Tower,

Infraco, MENA Research, MNOs, Research, STC, Saudi Arabia, TASC Towers, Towercos

Casablanca, Morrocco


Kingdom’s network. Although MENA MNOs are not as capital constrained as they are in Europe, Saudi Arabia needs to manage its capex for 5G roll-out and network densification and find a way to reduce opex in a network with significant operational challenges. Therefore a dedicated tower manager makes sense, but the debate over the ownership structure of that towerco remains live.

Governance challenges

There is a contradiction between MNOs’ desire to professionalise, commercialise and optimise infrastructure sharing and their desire to still own towers after the sale. MNOs can be envious of the substantial gross margins towercos enjoy, but the question that MNOs must answer is not whether these margins are justified, but whether towercos are adding value for MNOs, and the simple answers is that towercos do add value in ways which are elusive for MNOs.

The financial pressures MNOs face are real. Competitive pressure on MNOs is coming from new entrants, ARPU remains under pressure, which has pushed their EBITDA down. At the same time regulators are insisting in increased investments to meet coverage targets. That in turn pushes up capex even while the spectrum required for 5G remains expensive. This leads some MNOs to trade at multiples in the region of 4-5x, while American Tower trades at a multiple north of 20x.

However, MNOs are still well placed to capture consumer demand for digitalisation and for that

MNOs need to transition from asset owners to digital service providers. Towercos can add value by taking those passive assets off their balance sheet and by managing them better, and through lease up, add value to the industry. But because MNOs are so competitive and must focus on digitalisation, not tower management, that value add is harder for them to capture. There is a risk that MNOs trying to latch onto the towerco business will kill the goose that lays the golden egg.

Broadly speaking MNOs are not good at sharing their infrastructure, which is one of the principle ways towercos have been able to add value. However, MNO ownership itself has never really been the problem, it has been MNO control and the dynamics of competitive markets which held back infrastructure sharing. With the right governance, there was relatively little preventing an MNO-majority owned towerco from acting independently

and delivering the benefits of infrastructure sharing to the industry and the benefits of towerco ownership to an MNO’s shareholders.

edotco is majority owned by the Axiata Group, a Malaysian telecoms conglomerate, but Axiata only takes two of the ten seats on the board. At edotco there are limits on what majority shareholders can see, as towercos are privy to confidential information which could impact competitor plans and Axiata’s own planning decisions. There is also a Related Parties Transactions Committee which helps to keep things clean and inspects transactions which could suffer from any conflicts of interests. These additional governance structures can become cumbersome, but also show that risk of interference can be overcome. Each towerco and MNO needs to find a model that works, and it was suggested that STC might ultimately be following this model.Turkey’s Global Tower owns 11-12,000 towers in

Saudi Arabia needs to manage its capex costs for 5G roll-out and network densification and find a way to reduce the opex of a network with significant operational challenges. Therefore a dedicated tower manager makes sense


Turkey, Ukraine, Cypress and Belarus and has increased its top line by 2.5x in last years, as of early 2019, it’s EBIDTA is up 2.7x and its tenancy ratio now sits at 1.65x, but it is 100% MNO-owned by Turkcell. It is a completely captive-MNO but has an economic performance to rival many wholly independent towercos. The key is, just like at edotco, good governance, with a focus on communicating the company’s commercial mind-set to customers. They work with VEON, Vodafone, Telenor and Turkcell, and none of these would be happy if the reality of tower management wasn’t creating value for each tenant.

MNO preferences and reduction in flexibility

There is a transition from captive-towerco to independent-but-still-captive-towerco. Initially any carve-out is single tenant, or is at best limited to sites previously shared on an MNO to MNO basis. From a practical level that means that even with the best of intentions a captive towerco will lack the institutional memory of acting like an independent towerco and it will lack the operational experience of working with second and third (and fourth) tenants. But with time this will change and a willing captive towerco can upskill quickly.

However, unlike independent towercos, a captive-MNO may be predisposed to lean towards the preferences of their owner MNO. If the towerco is well managed these differences will be minor, for example, it could the a small difference of preference over cabinet temperature: if the owning MNO prefers a different cabinet

temperature to another tenant then the owning MNO may prevail. That will have operational knock-on effects and reduce the flexibility of the towerco. But the overall effect should be hard to detect.

Valuation and value creation

We can look at the valuation differentials between captive towercos, independent towercos, and best-in-class towercos like American Tower. Few companies enjoy the 20x+ multiple that American Tower enjoys, but many independent towercos still trade at more than 10x earnings. The captive towercos are typically valued around 7x which suggests financial markets and investors recognise that some value is destroyed by keeping the towerco captive, for example spending on extra governance is essential, but still increases the cost of doing business or missing out on potential tenancies because your governance quality is not easily marketable.

Access to capital

Another potential financial downside to captivity is access to capital. Of course, a well-capitalised towerco with opportunities for lease up, good quality assets, good governance in place, but MNO-owned will still have access to different capital to the parent MNO. But the capital structure will be limited by what the MNO is comfortable with or capable of carrying on its own balance sheet. edotco is levered at a ratio of 2.5x because of limitations imposed by its ownership by Axiata, but an optimal leverage level for a towerco is generally thought to be about 4x.

Especially in markets where towercos are in deployment mode, limitations of leverage will negatively affect the scope of strategy. While in extremis a towerco might not be able to access capital if its owner had a weak balance sheet, that is unlikely to be the case in Saudi Arabia and for TAWAL. STC’s sister company Saudi Aramco enjoys a net income of US$111bn per year after having paid taxes and dividends to the Saudi state to the tune of US$159bn.

The future of the emerging MENA tower industry

The future of communications infrastructure will include more sharing, more wholesale models and more neutral host networks. For that reason it is both tempting and likely that MNOs will want to play in these markets. Certainly the decision by STC to carve-out TAWAL fits a wider trend. The potential returns are substantial, but there are risks if towercos are not able to act in an independent way. With the right governance and strategy, however, it can be possible for MNOs to exploit these opportunities through their subsidiary towerco. However, in five to ten years many towercos will become multi-asset infracos, operating more infrastructure than just vertical real estate. Already in North America you see Crown Castle investing in fibre, likewise, in Europe and North America Digital Bridge are betting big on digital infrastructure like data centres too. As these new, diversified infracos develop, MNO-captive towercos will face difficult decisions and will likely become more independent as they also seek to broaden their service propositions and asset portfolios<


How the telephone tower helpeddefeat ISIS (and other success stories) The inspirational work reconnecting conflict zones and bringing modern communications to rural areas

We will be covering rural connectivity again in a panel discussion with expertise from Pakistan, Afghanistan and East Africa at the 2020 TowerXchange Meetup MENA, but in this article we review some of the insights shared at our 2019 Meetup from Iraq’s Korek Telecom, Afghanistan’s Asia Consultancy Group, i-eng and Delmec.

Zardasht Khalid is the Site Management Director for Iraq’s Korek Telecom. Korek Telecom was founded in 2000 and has been responsible for rolling out and rebuilding and rerebuilding infrastructure in Iraq ever since. It was particularly active in reconnecting communities which had been disconnected by ISIS. In Iraq Korek Telecom has 18% market share, while Zain has 44% market share and Ooredoo, operating as AsiaCell, has 38%. There are another four Kurdistan-only 4G LTE operators, Fastlink, Tishknet Goran-Netand Mobitel, which are excluded from our marketshare figures.

Hussein Abdulkader is the Chief Operating Office of the Asia Consultancy Group, who are a towerco active in Afghanistan. They own around 100 Afghan towers, out of a country total of 6,645, and offer both traditional co-location tenancies and RANsharing services. The security situation in Afghanistan has fluctuated since the 2001 war and it is expensive, not to mention dangerous, to operate across large parts of the country.

Salah Medawar is Chief Operating Office of ieng Group. ieng Group provides end-to-end engineering infrastructure solutions to the telecommunications and power industries across Africa, the Middle East

Read this article to learn:< Low cost strategies to connect hard-to-reach locations< Meeting power challenges with innovative solutions < How temporary solutions can become permanent profit-makers< The conflicting role of government in rural connectivity < How Korek Telecom underminded ISIS’s efforts to cut-off populations from the world

Keywords: 3G, ARPU, Afghanistan, Africa & ME, Air Conditioning, Asia Consultancy Group, Capex, Country Risk, Delmec, Energy, Energy Efficiency, ieng Group, Iraq, Korek Telecom, MNOs, Masts & Towers, O&M, Off-Grid, RANsharing, Towercos, Unreliable Grid, Urban vs Rural

There are nearly 4bn people offline around the world, and nearly 250mn of them are in the MENA region. This represents a huge untapped resource for humanity and a tremendous social and financial opportunity for the telecoms industry. However, it is difficult both practically and economically to connect the unconnected. The offline population is disproportionately female, rural and poor and, while connecting them is of vital importance to global development, the illiterate cannot use mobile data and the elderly all too often never learn, so expensive solutions are unviable. That is why infrastructure sharing, as championed by towercos, is so important.


and Southeast Asia and are operate in eighteen countries: Afghanistan, Algeria, Cameroon, Chad, Congo, DR Congo, Ethiopia, Ghana, Guinea, Kenya, KSA, Lebanon, Liberia, Myanmar, Nigeria, Pakistan, Uganda and Zambia. They manage over 11,500 sites for Africa’s largest MNOs and all four towercos and have extensive experience in working in rural, hard-to-serve markets.

Low-cost rural sitesWe began by discussing options for reducing the cost of a rural cell site. There are many costs to connecting the unconnected, most of which need to be covered by subscription revenues of low ARPU customers, so reductions in roll-out costs are essential to transform these lower revenues into investable margins. Towers typically cost US$80-120,000 in MENA and SSA, so reductions in tower cost can make or break marginal sites. Salah Medawar of ieng group discussed two solutions they had developed for MTN for their rural Africa sites. They developed low-cost rural sites (LCRs) and ultra low-cost rural sites (ULCRs), which were brand new solutions aimed specifically at rural areas.

LCRs used 18m monopole rather than free standing lattice structures in three, four or six legged varieties. ULCRs used 12m monopoles which reduced the towers’ coverage but further reduced cost. These were off-grid sites, so rather than install, fuel and maintain a diesel genset these sites relied solely on solar and batteries. A solo-solar system is much cheaper to install than a hybrid system and also offers lower ongoing opex

costs. Of course, the gensets are there for a reason, and this choice sacrifices reliability for lower capex, reduced site visits, reduced theft-risk and lower maintenance costs. The installed systems had lower power consumption than conventional sites, using only 0.15-0.35kW per day versus circa 2kW a day for a conventional site.

The result was a radically cheaper solution. The capex cost for the LCR solution was US$45k and for ULCR is US$35k, compared to a minimum cost of US$80k for a conventional tower in these markets. By using cheaper passive infrastructure, reducing O&M costs, eliminating fuel and therefore security costs, the opex for these sites was reduced from a typical US$1,500 a month bill to only US$500. Importantly, these sites are upgradeable; gensets can be added, towers can be strengthened, and tenants can be added, so initially low-cost, low-revenue sites can become normal-cost, normal-revenue sites. We should emphasise that often the

major barrier to marginal telecoms sites are not technological but a lack of investment prioritisation from MNOs.

The Afghan experienceThe sorts of ultra-rural, off-grid sites which ieng is working to connect are present in MENA, but are far less common than in SSA, where the solutions were developed. But there are many sites which are difficult to reach due to poor security situations or which have yet to be connected or had had their connection severed due to recent conflict.

Afghanistan has security issues which make grid power very unreliable. Security issues also make it difficult to deliver fuel and to keep it secure. The lack of a fibre backbone means that additional power and tower space is required for microwave transceivers. All of this makes reducing a power a key concern for operators and towercos and ACG has responded by providing active sharing services

The capex cost for the low cost rural solution was US$45k and for an ultra-low cost rural is US$35k, compared to a minimum cost of US$80k for a conventional tower in these markets


which reduces power demand, even if it reduces possible tenancy revenue. In addition to active sharing, ACG also has some sites reliant on pure solar, doing away with diesel gensets and associated maintenance and expense, as described earlier by ieng.

Hussein Abdulkader of the Asia Consultancy Group (ACG) discussed his experience in bringing towers to Afghanistan’s rural areas. ACG works with Aghanistan’s number one operator Roshan, and there is government support for rural sites. Payments are collected from the country’s MNOs

and redistributed through tenders for rural site construction. At present ACG owns and operates around 100 sites, but it aiming to add around two a week to reach 300 by mid-2020, against a total organic growth target of 500. As is often the case in difficult markets, diversification is key to ACG’s plans. ACG are investing in a fibre to improve the security, cost effectiveness and quality of Afghanistan’s telecoms backbone and have won a contract to direct Afghanistan’s airspace communications infrastructure, the first time Afghanistan will ever control its own airspace domestically.

Rebuilding IraqFollowing the capture of 30% of Iraq’s land by ISIS from 2014, much telecoms infrastructure has been destroyed or degraded in Iraq. ISIS targeted telecoms towers in order to cut off captive populations from the outside world, and from 2014 as ISIS expanded its territory and in subsequent years as it was gradually pushed back and defeated, telcos like Korek Telecoms have been working to rebuild towers and bring back 2G and 3G services to populations that have lost them. Our panellist Zardasht Khalid revealed that communities which were cut off from the outside world after the destruction of their telecom towers now see higher rates of voice and data usage than populations which were not cut off, once towers were rebuilt and service restored.

Hearing about the work to connect captive populations was a highlight of the conference, and a reminder of the important work our industry does. From 2014-2019 the focus in Iraq has been on rebuilding the 1,000-2,000 towers destroyed deliberately during the conflict, many as permanent sites, but also through a host of temporary sites. Mosul was captured early in the conflict with ISIS and for two years through its occupation, Korek Telecom provided semi-temporary towers on the surrounding hillsides to enable a weak 2G service in the city as a vital lifeline.

From 2016 onwards as the liberation progressed the degradation of Iraq’s telecoms infrastructure went into reverse with further temporary towers required to follow the train of military units, NGOs

At present ACG owns and operates around 100 sites, but is aiming to add around two a week to reach 300 by mid-2020, against a total organic growth target of 500. As is often the case in difficult markets, diversification is key to ACG’s plans. ACG are investing in a fibre to improve the security, cost effectiveness and quality of Afghanistan’s telecoms backbone and have won a contract to direct Afghanistan’s airspace communications infrastructure, the first time Afghanistan will ever control its own airspace domestically


and media which chased ISIS out of Iraq. Dealing with this surge of demand was vital for the war effort and our panellists paid tributes to the crews who spent the last years of this decade building towers in a warzone. It was during this time of liberation that Korek Telecom first deployed 3G.Even today, the security situation in Iraq makes it a difficult market to operate in, with battery and fuel theft creating an operating environment with expensive opex challenges. That said, international donors having promised funding to invest in new towers to reconnect Iraq’s population, which will ease the economics of connectivity. Korek Telecom has estimated it will need to build 2,500 towers over the coming years. For four years the focus has been on reconnection and recovery, but there is now a new cabinet, and the government is issuing national 4G licences at last.

LTE catch-upIt will be no surprise that our panellists agreed that 5G was some way from being viable in low ARPU, hard-to-reach rural sites, not least because of the technology’s required density and short propagation distances. However, all discussed the options for 4G technology in the markets in which they operate. Korek Telecom have begun to fibreise their network and discussions to share infrastructure in the country to reduce the capex cost of a 4G roll-out that is underway. Afghani telcos have 4G licences and roll-out in urban areas is happening at the same time 2G is only just reaching rural areas. However, due the minimal extent of fibreisation in the country 4G feels more like 3.5G in the cities where is available.

Government help and hindrance Governments almost without exception claim to want to improve rural connectivity and often have licence conditions and active programmes to promote it. However, what is given with one hand can be taken away with another. Governments in the developing world often find it difficult to raise revenues through traditional forms of taxation and can turn to high licence fees, compulsory charges of direct MNO taxation which all discourage investment in marginal sites.

There was some debate at the TowerXchange Meetup about how successful or important government incentives were for improving rural connectivity. ACG receive essentially all of the capex for many rural sites from the government’s rural build out fund, and argued that without direct support many sites they serve, with their opex costs, those sites would not be viable. Likewise, Iraq’s telcos will receive significant outside investment to rebuild their towers but cannot use components for those towers specified to global standards because local standards are different.

Future proofing marginal sitesReducing the cost of site installation and operation is vital for bringing connectivity to hard to reach groups and areas. However, costs are only one side of the equation and the potential for healthy revenue upside is also important. Initially sites will usually only have one tenant, significantly reducing potential returns. If a low site cost is achieved by minimising the leasable space on a tower then the

site may never become economical and so never be built in the first place. Likewise, despite reducing opex and capex, active sharing also reduces prospective revenues for towercos and reduces the appeal of marginal sites. ieng’s Salah and ACG’s Hussain both discussed options for transitioning temporary sites into permanent ones. The session chair Spencer Crawford-White from Delmec was also confident that reinforcing temporary or smaller towers will be easy to enable expansion from two tenant to four or more tenants if planned for from the start.

Commitment The tower industry has long horizons and is used to thinking in 10-15 year tenancies, and making capex investments which will take years to pay off, so it makes sense that commitment was a critical requirement for our panellists. If the commitment to delivering low cost but flexible sites is real, then it offers a huge potential market and firms like ieng. But engineering firms can only invest in developing and producing cheap to install and easy to maintain sites if the demand for them is there. But that, in turn, requires commitments from telcos and from government. Both Korek Telecom and ACG want to invest in larger and better networks, but without a top down commitment to bringing connectivity to difficult to reach areas it won’t be possible for MNOs or towercos to invest and reach people are rapidly as theoretically possible. There is lots of good work and innovative strategies already being pursued to connect the unconnected, but as always, more can be done<


Data collection andutilisation at edotcoHow edotco leverages data to enhance uptime, MTTR and drive tenancy ratio growth

TowerXchange: How would you summarise edotco’s current data strategy, both operational and commercial performance data? Gayan Koralage, Director, Group Strategy, edotco Group: Innovation is at the core of our operations, and we have embarked on a strategy that comprises of four focus areas, namely real-time efficient operations; advanced analytics; predictive capabilities and future proofing the company. This model places a great emphasis on data collection and usage, to drive business efficiencies and operational excellence, enabling us to benefit from smart process automation, advanced data analytics and applications. Our current strategy is aimed at ensuring we receive the most accurate real-time data from our tower assets, further enabling us to drive a business that ensures our operational teams benefit from insights gathered and customers get the best out of the partnership, resulting in a shift from reactive orders to a proactive demand generation model. TowerXchange: What tools do you use to collect data? Gayan Koralage, Director, Group Strategy, edotco Group: We have adopted a variety of initiatives and tools across our business that enables our operations systems to be leaner, agile and more cost-effective. Some of the more notable projects are:

Drones: To conduct site surveys, network inspection

Read this article to learn:< What tools do edotco use to collect, analyse and visualise data?

< Example insights derived from data analyses

< What are the most important KPIs edotco manages, and what have been some of their success stories?

< Future objectives from big data analytics: RPA, AI, machine learning and moving order generation from being reactive to proactive

Innovative integrated communications infrastructure services leader edotco leverages data to focus on four areas: real-time efficient operations; advanced analytics; predictive capabilities and future proofing the company. In this exclusive interview, Director of Group Strategy Gayan Koralage describes the tools they use the collect data, the analyses and insights derived from that data, and the operational and commercial KPIs edotco measure.

Keywords: Access Control, Asia, Bangladesh, Data Collection and Utilisation, edotco, Hybrid Power, Interviews, Job Ticketing, KPIs, Malaysia, Operational Excellence, Opex Reduction, SLA, Site Visits, Tenancy Ratios, Towercos, UptimeGayan Koralage, edotco


alongside assessment for preventive maintenance and revenue assurance. The use of drones’ results in faster data collation and report generation, reducing the turnaround time for reports by 35%.

echo RMS: Monitors real-time batteries, rectifiers and generator sets to make sure they are in good working condition. These assets are equipped with sensors that helps us manage our maintenance scheduling.

easi: An asset management platform to help us keep track of our inventory and workforce (our field technicians), ensuring what we have in reality matches what we have in our databases. Currently both echo and easi each have mobile applications, and we plan to merge them next year, along with the workforce asset management system on one cloud-based platform for optimised results.

RAPID: Usage of smart process automation built into our financial system. TowerXchange: What tools do you use to analyse and visualise data? Gayan Koralage, Director, Group Strategy, edotco Group: We use tools such as Power BI, MapInfo and, available functions in Microsoft Excel. Power BI transforms our data into rich visuals for better visualisation. We’re able to use such visuals and share insights organisation-wide, enabling our teams with the necessary to work more efficiently. As for MapInfo, it is a geographic information

system (GIS) software that we use for mapping and location analysis for our tower sites. It helps us visualise, analyse, and interpret data to understand certain patterns and trends. TowerXchange: How do you translate data into actionable insights? What kind of reports and ‘what if’ scenarios are you able to run? Gayan Koralage, Director, Group Strategy, edotco Group: We have a few examples of extremely useful achievable and automated insights, including:

Long-tail analysis: Derived from data gathered, this analysis helps us identify sites with prolonged power outage issues. As such, we can escalate it to the local operations teams to put the necessary

precautionary measures in place. In addition to that, by analysing the data, we are able identify the cause of an incident (i.e. failure of equipment, faulty) hence determining the best way to overcome or avoid an issue.

Monitor diesel readings: Having a thorough view of the diesel readings without being onsite helps us identify generator set inefficiencies and also, detect or prevent theft.

Avoid overbilling: We are able to show a comparison of our AC meter readings against utilities charges. This enables both edotco and the relevant utilities company to study and understand energy billings within a certain site better.

Revenue assurance: Comparison of energy usage at site against our asset register to detect equipment that was installed without permission or not updated in our internal system.

Monitoring of temperature: Real-time temperature reading to reduce energy consumption at site or avoid damaging equipment due to high temperatures. TowerXchange: What are the most important KPIs you are measuring and managing in terms of operational performance? And can you share some success stories? Gayan Koralage, Director, Group Strategy, edotco Group: Our most important KPI is uptime. Aside from that, we also look into mean time to repair

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The use of drones’ results in faster data collation and report generation, reducing the turnaround time for reports by 35%


(MTTR); percentage of sites with theft, vandalism and accidents; site delivery according to service level agreements (SLAs) and percentage of green or hybrid sites among others. Externally, the above KPIs give us the ability to meet the needs of our customers while internally, it helps us to be more competitive from the perspective of cost, time and quality in terms of the ability to meet and surpass our service level agreements (SLAs). Some of the successes we have attained over the past years include:< Maintaining energy up time in Bangladesh despite deteriorating grid conditions.< Over 600 sites with renewable energy, resulting in approximately 25% carbon reduction.

< The construction of more than ten bamboo structures in Bangladesh, the equivalent of 70% carbon reduction per site.< A 30% reduction of theft, vandalism and other safety risks through the usage of edotco’s smart padlocks and easi asset lifecycle management. TowerXchange: What are the most important KPIs you are measuring and managing in terms of commercial performance? And can you share some success stories? Gayan Koralage, Director, Group Strategy, edotco Group: In terms of commercial performance, there are many KPIs we benchmark against however, tenancy ratio of sites alongside lease fee per tenant

per site is the most important measure of our commercial performance. edotco’s portfolio of towers has a 1.60 tenancy ratio, while the global average is between 1.6 and 2.0. Our tenancy ratio grew from 1.5 in 2017 to 1.60 as of 3Q last year – this is a clear indication of our growth across all six markets we are in. TowerXchange: Please sum up your personal view of where we are as a communications infrastructure industry today in terms of collecting and utilising big data – and what we should strive to achieve in the future. Gayan Koralage, Director, Group Strategy, edotco Group: Businesses across all industries need to innovate or risk being left behind. Based on my observations, the communications infrastructure industry has not been adopting big data analytics as quick as they should. Driving value more for customers requires towercos to deepen their presence in the telecoms value chain. This means developing the right competencies and capabilities. Moving forward, we need to be able manage an end-to-end telecoms network autonomously with the use of RPA, AI, machine learning and so forth. Reducing the reaction or response time to a sub-millisecond range is crucial in the era of 5G where low latency and high availability are key. Even more so, order generation needs to move beyond reactive to proactive – informing customers where sites need to be built with a ready catalogue of structures and location partners for them when they do decide to build

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“order generation needs to move beyond reactive to proactive – informing customers where sites need to be built with a ready catalogue of structures and location partners for them when they do decide to build


Keywords: Bankability, Business Model, Country Risk, IDIA, Infrastructure Sharing, International Digital Infrastructure Alliance, Investment, Leasing & Permitting, Multi-Region, Next Billion, Regulation, Towercos

Working together to advocatethe tower industry to governments and regulatorsThe CEO of the newly formed IDIA explains the regulatory conditions conducive to attracting towerco investment

TowerXchange: Congratulations Chuck on the latest of the tower ventures you have founded or Co-founded, successfully monetising, after the Helios Towers IPO last month! Please tell us a bit about your history in the tower industry, and what has brought you to your new role as Chief Executive of the International Digital Infrastructure Alliance (IDIA). Chuck Green, CEO, IDIA: I started in the industry about 22 years ago when Ted Miller, founder of Crown Castle - as well as of the tower industry effectively – asked me to consider becoming the first Group CFO of the fledgling business. Over the first three or four years from inception we raised over US$5.6bn in funding to grow the business from a virtual start-up to 16,000 sites in the US, UK and Australia. I followed that by co-founding Helios Towers Nigeria, the first towerco in Africa, with Helios Investment Partners. Four years later we co-founded Helios Towers Africa (now Helios Towers) with a mandate extending to the rest of Africa and grew that business from a start-up to over 6,800 sites by the time of the recent IPO. I stepped down as Executive Chairman at the end of 2017 to comply with UK Corporate Governance requirements, which provided that I could no longer serve as Chairman following the planned the public offering. I have served as Non Executive Director and Advisor to leading Asian towerco edotco for six years and serve on the boards of, or advisor to, other towercos and infrastructure funds investing in towers.

Read this article to learn:< The vision and goals of the IDIA in terms of educating government stakeholders about the

benefits of professionalising infrastructure sharing< The regulatory and taxation conditions most conducive to attractive investment by towercos –

and the ‘red flags’< The socio-economic benefits enabled by towercos< How federal, regional and municipal governments and regulators can accelerate the

deployment of communications infrastructure< Why the IDIA has been created, and how prospective members can get in touch

The International Digital Infrastructure Alliance (IDIA) has been formed to fill a void in terms of independent, international advocacy of the tower industry, with a goal of educating regulatory, federal, regional and municipal government stakeholders about the socio-economic benefits of the towerco business model, and how the tower industry accelerate National Broadband initiatives and the emergence of Digital Economies. TowerXchange spoke to our old friend Chuck Green, recently appointed CEO of the IDIA, to understand the vision and goals of this important new initiative.Chuck Green, CEO, IDIA


During the period following my departure from Helios Towers, I was approached by the IFC to consider heading the International Digital Infrastructure Alliance (IDIA), an industry association focused on being a single common voice in dealing with regulatory authorities in emerging markets globally. TowerXchange: Even though towercos now own 70% of the world’s towers, the towerco business model remains unfamiliar to federal and municipal government leaders in many countries – what are the IDIA’s primary goals in terms of educating government stakeholders about the benefits of infrastructure sharing and of towercos? Chuck Green, CEO, IDIA:

< To be a global voice that promotes the tower industry and brings global authority to influence regional and national debate about communications infrastructure development and the acceleration of the emergence of Digital Economies.< To identify challenges affecting our members in the context of local, national and international regulation, and to work in partnership with all stakeholders to address these challenges.<To communicate the positive socio-economic impact and sustainability of the towerco model.<To share global best practice, simple and repeatable deployment processes, and socio- economic benefit case narratives.<To ensure global best practice informs local and regional decision making.

TowerXchange: What are the regulatory and taxation conditions that are most conducive to attracting investment by domestic and international towercos? Chuck Green, CEO, IDIA: Through application of its infrastructure sharing model, the tower industry is a facilitator of national, regional and local telecommunications initiatives. Our industry owns no natural resource but is essentially a real estate owner which provides mission critical, but not core, infrastructure and services to MNOs. Its open access, shared network platform encourages competition and innovation by MNOs to meet growing demand for broadband connectivity in the Digital Economy and allows MNOs to focus on their

core business of delivering high QoS and desirable products and services to mobile customers. Towercos force-multiply capital investment to increase the pace of expansion in network coverage and capacity and respond to the changing needs brought about by new technologies. Sharing infrastructure reduces the proliferation of towers, improves health and safety, improves operating efficiency and introduces positive competition for the benefit of consumers. The lower the total licensing and permitting fees, import duties and taxes on the industry, and the more streamlined the permitting process, the faster the deployment of network assets to meet National

Towercos force-multiply capital investment to increase the pace

of expansion in network coverage and capacity and respond to

the changing needs brought about by new technologies. Sharing

infrastructure reduces the proliferation of towers, improves health

and safety, improves operating efficiency and introduces positive

competition for the benefit of consumers


Broadband initiatives. The resulting acceleration in demand growth encourages towerco investment, which produces highly favourable socio-economic benefits that are often misunderstood or underestimated by central regulators in setting policy. Regulators must recognise that any country is effectively in competition for capital with other countries seeking to attract international investment in communications infrastructure. As such, one of the consequences of regulatory and taxation conditions that are not conducive to investment is that the people controlling that capital will simply go elsewhere to invest. TowerXchange: What are some of the regulatory and taxation ‘red flags’ that would represent inhibitors to towerco investment? Chuck Green, CEO, IDIA: The principle inhibitors to investment in towers include:<High total licensing and permitting fees and taxes, particularly when coupled with an emphasis on high recurring charges.<Non-existence of import duty or income tax incentives.<Inefficient, time-consuming permitting approval processes.<Independent regional and local authorities often with different agenda than those of the national regulator or telecoms ministry, resulting in inconsistency, exaggerated regulatory intervention, cost, and delay.

<Restrictions on foreign ownership, particularly if capped at 49.9%, can be prohibitive for the investment of towercos who would want to be able to consolidate results for financial reporting purposes. TowerXchange: Should towercos be licensed?

Chuck Green, CEO, IDIA: To ensure consistent, professional standards of service reliability and health and safety standards in building and operating passive infrastructure, some level of regulation is warranted. While some tower industry participants favour a regulatory regime that does not require a special infrastructure license for towercos, others feel that the absence of a licensing regime leaves uncertainty, and the risk of an unfavourable license regime being imposed at a later date. Whether your preference is for towercos to be licensed or not, the common sentiment is that towercos should be subject to ‘light touch’ regulation, consistent with the treatment of other companies that are essentially real estate owners and operators. TowerXchange: What are the principle socio-economic benefits offered by professionalising infrastructure sharing through towercos? Chuck Green, CEO, IDIA: The towerco business model drives greater utilisation of telecom

structures, reducing the proliferation of towers, extending to decommissioning overlapping sites. As well as the obvious aesthetic advantages, this also frees valuable land and resources for alternate exploitation. Towercos also facilitate the rapid and efficient deployment of passive infrastructure, accelerating improved network coverage and capacity. Towercos’ laser-beam focus on passive infrastructure can raise health and safety and operational efficiency standards, including improving cell site uptime, which can significantly inhibit quality and continuity of service, particularly in emerging markets. Transferring towers from MNOs to towercos releases capital for MNOs to invest in network improvements and spectrum, while enabling MNOs to focus on their core business of delivering reliable, ubiquitous connectivity, value-added services and products and high level of customer satisfaction. A critical differentiator between the infrastructure sharing facilitated by towercos, and that achieved through bi-lateral ‘swaps’ between MNOs, is that towercos provide open, non-discriminatory access to all network infrastructure by all MNOs, increasing competition and affordability. Ultimately, all these activities contribute to faster enablement of broadband connectivity,


accelerating participation in the Digital Economy, which has a positive relationship to macro-economic growth. TowerXchange: What role can towercos play in extending coverage and targeting universal service? Chuck Green, CEO, IDIA: Towercos provide additional capital investment in passive infrastructure deployment, facilitating and accelerating coverage expansion. Many towercos are also adept at collaborating with MNOs, governments (national, regional and local), and equipment vendors to develop economically viable solutions to connect the unconnected TowerXchange: What role can towercos play in creating smart cities and accelerating the emergence of a competitive 5G Digital Economy? Chuck Green, CEO, IDIA: An increasing proportion of towercos are transforming their business model to include development of small cells, DAS and IBS, fibre and data centers to meet the network densification requirements, data download speeds and low latency required to enable industrial 5G use cases. We’re already seeing the tower industry embracing innovation and incorporating different forms of communications infrastructure into their portfolios. For example, leading U.S. towerco Crown Castle

has ‘futureproofed’ their business by deploying US$37bn to acquire and deploying over 75,000 route miles of fibre, with around 40,000 small cells on air and a further 30,000 under contract. Meanwhile, 85% of small cells are being deployed on ‘street furniture’ in the towerco-led Chinese market. TowerXchange: How can federal and municipal governments and regulators accelerate the deployment of communications infrastructure? Chuck Green, CEO, IDIA: Federal, regional and municipal government and regulatory stakeholders can play a pivotal role in accelerating the

deployment of communications infrastructure, particularly if they are able to establish holistic, standardised and streamlined access policies and permit approval processes, and fee structures adopted across all levels of government. Without a countrywide process, National Broadband initiatives risk being held hostage by regional and local stakeholders and their fee structures. It is important to establish and maintain license and permitting fees at a low level to encourage passive network investment – in line with empirical evidence in many markets that shows there is an inverse relationship between the combined fees

Federal, regional and municipal government and regulatory

stakeholders can play a pivotal role in accelerating the deployment

of communications infrastructure, particularly if they are able to

establish holistic, standardised and streamlined access policies and

permit approval processes, and fee structures adopted across all

levels of government


charged to towercos by the different government agencies and the pace of network deployment. Any initiative that accelerates cell site permitting and rights of way for fibre can materially assist communications infrastructure owners with their efforts to adopt and comply with National Broadband initiatives. An ideal permitting regime might be a version of the ‘shot clock’ concept wherein permitting stakeholders have a limited period (for example 30 days) to respond to an application for a new tower build permit, after which time the towerco can commence the build, providing they comply with mutually agreed standards and processes. This principle has been successfully applied in the U.S. Regional and municipal governments can play an important role in protecting the zoning around existing towers to avoid overlapping sites. We’ve seen examples where new site build is only permitted where all opportunities for co-location have been exhausted. Regulatory stakeholders should consider mandating infrastructure sharing on commercially reasonable terms, where technically feasible. The IDIA would also call on governments to make their own land, and the rooftops of government buildings, available as cell sites. TowerXchange: Should regulators define lease prices?

Chuck Green, CEO, IDIA: In a word, no. Commercial lease prices are tied directly to the terms of towercos Master Lease and Service Level Agreements with their MNO partners, which in turn define QoS and uptime obligations. These contracts drive investment returns for both MNOs and towercos, which are the foundation of a healthy, innovative and consumer-focused mobile platform. In general, regulators should confine themselves to encouraging infrastructure sharing, and intervening in lease price negotiation only as a matter of last resort in dispute resolution. TowerXchange: Please sum up why the IDIA has been created, and how prospective members can get in touch.

Chuck Green, CEO, IDIA: The International Digital Infrastructure Alliance (IDIA) is the only membership organisation representing the interests of the towerco industry globally, sharing regulatory best practice to support rapid and cost-effective deployment of robust communications infrastructure. The IDIA provides a strong and unified voice to regulators, mobile network operators and other stakeholders as the industry rapidly progresses the deployment of next generation networks for 5G and IoT. To find out more about the benefits of Membership or Sponsorship of the IDIA, visit idia.io or email [email protected]

The International Digital Infrastructure Alliance (IDIA) is the

only membership organisation representing the interests of

the towerco industry globally, sharing regulatory best practice

to support rapid and cost-effective deployment of robust

communications infrastructure

https://www.idia.io/

mailto:membership%40dia.international


TowerXchange Meetup MENA 2020 exhibition preview

TowerXchange is not only about the views of towerco and MNO strategists. One of our top priorities is to provide a platform for proven passive infrastructure equipment and service providers to introduce themselves and their activity.

From static asset manufacturers to site management systems, RMS and backup power solutions, these companies play a critical role in ensuring the efficiency and safety of towercos, MNOs and their employees. In addition to interviews and articles featured elsewhere in the journal this section gathers further interviews with a selection of the top service, solution and equipment providers joining the TowerXchange Meetup MENA in January.

125 Al-Babtain LeBlanc

129 Bladon

134 Byrne Equipment Rental

136 Caterpillar

140 EnerSys

143 Enetek Power, An Eltek Holding Company

146 GRIDSERVE Sustainable Energy

150 House of Invention (HOI)

153 ieng Group

156 Infozech

160 IPT PowerTech

163 ITD / ClickOnSite

167 Metalogalva

170 NEXSYS-ONE

175 Northstar Battery

180 Polar Power Inc

185 Ramboll

189 Salasar Techno Engineering Pvt. Ltd.

192 Sera4

195 SerEnergy

198 Sitetracker

201 Vinson & Elkins RLLP


Al-Babtain LeBlanc:Local expertise, international scope and a complete service offering How this local tower builder grew to become one of the cornerstones of telecoms infrastructure in the MENA region

TowerXchange: Please introduce Al-Babtain LeBlanc, your history and footprint.

Omar Abdulaziz Al Rasheed, General Manager, Al-Babtain LeBlanc: Al-Babtain LeBlanc is a fully owned subsidiary of Al-Babtain Power & Telecom which was founded 60 years ago in 1955 as manufacturing company concentrating on manufacture of steel products. In 1993 we formed a joint venture with LeBlanc international to concentrate on the telecoms business which was more about the telecom infrastructure: towers, monopoles and rooftops as design, manufacturing and implementation, and in 2011 we became a 100% subsidiary of Al-Babtain Power & Telecom and expanded our reach from telecoms activities to other more and new areas such as security solutions, traffic solutions, smart infrastructure solutions, Special Architectural structures etc. Since 2011 we have diversified, changing focus to become a telecom system integrator. We are based in Riyadh in Saudi Arabia, but also have established businesses in UAE and Egypt and project offices in Oman, Yemen and Bahrain from which we cover all of the GCC and North Africa.

TowerXchange: Al-Babtain LeBlanc works across multiple fields with many high-profile clients. Can you tell us about how your telecoms business line developed and where it sits in the larger business?

Omar Abdulaziz Al Rasheed, General Manager, Al-Babtain LeBlanc: We took the decision five years ago to make it our mission to become market

Read this article to learn:< Who Al-Babtain LeBlanc are and their background and footprint

< How tower needs have changed in the MENA region

< The impact of tower sharing on the key players in the MENA tower ecosystem

< How the rollout of 5G will affect tower owners across the region

With a dedicated offering in the telecoms sector since the emergence of mobile telephony 25 years ago, Al-Babtain LeBlanc is one of the most established and trusted brands in Middle Eastern communications infrastructure. TowerXchange spoke with Omar Abdulaziz Al Rasheed, General Manager at Al-Babtain LeBlanc, about how the company has grown, the diversification of their business offering and why they see telecoms as such a critical and growing sector.

Keywords: 4G, 5G, Africa & ME, Al-Babtain LeBlanc, Camouflage, Construction, DAS, IBS, Installation, Managed Services, Masts & Towers, Middle East, Multi-Country Partner, O&M, Regulation, Rooftop, Small Cells, Smart Cities, Steelwork


leaders in infrastructure for all technologies, and concentrating more on the telecoms market. We offer a complete solution for the passive part of telecoms infrastructure, from towers to antenna and with the capability and experience to do more telecom scope design, testing and operating. Also, we do indoor based solutions, right through from tests to design, implementation and maintenance. In addition to standard telecoms sites we also offer complete solutions for smart infrastructure including smart cities, smart malls, smart schools, smart sport venues, etcetera – what we call ‘Smart X’. We are working on those solutions with international partners with the aim to provide our clients with full solution reaching their satisfaction and having the latest technology in the worldwide market.

TowerXchange: Tell us about Al-Babtain LeBlanc’s relationship with your clients and what sets you apart from your competitors.

Omar Abdulaziz Al Rasheed, General Manager, Al-Babtain LeBlanc: We had a very good relationship with our clients, particularly the operators in the GCC and North Africa, which came about because we are able to offer such a comprehensive solution, much more than our competitors. We have competitors in supply and we have others in implementation, but it’s hard to find someone who does both, whereas we offer a complete solution, starting from design right through to implementation. Clients feel we offer the right solution, implement in the right way, and that we are here for any issues later on. We have more

than 25 years of experience and many of our team members have been working with us since the beginning, which adds value for our clients and confidence that we are the right partner, giving us the competitive edge. This is why we are coming to TowerXchange Meetup MENA to deliver this message to the region. Our design team is made up of over 50 experts who are designing everything from a normal telecoms site or monopole to a large or camouflage custom tower: we have a huge range and can offer whatever a client needs.

TowerXchange: You offer a wide range of high quality structures. Please talk us through how you have seen your telecoms clients’ needs changing and how this is reflected in the shape of their infrastructure.

Omar Abdulaziz Al Rasheed, General Manager, Al-Babtain LeBlanc: Firstly, our clients are looking for more comprehensive solution, not only a tower. They are looking for a service and often need a special design then installation and after sales


service. They need more than just a tower. The second change we are observing is the appearance of towercos in the MENA market right now. We are seeing towercos emerging in Oman, Kuwait and Saudi Arabia already and this upcoming change is big news at the moment. Thirdly, tower owners are also moving away from standard towers and monopoles: they’re under pressure to reduce the impact of their infrastructure on the landscape or local environment, which is not a cheap solution

as it needs to be customised for each client and city dependant on specific requirements. There’s a lot of pressure on us to fulfil these bespoke camouflage requirements, but providing this is one of our strengths: we designed more than 500 different towers in the last two years.

TowerXchange: As the MENA landscape changes and we see an increased amount of tower sharing on the horizon, through independent towercos, regulator-mandated co-locations and bi-lateral collaborations between MNOs, what changes do you think will need to be made to MENA towers and where should tower owners be focussing in terms of rollout?

Omar Abdulaziz Al Rasheed, General Manager, Al-Babtain LeBlanc: Usually we are told that tower sharing is affecting solutions providers globally, as the market goes from three operators to only one main infrastructure provider but we see this very much as an opportunity. Tower sharing and making towers fit their landscape are a key part of the master plans of local and national governments, but delivering this needs more than a subcontractor.

This is where we fit, we can add value, one of the advantages of Al-Babtain LeBlanc is that we are not just tower supplier but also enhance existing towers and structures, we can add camouflage for existing sites, and upgrade and strengthen towers. Do we see tower sharing as a threat to our business? No, we look at it as another trend: the stage of “single operator site” is almost over and we are entering a new stage of sharing sites, which we look at as an

opportunity which will increase our market share as it requires a more specialised company.

The need to upgrade towers is a new trend which is an opportunity for us as a tower player, as new technology like 5G will require a specialised company which can do the analysis of existing sites and the replacement of the existing sites where needed. We explore how tower owners can utilise existing structures as well as providing

3!

Abu Dhabi Police Tower

9!

Palm Tree- Implemented Sites


new products, both of which necessitate a lot of experience and engineering work. In 2018, Albabtain LeBlanc engineering workload was double than the average of the previous years, although we built the same number of sites.

So, as 5G rollouts will be started soon, this will become more and more important it is a big opportunity for replacing, enhancing and camouflaging sites, driven by 5G and new colocation needs.

TowerXchange: We are seeing regulators putting increasing pressure on tower owners to minimise the impact of their towers on the landscape. How can Al-Babtain LeBlanc support MNOs and towercos in conforming to these demands?

Omar Abdulaziz Al Rasheed, General Manager, Al-Babtain LeBlanc: There are over 25,000 Al-Babtain LeBlanc traditional towers in use in the GCC which we’ve designed, manufactured and in many cases implemented in the last 25 years. When it comes to landmark projects in the region, we have played a critical role, supplying more than 4,500 towers for the huge USF project in Saudi Arabia to cover the rural area country wise. Another of our stand out projects was the Abu Dhabi Police Tower in Abu Dhabi, which is over 70 metres high and for which we undertook the design, civil works and erection.

It’s also important to note that we don’t just have good relationships with infrastructure owners, we also work closely with regulators as well. We

participate in workshops and give presentations, as well as suggesting solutions to help them manage this industry and create the right regulations. As a leading player in the manufacture of camouflage solutions in the GCC with a wealth of experience working for regional MNOs, we have a wide base of knowledge.

So, to answer your question, yes we consider ourselves is the best partner to MNOs and towercos to make their projects more successful and profitable.

TowerXchange: Talk to us about urban infrastructure. With the advent of 5G and countries like Saudi Arabia and Dubai making plans for ‘smart city’ infrastructure, what can Al-Babtain LeBlanc do to facilitate the rollout of densified networks?

Omar Abdulaziz Al Rasheed, General Manager, Al-Babtain LeBlanc: We look at 5G from two angles: firstly, 5G for existing infrastructure, for which telecom services companies are needed to install 5G on existing towers. We’ve already started a project with MNOs in the GCC to analyse and enhance their infrastructure based on these needs.

Secondly, there will be a bigger need for small cells, small city sites, for which we have various solutions which can be customised based on city requirements. We have already created customised solutions for clients in Saudi Arabia, UAE, Bahrain and Oman. When developers are focussing on a specific property or land, we can adapt our offering and work closely with their team to come up with a bespoke solution.

So in terms of 5G we can do the small cells and city solutions, and we can do upgrades to existing sites if needed as well. Whether city sites or rural sites, we do telecom installation, indoor solutions and mobile solutions as well<

4!

Abu Dhabi Police Tower - Implemented Sites


Micro Turbine technologymakes once a year site maintenance visits a realityCost effective innovative solution has up to 8,000 hour service intervals, is cleaner, quieter and can use multiple fuels including diesel, kerosene or paraffin or a mixture to reduce costs and deter fuel theft by up to 70%

TowerXchange: Where does Bladon Micro Turbine fit in the telecoms infrastructure ecosystem?

Stuart Kelly, VP Market Development, Bladon Micro Turbine: 2019 has been a breakthrough year for Bladon. After 10 years of heavy investment in R&D and 2 years of field trials we have deployed our microturbine technology on telecom sites in Africa, Australia and Europe, more specifically South Africa, Uganda and in the UK where our factory is based. A Micro Turbine Genset (MTG) is an evolutionary step in replacing conventional diesel gensets that are deployed in thousands of off grid and bad grid sites. Without making any drastic changes in business process, supply chain or taking a risk on new technologies towercos can drastically reduce their daily fuel and maintenance costs and see those reductions immediately. The MTG’s superior reliability and performance along with its multi-fuel capabilities nicely positions it to be the ideal replacement of noisy, inflexible and high maintenance diesel generators. Bladon’s MTGs are ultra-quiet, cleaner and greener, which is critical for towercos and mobile network operators alike that have strong corporate social responsibility and environment friendly agendas.

Gas turbines aren’t new. This is a 70 year old technology, and is the method of choice for providing ultra-reliable power as a utility to millions of people and businesses globally. Bladon has innovated the application of turbines to telecom tower power by making a microturbine fit into the space where normally diesel gensets are situated.

Read this article to learn:< How Bladon harnessed the power of microturbines for telecom power solutions< The advantages of Micro Turbine Gensets (MTGs) over conventional DGs< How the product addresses the weakness in all hybrid genset solutions – reinventing the diesel genset< More about the ultra-low maintenance solution: no engine oil, no water, only one moving part< The importance of an energy efficient solution that compliments your existing supply chain – MTGs can run on almost any liquid or gas fuel< Time to breakeven/crossover in different scenarios, compared with traditional DGs< Details of the World’s first Stage V emissions standard compliant diesel genset (12kW)

It’s not often TowerXchange comes across a genuinely innovative alternative to a traditional diesel genset that provides primary or backup power to many emerging market cell towers, but when we heard about Bladon’s Micro Turbine gensets (MTG), we had to find out more! While the MTG is cleaner and quieter than a traditional DG what makes the MTG particularly interesting to towercos is the fact that they require as little as once a year maintenance. A key business requirement we continuously see from mobile operators and towercos is to reduce site visits to once a month or less.

Keywords: Africa, Bladon, Bladon Jets, Bladon Micro Turbine, Energy, Vendor Directory, Who’s Who, South Africa, Uganda, UK


Our secret sauce is not so much a new technology as a manufacturing methodology that enables us to produce microturbines economically in volume. One of our most important manufacturing techniques is a process to cut turbine blades from a single piece of material. We’ve been able to manufacture to a price point such that our MTGs are commercially viable compared to reciprocating diesel gensets.

TowerXchange: Which telecom markets are you targeting and why?

Stuart Kelly, VP Market Development, Bladon Micro Turbine: The amount of activity in rejuvenation, investment and growth in the telecom tower market is most impressive in Africa, especially sub-Saharan Africa. We have conducted field trials in Africa over the last 2 years and learned valuable feedback working with our distribution partner Abbott Technologies. Some of our MTGs have been running nonstop for over a year now without ANY filter changes or servicing. Whether an MTG is deployed as a primary power or hybrid installation servicing the MTG will be maximum once a year. That’s a really compelling proposition to towercos that are crippled with genset maintenance costs.

We have attended TowerXchange Meetups around the world to share Bladon’s vision with MNOs and towercos. With so many assets changing ownership in Africa, there is a new focus and financial drive to leverage tower assets harder. When towers are bought, or being prepared for sale, audits often reveal the assets aren’t operating as efficiently as

the owner might have thought. But the new owners don’t want to create too much turbulence in the supply chain, so it’s important that our solution complements the existing energy supply chain in developing markets. The Bladon MTG allows MNOs, ESCOs and towercos to evolve their energy strategy, take advantage of unique opex savings methods without drastically changing the business model or increasing their energy capex budgets.

TowerXchange: Tell us about your solution’s maintenance requirements.

Stuart Kelly, VP Market Development, Bladon Micro Turbine: Microturbine engines are an ultra-low maintenance solution. Unlike a diesel reciprocating engine, there is no engine oil and no liquid coolant. The turbine itself consists of just one moving part, which runs on air bearings. Maintenance


is a key issue at remote sites that might be many hours’ drive on a bumpy road – the cost to get there can increase the TCO – so a technology with the potential to dramatically reduce site visits can be very compelling. There is a very low skill requirement to maintain our MTGs – in the highly unlikely event of a turbine failure, our strategy is remove and replace, not rebuild onsite. For lesser maintenance issues, such as filter changes, the O&M subcontractor can readily maintain a stock of fuel and air filters.

As well as reducing fuel and maintenance costs, thieves are less inclined to steal our MTGs as there are few, if any parts, they can recycle. Aspiring ESCOs that are currently in the business of maintaining traditional diesel gensets have an opportunity to profit handsomely by deploying a more reliable solution like ours – their goal of selling at a price per kWh rate becomes more achievable. Our MTG unit has robust telemetry built in, so you need fewer field engineers as many of the MTG settings can be changed remotely. From the NOC you can see if units are operating outside of their tolerances, enabling preventive maintenance rather than waiting for it to break. Also, and not insignificant for the tower operator, is the use of telemetry to know where the unit is, as well as having the inbuilt electronics to stop the unit operating if moved without permission – the same technology as a tracker system on a car. We have standardised also on the DeepSea Controller 7320 MKII to make it even easier for towercos and MNOs to fold the MTG into their estate and manage it through their NOC will minimal disruption.

TowerXchange: Okay, so what are the advantages of microturbines over other alternate energy solutions such as fuel cells or solar?

Stuart Kelly, VP Market Development, Bladon Micro Turbine: There is no reliable or sustainable supply chain to support hydrogen or methane fuel in Africa yet. As a technology that is hostile to the current supply chain, the practical challenges of keeping fuel cells running are prohibitive

to embracing that particular alternative energy solution in more than perhaps 20% of the estate. We don’t see our solution as an alternative to a 200sqm PV array but complementary to configurations using renewable technologies; our solution is so much more compact that the use cases differ significantly. Solar has to be a part of the future, but in the context of telecom towers it’s not a killer app, it’s a point solution. Our MTGs can be used to smooth power from solar as well as replacing a chugging tractor engine based generator.

We don’t see our solution as an alternative to a 200sqm PV array but complementary to configurations using renewable technologies; our solution is so much more compact that the use cases differ significantly. Solar has to be a part of the future, but in the context of telecom towers it’s not a killer app, it’s a point solution


But the important thing is that this is an evolution not a revolution – the MTG can be adapted to any local fuel supply resource. Bladon gensets, in keeping with all turbine based solutions, run on a wide range of fuels, including green alternatives such as natural gas and biofuels as well as diesel and kerosene. Bladon MTGs will also tolerate a blend of fuels like diesel mixed with kerosene thus making the mix useless for thieves planning on using it for other diesel engines.

TowerXchange: How does the capital outlay for your MTGs compare to traditional DGs, and

when does the Total Cost of Ownership (TCO) crossover?

Stuart Kelly, VP Market Development, Bladon Micro Turbine: The capital outlay for an MTG is currently slightly higher than a quality diesel genset solution, but the price difference is a double not triple digit percentage. Running for 12 hours a day in SSA in 30° heat then within 15-19 months the TCO will crossover having recovered the difference in capital outlay through fuel and maintenance cost savings.

TowerXchange: How near are your MTGs for telecom to being a market-ready solution?

Stuart Kelly, VP Market Development, Bladon Micro Turbine: Bladon deployed its first commercial MTG’s in Africa in 2019. More specifically in South Africa with one of the largest TowerCo’s and MNO’s there. We have also expanded into Uganda, and soon into Nigeria, Kenya, Egypt. We’ve signed distribution agreements already with partners in Africa and now Australia. Our production factory headquarters is also where our R&D team is based; in Coventry, UK.

TowerXchange: What is the sweet spot in terms of the load your solutions can support?

Stuart Kelly, VP Market Development, Bladon Micro Turbine: Our Bladon MTG12 MTG delivers up to 12kW, with 230V AC output. Most telecom sites need somewhere between 3kW and 6kW for constant power, maybe 9kW if there is air-

conditioning units too. Hybrid solutions have been deployed to address avoiding DG maintenance intervals. This is not an issue with the MTG, therefore the application varies somewhat and doesn’t need large banks of batteries (that can be open to theft). The MTG runs at variable speed to match the load, our efficiencies are much better at partial loads compared to conventional DGs.

TowerXchange: How do you ensure modularity and futureproof your solution as power requirements increase with the addition of multiple tenants?

Running for 12 hours a

day in SSA in 30° heat then

within 15-19 months the

TCO will crossover having

recovered the difference

in capital outlay through

fuel and maintenance cost

savings


Stuart Kelly, VP Market Development, Bladon Micro Turbine: The MTG works more efficiently at very low powers that you see with single tenant sites (and can cope with temporary zero loads) than regular DGs. Given that telecom radio manufacturers are trying to drive power consumption down, e.g. a new BTS might need 1kW when the last model needed 2kW many sites start off at low powers then increase with additional tenants or technologies like 5G. But rather than specify massive DG’s that run inefficiently at first it’s important to ensure CAPEX expenditure and opex is matched closely to operator revenues. At the moment the applications, especially for new sites or offgrid sites we see don’t consume more the 3kW in total, so it’s possible to add a second tenant without upgrading the MTG. The MTG is a more reliable means of delivery of consistent power than a conventional DG for a multi-tenant site. If additional tenants are added beyond what one MTG can provide, the answer is to add a second unit in a daisy chain. And if the power requirement reduces again, our units are relatively easy to relocate to another tower.

TowerXchange: How do you bring Bladon Micro Turbine to market – do you sell direct or through channel partners?

Stuart Kelly, VP Market Development, Bladon Micro Turbine: Our model is to sell through partners. Towercos, ESCOs and MNOs need the reliability and credibility of boots on the ground to provide dedicated in country support, even with a low

maintenance solution such as ours. We are targeting key managed service providers on the front lines of tower builds, upgrades and maintenance, with the objective of creating a pipeline for thousands of unit sales.

TowerXchange: Finally, please sum up how you would differentiate Bladon Micro Turbine from other cell site energy solution providers.

Stuart Kelly, VP Market Development, Bladon Micro Turbine: We’ve taken a well-known form of power generation in the reciprocating engine, turned it on its head and married it with another established

technology in gas turbines, then developed a manufacturing process to bring to market an innovative solution with a lower TCO business case for telecom tower operators. Microturbine engines are ultra-reliable, super durable, low maintenance, and generally have a ROI runway in Africa from 9 to 19 months. The MTG is designed to support the current supply chain, which means our solutions can be easily introduced with an expectation of a short term payback. The fact that it’s an exciting new engine technology is only so interesting – what matters is reducing fuel bills and theft, and the ability to operate it into the field easier and cheaper than a regular diesel genset<

Sample – Telecom tower 3 year OPEX savings

$60,000

$50,000

$40,000

$30,000

$20,000

$10,000

DG MTG - diesel

Fuel costsMaintenance costs

MTG - kerosene


Keywords: Byrne Equipment Rental,

Capex, Energy, Energy Efficiency, Middle

East, Multi-country Partner, Off-Grid,

Opex Reduction, Rental, RoI, United

Arab Emirates, Unreliable Grid, Uptime

What Byrne Equipment Rentalcan offer the MENA tower industryWith nearly 30 years’ experience in the Gulf, Byrne Equipment Rental are natural partners to the industry in the region

TowerXchange: Please introduce Byrne Equipment Rental, your history and footprint.

Steve Caygill, Regional General Manager, Byrne Equipment Rental: Byrne Equipment Rental is the most diverse supplier of rental equipment across the GCC, with 20 operational bases, a fleet of over 14,000 items of plant and a team of 1500+ people.

The company offers high quality equipment rental solutions to a broad variety of sectors including but not limited to: Oil & Gas, Construction & Infrastructure, Events, Industrial & Manufacturing, Retail & Commercial and Marine & Ports.

TowerXchange: Tell us about the range of gensets you provide – KVA, AC or DC, variable speed etc.

Steve Caygill, Regional General Manager, Byrne Equipment Rental: Our rental generators range in size from 6kVA to 1650kVA and have the capability to scale up to multi-megawatt power plants.

Available for a variety of environments, from concerts to construction sites to camps, our power generation equipment can be adapted to meet a variety of needs and is available for short or long-term hire. In addition, we can supply complete power packages if required, including secondary power distribution and transformers, bundled fuel tanks, drip trays, and cables.

Our in-house technical team can also provide a pre-hire advisory service to ensure our clients requirements are carefully specified with an appropriate fuel management plan, supported by our sister company Byrne Yas Petroleum.

Read this article to learn:< Byrne Equipment Eental’s experience in the GCC

< The power equipment available from Byrne Equipment Rental

< How Byrne Equipment Rental can take away telco power hearaches

< Next steps for Byrne Equipment Rental

Having operated across the GCC for almost 30 years, Byrne Equipment Rental understand the region’s climate issues and ensure their extensive fleet of equipment can support their client’s requirements in the Oil & Gas, Medical and Telecommunication sectors. TowerXchange caught up with Steve Caygill, Regional General Manager and one of the experts Equipment Rental’s offerings are relevant for the telecom tower sector.

Steve Caygill, Regional General Manager, Byrne Equipment Rental


TowerXchange: Resilience is becoming increasingly key for telecoms networks across the world. What do you see as the main threats to uptime in MENA, and how can this be combatted?

Steve Caygill, Regional General Manager, Byrne Equipment Rental: It’s a collection of everything, mobile network operators find themselves executing elements which are not in their core focus. It’s a core focus for us, and the challenge is acquiring and depreciating assets not delivering full useful life. They must be suited for the GCC market where you have a lot of heat, humidity & dust, of which have a massive impact on how well assets perform, meaning assets are carrying cost and overhead beyond useful life.

We see this solution as taking away all that headache and hassle.

TowerXchange: Can you tell us more about your plans for the future and where you see the business going?

Steve Caygill, Regional General Manager, Byrne Equipment Rental: Byrne Equipment Rental is entering into a new phase having built a strong brand identity, an extensive infrastructure covering the whole GCC, the widest mix of equipment promoting the ‘one-stop-shop’ concept, experience of over 25 years in the region, extensive supplier arrangements, and systems and procedures that have survived the test of time.

With the latest major economic changes in the region, towards further anticipated substantial growth in the coming years, Byrne is well placed to expand our existing business lines and open new business lines capitalising on our existing infrastructure in place

Byrne Equipment Rental is the most diverse supplier of rental equipment across the GCC, with 20 operational bases, a fleet of over 14,000 items of plant and a team of 1500+ people









The global telecompower supplierCaterpillar provides the equipment which keeps digital infrastructure running, and they have more to offer for 5G and telecom infrastructure convergence

TowerXchange: Please briefly introduce Caterpillar, and your history supplying the telecom industry.

Neil Smith, Sales Manager - Europe Africa Middle East, Caterpillar: Caterpillar is a global leader in supplying and servicing equipment for the construction industries, resource industries and energy and transportation sectors. As a global business we are a Fortune 100 company, one of the thirty on the Dow Jones Industrial Average and have also been named to the Dow Jones Sustainability Indices. In addition to physical products and parts and service support, we also have a financial products business which supports our dealers and customers.

In the energy sector we are a recognised world leader in diesel and gas engines, industrial gas turbines and increasingly in renewable energy solutions. It is our Electric Power Division which works most closely with the telecoms industry, having powered tens of thousands of towers across the world, and also powering many of the data centres that support mobile data.

In the tower industry we have supplied generator sets and hybrid systems for many years, initially working directly with operators, and then through the growth of the towerco industry. When the industry was being built in the Middle East and Africa we already had dealers in place to provide local expertise and service support (and often provided logistical and security support in the very early days of GSM rollout).

Read this article to learn:< Caterpillar’s global footprint and years of experience

< Cat dealers’ ESCO offerings

< How data centre experience can help in telecom sites

< How Caterpillar is responding to 5G

Caterpillar is a global leader in energy equipment for many sectors, including telecoms. In the tower industry they have supplied generator sets and hybrid systems for many years. As well as powering cell sites, Caterpillar has also been a leader in the data centre industry since its birth, powering much of the digital infrastructure the world relies on today. As the world transitions to 5G increased power demand will lead to some very interesting challenges, and an increase in the commonalities of the two spaces. Caterpillar, and its dealer network, have been offering remote asset management, and ESCO-like services for many years, and will play a major role in telecom tower power for years to come. TowerXchange speaks with Neil Smith, Sales Manager - Europe Africa Middle East and their plans for the sector.

Keywords: 5G, Caterpillar, Data Centre, ESCOs, Edge, Energy, Energy Efficiency, Hybrid Power, Multi-Country Partner, Off-Grid, Unreliable Grid, Who’s Who

Neil Smith, Sales Manager - Europe Africa Middle East, Caterpillar


TowerXchange: Caterpillar has a global presence through its dealer network, can you explain the benefits to customers of this route to market?

Neil Smith, Sales Manager - Europe Africa Middle East, Caterpillar: Caterpillar has a network of 168 dealers serving 193 countries, some of whom have been with Caterpillar for generations – for example our dealer in Lebanon celebrated its 90th anniversary as a Cat® dealer this year. Our global presence means we can assure the same level of support to telecom customers expanding into new markets, almost wherever they go they will find an active Cat dealer with world class support services and infrastructure.

Many of these dealers are major companies in their own right, with the financial strength, logistical networks and local knowledge to allow growing customers to quickly scale up their operations in new places.

TowerXchange: 5G is driving a convergence in digital infrastructure, how is Caterpillar reacting to this trend?

Neil Smith, Sales Manager - Europe Africa Middle East, Caterpillar: Caterpillar has been a leader in the data centre industry since its birth, and we power much of the digital infrastructure the world relies on today. As we are also heavily involved in the telecom tower industry globally, we can see a lot of commonalities in the two spaces. Uptime is critical across the network. Both mobile

networks and data centre infrastructure are seeing continuous growth in demand, and in capital expenditure.

The hosting of cloud data in co-location data centres and co-location of mobile networks by towercos are driven by the same economic drivers. The Caterpillar approach in both industries is to work with end users or service providers to support

critical uptime requirements with solutions that optimise life-cycle costs. The optimum solution in most cases will be a combination of product and services, often including financial services.If, as expected, the rollout of 5G requires our customers in the mobile industry to become data centre operators as well as tower operators we already have the expertise to help them be successful in that transition.


TowerXchange: How do you see power requirements at cell sites changing with green agendas and increased data consumption in the 5G-era?

Neil Smith, Sales Manager - Europe Africa Middle East, Caterpillar: We have all seen over the last decade the transition of cell sites in the MENA region from being diesel powered to being mostly hybrid powered, which is driven as much by economics as by any green agenda. However, the increased power demand of 5G could lead to some very interesting challenges. Increasing solar power supply on existing tower sites could be difficult given the space claim requirements of larger panels, which could lead to a greater use of diesel power in the mix.

At the other end of the scale, the potential for more distributed small cell coverage in cities, which would appear simple in developed markets with reliable grid power, could prove challenging in some of the MENA markets where reliable power supply is an issue.

The optimum solution will probably not be a “one size fits all” 10kW base station. We are likely to see power supply changes in existing infrastructure, and possibly see much more distributed power supply for new 5G infrastructure depending on the approach to cell sizes in different markets. As a supplier of power to the industry we know we will need to be flexible and support a wide range of products to support the divergent demands in power requirements.

TowerXchange: What has driven Caterpillar’s focus on service innovation in addition to product innovation? Can you give us a couple of examples?

Neil Smith, Sales Manager - Europe Africa Middle East, Caterpillar: Caterpillar has a long history of innovation and constantly invests in research and development, not just in products but also in service provision. As an example, our dealers have been using remote monitoring to support service operations for decades before it became industry standard – I recall myself using a system before the mobile phone revolution where generator sets would contact service technicians by pager or even in one case with a connected fax machine!

Of course, the use of modern communications makes remote condition monitoring much more straightforward and we are continuing to roll out Cat Connect throughout our product range to improve efficiency in asset management and service support.

Our remote monitoring tools now connect to a range of other service innovations – from mobile apps designed to allow operators critical data at their fingertips, to fluid sampling laboratories which monitor oil and fuel for signs of component wear which allows repair before failure and improved uptime.

TowerXchange: How can towercos use your remote monitoring and data collection systems to improve uptime and site autonomy?

Our remote monitoring tools now connect to a range of other service innovations – from mobile apps designed to allow operators critical data at their fingertips, to fluid sampling laboratories which monitor oil and fuel for signs of component wear which allows repair before failure and improved uptime


Neil Smith, Sales Manager - Europe Africa Middle East, Caterpillar: The Cat Connect system allows towerco asset managers to receive and share information about their assets in real time. Customised dashboards and web-based maps allow a view of the whole fleet, whether in the office or out in the field, allowing maintenance and service operations to be planned out proactively and in a timely manner. The dashboards can be configured to focus on key assets, or on critical KPIs to make fleet management simpler.

Where the system really differentiates itself is in Preventative Maintenance Planning, which can be either time based or condition based depending on the mode of operation and is based on millions of hours of operating experience of Cat equipment. The Cat Connect system allows the towerco asset manager to leverage the expertise of Caterpillar and the dealer organisation to optimise life cycle costs and improve equipment efficiency and life expectancy.

TowerXchange: Your dealers have been offering Cat products on rental and ESCO-like basis for some time, do you see opex-based offerings as an important growth area?

Neil Smith, Sales Manager - Europe Africa Middle East, Caterpillar: We see opex-based offerings as an important growth area across our business, not just in telecoms. Businesses want to use their capital in their core business and leave the owning and operating of supporting infrastructure such as power supply to experts in the field. In the telecoms industry we expect this demand to grow rapidly as

operators apply themselves to the capital intensive development of 5G infrastructure.

Cat dealers have a long history of offering rental or financed solutions to our customers in many industries, and in the electrical power industry many are used to offering contracts based on hours run or cost per kWh. Cat dealers can offer a menu of options to customers, from simple equipment purchase, repair and maintenance contracts, equipment rental to full power supply contracts. In fact, after the discussion on ESCOs in last year’s TowerXchange MENA meetup, one of our dealers commented that they had been working as an ESCO in telecoms for over a decade, they just didn’t realise it was a new thing!

TowerXchange: How would you summarise the approach Caterpillar is taking to telecom power, and how does it differentiate you from your competitors?

Neil Smith, Sales Manager - Europe Africa Middle East, Caterpillar: Caterpillar’s approach to the telecom industry is rooted in our history of providing solutions to help our customers be successful. We were in at the start of the mobile telecoms industry, and in at the start of the data centre industry. We know we can only be successful and grow if our customers are successful and grow. We want to build long partnerships with the people in this industry as it goes through continued radical change, and we will do that by applying the combined experience, expertise and financial strength of our global family of Caterpillar and Cat dealerships<









Keywords: 5G, Asia,Batteries, DG, DG Runtime, EnerSys®, Energy, Energy Efficiency, Fuel Cell, Hybrid Power, Interview, Meetup Preview, Off-Grid, On-grid, Operational Excellence, Opex Reduction, Renewables, SLA, Solar, Unreliable Grid, Uptime, Who’s Who, Wind

Backing up towers in the MiddleEast and North Africa: EnerSys®’ sophisticated battery solutionsSupporting the rapidly evolving tower industry with bespoke backup solutions

TowerXchange: Please introduce EnerSys®, your footprint and your offering to the Middle East and African markets.

Yamen Saleh, Business Development Manager, EnerSys®: We are the global leader in stored energy solutions for industrial applications. We manufacture and distribute energy systems and motive power batteries, battery chargers, power equipment, battery accessories and outdoor equipment enclosure solutions to customers worldwide.

EnerSys® offers an extensive portfolio of premium flooded and sealed batteries to serve the telecom industry. This portfolio of batteries offers design features such as exceptional performance, long life, compact footprint, high energy density, and ease of installation. Our batteries are ideally suited for a wide range of wireline and wireless telecom applications, including central office and outside plant. We also offer outdoor equipment enclosure solutions.

EnerSys® maintains its position by providing customers with world-class products and services from over 100 countries through its sales and manufacturing locations around the World, and has a comprehensive local infrastructure with a regional head office in Dubai for sales, applications and logistic support.

TowerXchange: How does your experience in Middle East and North Africa differ from the other markets you operate in?

Read this article to learn:< EnerSys®’ offerings for global and MENA tower owners

< How the MENA backup power market differs from the rest of the world

< Backup power considerations for on-grid, unreliable grid and off-grid

< Case study demonstrating TCO savings up to 55%

With operating costs becoming a key issue for tower owners, choosing the right backup power solution is an increasingly important task. With variables in location, climate, budget, maintenance and deployment, choosing the right battery and cooling options to keep the total cost of ownership (TCO) to a minimum can be tricky. EnerSys® talk us through their experiences in the Middle East and North African markets and how they work with customers to choose the most efficient solutions to meet their requirements.


Yamen Saleh, Business Development Manager, EnerSys®: The European and North American markets are very established and have relatively reliable power. In the Middle East and North Africa, of course it is very different and we see a wide variation in the operating conditions and power reliability across the region. This in turn means we have to develop customised solutions that are uniquely suited to the conditions and requirements of particular customers and geographies.

TowerXchange: What are the considerations that tower owners need to keep in mind when choosing a backup solution in on-grid, unreliable grid or off-grid environments?

Yamen Saleh, Business Development Manager, EnerSys®: Each of the scenarios listed presents their own unique challenges to the backup power system as well as opportunities for cost savings and minimising TCO.

For on-grid systems, the main consideration is typically how to maximise battery life whilst also minimising the power usage on the tower. For this we would typically propose reducing or completing disabling the cooling system and using a backup battery specifically designed for operations at high temperatures. The new EnerSys® PowerSafe® SBS® XL battery range is ideally suited for stable grid conditions (typically one outage per month) and using our Thin Plate Pure Lead (TPPL) technology has a life expectancy of ten years at a temperature of 35°C.

On the other hand, off-grid systems have been successfully powered for some time now by a hybrid mix of batteries, diesel generators and increasingly some kind of renewable energy source (solar, wind et cetera). This kind of system brings unique challenges to the battery system and our research has shown that the lowest operating costs can only be achieved by using the full capacity of the batteries on a daily basis to minimise diesel genset runtime. This means the batteries need to have the capability to cycle deeply and recharged quickly – something that our tried and tested PowerSafe® SBS® EON Technology® range of batteries has been specifically designed for. In addition, with EnerSys® PowerSafe® SBS® XC+

technology, which incorporates carbon chemistry with our proven TPPL technology, further benefits in TCO can be obtained with longer service life, due to increased cycle capability, while reducing OPEX with Partial State of Charge (PSoC) operation.

Finally, in unreliable grid environments towers are typically supported by a combination of batteries and diesel gensets with renewable energy solutions often incorporated. The random reliability of the main system means batteries have little time to recharge from the power grid and that generators need to run every day to either support the tower once the batteries are discharged and/or recharge the batteries themselves.

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Off-grid systems have been successfully powered for some time now by a hybrid mix of batteries, diesel generators and increasingly some kind of renewable energy source (solar, wind et cetera). This kind of system brings unique challenges to the battery system and our research has shown that the lowest operating costs can only be achieved by using the full capacity of the batteries on a daily basis to minimise diesel genset runtime


The key challenge here is therefore how to minimise the runtime of the diesel gensets that are one of the biggest contributors to the tower operating costs – typically far more than the cost of batteries. For this kind of application our new PowerSafe® SBS® XC battery range is ideal as it combines an outstanding fast charge capability with the ability to achieve an exceptional number of cycles; the modelling work we have done shows it can give tower owners TCO savings in the range of 30 to 50%.

The most effective TCO savings will depend very much on the site operating conditions and power reliability. However, choosing a battery that is designed for the site conditions can definitely deliver TCO savings to tower owners. The highest savings typically come from reducing the cooling load on the tower or from reducing or even eliminating the runtime on costly diesel generators – and the key enabler to this can be choosing the optimum battery solution.

The highest savings typically come from reducing the cooling load on the tower or from reducing or even eliminating the runtime on costly diesel generators – and the key enabler to this can be choosing the optimum battery solution.

TowerXchange: Can you share a case study illustrating how you helped your clients achieve desired outcomes?

Yamen Saleh, Business Development Manager, EnerSys®: A recent project has been looking at

potential TCO savings for a tower owner in an extremely unreliable grid environment. In this instance, each tower is usually equipped with at least 600Ah of battery back-up, but even that is not enough to cover for the many power outages in an average 24-hour period.

Typically, the batteries are completely discharged within eight to ten hours a day, meaning the diesel generator needs to be run for the remaining 14 to 16 hours of every day. This is obviously bad from an environmental perspective, noisy for the community nearby and of course it involves significant costs related to the fuel, maintenance and service of the genset.

After assessing the application, we realised that the perfect solution would be a battery that has both an outstanding fast charge capability and excellent cycling. We already knew that our TPPL technology had the potential for industry leading charge acceptance, so we decided to optimise its design even further.

Our target was to design a product able to maximise its recharge while the power is on, enabling the battery to be ready for the next outage. If enough recharge current is available, it’s even possible to design a system that relies totally on battery backup on a standard day. The result of this work is our brand new PowerSafe® SBS® XC battery range that we have just launched.

Based on the load details that were provided to us by the tower owner, we estimate that TCO savings of

up to 55% can be achieved compared to traditional lead acid batteries.

TowerXchange: Looking forward, what do you think will be the power priorities for MENA tower owners as 5G and network densification requirements increase?

Yamen Saleh, Business Development Manager, EnerSys®: While 5G standards are not yet fully defined, increases in power demand have been highlighted. The evolving infrastructure needs seem to be trending towards a larger number of smaller, but denser tower sites. We expect this to drive demand for new, innovative power solutions.

TowerXchange: Can you give us some insight into EnerSys®’ vision for the future and how you will fit into this evolving market?

Yamen Saleh, Business Development Manager, EnerSys®: We believe experience in providing power backup in mobile communications is very important. The mobile network has a critical dependence on available power and backup regardless of the reliability of the local grid. EnerSys® is a powerful solution provider and a trusted partner in backup power solutions. Hence, we are in a unique position to use our experience and unique technology solutions to help and continually support tower companies to back-up their mission critical equipment in the most cost-effective way


Keywords: 5G, Energy, Energy Efficiency, Enetek Power, Hybrid Power, On-Grid, Passive Equipment, Rectifiers, Who’s Who

Safe and reliable power for telecoms towersEnetek, an AC and DC power specialist, tailors solutions to the increasingly demanding requirements of telecom sites

TowerXchange: Please introduce yourself – how did you get involved in the telecoms infrastructure industry?

Jan Rønsen, Vice President, Enetek Power: I entered telecoms in 2000 with Eltek, just while the TMT bubble burst. Luckily at that time Eltek was not involved in the datacentre space so we were not that badly hurt at the time, unlike others. Eltek was focused on core telecoms at that period.

My background was in the manufacturing industry, not telecoms, but in 2002 I was asked by the CEO to take up the Middle East and Africa market for Eltek and I moved to Dubai, where I have stayed.

TowerXchange: Please introduce Enetek – can you tell us more about the history of the firm?

Jan Rønsen, Vice President, Enetek Power: In 2015 Eltek was acquired by Delta and Enetek was formed to continue our work under another brand. This means that for a young company Enetek has a long history. The owner of Enetek is Eltek Holdings, which is managed by the family who started the original Eltek in1973.

Enetek is a company under Eltek Holding AS, Norway. Enetek has a long legacy in the telecom power industry. Our staff, from CEO, CFO and CTO to Sales, Admin and R&D engineers are recognised as some of the best and most successful names in the business.

The operational HQ of Enetek is located in Singapore. However, the corporate HQ is in Oslo,

Read this article to learn:< The long experience embodied in Enetek’s staff

< Enetek’s origins and unique selling point

< The range of energy equipment supplied by Enetek

< The growing importance of rectifiers in a 5G world

Enetek is a supplier of AC and DC power equipment. Enetek’s power solutions offer modularity, flexibility, and scalability through rack-mounted, hot-pluggable power conversion modules, smart monitoring and effective customisation. With Gulf states increasingly installing large numbers of power-hungry 5G base stations, good quality rectifiers and upgraded power set-ups at site will become more important. But without secure, efficient and reliable power it is impossible to consistently fulfil SLAs and keep sites online. TowerXchange discussed Enetek and what differentiates them from their competitors with the VP, Jan Rønsen.

Jan Rønsen, Vice President, Enetek Power


Norway, from where we are also supporting the EMEA market through our network of certified partners.

TowerXchange: Please tell us how many Enetek Power telecom systems have been deployed across the world, where and with who?

Jan Rønsen, Vice President, Enetek Power: We don’t give current numbers, but our staff has deployed more than 10,000 hybrid sites, from past experience. Around 99% of our staff comes from Eltek which means that all of that experience is embedded in how Enetek work.

Our staff has successfully completed power projects all over the globe for the past 25 years. We strongly believe we can serve our customers with the best products and support. Together with our partners, we will train technical staff across the country to ensure a smooth and trouble-free network operation.

TowerXchange: Tell us about the range of products you provide for the telecoms sector.

Jan Rønsen, Vice President, Enetek Power: Our power solutions are capable of safeguarding telecom assets for numerous different applications with flexible, modular and scalable system building blocks.

Typical applications include the main switching centers, core network power, wireless/wireline, macro/micro BTS, LTE/Wimax, broadband access, FTTX, optical fibre transmission system as well

as remote power sites. Enetek also has a range of hybrid/solar solutions for off- and on-grid, significantly reducing the runtime of generators.

A power system solution comprises of essential component that includes the rectifiers, batteries, system controller, inverters as well as uninterruptible power supplies (UPS), and they are designed for easy connectivity with renewable energy sources.

TowerXchange: Why are rectifiers so important for keeping sites active and hitting towerco SLAs?

Jan Rønsen, Vice President, Enetek Power: In a basic DC power system, the rectifier converts AC to DC to provide power necessary to sustain the output load and charge the batteries. Where AC power is required, the inverters will be used to convert the DC into uninterruptible AC.

The system controller provides the relevant control, monitoring and management of the system solution and site infrastructure to maximize ROI, minimise TCO and secure near 100% uptime.

Our products have been successfully tested in extreme environmental conditions; heat, frost, dust and humidity. All to make sure that our customers will receive exceptional reliability wherever our systems may be deployed.

With continued advancement of technologies and through strategic collaborations with industries’ stakeholders, we aim to achieve the goal of delivering one-stop solutions.

TowerXchange: 5G will increase power demand and change requirements at site, how can Enetek help?

We are well prepared for 5G, but the demand for these solutions is currently weak. Outside of China the demand for new rectifiers and reconfigured sites for 5G is limited. At the moment MNOs are mostly relying on their existing power set-ups, but that will change. From 2021 onwards increased use of Massive MIMO and densification of networks will see a boom in demand for rectifiers which are ready for 5G


Jan Rønsen, Vice President, Enetek Power: We have developed our own rectifiers for 5G, a small one based on working with lithium-ion batteries with a range of 1kW-3kW. But they can be serialled if our customer has larger power requirements for high capacity sites.

We are well prepared for 5G, but the demand for these solutions is currently weak. Outside of China the demand for new rectifiers and reconfigured sites for 5G is limited. At the moment MNOs are mostly relying on their existing power set-ups, but that will change. From 2021 onwards increased use of Massive MIMO and densification of networks will see a boom in demand for rectifiers which are ready for 5G.

TowerXchange: Please sum up how you would differentiate your solution from your competitors’?

Jan Rønsen, Vice President, Enetek Power: In some markets it is difficult to differentiate, power supply equipment is seen as basically a commodity. But we are small enough to be flexible, and big enough to deliver.

Most of the large companies provide standardised solutions, which is great for a commoditised product, but means it is very hard to get customised solutions from Enetek’s competitors. And if you need something non-standard then lead time goes dramatically up.

But because we are somewhat smaller, we can provide flexibility, which is a differentiator. But because we still have scale and expertise our lead times remain short, just 6-8 weeks. So lead times are a key differentiator, but without sacrificing on the high efficiency necessary for rectifiers and other power supply equipment

Because we are somewhat smaller, we can provide flexibility, which is a differentiator. But because we still have scale and expertise our lead times remain short, just 6-8 weeks. So lead times are a key differentiator, but without sacrificing on the high efficiency necessary for rectifiers and other power supply equipment









GRIDSERVE steps upinnovation with enhanced modular hybrid energy solutionThe new SEC12 will be even more secure, reliable and flexible

TowerXchange: Please re-introduce yourself and GRIDSERVE to the TowerXchange community.

Richard Hallas, General Manager – Telecoms, GRIDSERVE: With all the growth and exciting developments that have taken place over the last year with GRIDSERVE, a re-introduction is well warranted! Group progress continues at breath taking pace with major industry-defining achievements being posted across all three of our product solution verticals.

GRIDSERVE made headlines earlier this year by being the first company to crack genuine subsidy-free solar projects at scale in the UK. The technical and commercial landmark innovations that have led to this pioneering position have been further fortified by the fact GRIDSERVE will end the year as the market leader for installed hybrid solar in the UK, the first one in my home town, with over 60mWp of the most advanced bifacial hybrid solar farms being developed, constructed, and in commercial operation.

This sector benchmarking was made further compelling by the announcements of GRIDSERVE’s Electric Forecourts programme. With the first site of 100 further sites announced and now going into construction in Braintree, Essex, these flagship projects are set to revolutionise renewably powered electric vehicle charging infrastructure. The UK government rubber stamped GRIDSERVE’s bleeding edge innovation efforts with a £5mn grant through its Innovate programme, and we remain really excited about commissioning Braintree for public use in April 2020.

Read this article to learn:< How GRIDSERVE’s flexible, modular approach enables their system to be sized and specified to

the site location

< The specific steps GRIDSERVE has taken to improve security

< How GRIDSERVE has made it easier to ship and install their systems

< How GRIDSERVE stand ready to enable innovations such as co-locating EV charging stations or

edge data centres with cell sites

GRIDSERVE turned a lot of heads when they brought the SEC12, their elegant turnkey plug and play solar hybrid energy solution, to TowerXchange last year. Attendees were impressed, but also gave GRIDSERVE a wealth of feedback to further enhance their offering. General Manager of Telecom Richard Hallas and his team will be demonstrating a new iteration of their SolarEnergyCentre at TowerXchange Meetups in Africa, Asia and MENA in the coming months. We spoke to Richard to find out what’s new.

Keywords: Africa, Asia, Batteries, Dimensioning, Edge, Energy, Energy Efficiency, Energy Storage, ESCOs, Fuel Security, GRIDSERVE, Hybrid Power, Installation, MENA, Renewables, Solar, Vendor DirectoryRichard Hallas, General Manager – Telecoms,

GRIDSERVE


Our Telecom and Remote power division has come to the party in a big way when it comes to the ambitious development pace that grips the company and its commitment to critical power improvements. This year’s TowerXchange shows will introduce an entirely new and enhanced version of the SEC12 that was so successfully toured with TowerXchange last year. We have supercharged the systems DNA with upgrades to just about every feature and are confident the market is going to be really impressed with how we have listened and responded in such timescales.

And as for me, I’m coming up on my first year with the group and what a year it’s been – I was brought on to take a lead on all activities related to telecom and remote power for GRIDSERVE and I’m over the moon at the progress we have been able to chart as a team. GRIDSERVE is a fast paced and dynamic environment, but I’ve been given the autonomy needed to really catalyse our development processes and this combined with my personal experiences over decades within the industry and that of my colleagues has all contributed to the strong pedigree of delivery that we have been able to achieve. If this is where we managed to navigate thus far, it makes for a thrilling next passage for this division of the company.

TowerXchange: GRIDSERVE made a huge impact when you brought the SolarEnergyCentre (SEC12) to the TowerXchange Meetups in Africa and Asia last year, and MENA earlier this year – how did attendees respond to the product and your proposition?

Richard Hallas, General Manager – Telecoms, GRIDSERVE: GRIDSERVE generated massive support for the SEC12 during and post the Africa, Asia and MENA TowerXchange events. We enjoyed some really first-class interactions with key stakeholders in the market and this invaluable discourse quickly became the foundation for our ongoing development and solution optimisation programme.

Security, reliability and flexibility have been the top three driving points we took from the previous TowerXchange events, and we have now incorporated major design advances into our next generation product. I am really looking forward to exhibiting the new version solution because we really have addressed these three key areas without

compromise. The results from our commercial, technical and logistical innovation will really move the needle. We are also very excited to unveil the latest iteration of the SEC12 in a new and innovative way to show how at GRIDSERVE we think very differently from other suppliers and draw on the powerhouse we have as a company for invention and design.

TowerXchange: GRIDSERVE is renowned for listening to your clients: what kind of feedback did the MNOs and towercos who saw the SEC12 at TowerXchange give you?

Richard Hallas, General Manager – Telecoms, GRIDSERVE: GRIDSERVE continues to address


attendees’ requirements and many of the enhancements within the new SEC12 model are as a direct result of clients' requests for specific features and capabilities.

Speaking more to the aforementioned focus being on security, reliability and flexibility; with security we have seen and heard first-hand the issues of battery and diesel theft, along with solar panel security, and made significant changes to further address these.

Reliability has been taken on from all angles to make sure we are using matched and compatible products and taking advantage of the features and functionality of each piece to ensure longevity and maintainability to a level where an annual routine check of the system is all that is needed.

One of the biggest concerns we hear is around the sizing of a unit for a site location. Many systems out there have fixed sizes that result in a site having to be matched to a system, rather than a system being match to the site requirements and conditions. With the flexible and modular approach that we have spearheaded it is possible to select the power core, solar module, and battery size depending upon the load requirements, site size, and solar possibilities, and all of these can be quickly ascertained from basic site information. We have a matrix selection where the ‘pick and pack’ of the new SEC12 elements can be simply performed, resulting in a standard system approach but with scalable modules. This way there is a focus on providing what product mix is needed and not what ‘one size fits all’ system is available.

TowerXchange: Can you tell us about some of the specific improvements you’ve been able to make in terms of security?

Richard Hallas, General Manager – Telecoms, GRIDSERVE: This latest version of the SEC12 includes exponential enhancements in security which include features such as 6-point heavy duty locking systems, concealed hinges, anti-intrusion door brackets, double lock protection cover, internal battery 6mm box with top cover locking system… the list goes on and on!

As well as the physical changes we have introduced, there are software changes too regarding sensors for anti-tampering of fuel and doors, through to options of CCTV and audible warnings that can be added. You will see on our system there are no external bolts or even heads of bolts, and a plinth that locks in the units. All anchor system connections are internal and not accessible from the outside of the unit. We will continue to enhance and upgrade security with each subsequent version and further develop the software and features around advanced reporting of issues.

TowerXchange: I also understand you have made substantial modifications enabling the product to be more easily shipped and installed as a site – what can you tell us about that?

Richard Hallas, General Manager – Telecoms, GRIDSERVE: The SEC12 is designed to be modular and highly mobile. We will be able to deploy the unit to site and deploy / commission within a day – this is a game-changer!

The unit is also specifically designed to support shipping container packing density optimisation, so we can reduce shipping costs and logistics cost in general.

Having a system which can be split down into modules allows more options for site delivery and reduction in the need for Hiab lifts and special delivery requirements. Designed with the remote deployment requirement in mind, we are able to address issues for an island site in Indonesia or a hilltop site in Uganda and not pass the issue to the installation company, but have the foresight to design for end to end deployment.

TowerXchange: We’re starting to see MNOs and towercos looking beyond cell site energy to explore how else they can support businesses and communities around towers. What can the SEC12 v2 do beyond providing power?

Richard Hallas, General Manager – Telecoms, GRIDSERVE: The SEC12 is an ideal platform to provide Edge Datacentre capabilities in parallel to the provision of power to off-grid telco and towerco sites. The possibilities are vast for businesses and communities once reliable power is available. Innovations at the nexus of the food, energy and water systems are part of the development strategy for the SEC12. We are already prototyping air to water generator systems run 100% from an SEC12, from here we are progressing hydro and aquaponic systems to address the needs of the developing world where we are already active with the telecom provision of power.


TowerXchange: Please sum up your vision for the SEC12 – how do you differentiate it from other, plug and play hybrid power cubes?

Richard Hallas, General Manager – Telecoms, GRIDSERVE: The SEC12 is uniquely placed to address telco and towerco's off-grid power requirements via a highly resilient (solar, storage, genset) design which incorporates a

comprehensive control and monitoring system, specifically designed to address the regulatory and compliance obligations of the telecommunications industry.

We are not a power cube but a power core made up of selectable modules which are picked and packed depending upon site requirements. The resulting system gives a standard look to a highly modular

approach. This way we don’t have a standard power cube model but have gone the additional layer where each part of the power core has the flexibility of design to scale as needed, and what we can call the wrapping of the system is all standard. Having an engineering design team that creates a productised system of parts and not a productised system allows for much greater flexibility and savings

How GRIDSERVE can enable the convergence of cell sites with EV charging and Mobile Edge Computing infrastructure

TowerXchange: Towercos are exploring opportunities to diversify beyond provision of towers and power. For example, China Tower Corporation has setup a new subsidiary, Tower Energy, to explore opportunities to get involved in EV charging and battery sharing. As pioneers of EV forecourts, how does GRIDSERVE see the potential convergence of EV charging and telecom infrastructure? Richard Hallas, General Manager – Telecoms, GRIDSERVE: Yes, this is where GRIDSERVE really stands out from the pack!

We are ideally placed to leverage the SEC12 platform to expand provision of power beyond the BTS and the dependant infrastructure to include EV charging capabilities for emerging markets as well as developed sectors. It could be that electric motorcycles or bicycles are the growth vehicle in the developing world, and we already have the designs for incorporation of charging stations for these in to the SEC12. GRIDSERVE's market leading experience in the EV sector ensures that this solution will be relevant and a key revenue growth engine.

TowerXchange: Another diversification opportunity towercos are exploring is Mobile Edge Computing. If a towerco wanted to host an eight rack, micro data centre at a cell site, it’s been estimated that might add a 20KW load to the site, with an uptime Service Level Agreement that would make most towerco executives’ eyes water! How would GRIDSERVE respond to such requirements for high availability remote power?

Richard Hallas, General Manager – Telecoms, GRIDSERVE: The SEC12 is an ideal platform for the creation of an off-grid Edge Datacentre.

The racks will leverage the new SEC12 control system and monitoring to provide a managed solution, in addition to colocation capabilities. Having the ability to integrate multiple power sources; grid, solar, wind, hydro, battery, genset, gives the capability for ‘Always On’ power. As a group we design, implement and own and operate systems with high dependency requirements and multi-megawatts of battery and power provision, so we are very comfortable with 20kW. The principles are the same; the design for redundancy and accurate reporting and diagnostic capabilities. It’s a challenge we relish the opportunity to discuss further with towerco executives, come and see what we have in place now and for the future!


HOI reinvents itselfas a towercoInnovative static asset manufacturer and turnkey infrastructure service provider interested in buying towers from Mobinil

Khaled Gad, HOI

TowerXchange: Where does HOI fit in the tower industry ecosystem? Khaled Gad, Board Director, HOI: HOI is headquartered in Egypt with offices in Sudan, KSA, UAE and Qatar. We provide full turnkey services (including design, supply, permitting, installation and managed services) in these countries, while also supplying our products to many other countries such as Algeria, Bangladesh, Ethiopia, Kuwait, Oman, Lebanon, Iraq and Libya. Our company started trading as “House Of Invention” in 1997 as a contractor to Lucent Technologies in Saudi Arabia. We later moved to Egypt to make a joint venture with ASTE, becoming “HOI ASTE”. Now we have rebranded as HOI and use that name everywhere. HOI strives for the highest quality in the industry while not jeopardising the customer’s budget or project delivery date. HOI design, fabricate and install a wide range of products from antenna mounting structures to shelters, electrical boards and panels, mobile and rapid deployment solutions, plus a comprehensive range of decorative structures. TowerXchange: Please tell us about HOI’s current role in the Egyptian tower market. Khaled Gad, Board Director, HOI: HOI provides full end to end turnkey services for Egyptian cell sites: we design, manufacture, permit, install, add power solutions and maintain the sites.

Read this article to learn:< Insights into the tower markets in Egypt, North and South Sudan< How HOI has launched a licensed independent towerco in Egypt< The proportion of new towers in Egypt that have capacity for multiple tenants< The current state of Mobinil’s potential tower sale< The growing demand for camouflaged towers

TowerXchange continues our profiles of the four licensed infrastructure providers in Egypt. HOI has designed, manufactured and installed over 1,650 telecom towers in Egypt and Sudan, with a further 4,000 towers manufactured by HOI installed in other countries. Their unique camouflaged multi-tenant towers have enabled them to become key partners of Vodafone Egypt and other operators, and the company has now commenced operations as an independent towerco.

Keywords: Who’s Who, Towercos, Managed Services, Steelwork, Tower Design, Construction, Installation, Leasing & Permitting, Camouflaged Towers, New Market Entrant, Hybrid Power, Masts & Towers, Shelters, Infrastructure Sharing, Middle East, Africa, Egypt, North Sudan, South Sudan, Mobinil, Vodafone Egypt, HOI


We are very busy in Egypt working in both FTK projects for Vodafone and also in developing our own towerco business. While the Egyptian tower market is slightly down because of the political situation, we believe the market will recover as the country returns to political stability. The Egyptian towerco market started at the end of 2010 but was on hold for some time because of new revolution in Egypt. The market is now starting again with all three operators, Vodafone, Mobinil and Etisalat, sharing existing and new sites. Our regulator the NTRA awarded telecom infrastructure provider structures licenses to four Egyptian companies. HOI was the first company win such a license and is the only company working on site sharing projects in Egypt with Vodafone. We started with an order for 150 sites last year, 42 of which are already complete. We will continue to build 500 sites within the next three years in the Delta region in North-Central Egypt. About half of Egypt’s 80m population live in the Delta region, which includes the city of Alexandria. Network coverage is less of an issue than network capacity, compounded by residents’ bad reactions to putting cell towers too close to them, which is why our camoflaged tower designs have proved popular. Many of the towers HOI has installed in the Delta region are 60m self-support towers with capacity for up to five co-locations. Mobinil and Etisalat are already negotiating to lease some of the sites

but there are other potential tenants beyond Egypt’s three mobile network operators such as government and police public safety networks. TowerXchange: What’s your view on the potential for a tower transaction in Egypt, and what role would HOI like to play? Khaled Gad, Board Director, HOI: Mobinil is considering offering some towers for sale, and an official RFP has been issued. I’ve spoken personally to Mobinil to express HOI’s interest in acquiring those sites. HOI are interested in providing independent towerco services to gain more stability in our market and to develop our business a step beyond our competitors.

TowerXchange: What proportion of new towers you are installing have capacity for multiple tenants? Khaled Gad, Board Director, HOI: Around 40% of new tower orders we are receiving today are for designs that have capacity for multiple tenants. TowerXchange: How do HOI differentiate yourselves from your competitors through you manufacturing capabilities? Khaled Gad, Board Director, HOI: One of our main differentiators is our R&D department. We invest US $2-3m annually in R&D, far more than our competitors. HOI have 16 engineers from different disciplines working in our R&D section, and that has enabled us to consistently develop several new product designs every year, ensuring our static asset product range meets all the latest customer requirements. We own several specialist factories which produce steelwork exclusively sold by HOI including a shelter factory producing telecom shelters fully furnished or flat packed; a factory dedicated to decorative support structures; another factory working under Schneider for electrical panels, control panels, ATS and power distribution; plus a copper factory for power cables, lightening rods, bus bars et cetera; and a tower factory in KSA for towers, monopoles, steel structures and galvanization with a capacity of 30,000 tons per year.

“

“

Mobinil is considering offering some towers for sale, and an official RFP has been issued. I’ve spoken personally to Mobinil to express HOI’s interest in acquiring those sites


In the last five years HOI have been the only supplier of towers to Vodafone Egypt, and we’ve been able to beat every competitor’s price because we offer end to end turnkey infrastructure services from design and manufacture to installation and maintenance services. Every year our R&D team invent several new towers, rooftops and camouflaged structures every. For example, we’ve sold a lot of a new design for a permanent, 60m self-support tower that can be installed in just two days, thanks to using a prefabricated foundation. TowerXchange: Has there been much demand for camouflaged towers in MENA? Khaled Gad, Board Director, HOI: We’re seeing a shift in demand in the Middle East and North Africa move from conventional towers, where the competition among manufacturers is fierce, towards environmental friendly, decorative camouflaged towers, where the competition is not so intense and the margin is good.

HOI has sold 450 camouflaged towers in the last three years, including both conventional camouflaged towers and some of our new shapes. We design, manufacture and install cell sites decorated as palm trees, pine trees, rooftop gardens, water towers and flag poles. This is why HOI are able to build sites in areas in areas where others find it very tough. With our hidden antennas, nobody knows a GSM site is there (of course all the permits are still secured).

HOI’s camouflaged towers can be provided with capacity for single, two or three tenants. A fourth tenant can be added but would no longer be camouflaged. Very high wind loading capacity for four or more tenants requires use of a conventional tower. HOI’s extensive range of camouflaged towers includes rapid deployment options and gives us a competitive advantage - securing an order for 100 camouflaged towers often opens the door to add several hundred conventional towers. TowerXchange: Have you installed many hybrid energy solutions in Egypt and Sudan? Khaled Gad, Board Director, HOI: HOI are also investing in green power and control, and have implemented 15 hybrid sites in Sudan in the last year and a further 5 in Egypt. When the Egyptian government takes the fuel service away in a few months, the only solution will be hybrid.

TowerXchange: What’s your view of the tower market in North and South Sudan?

Khaled Gad, Board Director, HOI: HOI are providing turnkey infrastructure services for three to four operators in North and South Sudan, through ZTE with one, providing services direct to the others. While the Sudanese economy had slowed down, we feel it’s recovering now. In the first few months of this year we’ve received orders for more than 75 sites, whereas in the whole of last year we didn’t receive orders for even 100 towers. We’re also in negotiation with Huawei to add a further 125 sites in South Sudan this year. Most of the work in Sudan is rural network extensions to remote areas that have never had connectivity before <

Typical 60m shared site

Shared site


Rural rollout, densification,site upgrades and ESCO contractsInfrastructure experts, ieng Group, expand their support to the telecom industry

TowerXchange: It was a while since TowerXchange last interviewed ieng Group and the company has expanded and integrated new companies since then. Please can you introduce i-eng Group and its subsidiaries.

Kadri Hakim, Co-CEO, ieng Group: ieng Group is a leading turnkey infrastructure solution provider active in both the African and Asian market providing end-to-end engineering infrastructure solutions to the telecommunications and power industries. The company was founded in 2007, initially focused entirely on EPC (site build and refurbishment), and then in 2009-10 we moved into also providing O&M services to the telecom sector. We now have 13,000 sites under management with plans to increase this to 20,000 sites by 2020.

ieng Group has recently integrated tower design and manufacturing business, Eki.Struct into our group. Eki-struct produces a broad array of different tower designs; from lattice, tubular and hybrid (a combination of angular and tubular towers) solutions to low cost, quick deployment towers and camouflage designs. With a fully-fledged design and engineering office in Croatia, adopting a customized approach to designing towers for our clients, Eki.Struct has acquired more than 120 tower structure certifications for various clients across the globe, from a library of more than 200 solutions.

In addition to Eki.Struct, ieng Group recently integrated power business, GreenPole into the group. GreenPole designs and co-manufactures intelligent hybrid power systems for telecom clients across the globe. Our system combines battery power cabinets

Read this article to learn:< How ieng Group’s structure, subsidiaries and service offerings have expanded

< The role that ieng Group is playing helping operators improve rural coverage

< Details of Eki.Struct’s Multi-Tenant modular solution and how it can revolutionize the way Towercos

specify sites

< ieng Group’s ambitions in the ESCO market

Leading turnkey infrastructure provider ieng Group has further expanded its capabilities in tower design, power system provision and tower services through the integration of GreenPole and Eki.Struct and formation of their new ESCO sister company, CREI. TowerXchange speak to ieng Group’s Co-CEO, Kadri Hakim to catch up on the company’s latest developments and how ieng Group is strengthening its position as an invaluable partner to the African and Asian telecom markets.

Keywords: Africa, Camouflage, Capacity

Enhancements, CREI, Densification, Eki.Struct,

Energy, ESCOs, GreenPole, ieng Group, Multi-

Country Partner, Network Rollout, O&M, Site

Surveys, Urban vs Rural, Who’s Who


with gensets and/or grid connection, with our smart controller allowing for remote monitoring, control and optimization of the system.

ieng Group is also expanding into the ESCO space through our new sister company, CREI which has entered into negotiations with telecom companies in multiple markets.

Headquartered in Lebanon, ieng Group has a presence in 18 countries (figure one), employing over 1,600 staff. The integration of Eki.Struct and GreenPole and creation of CREI enables ieng Group to offer a more holistic service offering to the industry (figure two).

TowerXchange: There is a major focus in Africa at present on improving rural coverage, something that ieng Group is heavily involved in. Please can you tell us more about this?

Kadri Hakim, Co-CEO, ieng Group: In Africa, all MNOs are focused on finding ways to access the 20-30% of the population that they are yet to connect, most of which live in rural and remote areas. With typical high sites costs being around US$80-100k to build with an annual opex of around $1500-2000 (depending on the country), the revenue that could be generated in such rural and remote areas would not be sufficient to cover costs.

We have developed the ieng low cost rural (iLCR) and ieng ultra low cost rural (iULCR) sites to address this area of the market. The solutions, combining both active and passive infrastructure as well as a power source (solar) can deliver coverage for dramatically

Figure one: ieng Group’s geographical footprint

LEBANON

Figure two: ieng Group’s range of telecommunication services

Network deployment< Site planning, acquisition and property services< Design engineering and construction< Towers and masts solutions< Power supply< Procurement, logistics and warehouse management< Network equipment installation

Fibre optics< Design & Construction< Testing and commissioning< Procurement, logistics and warehouse management

Managed services< Operations and maintenance< Procurement, logistics and warehouse management


lower capex and opex. Our iLCR sites, which cover a radius of approximately 15km cost US$50k to build, whilst our iULCR sites which cover a radius of around 3km cost US$35k, including passive and active material; both have an opex of around $400-500 per month. As simpler systems, deployment is rapid, with it taking around a week to build a site.

Different contractors are offering a range of different business models to operators to deploy low cost rural sites. A large number of players offer a revenue sharing model, others offer a pure capex model and others offer an opex model. ieng Group offers the capex model to MNOs, with some opcos opting for a capex model and others opting for opex and revenue sharing models.

With operators competing to cover rural areas in Africa, we are getting a huge amount of interest in our iLCR and iULCR solutions and we expect demand to continue to increase dramatically over the next 3-5 years. There is a big race between operators to be the first into a given market, capturing market share ahead of their competitors.

TowerXchange: What about new build outside of ultra-rural areas, have you seen this picking up in Africa? What demands do you see from clients and how is ieng Group addressing these?

Kadri Hakim, Co-CEO, ieng Group: We have seen new build picking up across Africa; the market is turning a corner following the recession and 4G rollout is requiring an increased number of sites.

In terms of requests from clients, the one constant

is the need to push down prices. For this, you need to take into consideration both the tower structure and the foundations. Eki.struct tower designs are particularly efficient, being able to take the same load whilst using less steel. In terms of foundations we have explored different options including towers that are up to 55m high without conventional foundations. In this instance, boxes filled with stones at each of the corners are used in place of concrete foundations. The result is that the sites are much quicker to deploy with a lower TCO, such sites are useful in rural areas.

In urban areas we’re seeing increased rollout of sites to improve capacity for 4G and even for 3G. We see lots of demand for monopoles with a smaller footprint (although these are typically more expensive than angular towers), as well as for demand for alternative structures such as advertising boards and street lights. We are currently looking at the potential to develop a smart street pole solution.

TowerXchange: Ease of upgrade is an important feature in tower designs, particularly for Towercos whose business model is predicated on securing additional tenancies. Can you tell about Eki.Struct’s multi-tenant modular solution and the benefits this can offer?

Kadri Hakim, Co-CEO, ieng Group: Our Multi-Tenant modular, is a single tenant tower which is upgradable to a two, three or four-tenant tower in a single day. This allows Towercos to deploy towers with lower initial capex, safe in the knowledge that they are able to upgrade them to sites capable of

hosting multiple tenants within just a few hours. It is a groundbreaking solution for Towercos, allowing them to deploy lower capex solutions without slowing their ability to add further tenants. Towercos save around 15-20% on capex by deploying a single tenant tower and only need to pay the additional amount when upgrading to multiple tenants. This generates considerable savings for the Towerco and changes the way that Towercos prepare for tower specifications.

TowerXchange: And finally, looking more towards the power side, we have seen ESCO activity picking up considerably in the telecom sector at present with several contracts now signed and further RFPs live. Can you tell us more about ieng Group’s ambitions in the ESCO market?

Kadri Hakim, Co-CEO, ieng Group: ieng Group has formed our new ESCO sister company, CREI which stands for Communication and Renewable Energy Infrastructure. CREI has been involved in pilot projects in Afghanistan and Myanmar and we are also participating in a number of RFPs, hoping to be able to make some announcements this year.

Whilst it is not a requirement, our expectation is that we will use GreenPole power equipment in our projects, whilst also leveraging ieng Group’s extensive field experience in operating sites. We offer both an ESCO model and a guaranteed savings model to the market, anticipating that Towercos will have a stronger appetite to invest the capex themselves and opt for the guaranteed savings model, whilst MNOs will lean more towards the ESCO model (although there are always exceptions!)<


Unlock a million dollars inhidden savings by streamlining site operationsInfozech’s CEO describes how the company’s easy to use and cost-effective platform incorporates all phases of site management into a single enterprise solution

TowerXchange: Please introduce Infozech’s Telecom site management platform and what parameters it is able to manage and monitor?

Ankur Lal, CEO, Infozech: Monitoring tower sites from a centralised location is becoming increasingly difficult with growing networks, increasing opex and significant security threats. Poor maintenance of assets and non-visibility on energy consumption only add to the complexity. Profits are getting leaner and Site Licence Agreements (SLAs) tighter. Infozech’s end-to-end site management solution iTower is built on a unified platform that addresses tower infrastructure companies’ concerns.

Infozech has developed an enterprise-level solution – iTower for telecom tower infrastructure companies that incorporates complete tower site lifecycle management right from site acquisition to decommissioning of the towers. iTower expedites efficient operations, cost optimisation and revenue assurance for tower operators and managed service providers. It is a purpose-built solution designed with highly effective field management processes in mind. It unifies field forces by providing a flexible platform for users to collaborate and manage projects from one source while capturing detailed data and real-time site activity. iTower’s data validation layer helps reduce common data errors and omissions that stand in the way of efficient field operations. It also provides relevant insights for decision making and future planning through a dashboard.

The biggest concerns today in streamlining site operation are visibility of assets at sites, efficient

Read this article to learn:< The different modules in Infozech’s site management platform

< How Infozech support tower owners in better management of their billing

< Ways that Infozech enables tower owners to streamline tower operations and optimize costs

< The sorts of savings that can be achieved through their platform

< Why it makes sense to outsource your IT to a third party

With a keen focus on an easy to use and cost-effective platform, Infozech has an impressive record of deploying IoT and telecom site management solutions for various telecom infrastructure companies and operators across the globe. Infozech manages over 150,000 tower sites, tracking over 42mn litres of fuel per year, reconciling bills worth US$228mn, and over 7.6mn individual assets. TowerXchange speaks to Infozech’s CEO, Ankur Lal to understand how Infozech’s solutions are generating value for the telecom industry in terms of revenue assurance, operational efficiency, and cost optimisation.

Keywords: Africa, Asset Register, Energy, Infozech, KPIs, Logistics, Monitoring & Management, O&M, Operational Excellence, QoS, RMS, Site Level Profitability, Site management system, Site Visits. SLA, Vendor Directory, Who’s Who

Ankur Lal, CEO, Infozech


field operations, security assurance, optimisation of energy consumption, accurate invoice generation and ensuring remote sites are still well-maintained. Infozech’s iTower manages and monitors all of these essentials to assist tower operators in achieving operational excellence, reducing opex and optimising capex.

TowerXchange: Please explain some of the challenges that tower owners face in collecting revenues from tenants and the role that your platform plays in addressing this.

Ankur Lal, CEO, Infozech: For any telecom tower owner or manager to maintain and grow their business, billing and invoicing plays a vital role. It not only helps collect revenue but also maintains a dispute free relationship with tenants.

Telecom passive infrastructure companies receive large sums of money from their tenants for infrastructure management and energy consumption on a monthly basis. In India alone, this number is about US$310mn/month inclusive of leasing space on the tower as well as energy usage charges. With such large scale billing, there are bound to be inefficiencies in the billing protocol if handled manually or in excel or enterprise resource planning software. The inefficiencies in billing come up due to a number of reasons, including complex master service agreements (MSAs), multiple billing contracts with the same tenant on a different set of sites, unauthorised charging, or if sites are being invoiced based on incorrect asset data. Then there are human errors in calculations or errors due to a lack of accurate and reliable asset and energy data.

Billing inefficiencies cause revenue loss and leakage which directly hits the business.

Infozech’s infrastructure and energy billing system (iBill) is a cloud based billing engine capable of processing thousands of records within a few minutes to generate accurate and precise bills.

iBill works on an efficient and economical cloud-based model eliminating all billing errors through data validation algorithms. The direct result is an overall increase in efficiency achieved by eliminating the recurrence of errors and an improvement in the quality of data in upstream and downstream systems. iBill supports different MSAs and contracts with minimal changes and a

fast turnaround. Management gets better visibility of the revenue across the region.

iBill also has the provision of maintaining a record of historical data for reference purposes during dispute resolution for past transactions. Hence, the system not just fixes all errors but also brings transparency into the complete billing process.Many big towercos with operations in multiple countries have different contracts and billing parameters and the goal to standardise their billing process across different countries, which iBill can help achieve.

TowerXchange: How is Infozech’s platform helping tower operators in taking a proactive approach to streamlining site operations?

Telecom passive infrastructure companies receive large sums of money from their tenants for infrastructure management and energy consumption on a monthly basis. In India alone, this number is about US$310mn/month inclusive of leasing space on the tower as well as energy usage charges


Ankur Lal, CEO, Infozech: A competitive market constantly exerts pressure on tower operators to look for extra cost advantages; cost saved is profit earned!

iTower helps tower operators in optimising opex and in the right allocation of capex while enhancing the quality of site operations.

Opex optimisation can be achieved by streamlining site operations, which means the better sizing of both field force teams and central functions such as real time site monitoring, maintenance tracking, accurate billing and removal of non–valuable activities done by technicians.

About how Infozech platform is helping towercos in streamlining site operations, I am glad to tell that our site management system is already deployed with tower operators in Africa and they are delighted, realising savings and value through our system.

One of the leading telecom operators, operating and managing a portfolio of more than 6,000 towers in East Africa was facing challenges in capturing activities carried out by field operations staff which have a cost implication in a central database system. They were struggling in generating daily/weekly/monthly/yearly reports and dashboards for effective network operations management.

They didn’t have a clear visibility of all activities carried out at sites and therefore were not able to measure performance in terms of cost efficiency and SLA compliance by the contractors and MSPs.

They didn’t have an automated system for trouble ticket creation from real time alarm systems or OSS data feeds. They wanted to take control of preventive maintenance management and energy management to optimise energy consumption and operational cost.

They aimed to install a robust and comprehensive solution to monitor, manage and analyse in a central database system all field activities which had a cost implication.

Infozech proposed solution was Site Cost Management System (SCMS) which is able to capture all the information on tasks being performed by field staff which has cost implications such as fuel filling, corrective maintenance, and preventive maintenance, spare part provision. Based on data captured through mobile application and a web portal, operational cost is calculated in the system on daily basis. It made all reports available for refuelling, preventive maintenance, spare parts and corrective maintenance and can be viewed daily/weekly/monthly/yearly. SCMS has a mobile application which enables the user to feed the refuelling information at the time of delivery. The mobile application can also work in standalone mode and store the captured filling data internally, which is especially useful in cases of no network or no data connectivity.

Our system also provides the option to capture a grid meter reading at the time of fuel filling and preventive maintenance activities. The user has to capture photographs before and after the activity along with the location and time stamp when the

user performs and submits the checklist. The system can also auto-assign the ticket to a concerned user based on the mapping provided by an admin.

The system is able to schedule any type of preventive maintenance against a site and has a configurable checklist form, which can capture any kind of data at the time of conducting preventive maintenance on site. The system has an inbuilt AI which will reconcile data from contractors or MSPs and the report and highlight any variance.

Our customer received multi-dimensional benefits just after installing the system for four months. Our customer has noticed a significant saving in fuel consumptions after using the system without compromising on network uptime. Our customer mentioned that the automated Purchase Request creation process has improved Turn Around Time from 1 week per MSP to 5 minutes for 8 MSPs. Even their internal payment approval process cycle had reduced from 15 days to 2 days. Now they are able to track & manage 100% spare parts cost and usage on the SCMS portal.

We take care of our customers. One of our organisation’s core value is “customer delight”, we push ourselves really hard to achieve that.

TowerXchange: Why should tower owners look to use a complete end-to end site management system such as Infozech’s rather than developing an in-house system?

Ankur Lal, CEO, Infozech: Very good question. While looking for site management software solutions, tower operators often analyse the


different scenarios to choose between outsourcing and in-house development. This strategic choice may have a significant impact on cost, quality and resource aspects of the telecom tower company. Thus more and more telecom tower companies prefer to choose IT outsourcing models rather than looking for specialists in-house. Subject matter expertise, access to exceptional capabilities and reduced costs are some of the major factors driving the IT outsourcing market.

If you consider market trends, the Global IT outsourcing market is expected to reach US$481bn by 2022 growing at a CAGR of 6.2%. To choose the right strategy on digitalisation of telecom site management, let me take you through multiple benefits of outsourcing IT infrastructure:< Faster approach to high-quality software development resources < Flexibility – specialised vendors like us are

flexible to provide support in accordance with project schedule and needs< Cost savings – outsourcing can help achieve a high level of productivity at reduced costs.< Broader range of subject matter expertise – we have built industry expertise and on field experience by working with different customers in different geographies and at a different maturity levels. We can work as an extended arm.< Solves capability issues and enables focus on core business functions

Infozech’s platform and support teams are experienced enough to be key business enablers for tower operators rather than just a cost saving tool. Infozech’s commitment to faster deployment and great quality to price ratio has helped us grow to the next level, becoming the right technology partner for telecom tower operators<

Infozech’s platform and support teams are experienced enough

to be key business enablers for tower operators rather than just a

cost saving tool









IPT PowerTech add Guinea Conakry and Lebanon to their ESCO portfolioHow the world’s largest T-ESCO is going from strength to strength

TowerXchange: Please can you re-introduce IPT PowerTech to TowerXchange readers.

Khaled Habbal, VP & COO, IPT Powertech: IPT PowerTech was founded back in the 1990s, initially focused on the provision of starter and specialty batteries. When the telecom sector started to pick up in the mid-90s we started offering battery systems to the sector before expanding into the sale of power systems, being one of the first companies to first launch the battery hybrid concept. We spotted the need to integrate power equipment into outdoor cabinets and began manufacturing our own cabinets independently. Innovation has always been at the heart of our business.

In parallel, we built our telecom services division, providing site construction services (of both towers and fibre), telecom installation and network services and field managed services and maintenance.

Whilst the product and managed services divisions remain key parts of our business, our focus has increasingly turned to our telecom-ESCO business where we see huge potential.

TowerXchange: Please tell us more about your T-ESCO business.

Khaled Habbal, VP & COO, IPT Powertech: IPT PowerTech currently manages power under T-ESCO contracts in Myanmar, Guinea Conakry and Lebanon and is enrolled in a Guaranteed Savings contract in Nigeria. The large number of

Read this article to learn:< Who IPT PowerTech are< Details of their recently signed ESCO projects in Guinea Conakry and Lebanon< How their guaranteed savings contracts have evolved in Nigeria< IPT PowerTech’s attitude to working with third party equipment providers< How IPT PowerTech envisage the ESCO investment landscape evolving

IPT PowerTech, the world’s largest T-ESCO, operates the energy equipment across four countries with the largest number of ESCO sites worldwide. Established in the 1990s, IPT is also a managed service and energy equipment provider with a presence in 11 countries in Africa, South East Asia and the Middle East. TowerXchange speak to IPT PowerTech’s VP and COO, Khaled Habbal to find out more about how their ESCO business is developing.

Keywords: Africa, Africa & ME, Asia, Energy, ESCOs, Guinea Conakry, IHS Towers, IPT PowerTech, Lebanon, Middle East, Myanmar, Nigeria, Off-Grid, On-Grid, Ooredoo, Orange, Renewables, RMS, Solar, Unreliable Grid, Uptime, Who’s WhoKhaled Habbal, VP & COO, IPT Powertech


IPT worldwide ESCO sites and our extensive know-how makes IPT PowerTech the leading T-ESCO globally. Our current pipeline sits around a total of approximately 10,000 sites under Guaranteed Savings and T-ESCO and we remain very ambitious in our growth plan beyond this.

Recognised as a Telecom Energy Service Company (T-ESCO), we offer various models to MNOs and towercos reflecting the appetite for CAPEX savings and CAPEX leasing, while ensuring the deliverables of power availability and reliability to the network respecting all SLAs related are met.

TowerXchange: What do you think is driving the adoption of the ESCO model by the telecom sector?

Khaled Habbal, VP & COO, IPT Powertech: Operators across the globe are coming under increased financial pressure with competition from OTT players and ARPU continuing to decline. They are searching for ways to decrease OPEX whilst minimising capex and the ESCO model offers an ideal solution.

TowerXchange: Please can you share further details on the new ESCO projects that you have signed in Guinea Conakry and Lebanon?

Khaled Habbal, VP & COO, IPT Powertech: In Guinea Conakry we have signed an ESCO agreement with Orange, with high probability of extending to new sites within the upcoming 3 -5 years.

Initially we will take over management of the existing power equipment on sites, but over time we will upgrade this to make the system more efficient, a process which we have begun already. Of the total number of sites, around a third are off-grid entirely with the quality and availability of on-grid sites varying significantly. In the worst grid areas, availability can range between 6-12 hours per day, but as you get closer to urban centres this improves. All on-grid sites however require significant backup and alternative generation and so our plan is that most sites in the country will have solar in place.

In Lebanon, we are enrolled on an ESCO contract with one of the two operators in Lebanon, where the majority of sites are on unreliable grid connections: typically, 18-21 hours of usable grid in Beirut, falling to 6-12 hours in rural areas.

The grid quality in Lebanon is better than the grid quality in Guinea Conakry but grid availability can still be quite low; in Beirut, grid availability is around 18-21 hours per day but in rural areas this drops to around 6-12 hours. There is however a power schedule in Lebanon meaning that you know when power will be on or off. This predictability makes the design and management of an optimal power system a much more scientific process.

As with Guinea Conakry, we have inherited legacy power equipment with plans to upgrade this over time, in Lebanon however, most of the power equipment is IPT PowerTech equipment and so we are very comfortable with managing it.

TowerXchange: Can you tell us more about developments in IPT PowerTech’s involvement in IHS Towers’ “big five” project in Nigeria; and for those less familiar with the model, please can you explain the difference between the Guaranteed Savings model you have in place in Nigeria and the ESCO model you have in place in other markets.

Khaled Habbal, VP & COO, IPT Powertech: IPT Powertech Group is engaged in Nigeria with the largest towerco on a major project of Guaranteed Savings across the African continent under the “Big Five Initiative”, supplying energy efficient power solutions—including management and long-term maintenance — and OPEX optimisation under a long-term contract.

The guaranteed savings model is something which IPT PowerTech have been promoting for a long time, having introduced the model at TowerXchange’s Meetup in Africa about five years ago. Historically, when an MNO or towerco has purchased energy equipment, they have used contractors to deploy, operate and maintain it. When the equipment isn’t performing as hoped, a blame game can ensue with the contractors complaining that the equipment isn’t delivering on expectations, whereas in reality it may have been incorrectly deployed or maintained by the contractor.

Our approach in eliminating the blame game is simple: combine energy equipment provider, system integration, and O&M service contracting services to create a single point of accountability.


By being the energy system integrator and the contractor at the same time, we are able to manage key points in the value chain, thus leaving no room for performance failure—or for the ‘blame game.’ In fact, we believe that our group is one the few solution providers globally offering and merging hybrid and renewable energy solutions with telecom infrastructure services and offering field managed services and maintenance all at the same time.

Under a guaranteed savings model, we sell the equipment to the MNO or the towerco who then pays a fixed rate for us to install and maintain the equipment. We guarantee that we will deliver the savings promised, any deviation from this will be absorbed by IPT PowerTech. This gives the MNO or towerco not only clarity on the capex to install the system but also provides predictability in opex. With IPT PowerTech providing, deploying and maintaining the equipment, it avoids the blame game between equipment vendor and contractor that can so often occur in the management of power on cell sites.

The guaranteed savings model offers an alternative to the ESCO model, whereby the MNO or towerco still deploys the capex (whereas in an ESCO agreement the ESCO would invest the capex).

TowerXchange: What technologies does IPT PowerTech manufacture and supply and what equipment does it source from third parties? How does it select these third parties?

Khaled Habbal, VP & COO, IPT Powertech: The dedication of our professional team exceeding 4500 specialists, impelled the group into serving more than 60 operators in 50 countries and becoming one of the few companies in the region to combine product R&D to our assembly facilities in Romania and Lebanon. Our modernised factory in Romania is a leading ODM enclosures manufacturer of outdoor cabinets, and an integration facility for advanced energy solutions, allowing us to combine high quality in-house products of enclosures and cabinets coupled with our own services proposition.

IPT has also incorporated the controllers for all our gensets, and lately IPT RMS, a complementary tool to all our solutions guaranteeing optimal performance, and allowing mobile operators better surveillance of their sites globally in terms of energy availability and efficiency. IPT Digital Platform features advanced machine learning along with existing energy equipment compatibility, ensuring smart and centralised monitoring across the network

On the other hand, IPT Powertech is an integrator of top-notch products, developing and identifying best technologies to create products, optimising the output of the solution. Our D&D team always makes sure to choose top international brands from trusted suppliers ensuring optimal performance of the products. We know our suppliers well; how reliable their products are and the level of service that they provide. Whilst we do consider new suppliers from time to time, we are very cautious as

our reputation is also dependent on the quality of suppliers that we use

TowerXchange: At present does IPT PowerTech provide all the financing for ESCO projects and do you envisage using outside investment in the future? What kind of investors do you see as being interested in the ESCO space?

Khaled Habbal, VP & COO, IPT Powertech: We have relied on our own funds this far but do envisage that we will look at outside financing. We are receiving a large amount of interest from investors on both the debt and equity side from banks and funds and could foresee that many investors which have played in the towerco space will start to look at investment opportunities in ESCOs.

The challenge however is that the T-ESCO model is still very new and investors are still trying to understand it; there is a lot of ambiguity in the term ESCO, people don’t understand what type of contracts or MLAs are in place. There’s also a lack of sizeable ESCOs in the market which investors can compare; after IPT PowerTech, the next biggest sized ESCO is way behind.

Ultimately however, there are a lot of parallels between ESCOs and towercos; it is still in the telecom infrastructure space involving long term (10 year) contracts with creditworthy MNOs and towercos. There is a lot of commonality in the two business models and the fact that towercos often view ESCOs as the competition only goes to support this view<


ClickOnSite’s evolutions that continue to #MakeTheEverydayBetter for the fast moving tower industryAn interview with IT-Development’s Jerome Perret

TowerXchange: Please can you reintroduce IT-Development and your ClickOnSite product to TowerXchange readers.

Jerome Perret, Managing Director, IT-Development SAS: Sure! ITD’s leadership comes from managing telecom tower rollouts earlier in our careers. We saw how technology can make each individual’s work in these processes more efficient, and thereby allow companies to grow while keeping their OPEX under control. We are telecoms operations experts making online software services for the telecoms industry. MNOs & towercos use ClickOnSite to manage tower sites, rollouts, asset lifecycle and operations at scale. It is an online tool (customer-hosted or SaaS) where everyone from the office to the field works on one set of data, in real-time. It is infinitely more efficient than using Excel, and better in terms of price, speed-to-market and cost-of-ownership than ERP-like systems. On the user-side, ClickOnSite comprehensively covers the needs for tracking all passive and active infrastructure assets and information, in a highly user-friendly interface on PC, tablet or mobile. Equally importantly, on the technical side, ClickOnSite can be configured to each client’s needs with no technical developer intervention, except for third party integrations. This means most configurations to each client’s unique needs are quickly done by a Business Analyst, without getting into a development cycle.

Read this article to learn:< Who IT-Development are and what experience they have in the telecom sector< How the ClickOnSite product has evolved in the past 12 months, incorporating feedback from clients< Why the platform is particularly attractive to towercos as well as MNOs< What leads to ClickOnSite being typically 50% cheaper than big ERP systems< ClickOnSite’s unique level of local support< Expansion plans for IT-Development

Living by their four guiding principles, IT-Development remain committed to #MakeTheEverydayBetter for their clients. Their ClickOnSite platform has seen significant evolution in the past 12 months and remains future proofed for the fast moving tower industry. TowerXchange speak to IT-Development’s Managing Director, Jerome Perret, to understand what makes the company stand out from the crowd.

Keywords: Africa, Asia, Asset Register, ClickOnSite, Energy, Fibre, Backhaul & FTTH, IT-Development, MENA, Monitoring & Management, O&M, Operational Excellence, QoS, RMS, Site Level Profitability, Site management system, Who’s Who


Making ClickOnSite powerful functionally, yet easy to use, is part of our philosophy to #MakeTheEverydayBetter. TowerXchange: How has the ClickOnSite product evolved in the past year since we last spoke to ITD, what new capabilities does it have?

Jerome Perret, Managing Director, IT-Development SAS: When we went to the TowerXchange Meetups in Africa and Asia in 2017, our main purpose was to show how we had refactored ClickOnSite with leading edge, future-proof technology atop of the comprehensive database model we had assembled over the previous years. The highlights in the year since then can be grouped as integrations which bring expertise and functionalities from partners into the ClickOnSite interface, and native ClickOnSite features: < Remote Monitoring System (RMS) integrationsAs you know from the TowerXchange Meetups, and with the upcoming TowerXchange Meetup Africa emphasising operational excellence, the demand for remote monitoring systems is growing: towercos and site owners need current status, and analytics, of their sites, especially related to power.

We have built APIs which allow ClickOnSite to display key RMS readings from our partners in the ClickOnSite interface. This means ClickOnSite users don’t have to change application to know the overview current status of their sites. They can drill down deeper at the RMS partner’s site/service directly.

< IFRS 16This is an example of how we apply our industry knowledge in a forward-looking way to create technical solutions. The new IFRS 16 regulation for lease accounting has been flying under the radar, but we recognised early how significantly it will impact MNOs and towercos, so we built an integration with a partner, Blimp 360, to seamlessly sync lease-information in ClickOnSite. This is an example not only our technical prowess, but the application of our deep industry knowledge to foresee issues and needs.

Within ClickOnSite itself, the top 3 functionalities of recent months are:< ClickOnSite mobile app, which can even be used offline, to upload data from the field straight into ClickOnSite< Project tracking, which shows managers exactly where all their projects (for example,

rollouts) are in the process. This is connected to our unique use in the telecom industry of BPM 2.0. It gives great up-to-the-minute information, and the data can be mined to find bottlenecks and future improvements< Global search, which indexes all file types stored in ClickOnSite Additionally, though it is not visible as a feature to customers, we have been maintaining our response target of less than 2 seconds per click (the benchmark for e-commerce sites). TowerXchange: Whilst ITD had historically focused on MNOs, can you explain how your product is particularly well suited to the needs of independent towercos?

Jerome Perret, Managing Director, IT-Development SAS: In fact, the processes and data models of both


MNOs and towercos are very close which, because of the flexibility and configurability of ClickOnSite, for us meant just some minor, non-technical configurations to be able to serve both kinds of companies. As with MNOs, towercos need a tool that works at scale over widely distributed locations. However, towercos require more agility to cope with their fast moving industry, which constantly reinvents itself. In that respect, our use of the latest technologies guaranties our clients that they purchase a tool which is future proof and able to evolve with their technical needs and business. For instance, fibre is increasingly part of a towerco portfolio, and ClickOnSite can already handle that, in contrast to other systems which do not today and would require heavy development to enable.

Moreover, our SaaS version is particularly attractive for towercos that have scarce IT resources and appreciate handing over database administration and security concerns to a specialist. TowerXchange: Traditionally ERP-like solutions are often criticised for their high cost and cumbersome nature, can you explain how ITD offer a more nimble and cost effective solution?

Jerome Perret, Managing Director, IT-Development SAS: There is how we do it from a business perspective and there is how we do it from a technical perspective. First of all, let’s look at the current state in the marketplace. Companies that don’t know about

ClickOnSite think they must decide between two extremes:< Use Excel in order to avoid the high license and implementation costs of the big ERP-like solutions. But Excel, or a simple database, comes with a host of other inefficiencies and is, frankly, an awful compromise.< ERP-like systems which have associated high costs (license and implementation) and, also significantly, forces the staff to work according to the processes defined by the software. ClickOnSite is modular so you only pay for what you need/use. On the one hand this means cost savings for the software license. But, as I mentioned before about how non-technical people can do most customisations, it also means very low costs for technical development, both during the implementation phase as well as over time.

And being able to do non-technical implementation has another bonus: speed! ClickOnSite can be fully implemented within a few months, whereas most of a year is not uncommon with the big systems. We see all these factors together as a win-win-win situation for the customer. All told, typically we are at least 50% cheaper than the big ERP systems. It all boils down to the fact that we are telecoms people making software and services for the industry, not software people who are trying to make round pegs fit into square holes in diversifying into telecoms. TowerXchange: What feedback has your system had from clients and how has this translated into product evolution?


Jerome Perret, Managing Director, IT-Development SAS: The integrations and features over the past year I talked about earlier are the direct result of talking with clients. Not only in “formal” feedback channels, but also from being active in the industry and listening to what people are talking about, where their pain points are. At a high level, the density of 5G nodes will clearly drive need for passive infrastructure management. Closely related to this is fibre. ClickOnSite can handle both of these types of implementation today, but they will bring with them new requirements, for example GIS, as I talked about. Through our customers we will learn which things to prioritise. A more hands-on example, and one which shows our agility, is that we had a requirement to be able to visually diagram passive infrastructure on a tower. Literally within 48 hours our technical team discussed how this could be done within ClickOnSite and had a prototype working. For context, when we think of what to add or build next, we prioritise by applying the four guiding vision principles of ClickOnSite:

< Users must be able to easily access data< Data must be useful (usable in reporting)< Performance (speed) is not negotiable< Data & system security are not optional! It’s fun to think about future functionalities, but there is a lot of need for what ClickOnSite does today out there right now!

TowerXchange: How do you ensure that your solution is correctly implemented and used optimally in the field?

Jerome Perret, Managing Director, IT-Development SAS: First and foremostly, everyone at ITD subscribes wholeheartedly to the philosophy that for us to be successful as a company, our customers must be very happy with our service. We live this philosophy every day. Our tagline #MakeTheEverydayBetter fits perfectly our corporate philosophy and culture. In practical terms to ensure optimal implementation and use of ClickOnSite by our customers, also fairly unique to the industry, is the fact that we do the implementations ourselves; we don’t use integrators. We believe personal connection is important, so we have Business Analysts go to the customer locations to work with them during the implementation through acceptance and training. Additionally, for some clients, we hire a local support person in their market.

Perhaps uniquely for companies like ours, we also hire & train local people in-market to support our clients on-site and in close geographical proximity.

We also organise ClickOnSite user workshops, which are great both for gaining insight to how users use the software as well as for advanced training for them. And it builds community among ClickOnSite users.

We remain in close communication with our clients, not only in person via our customer support team, but also through regular short, targeted surveys.

TowerXchange: What is ITD’s geographical footprint and how is this expanding?

Jerome Perret, Managing Director, IT-Development SAS: Currently, most of our customers and users are in Europe and Africa, with Southeast Asia starting to roll.

We have concentrated a lot on Africa and the Middle East because our management has spent a lot of time there rolling out towers (including in Nigeria, Ivory Coast, Cameroon, Congo, Iraq and Egypt), which means we have a lot of contacts there and feel close to the African and Middle Eastern countries and markets. And we see a great need for our services there -- demand to roll out and manage sites is strong and the companies are dynamic, like us. We have opened an office in Vietnam which does sales, support and technical development, the latter expanding the technical team working day by six hours from our development teams in France and Slovakia. There is a lot of action happening in SE Asia, especially with towercos and fibre and we expect to have some big announcements from that office soon. This industry moves so fast that every day there is a new interesting nut to crack, technically, operationally or commercially. Never a dull moment! My team and I enjoy our work


Introducing tower designers and manufacturers MetalogalvaMetalogalva has manufactured over 200 towers for Unitel and Vodacom Mozambique in the last year

Bruno Mota, Metalogalva

TowerXchange: Where does Metalogalva fit in the telecom tower ecosystem? Bruno Mota, Business Unit Manager - Telecom, Railways & Special Projects, Metalogalva: We design, manufacture and galvanise towers, for telecoms, transmission line poles, substations, lighting poles, road structures, catenaries and solar structures. For the telecom industry, we manufacture monopoles, lattice and tubular towers from existing designs - Metalogalva’s standard - or we develop a new design in order to meet customers’ specific requirements. We have our own factories, which we adjust according to the requirements of the work, with capacity to galvanise up to 140,000 tonnes per year. We have specialist equipment including welding robots, plasma and laser cutting machines and CNC machines for cutting, drilling and punching profiles and L shaped section. We also have in-house an automatic powder coating line (with capacity of 1400m²/day) and we have as well a liquid painting unit, so we are able to do the DUPLEX system with good quality at fair prices. Right now we are doing some interesting projects with camouflaged towers (Pine|Palm towers) for a partner with lots of experience in this niche market. To get an idea of our capacity in telecoms, we recently produced 114 towers in under one month for Vodacom Mozambique. TowerXchnage: What is Metalogalva’s experience in Africa?

Read this article to learn:< The importance of sourcing high quality steel from a reputable company< How the lifetime, and guarantee, of a tower is extended< Designing towers to be easily upgraded for multiple tenants< Metalogalva’s experience supplying towers for Unitel in Angola and Vodacom Mozambique

TowerXchange asked Bruno Mota, Manager of Metalogalva’s Telecoms Business Unit, to explain the quality differentiators and economics of telecom tower design and manufacture, and to describe and how they adapt to meet the changing needs of customers as their structural requirements change from capacity for single to multiple tenants.

Keywords: Who’s Who, Steelwork, Tower Design, Tower Manufacture, Installation, Capacity Enhancements, Loading, Retrofitting, Procurement, Masts & Towers, Asset Lifecycle, Infrastructure Sharing, Europe, Africa, Vodacom Mozambique, Unitel, Metalogalva


Bruno Mota, Business Unit Manager - Telecom, Railways & Special Projects, Metalogalva: In the last year we have manufactured over 200 telecom towers which are now installed in Unitel’s network in Angola and in the network of Vodacom Mozambique. We’re looking to expand to send our towers to countries like Nigeria, Uganda and Tanzania. In these cases we didn’t sell directly to the operators, but were introduced by our partners locally. We’ve also sold towers into Algeria, Morocco, Cape Verde and São Tomé and Prí ncipe markets indirectly. We’re interested in building relationships with other tower installation companies in Africa, in order to spread our product to other emergent markets. Metalogalva also have several important clients in Europe, for example we supply towers to E-Plus and

Vodafone in Germany, and two years ago we won a big project for TGV in France called GSMR Synerail to supply GSM towers. TowerXchange: How should buyers distinguish between the quality of products offered by different tower manufacturers? Bruno Mota, Business Unit Manager - Telecom, Railways & Special Projects, Metalogalva: We source our steel mainly from ArcelorMittal, the world’s leading steel producer - we don’t use second rate

steel. It’s important to confirm that your tower manufacturer uses raw material from a reputable company, and we use 3.1 certified raw material whether we’re shipping to Germany or Angola. All the procedures we use are certified like for example welding (DIN 18800) or galvanisation (DASt22). We are as well certified by ISO9001, ISO14001, OHSAS18001, CE mark and EN1090 (EXC3). There are different standards and specifications in different markets. Our solutions meet the customers requirements and they are adapted to the location

“ “

We source our steel mainly from ArcelorMittal, the world’s leading steel producer - we don’t use second rate steel. It’s important to confirm that your tower manufacturer uses raw material from a reputable company


multidisciplinary team of engineers who can quickly verify if it is possible to apply more load. If there is no additional capacity, the customer may need to reinforce or replace the tower. We can also offer towers designed to be easily upgraded after installation. For example, we recently applied for a tender in France for two variants of 30m tower designs, evolutive and non-evolutive. The evolutive designs have 4sqm of capacity at the top, but it is possible to add an extra section to add a further 3sqm of capacity to enable sharing the tower with more operators, so we design the structure for 7sqm capacity. TowerXchange: Finally, please sum up how you would differentiate Metalogalva from other tower manufacturers. Bruno Mota, Business Unit Manager - Telecom, Railways & Special Projects, Metalogalva: In 2013 we invested €6.6m in new equipment, enabling us to produce towers more efficiently.

Moreover, we have been serving the market for 42 years, which means we have a lot of ‘know how’ in what we do. We think it’s very important to achieve our lead time commitments, whilst maintaining quality. And we think it’s important to give constant support to our customers, to act quickly to meet their needs, which means Metalogalva has many happy customers!

There are fixed costs that are the same whether we’re producing one tower, 50 or 200. We’re very competitive at a larger quantity as we can use serial production techniques. TowerXchange: Tell us about the implications for the design and reinforcement of towers as clients add additional tenants. Bruno Mota, Business Unit Manager - Telecom, Railways & Special Projects, Metalogalva: There are now a number of companies offering solutions to reinforce towers to achieve more capacity. If one of our customers wants a tower with 6sqm on top, we may evaluate their requirements and find they can be met by a standard tower, or we may need to design a new structure. Then if the customer wants to add additional antennae, requiring additional capacity, then we have a

where they will be placed. We have a technical department with eight Structural Engineers able to design structures according to any norm required: Eurocode or TIA for example. The lifetime of a tower has a lot to do with the thickness of the paint and the zinc galvanisation, so we can offer towers with a 10, 15 or even 25+ year guarantee depending on the client’s requirements and its own respective budget. We use the 1461 Euronorm standard for galvanisation.Our competitiveness comes from optimised and custom solutions, introducing technology on the production process such us robots, lasers, powder coating, and also Kaizen concepts. TowerXchange: What is the tradeoff between tailor made solutions to meet the specific requirements of each cell site versus installing standard, and therefore lower cost, towers? Bruno Mota, Business Unit Manager - Telecom, Railways & Special Projects, Metalogalva: If we have an order for 200 different towers then that requires lots of unique designs to be verified, lots of different drawings to be prepared - a lot of work is needed before manufacture. In addition the performance of our production line will be reduced, making our solution less competitive. So instead the optimum solution might be to create four variants on a standard tower, enabling us to produce four batches of fifty towers for example, so we can offer a more competitive manufacturing price, and facilitate easier mounting/logistics of the structures on the field.

“ “We have a multidisciplinary team of engineers who can quickly verify if it is possible to apply more load


How NEXSYS-ONE is driving operational excellence for telecom infrastructure ownersFrom Project Management to IFRS 16 lease Management to drone survey technology, NEXSYS-ONE’s flexible software solutions create seamless processes to enhance the operating performance of tower companies and mobile operators

TowerXchange: Please introduce NEXSYS-ONE, your history and footprint.

David Gater, Global Head of Business Development, NEXSYS-ONE: NEXSYS-ONE was initially an internally developed platform for a global systems integrator deploying and operating 350 network technologies across 40 countries since 2001. Today we operate globally and serve multiple channels through towercos, tier one operators, and systems integrators from our HQ in Dubai with presence and subsidiaries in key strategic locations: Myanmar, United Kingdom, The Philippines, USA, Germany, Australia and Iraq.

NEXSYS-ONE is a proven software platform differentiator that enables the rapid deployment and maintenance of mobile network infrastructure across the globe. The product is a cloud native, configurable “off-the-shelf” platform incorporating industry best practice and functionality enabling support for multiple technologies and applications across a wide variety of uses. We capture the network requirements around quality assurance, project management, tower sharing, IFRS compliant lease management, work force management, procurement and supply chain processing, warehouse and asset management, health and safety, access and RMS solutions, fibre/TRS/RF tracking and risk management.

TowerXchange: You offer several modules, spanning different functions within telecom infrastructure owners’ businesses, can you talk to us about the models, how they work and typically what your customer uptakes are like?

Read this article to learn:< Who NEXSYS-ONE are and their global footprint < How NEXSYS-ONE observes the difference between the key markets in which it operates< The measurable ROI NEXSYS-ONE can deliver and use cases from the field< How NEXSYS-ONE can help drive 5G rollout

Most of the NEXSYS-ONE organization has a background in telecoms infrastructure, a fact which has given them unique insight into the operational and administrative challenges infrastructure owners face today, whether that’s complying with international standards or simply coordinating field techs to resolve cell site problems. They’ve built a solution which is designed to work with existing platforms and technologies to deliver maximum efficiency as well as removing complexity from the lives of PMOs, C levels and field teams. We spoke to David Gater, Global Head of Business Development at NEXSYS-ONE, to find out how the solution has evolved and how it’s working for the telecoms industry today.

Keywords: 5G readiness, Asia, Asset Lifecycle Platform, Asset Register, Co-locations, Europe, Europe insights, Health and Safety, Insights, Leasing and Permitting, Logistics and warehousing, MENA, Middle East, NEXSYS-ONE, Project Management solutions, RMS, Site auditing, Site quality Management, Software Solutions, USA, Work Force Management

David Gater, Global Head of Business Development, NEXSYS-ONE


David Gater, Global Head of Business Development, NEXSYS-ONE: For the complete 360 operational requirements for building and maintaining todays network infrastructure we offer these modules based on innovative scalable software solutions improving efficiencies and performance whilst eliminating unwanted costs due to lack of visibility

or operational process failures. If you use one or all modules they can be tailored to ensure processes throughout the organization and through the platform are interconnected and seamless enabling transparency of synchronisation and synergies across the organisation through enhanced visibility.

Due to our unique history and telecom experience we have open dialog with our clients speaking directly the same language, understanding the underlying issues and being able to tailor our solutions to meet their individual needs and solve complex problems. Our best sellers are by far TOWER-ONE closely followed by TASK-ONE where

TELECOMS SOLUTIONS

COST SAVINGS

Less extra site visits 39%Payment performance 40%Process efficiencies 56%

OPERATIONAL

ORGIMPLEMENTATION LEAD-TIME

35d

SITE WORKS PERFORMANCE

78%REDUCED STAFF CHURN

81%TENANT RATIO IMPROVEMENT

45%

ASSET HANDLING PERFORMANCE

STAFF-ONE

30%

Less lost assets 20%Less HW defects 15%Asset visibility improvements 45%

350,000 cell sites deployed using NEXSYS-ONE / LNT

Used in 40 countries across all continents

Serving the Telecoms industry since 2001

Value propositions

TELECOMS SOLUTIONS

COST SAVINGS

Less extra site visits 39%Payment performance 40%Process efficiencies 56%

OPERATIONAL

ORGIMPLEMENTATION LEAD-TIME

35d

SITE WORKS PERFORMANCE

78%REDUCED STAFF CHURN

81%TENANT RATIO IMPROVEMENT

45%

ASSET HANDLING PERFORMANCE

STAFF-ONE

30%

Less lost assets 20%Less HW defects 15%Asset visibility improvements 45%

350,000 cell sites deployed using NEXSYS-ONE / LNT

Used in 40 countries across all continents

Serving the Telecoms industry since 2001

Value propositions


our customers immediately benefit from our off the shelf functionality.

The key modules of NEXSYSONE consist of: TOWER-ONE Tower-one offers customers a tower sharing solution to centralize all site information into one platform whilst enabling unique techniques to obtain additional tenants per site. The TOWER-ONE project management solution tracks and reports any project to completion. This module is the most used module of NEXSYS-ONE for tower companies and mobile operators.

TASK-ONE is our award winning comprehensive task management solution that coordinates deployment and maintenance field activities. It features a reliable and accurate interface that processes organization or supplier task work flows processes to completion

ASSET-ONE tracks assets across all warehouses, vehicles and cell sites by bringing together operations to manage inventory, repairs, spares management and reporting. It makes asset information available to all involved personnel in

the network, engineering, logistics, finance and planning.

FIBER-ONE with FIBER-ONE you’ll have the visual interface to help you understand and manage your entire Fiber optic network deployment. FIBER-ONE delivers information in a seamless, map-based data format and provides an array of software solutions to help deploy and maintain your fiber network. FIBER-ONE makes it easy to enter, update and understand the connectivity of your network. You’ll be able to quickly establish and insert connections within splice enclosures, patch panels, optical network devices and passive optic network splitters used in the fiber network.

SITE-ONE enables IoT sensor monitoring of the cell sites to measure and monitor energy usage and fuel consumption, track access and potential theft of cell site equipment. The uniqueness of the NEXSYS-ONE RMS solution is that its connected also with a satellite backhaul for emergencies when the cell networks fail.

SAFETY-ONE provides customers with the visibility and oversight required to effectively implement their health and safety management systems by driving the ownership and accountability needed to ensure compliance with legislative and corporate responsibilities.

Each module fits a purpose to ensure processes throughout the organization are seamless. Modules are interconnected to push and receive information to synergise departments. Our customers typically


enjoy the visibility and transparency our modules offer. Customers also prefer our scalable solutions to meet their exact requirements.

TowerXchange: Tell us about how your solutions work in different markets. What kind of pressures do you see MENA tower owners coming under and how does that differ from elsewhere in the world?

David Gater, Global Head of Business Development, NEXSYS-ONE: Our global experience indicates the majority of tower owners will face the same key challenges in the near future where infrastructure needs to be strengthened and future proofed ahead of 5G combined with some requirement for acceleration of co-location and an industry need to reduce OPEX. Some MENA countries have infrastructure, security and access challenges but, the same fundamental pressures remain around the push for colocation, minimizing site costs, increasing tenant ratios, providing adequate tower services and processing to completion lease contracts with landlords or tenants. Our out of the box solutions meet the many local pressures and requirements for customized features, The IFRS 16 compliant lease Management solution we offer is proving a very popular pressure point eradicator with our clients.

TowerXchange: Talk to us about the benefits of your platform. As well as delivering higher standards in software to support tower management, is there a measurable ROI which comes from your solutions?

David Gater, Global Head of Business Development, NEXSYS-ONE: I mentioned earlier that our offering is a cloud based, configurable off-the-shelf platform, enabling multiple technologies and applications across a very wide variety of uses which resonates with our customers, this proven software platform combined with unrivalled industry expertise provides as a differentiator to most deployment and maintenance organizations where the most notable benefits can be noted as: 39% less site visits, 40% improvement in payment lead time, 45% tenant

radio improvements, 56% process efficiencies, 78% improvement of implementation quality, 20% reduction in lost assets, 15% reduction in hardware defects and a staggering 35-day turnkey implementation lead time improvement. In 2017 the NEXSYS-ONE module Task-One was awarded as best task management and ticketing system of UAE.

TowerXchange: Can you give any use cases of where your solutions have been implemented and how they have helped your customers with


key decision making or meeting critical business objectives?

David Gater, Global Head of Business Development, NEXSYS-ONE: The financial burdens on a company who operate without detailed visibility into their operational performance can be substantial. In the US, a turf vendor customer required immediate transparency across its operations for a major Tier-one operator with complex deployment processes. With our web service API capabilities, we synchronized their internal financial systems with the operators supply chain platform and deployment management system. NEXSYS-ONE bridged the gap between the systems whilst empowering additional control with advanced features to enable visibility and transparency throughout their organization. Our customer could see immediately in which areas needed focus so we worked together and found areas of improvement where they were failing or losing money and implemented tailored solutions to improve their operations or renegotiate their contract terms when clearly, they were not in their favour.

TowerXchange: Infrastructure will have to change significantly to meet the needs of 5G rollout. Can you talk to us about how NeXsysOne can support the changing shape of infrastructure, and any new solutions you’re working on to develop this?

David Gater, Global Head of Business Development, NEXSYS-ONE: We’ve been around in the telecoms sector since the beginning. We’ve gone through the technology life cycles before and we’re truly excited

to welcome 5G. The networks will indeed change substantially and so will the user experiences. 5G requires a huge back haul capacity upgrade that by no means should be underestimated. Coordinating such an upgrade requires proven software solutions as FIBER-ONE. Mobile operators have already embraced the challenge and FIBER-ONE is in big demand. Cell site capacity upgrades and configuration change management requires proven work force management systems, that are tailored around Telecom implementation processes. Between TOWER-ONE, ASSET-ONE and TASK-ONE, every aspect to upgrade networks to 5G is covered.

The industry cannot underestimate the volume of work required to upgrade networks through 5G and beyond. The evolution of the systems used in most cases to support the deployment and maintenance of required infrastructure are no longer fit for purpose. Operators, systems integrators, OEMs and towercos will need to make bold decisions and implement new “user” friendly project management solutions with advanced features that seamlessly process the required complexity.

Our journey as a company has and is enabling and guiding many organisations to consistently and continually implement, maintain and upgrade tens of thousands of network infrastructure through the 2G > 3G > 4G technology evolutions. NEXSYS-ONE delivers on the tough questions being asked from tomorrows networks, whilst preserving the old with increased efficiency. We welcome the challenges the future brings and would encourage interested organisations to get in touch so we can enable effective management of this complexity for them<









NorthStar: more than justa battery companyMarket leaders in premium lead acid batteries committed to understanding and resolving their customers’ energy storage problems

Thierry Tardivent, Head of MEA and APAC, NorthStar Battery

TowerXchange: Please introduce NorthStar to our readers - what role do you play in the telecoms infrastructure ecosystem? Thierry Tardivent, Head of MEA and APAC, NorthStar Battery: Since 2000 NorthStar’s telecom batteries and site solutions have been delivered in more than 150 countries. NorthStar helps its customers globally to extend battery life and save energy by providing High Performance AGM Batteries specially designed for different grids and telecom applications – I believe today NorthStar Batteries makes the best AGM batteries in the industry. But NorthStar Battery is more than just a battery company. We also have a unique expertise in power systems for emerging markets which is key to optimise battery life and energy saving. TowerXchange: We usually ask how many cell sites in Africa, LatAm and Asia the interviewee’s solutions are installed - I guess that may be difficult to specify given the scale of NorthStar’s business! However, can you give us a sense of the size of your telecoms business in those three regions. Thierry Tardivent, Head of MEA and APAC, NorthStar Battery: Tens of thousands sites in MEA are equipped with NorthStar products. In Pakistan alone, Northstar has equipped over 5,000 sites with a pure fuel saving application delivering outstanding results. Many thousands of hybrid

Read this article to learn:< Why premium lead-acid batteries remain the best compromise between capex and opex

< How to choose the right battery for the grid profile and application

< How to overcome common problems in the installation and setting of batteries

< How to cool batteries with just 40W, even at 30-40°C ambient

< How to protect batteries from theft and vandalism

NorthStar is more than just a battery company. They’ve made a commitment to really supporting their customers. A commitment to help customers select the right batteries. A commitment to identify and resolve power system problems, even if they aren’t caused by batteries. And a commitment to manufacture, and dispose of, lead-acid batteries in an environmentally aware manner. Of course, NorthStar also manufactures premium lead acid batteries which they say represent the best compromise between capex and opex, which is why they are one of the market leaders in energy storage for emerging market cell sites.

Keywords: Who’s Who, How to Guide, Meetup Preview, Energy, Installation, Opex Reduction, Batteries, Fuel Security, Air Conditioning, Off-Grid, Unreliable Grid, ROI, Hybrid Power, DG Runtime, Dimensioning, Procurement, Warehousing, Shelters, Rectifiers, Africa, Asia, Pakistan, NorthStar Battery


sites in Africa have been equipped with NorthStar technology since 2000. TowerXchange: Why are lead acid batteries standing up to the challenge of alternate energy storage chemistries in a telecom context? Thierry Tardivent, Head of MEA and APAC, NorthStar Battery: Frank Fleming, our renowned CTO, has a strong belief that lead acid can remain the technology of choice for telecom energy storage for the next 50 years, as long as we push the limits of the design. We also want to push back against the bad environmental image of lead acid batteries, which is why we invested massively in environmental controls when we built our new factory. Many of our key customers select NorthStar as their preferred / strategic supplier partly because of our strong environmental control. Corporate Social Responsibility policies make environmental control a key target for companies like Ericsson, with whom we’ve been a key strategic partner since 2002. We’re also strategic suppliers to NSN, Huawei and ZTE. TowerXchange: How much tailoring to the specific requirements of individual sites can really be achieved through the selection of batteries? Thierry Tardivent, Head of MEA and APAC, NorthStar Battery: One battery cannot fit all applications. You need different chemistry

depending on the grid profile and energy situation. There’s a huge difference between the battery you should deploy on a stable grid in USA, compared with the unpredictability of the grid in Pakistan, and pure off grid applications in Myanmar for example. NorthStar differentiates ourselves by offering different chemistry depending on the application and grid profile. Whereas with other vendors the battery is a standard, commoditized component, forcing site designers to solve their problems through the modification of other power systems, NorthStar have been able to customise the design of our batteries for different grid availability and telecom applications. For example, one of the most unstable grids we have experienced was in Bangladesh. No matter what power system we used, there were so many repeated power outages that it seemed we were never able to fully recharge our batteries. That presents a problem for traditional lead acid energy storage technology, but we were able to modify our electro chemistry to be fully partial state of charge (PSOC) compatible. TowerXchange: Why is the replacement cycle so much shorter for batteries on developing market cell sites, and what can be done to deliver reliable, sustainable power? Thierry Tardivent, Head of MEA and APAC, NorthStar Battery: We think there is too little

understanding of why batteries are failing. While the right choice of battery is crucial, it’s as much about the electrochemistry as it is the choice of supplier – so simply switching to a different supplier won’t fix the problem. Energy storage solutions need to be redesigned to provide reliable, sustainable power to cell sites in emerging markets, providing faster recharge, high cyclic, high temperature, high efficiency operation. You need to deploy the right power system, on the right settings and ensure it’s installed properly. This is why we are lauching the NorthStar Academy – to help to extend battery life by two to three times and save energy. While some battery vendors may prefer their batteries die sooner to accelerate replacement cycles and sales volumes, NorthStar want to make sure our batteries last a long time and deliver the opex savings targeted. Our success comes from our people in the field, people with a background from the power industry, who can address power system problems holistically and who can help our customers fix those problems. If it’s not a battery problem, we don’t just say “talk to the power system vendor”, we help the customer to change controller settings, cabling et cetera – training their people to avoid repeating mistakes. TowerXchange: I understand NorthStar initially, and to a certain extent still do, sell a significant proportion of batteries via OEMs – how does the entry of the independent towercos affect the


criteria against which energy storage solutions are acquired?

Thierry Tardivent, Head of MEA and APAC, NorthStar Battery: We have always had a strong strategic relationship with OEMs and we will always will. But we also realised we need to accelerate the battery technology and solutions awareness at the end customer level such as with towercos as they are more and more driving the battery selection process. Our technology has been approved already by two major emerging market towercos this year. We still see a few examples where energy storage

solution selection is driven by short term capex savings, resulting in a temporary improvement in the P&L. However, making the wrong decisions in the selection of energy storage is does not yield performance improvements that are sustainable in the medium and long term, particularly at unstable and off grid sites. There are only three or four factories worldwide that can manufacture premium AGM batteries. But the good thing about premium AGM is that they have a two year shelf life thus we can then easily maintain inventories in hubs all around the world and provide a short lead time to our customers; we adapt to the logistical challenges to ensure

our products are available as close as possible to market.

TowerXchange: What is the performance, and cost, difference when using premium lead acid batteries versus lower cost alternatives at cell sites in harsh conditions?

Thierry Tardivent, Head of MEA and APAC, NorthStar Battery: A premium AGM (thin plate technology) would normally cost 30% more than a Standard AGM battery with three to four times greater storage life and up to five times longer operating life in real harsh conditions (typically 2.5 X the life). A lot of our customers are migrating from dual DG to DG plus battery hybrids to cut DG runtime by 50% or more. If you want to optimise energy efficiency programmes, you have to think about total efficiency; about DG efficiency, the efficiency of rectifiers, and the efficiency of batteries. A standard battery can suffer two to three times more loss than a premium battery, which can make a huge difference for some applications. A premium, fast charge battery can take a lot of energy to recharge the battery in short time, which enables the customer to run the DG faster and more efficiently, for a shorter time. For example, when we rolled out NorthStar Blue Technology in Pakistan, we found that most of the operators were buying low cost batteries because of their focus on capex. When they saw that at off

Delivering reliable and sustainable power to the world

Using Premium AGM in Offgrid will offer best Capex /Opex compromise

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grid sites we were cutting DG runtime by up to 85%, we helped them realise that it doesn’t even matter if you replace in your batteries every two to three years if you payback the investment in three to four months.

NorthStar Blue Technology is ideal for unstable and off grid sites; it’s a fast charge, high efficiency battery with Partial State of Charge (PSOC) compatibility. If used in a hybrid genset combination, it offers the best capex and opex compromise. Other technology such as sodium and lithium batteries are two to three times the price and are not so easy to implement in large scale projects.

TowerXchange: Why are telecom batteries failing so early? And what are the key steps towercos and MNOs can take to extend battery life? Thierry Tardivent, Head of MEA and APAC, NorthStar Battery: We need to increase customer awareness of the root cause of batteries problems. What NorthStar have done, and what all the battery manufacturers should have done, is make an assessment on over 60 countries where our batteries had been installed, to find out what were the key challenges were with using batteries, and to and try to find a solution for each: 1 Make sure to select the right battery based on grid and application including sizing/dimensioning; in too many cases there is not enough power to

recharge the batteries. Our recommendation is that customers need to use different chemistries for different locations.

2 Solve installation and setting issues: everything from cabling the battery properly to controller settings (charging voltage, boost timing et cetera); low voltage disconnect; temperature sensor configuration and cooling systems. Too many site installers don’t even know how many rectifiers they need to recharge the batteries – spending an extra US$200 on a rectifier can save a US$5,000 battery bank. 3 Temperature: a 10°C change in temperature can reduce battery performance by as much as

30-50%. But air conditioning just to cool energy storage elements costs a lot of money. A few years ago we partnered with one of the most famous fridge manufacturers to leverage proven consumer product technology into the telecom fields. We took the high efficiency, high reliability DC compressor cooling technology, added a unique cabinet structure and made the world’s most efficient telecom battery cooler called SiteStar. We can now cool batteries with just 40W even at 30-40°C ambient. Over 30,000 sites have been equipped with our SiteStar technology to date with very positive feedback from the field. 4 Protect batteries from theft and vandalism: One approach we’re trying is to protect batteries in a

Source: NorthStar Battery

Why are telecom batteries failing so early?

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safe-like structure. We’ve co-operated with a safe manufacturer to come up with a cabinet which used to be a safe box; made of robust, very thick metal. Another area we’re starting to explore is advanced locking systems.

In some countries theft is related to the parallel market; at one point batteries were even being resold to the operators from which they were stolen! This was resolved with a relatively easy to fix – an engraving that cannot be removed. In other cases the parallel market is home usage, but I feel that’s minimal. No single approach to combating theft can be successful everywhere as there are different causes of theft, from theft by large organisation’s to pilferage within the fuel supply chain. Ultimately combating theft requires working with the operators and towercos to develop an understanding of the nature of their theft problem and what budget they can afford to resolve it. Theft is a problem, and we want to address it. NorthStar can help MNOs and towercos overcome all four of these challenges. I’m particularly concerned when people talk about minimising the competence required of people in the field. While the solution needs to be as simple as possible to be installed and operated, the competence of the average field engineer is not necessarily the same in Southern Asia and Africa as it might be in Europe. We see a lot of mistakes in installation, and we’re happy to the deliver first training at the

NorthStar Academy on the basic principles – we can put all the installers in one room, identify common problems and misconceptions, and make corrective actions. TowerXchange: How do NorthStar ensure you remain sensitive to environmental considerations from manufacture to disposal? Thierry Tardivent, Head of MEA and APAC, NorthStar Battery: NorthStar has invested heavily in building the most environmentally advanced battery plant in the world. But our environmental policies actually start from the design of the product; making sure the battery is designed to last longer and also not to deteriorate beyond the end of its life. We are also developing an advanced solution to operate batteries with the minimum energy consumption – our SiteStar battery cooler designed in Sweden is still the most energy efficient Battery cooler in the industry. TowerXchange: Finally, please sum up how you would differentiate NorthStar’s batteries from other energy storage solutions for remote cell sites. Thierry Tardivent, Head of MEA and APAC, NorthStar Battery: Most battery companies are focusing only on selling their own components. But NorthStar are more than just a battery company. We take a different approach – we really want to help our customers (as well as help ourselves). How we support our customers

is a tangible, core value for NorthStar Batteries. In the past few years we’ve assessed the typical problems faced by our customers, and come up with solutions for what can we do to extend battery life and save energy. We seek to understand our customers’ problems. We’ll audit your site for you and we won’t leave without giving you an analysis of the problem and corrective actions. You won’t get an “it’s not a battery problem – talk to power system vendor” attitude with NorthStar – we have a strong competence on the whole power solution, not just the batteries. We’ve changed the focus of our business to help our customers understand how to select the right batteries. One best electro-chemistry and battery technology isn’t right for all grid profiles and applications. For example, low technology batteries could be good enough for some developed market applications. But battery performance is more problematic in developing markets, so we’ve developed energy storage solutions for unreliable and off grid applications which we think represent the best compromise between capex and opex. Lastly we are developing solutions which have a very quick payback. Payback after five to ten years won’t work in telecom industry – everything needs to pay for itself in less than two years. NorthStar are focused on developing the best opex solutions, with affordable capex and quick payback – making our energy storage solutions a ‘no brainer’!


Keywords: Africa & ME, C-Level Perspective, Community Power, DG Runtime, Energy, Hybrid Power, LPG, Managed Services, Market Entry, Masts & Towers, Microgeneration, Namibia, Network Rollout, Off-Grid, Passive Equipment, Polar Power, TowerXchange Research, Unreliable Grid, Urban vs Rural, Who’s Who

Why Polar Power is movingup the value chainWhy Polar Power have started offering new engineering, design and construction services for towers and how it could help enhance rural connectivity

This isn’t the first time we’ve interviewed you about Polar Power, so please give us a short introduction to yourself and the company.

Arthur D. Sams, President and Chief Executive Office, Polar Power: In 1979, I co-founded Polar Power and started delivering solar photovoltaic power systems to remote locations worldwide. Polar Power has become a leading end-to-end designer, manufacturer and distributor of DC generators for the telecom, marine, oil and gas, military and automotive industries.

Today, starting in Namibia, we have moved up the value chain and now provide engineering, design and construction services for towers so that we can put out technology to work in the most efficient and effective way possible. We intend to spread through Southern Africa once we are established in Namibia, but in time we may be building towers across the world, including our home market, the US.

Polar Power is publically traded on Nasdaq under the symbol POLA. This gives our customers transparency on Polar’s financial strength along with the confidence that we will be around for long into the future to service their needs. Polar directly employs 165 employees comprising of manufacturing, engineering R&D, customer service, and administration. Most of the company’s management is made of highly experience engineers. We are a very hands-on team and we do understand the real technical challenges of our

Read this article to learn:< Polar Powers ambitious plans in Southern Africa< How supply chain rationalisation is pushing Polar Power to enter new markets< The potential of alternative fuel sources to reduce genset total cost of ownership < Strategies for enhancing rural connectivity and development


customers. One of my favourite pastimes is to visit rural communities to explore (and put into practice) ways to improve the lives of people by providing power and cooling.

In the 1990s we pioneered Hybrid Solar Systems using DC generators and this enabled us to lower both the capex and opex while improving upon the system reliability. In 1995, Polar was the first company in the telecom industry to introduce DC generators as a prime power replacement to AC generators. Polar was also the first to incorporate DC generators into Solar Hybrid systems. Actually, our first product in 1979 was a solar powered vaccine refrigerator for use in remote areas worldwide, developed in cooperation with the World Health Organization, NASA, and the U.S. Agency for International Development. Since 1995 and continuing, our focus has been improving every component within the system through engineering innovation, new production tooling and raw material sourcing. A few very simple components can cause a functional problem that requires one or two expensive maintenance trips to the site for corrective action.

Within our Los Angeles headquarters, we manufacture in volume our own alternators, controls, engine accessories and enclosures. We have also developed, alongside Bosch and Toyota our own LPG engines, with a 15-25% fuel efficiency advantage over its predecessors.

TowerXchange: What has prompted the shift from being a manufacturer and provider

of energy solutions to engineering and construction?

Arthur D. Sams, President and Chief Executive Office, Polar Power: Recently there has been a trend towards simplifying supply chains. That means cutting down on the number of suppliers

and reducing the variety of installed components and service providers. This allows for easier supply chain monitoring, and the building of longer relationships between buyers and sellers, but it also involves some compromise in cost and quality. If you reduce the number of suppliers you work with it reduces your capacity to bid down prices to the


most competitive level, and it reduces your ability to explore more suppliers to find the highest quality product.

At the moment only around 10% of African cell sites are using DC gensets, and that means 90% of cell sites are missing out on a cleaner, cheaper, easier to use alternative to their AC gensets. Part of our strategy will be to bring our expertise and DC genset products to market through our construction business.

We have always offered a quality product and worked well with sophisticated buyers, but many of those constructing towers are not sophisticated buyers of energy solutions. The traditional energy

solution is a standby or temporary diesel generator but these are not designed to be long-lived when used autonomously, or to have the flexibility and finesse required of modern telecoms infrastructure. A genset which works when someone is always there to check the oil is not appropriate near the Namib Desert. So to get the right energy solution installed at site we have had to move up the chain and start constructing the towers.

Today, if you point to a site we will put a tower there, and if you’re not sure what type of tower would work best on the site we can help you with the engineering services to decide what tower would be optimum. For example, at some sites wouldn’t require an elaborate foundation and so we

could save you money and time. Right now, we are helping to install the radios and helping to calibrate the antennae, but we don’t do site acquisition. We are engineers, so there are some things we are comfortable with, and some things which belong to someone else’s skill set.

TowerXchange: There are more mature and larger markets around the world, why are you entering Namibia first with your tower construction business?

Arthur D. Sams, President and Chief Executive Office, Polar Power: Namibia is a wonderful market to work in. And a beautiful country as well. First of all, for a small market, there is already an existing tower industry that has done a lot to professionalise the tower industry in Namibia.

Overall, Namibia is an easy country to do business in, with reliable payments and banking infrastructure and is part of a Southern African Customs Union. That zone includes Botswana, Lesotho, Namibia, South Africa and Eswatini. It also has close regional ties with Angola, Zimbabwe and the other 14 members of the Southern African Development Community. Namibia is also just a pleasant place to live, safer than many other countries and a good place to base a regional team.

We are working for a major telco in Namibia to help them in their roll out. They have ambitious plans to add hundreds of towers to bring universal coverage to Namibia’s populated areas. Many regions of Namibia have very limited wireless broadband,

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We have always offered a quality product and worked well with sophisticated buyers, but many of those constructing towers are not sophisticated buyers of energy solutions. The traditional energy solution is a standby or temporary diesel generator but these are not designed to be long-lived when used autonomously, or to have the flexibility and finesse required of modern telecoms infrastructure


especially in rural areas. That’s a big problem in a country with such potential as a tourist destination. Namibia has some of the most amazing wildlife, but without the reassurance of quality telecoms infrastructure they will be unable to maximise the potential of Namibia as a tourism destination.

We want to make an impact here. We are setting a precedent for our way of doing construction and engineering. We want other countries and companies to see how we are incorporating power systems into our build and design and our innovative way of running and servicing the sites.

TowerXchange: Tell us more about your approach to solar and hybrid systems, and what role alternative fuels can play in improving the operational efficiency of towers.

Arthur D. Sams, President and Chief Executive Office, Polar Power: There have been some amazing advances in photovoltaic cells, but now they have reached a level of efficiency where you can buy them as a commodity, the real value add comes from taking a systems approach to your energy set-up. There’s very little cost you can pull out of a solar module, but there is often a lot of cost you can pull out of your overall energy system by making it work smarter. For example, a fuel-based back up can save you a lot of money relative to a battery back-up system. A system which is powered 80-90% solar and 10-20% fuel can have lower overall cost, especially when opex costs like ground rent and battery maintenance are included. Although the land used by extra solar panels is usually relatively

minor, because the tenant is a large corporate, and the need for power is usually acute, rental costs can inflate.

Often people’s default picture of a genset is a diesel generator, but there are alternative fuels which we are really excited about. There are big advantages to diesel in terms of familiarity and ease of transport,

but that doesn’t mean towercos, telcos and their managed service providers shouldn’t be leading the way in exploring alternatives. For all its benefits, diesel can be dirty, smelly, polluting and also cause vibrations and noise which disturb neighbours.

Alternative fuels like liquid natural gas (LNG), compressed natural gas (CNG) or propane can fuel engines engineered for long life, but the modified petrol engines operating on gas have given this application a bad reputation.. We have worked with the propane council and they have been telling us about 80 years old tanks they’ve discovered, still sealed and the fuel was still good. Unlike diesel you don’t need to treat them to stop algae or use additives to stop them gelling in cold temperatures. We have found that these alternative fuel engines have three of four times the life expectancy of diesel engines. We worked with Toyota and Bosch to design and build the ideal gas (LPG and natural gas) engine, and includes our own alternator. We plan to start to deploy this engine into the field at the end of Q2 2019.

There are some key ways that we are reducing the total cost of the energy system. First of all we reduce the maintenance on your starter battery by eliminating it, we use a capacitor instead which is more reliable. Because we’re not using diesel we’re also not using a fuel injector. If water gets into your diesel and that passes through your injector it will seriously reduce its lifespan which again pushes up maintenance costs and site visits. The alternative fuels also work well at a lower rate of compression so your bearings, crankshaft, pistons, et cetera all


take less punishment and last longer. All across the engine we’re reducing the wear and tear it will suffer in normal operation and taking out components which can go wrong. To also reduce maintenance and greatly improve fuel economy we removed the parasitic load of the engine including all V-belts, belt driven alternator, belt driven water pump, and the charging battery alternator.

TowerXchange: What is holding back the greater adoption of alternative fuels? Are the distribution networks there for it?

Arthur D. Sams, President and Chief Executive Office, Polar Power: We’ve been deploying alternative fuel generators for nearly 20 years. For example, in the US, if a tower is on federal land you cannot burn diesel without a special permit. Even on military sites, natural gas and propane is used. So there’s a market for them and the technology is proven. At the moment there is an infrastructure deficit, but with the potential efficiency gains, it will be worth investing to fill that gap.

Towers and telcos wouldn’t be the only market for these fuels. Deforestation is a major issue in many places in Africa, and many hours a day are spent just collecting wood to burn. A propane distribution network displaces that and gives every family that uses propane a couple of extra hours a day to do more valuable work. Fuelling telecoms sites creates the sort of throughput that a distribution system needs to get started, but once the market for cooking fuel is live it doesn’t require any subsidies. What we can do with alternative fuels we can do

with other aspects of the telecoms value chain to push rural development. It is a big opportunity.

TowerXchange: As something of an outsider to tower construction, how do you want to see site development change?

Arthur D. Sams, President and Chief Executive Office, Polar Power: There’s a big opportunity for rural development, which in my view, we are missing out on because we as an industry aren’t involving the whole value chain created by telecom site development. On current lines, the business case for connecting rural sites is lacking, but of course, without connectivity it will take even longer for those reason to develop strong business cases for investment.

But for the last 25 years, we have seen banks enter rural areas and put in a power system for a remote ATM. Today, you don’t need an ATM to access banking services, but you do need wireless broadband. The development also supports safety and security services which are essential for attracting tourists. Bringing it back to our roots, it also enables the storage of vaccines and for medical treatment which supports the development of future generations of producers and consumers.

So the whole pie grows, it helps commerce, health, tourism, finance, security, education. But the issue is we’re not collaborating. It’s not an easy problem to solve, to coordinate all the different parties who would benefit and crystallise it into a viable

investment plan, but it is what is needed. Sadly we cannot rely on government programmes to connect rural areas because they move to slowly.

In developing areas the two most important areas are power and broadband and that is what the tower industry provides. A power system alone in many areas would be great, but it needs to be maintained and telcos can provide, or contract for, maintenance. Broadband and low-cost power go hand-in-hand. How you monetise that power generation and justify that maintenance cost is another question, whether you can give access to your generation for charging batteries or use excess energy to power a school, and your independent systems, fuel service and maintenance personnel are shared. Or perhaps the schools or local business enterprises generate power and sell to the tower company, these are some of the options.

Once upon a time, a major beverage company investigated using solar generators in remote locations so people could enjoy cold beverage in rural areas. Years later when people moved to the cities they still enjoyed that cold beverage and kept buying it because they remembered it had been there when they were young. Viettel are using this strategy in Tanzania, going to rural areas, winning customers, and then keeping them and banking a lifetime of income far in excess of the cost of the capex required to reach that rural community. There’s so much more value add possible in the telecoms industry, but it requires even more coordination


Keywords: 4G, Asset Register, Bankability, Batteries, Build-to-Suit, Construction, Densification, ESCOs, Hybrid Power, MLA, Monitoring & Management, O&M, Off-Grid, Opex Reduction, SLA, Sale & Leaseback, Small Cells, Tenancy Ratios, Towercos, Valuation

A strategic approach to deliver outstanding total cost of ownershipHow Ramboll offers much more than just steel structures

TowerXchange: Please can you introduce Ramboll to TowerXchange readers.

Pankaj Sachdeva, Country Market Director – Energy and Telecom, Ramboll: Ramboll is a leading engineering, design and consultancy company founded in Denmark in 1945. The company employs 15,500 experts globally and has especially strong representation in the Nordics, UK, North America, Continental Europe, Middle East and Asia Pacific.

With more than 300 offices in 35 countries, Ramboll combines local experience with a global knowledgebase constantly striving to achieve inspiring and exacting solutions that make a genuine difference to our clients, the end-users, and society at large. Ramboll works across different markets including telecom, buildings, transport, planning & urban design, water, environment & health, energy and management consulting. As a provider of telecom consultancy, we seek to become a trusted knowledge partner to our clients, offering technical support throughout the project lifecycle. Our client base includes tower companies, operators, vendors, contractors, investors and other parties.

Talking about our towers and telecom service, we have evolved keeping ahead of the market trends and are ranked No.1 globally in the ‘Towers and Antennae’ category among the international design firms worldwide (ENR Sourcebook 2018). We also recently received the Aegis Graham Bell Award for ‘Innovation in Telecom infrastructure’ at the India Mobile Congress 2019 and the Corporate Vision

Read this article to learn:< Ramboll’s history, expertise and geographical coverage

< Why the company opts for a customised approach for clients

< Developments with Ramboll’s Rapid Deployment Units

< How Ramboll work with clients to focus on long term solutions over quick fixes

< Ramboll’s Smart City solution

With over 70 years’ experience in the telecom industry, Ramboll has become a trusted partner in the sector, working alongside clients to better develop customised solutions which address long term holistic network requirements. TowerXchange speaks with Ramboll to find out more.

Pankaj Sachdeva, Country Market Director – Energy and Telecom, Ramboll

K.Suresh Babu,Business Development Director, Ramboll


award 2019 for Best Telecom Tower & Mast Design Specialists 2019.

TowerXchange: On the spectrum between an “off-the-shelf” and “completely customised” method to designing and supplying towers, where does Ramboll sit? What is the reason behind this approach and what are the main capabilities that you have to support this?

K.Suresh Babu, Business Development Director, Ramboll: Market conditions and demands differ depending on clients and geography, and it is Ramboll’s experience that customised solutions provide maximum value to our clients. This not only relates to towers, but generally to all our services. We need to find the most cost-effective solutions for each of our clients, and therefore we need to consider each project as unique. In Ramboll we take advantage of having been in the telecom business for almost 70 years, and with optimised processes and advanced expertise supported by our advanced in-house software, it is possible for us to provide highly optimised designs within short timelines.

TowerXchange: There is strong demand for aesthetically pleasing, environment friendly, low-cost and rapid deployment towers at present globally – how has Ramboll been supporting and servicing this demand?

Pankaj Sachdeva, Country Market Director – Energy and Telecom, Ramboll: At Ramboll, we put in a lot of effort into innovation and continuous development of new concepts and solutions to the market. Our

experience in catering to projects globally helps us apply our global expertise to local challenges and offer holistic solutions.

Each city has its local flavour and cultural inclinations which determine its need. As part of our customisation, we ensure that the towers designed take into consideration all the factors concerning the climate, aesthetics and trends of the city.

Ramboll’s smart city solutions is a good example to cite here – towers do not need to typically be a tall pole standing upright. We have designed models that have telecom equipment fitted into smart poles

and bus stations which is camouflaged aesthetically. We also have solutions like the solar tree for public spaces such as parks.

TowerXchange: When upgrading towers for the addition of tenants there can be a lot of inefficiency in the suggestions made by consultants, can you share some examples of where Ramboll has helped clients develop a more cost-effective solution.

Pankaj Sachdeva, Country Market Director – Energy and Telecom, Ramboll: There could be a possibility that solutions implemented on sites which are inefficient and do not consider


long-term sustainability. I believe that a strong communication link between consultants and the client solves most problems. There is a need to discuss the goal amongst the stakeholders as there is a risk of optimising the solution based on the wrong parameters if this discussion is not included in the process. Upgrading towers should be a strategic consideration where the tower portfolio is looked upon as a whole. The strategic decision should be taken by combining technical and commercial knowledge. Ramboll is a knowledge partner to clients, and it is always Ramboll’s aim to talk strategy before deciding on concrete solutions.

For instance, after discussions with one of our trusted clients, who was executing a strengthening project on several existing towers, we understood that the overall aim of driving down the cost was not really met, and hence we were asked to investigate the solution. It was clear that the speed of the implementation was quite good. However the overall cost, including the materials, was high. We provided an alternative solution to our client, based on a generic strengthening solution, grouping towers to streamline the manufacturing and supply chain as well as make the implementation easier. It required upfront changes to the solution

and the supply chain, which can have initial cost go up due to additional design and management hours. However, including the material and implementation cost, our client saved more than 20% of the initial implementation cost. In addition, we ensured that the towers were calculated in accordance with the latest standards. If our client had not been ready to share their overall challenge and their goals, Ramboll would not have been able to provide efficient support.

We generally believe that more time should be spent on planning, if our aim is to work effectively and minimise the total cost of a network upgrade. We are obliged to move towards sustainable solutions, and the way we work should mirror that, rather than focus on a short-term quick fix.

TowerXchange: Smart city initiatives and increased requirements for densification in urban areas are fuelling demand for camouflage solutions – can you share some designs/initiatives that Ramboll has been involved in and how you helped clients fill a brief.

K.Suresh Babu, Business Development Director, Ramboll: We have always looked beyond today for solutions that are innovative and ahead of the future and our smart city initiative was one such move in this direction. Ramboll’s smart city solutions are customised to make city residents have modern conveniences in a secure public environment. Interactive smart structures also ensure that the governing authorities have access to real-time data enhancing the efficiency of the

28-08-2018TD/BD REVIEW

RAMBOLL CAN SUPPORT IN ALL PHASES OF A PROJECT LIFE CYCLE

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• Project Excellence:

• Over the years Ramboll has experience an increased demand for project excellence, as projects are becoming increasingly complex.

• Ramboll has a dedicated and methodized project management approach, which is commonly used across Ramboll.

• Execute Decommissioning / Site Retirement Plan

• Evaluate site life cycle and learnings

• Software Solutions• Asset management

programs• Operation and

Maintenance Planning• Perform condition

assessments• Focus on optimal

utilization of sites• Risk Assessments• Validation and Upgrade• EMR

• Design of smart City Solutions• Design of Masts, Towers &

Monopoles• Site design (Model sites)• Technical Due Diligence• Design requirement

specifications • Provide site specific designs

• Identify solution providers and suppliers

• Collect supplier information on size, products, competencies etc.

• Approvals and Negotiation• Supply chain management

• Contract Management • Supervision (manufacturing & construction)• Authority handling• Educating and training staff• Design and Supply (construction with partners)

Planning

Purchasing

Deployment

Operate

Decommission

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Ramboll Services areas:

OPEX PhasesCAPEX Phases


government. Each smart structure can be fitted with multiple functionalities as per the city’s requirements.

The focus areas for us with regards to smart city solutions are as follows:Integrated and multi-purpose solution: Telecom cells that can be integrated in structures like Smart poles, Bus Stations and Solar Tree, which also serve other purposes like traffic signalling, public security systems, disaster response mechanism etc.

Infill sites: Smart structures at vantage points or along city streets to enhance connectivity and provide faster data.

Aesthetic solutions: Structures that can be functionally designed to suit the aesthetic requirements of a city or the client’s need (camouflage)

Counter CO2 emission: Integrated multipurpose solution, which is custom-made to meet several demands, with the aim to reduce material and resources resulting in reduced CO2 emissionSuch solutions can become beneficial not only to our clients, but also to society, as they may have environmental and social benefits too. Some of our concepts have already been manufactured and installed by our clients, and one picture from India can be seen in the photos


Cell sites for the 5G-eraSalasar has deployed more than 25,000 structures and is gearing up to supply the explosion of infill sites needed for 5G in MENA, and across the world

TowerXchange: Please introduce your company and the typologies of telecom site which you offer.

Shashank Agarwal, Managing Director, Salasar Techno Engineering Ltd: Salasar Techno Engineering Ltd started its journey around 13 years ago and is India’s leading provider of steel and infrastructure solutions, with customers spread across the globe. Working in 30+ countries, we have pioneered the design, manufacture and installation of all kinds of infrastructure for the telecom industry with full customisability.

Our diverse product portfolio comprises of everything that the telecom industry needs, including angular towers, tubular towers, hybrid towers, monopoles, camouflaged monopoles, smart city poles, cell on-wheels, skid-base towers, accessories, and more. All that we do is driven by the single purpose of “Building a Stronger World”. Not only are we experts in carrying out turnkey EPC of telecommunication towers, through which we kicked-off operations in just a short span of time, but also our product portfolio has grown to cater for all sorts of infrastructure needs, be it renewable energy, smart cities, power transmission, or India’s ever expanding network of roads and railways.

TowerXchange: How proven are your sites in the field, how many of your structures have been deployed globally?

Shashank Agarwal, Managing Director, Salasar Techno Engineering Ltd: Since inception, our company has focused on providing safe, rigid and

Read this article to learn:< Salasar’s range of products

< How Salasar will support 5G rollout

< How innovations in AI can improve health and safety

< Salasar’s experience and deployed volume

Salasar Techno Engineering Ltd has been providing high-quality, safe, adaptable and innovative telecom towers for more than 13 years. Based in India, but with operations globally, Salasar has made its name providing macro sites to Indian mobile network operators. Salasar also offers a range of smaller sites, camouflaged towers and smart poles and are gearing up for the extra sites required for the 5G-era. TowerXchange interviews their Managing Director, Shashank Agarwal and asks about the company’s origins, its innovations and its plans for the future.

Keywords: 5G, Camouflage, Health & Safety, India, Infill, Masts & Towers, Passive Equipment, Ramboll, Salasar Techno Engineering Ltd, Site Surveys, Smart Cities, Steelwork, Who’s Who

Shashank Agarwal, Managing Director, Salasar Techno Engineering Ltd:


optimised towers to the telecom industry. Salasar Techno have deployed more than 25,000 structures, both in India and globally, for various telecom customers.

Because of our association with M/S Ramboll Telecom we have solidified our proposition in the market as a provider of safe and optimised towers. That has translated into a higher level of customer satisfaction for our various customers.

TowerXchange: As the Middle East enters the 5G era, how do you see the balance of macro sites and other site typologies changing?

Shashank Agarwal, Managing Director, Salasar Techno Engineering Ltd: The demand for mobile broadband will continue to increase in the next few years, largely driven by the need to deliver ultra-high definition video. However, 5G networks will also be the platform enabling growth in many industries, ranging from the IT industry to the automotive, manufacturing industries, entertainment, et cetera.

5G will enable new applications, for example, autonomous driving, remote control of robots and tactile applications, but these also bring a lot of challenges to the network. Some of these are related to providing low latency in the order of a few milliseconds and high reliability compared to fixed lines. But the biggest challenge for 5G networks will be that the services to cater for a diverse set of services and their requirements. To achieve this, the goal for 5G networks will be to improve the flexibility of their architecture. To cater for the

increased demand for seamless connectivity for mobile networks, the industry requires lots of infill sites which translates to demand for small cells and typically standalone towers.

Towerxchange: When designing new sites and smart city poles how do you balance the concerns of camouflage, cost and structural capacity?

Shashank Agarwal, Managing Director, Salasar Techno Engineering Ltd: Various ways of reducing the visual impact of mobile towers have been tried in many countries. These include the use of alternative support structures to hide the towers and the camouflaging of towers.

Local administrations in many countries have set standards for the installation of mobile towers in order to minimise any adverse visual effects. International experience indicates that local civic authorities are concerned about the skyline of cities and encourage various techniques like

camouflaging and integration of towers with surrounding structures. However, for implementing such techniques additional expenditure is required.

We are focusing our efforts on balancing out the additional cost of camouflaging without compromising on the structural capacity by working alongside local bodies and the industry association. We are advocating that permits for sites and one time permission charges should be removed so that the desired objective of all stakeholders are achieved.

TowerXchange: Tenancy ratios in MENA are currently low, but tower sharing is growing, what are the most economical ways to strengthen a tower structure to accommodate more tenants and more wind load than it was originally designed to accommodate?

Shashank Agarwal, Managing Director, Salasar Techno Engineering Ltd: Legacy towers during the initial tower rollout stage pose a big challenge

To cater for the increased demand for seamless connectivity for mobile networks, the industry requires lots of infill sites which translates to demand for small cells and typically standalone towers


for the MENA region because all these towers were typically designed and installed without any provision for additional tenants. This typical issue will pose a big challenge for MNOs in the region. The industry will require lots of safety and technical audits to validate if there is any possibility of accommodating additional tenancies on existing towers. According to our assessment, there is no common solutions or standard solution to provide to address this challenge. There is an urgent need for specific solution for the MENA region to address tower sharing to accommodate more tenants.

TowerXchange: Please describe any innovations you have developed that make your sites resilient to the difficult conditions present in much of MENA. How have these innovations helped reduce costs and improve the re-usability of towers?

Shashank Agarwal, Managing Director, Salasar Techno Engineering Ltd: The MENA region has its own special requirements for the resilience of telecom infrastructure due to extreme weather conditions. Salasar has a technical collaboration with Ramboll, the world leader in telecom and high mast design. With collaboration from Ramboll, our tower designs are lighter in weight and cost 20% less than conventional towers.

Also, our innovative monopoles designs can endure all types of soil and wind conditions. With large scale deployment, land acquisition and tower aesthetics is becoming a costly challenge even for the telecom giants and monopoles are the need of the hour.

We also provide high quality aesthetic camouflaging for our monopoles, which not only make our sites look better but also make it easier to secure land permits due to less footprint for the monopoles installation.

TowerXchange: Worker safety is of critical importance, what can you tell us about your artificial intelligence solution for health and safety?

Shashank Agarwal, Managing Director, Salasar Techno Engineering Ltd: Environment, Health and Safety (EHS) is a set of processes, rules, standards, and regulations aimed at the protection of the environment, company employees and society from any damage. The EHS industry is only starting to apply AI to its operations. Companies are slowly but steadily adapting their safety programs to keep pace with evolving technological advances. Our AI provides a significant number of benefits and improvements.

Currently, under our offshoot “Salasar New Age Technologies”, we are working on an AI-based safety program called “Salasar AI Suraksha” which aims to reduce human intervention in safety monitoring.

Our technology can offer intelligent databases with a built-in AI. That means that we can monitor and analyse sustainability data and then compare them to prescribed parameters in order to detect errors or areas that are to be considered. It also provides alerts if thresholds are exceeded or some anomaly is detected.

Another sector where our AI proves its efficiency is predictive maintenance. Based on the data it generates, AI systems can provide recommendations and forecast any failures or accidents.

TowerXchange: What are your visions for the future of your company? Where do you see yourselves in five years from now and what worldwide telecoms developments excite you the most in terms of business development?

Shashank Agarwal, Managing Director, Salasar Techno Engineering Ltd: Telecom companies are competing in an increasingly fast-paced, complex, global economy. We aim to succeed by navigating where customer needs are fast changing, and extensive technology investment is required.

The transition to 5G is expected to generate a windfall for network, infrastructure, and equipment vendors. We intend to contribute effectively towards the economy as it moves towards 5G. We are trying to discover new markets and new customers, where we can offer our solutions. At the end of the day we want to be known as a company of international standards from India.

For Salasar Techno, the most exciting part of the 5G expansion is that industry will be needing higher number of the connectivity points which in turns converts into lots of infill sites. The additional requirements will provide us a big opportunity and we are fully prepared to ride on this growth opportunity for our future business growth<


Creating a safe and efficienttower ecosystem through access control innovationSera4 on the evolution of its cutting edge products and key market trends

TowerXchange: Please re-introduce Sera4 for any readers not already familiar with your vision and achievements. David Coode, CEO, Sera4: Sera4 is a keyless access control company committed to protecting critical infrastructure while making life easier for everyone involved. Five years ago, Sera4’s engineering team came directly from Blackberry, the pioneers of mass-market wireless security. It was only natural that usability, universality and security are all core design principles we carried forward from our experience. We started out serving the telecom market in Mexico and spread throughout Latin America, and now we have a global focus with our business. We have a vision to use technology to bring great value and great experiences to our customers. TowerXchange: Two years ago, we sat down with you to discuss your plans and activities across CALA. How has Sera4’s footprint evolved and what success stories you can share? David Coode, CEO, Sera4: Two years ago, we were only establishing ourselves within Mexico. Since then, we have introduced a padlock to our product line. This padlock was specifically designed for the telecom industry and to serve critical infrastructure usually exposed to tough weather conditions and often forgotten for months at a time, and it was selected by American Tower for their sites in Latin America. We have also launched our next generation of lock controller, the MX5. We have some very

Read this article to learn:< The evolution of Sera4 products and value proposition

< The top security challenges that towercos and MNOs face in CALA and globally

< How security and access control can drive efficiency across telecoms infrastructure

Five years ago, Sera4 was a pioneer in offering keyless access control to MNOs and towercos in Mexico. The company has now expanded its footprint across many countries in CALA as well as globally, and is driving efficiencies among towercos, their clients and vendors thanks to its integrated control access system. Sera4 provides a cloud-based Network Operations Center (NOC), electronic controllers and smartphone apps that enable secure onsite access.

TowerXchange caught up with Sera4’s CEO David Coode to hear about the company’s expansion and how their solutions are reducing losses and disruption while helping towercos and MNOs in achieving efficiencies.

Keywords: Access Control, Americas Insights, American Tower, Capex, Managed Services, Mexico, Monitoring and Management, Opex Reduction, Sera4, Site Management System, South AmericaDavid Coode, CEO, Sera4


important updates in our servers, which not only enable scaling and reliability, but many new features as well. Additionally, we have expanded into four continents and some adjacent segments such as TV broadcast and transportation network infrastructure. Our team has also grown significantly over the last four years. We have added some great technical and business talents, and have some scale to extend top quality support to all of our customers. Our ecosystem of partners has established and is really growing well. It is perhaps this ecosystem that helps to create the most value compared to who we were two years ago as it enables new models, such as Access Control as a Service (ACaaS), which is a very easy way for customers to get started with keyless access control. TowerXchange: What are some of the main challenges and inefficiencies when it comes to controlling sites access? How are you helping to address those challenges? David Coode, CEO, Sera4: We’ve discovered over 50 different challenges when it comes to more traditional forms of access control. Each of these are opportunities for optimisation and value creation. The most important challenge is anonymity, when someone knows they are not identified going into a sensitive area, they are much more likely to steal. This has been clearly proven: we have shown vandalism and theft have fallen dramatically each time we install. The other main challenge is around the management of physical keys: getting the right

key to the right person at the right time, the risks posed when a key is lost, and the lost time when someone forgets their key. We have seen that no one in 2019 forgets their phone! Our core technology of keyless access control provides operators and towercos with a way to get efficiency without trading off security. We help customers to adopt this technology by bringing in ecosystem partners as needed to complete solutions

and provide a great customer experience during implementation and over the long run. TowerXchange: What differentiates your offer and solutions from your competitors and what is unique about your value proposition? David Coode, CEO, Sera4: We were the first in the market with keyless access control that covered the needs of both towercos with perimeter access and MNOs with cabinet and shelter access. We have the most experience on the market in delivering a solution across all phones that simply works when it needs to. This point is really important, as we promise operational efficiency to our customers so we make sure that it works reliably and without any need for end-user training. Earlier, we took this point for granted, but we are seeing how it is not the case with some other access control solutions. We are also all about customer experience—it’s deeply ingrained in our company’s DNA. We support them zealously, and when they have special requests we are often able to accommodate them quickly in a way that large companies just cannot match. Sometimes those special requests are for features or customisations, and other times it is in the structure of a business deal. I am personally responsible of maintaining Sera4’s commitment to a great customer experience as we grow. Though it may seem counter-intuitive, we are somewhat unique in our choice to be great in something as specific as access control. We see many companies in access control spread into


asset tracking, job ticketing or other adjacent value streams. These moves might make sense on paper but we don’t want to compete with experienced firms in adjacent segments while also spreading ourselves too thin. TowerXchange: How are security and efficiency related and how are Sera4’s solutions helping MNOs and towercos to optimise their assets? David Coode, CEO, Sera4: Although we use the word “security” when we talk about reduction of theft, it’s really important to note that security is not the issue: it is identification. No one wants to be identified as the last person on a site before the batteries are discovered to be missing. This psychological deterrent is very effective. But, still, there are those who are brazen and try to steal anyway. I remember meeting with a customer who was bragging about all the thieves that our solutions help them to catch and how many of them are now in prison. Thieves in prison is someone else’s mission, but in every configuration we’ve implemented we see the elimination of the majority of losses and disruptions due to site vandalism. I think it is easy to imagine how eliminating a physical artefact like a key to open a lock can lead to natural efficiencies. I am consistently surprised when I learn about the real inefficiencies in the field and with the staff involved in key and access log management. Our customers often save more money in efficiency improvements as they do in theft recovery. As I mentioned earlier, this efficiency effect is magnified when both a towerco and an

MNO on a site share the same system because the coordination between organisations is often very inefficient. Usually that benefit is most felt by the towerco because the MNO doesn’t feel the pain of how they ask for access in a secure environment, and now it can be fully and securely automated. It’s easy to see how real-time access data can feed business intelligence systems and show how to take the efficiencies to an even greater level. With reduced losses and greater efficiencies, we can work with our customers on financial models that can save them money as soon as they deploy a Sera4 access control system. Then, with fewer losses, our customers can plan for lower capex budgets while efficiencies lead to lower opex budgets at the same time. Ultimately, this leads to greater asset efficiency for our customers. TowerXchange: With so many different parties operating several elements of the sites, how important is communication across this complex ecosystem and how is your solution driving a dialogue among tower companies, operators and their partners? David Coode, CEO, Sera4: We believe that understanding the players in an ecosystem is critical to delivering a solution that works flawlessly and is feasible to install and service. Communication is critical so that our solutions behave as we expect when installed at customer sites. Of course, this is only possible with a dedicated focus on a market such as Sera4 is focused on telecom. We are in a position to drive the discussion amongst the

ecosystem because we have a solution that delivers high value to our customers, while at the same time it is a narrow piece of many RFQs and we partner well with others. We have seen the value that is created for our customers when the towerco as well as the MNOs are using Sera4 on a given site. When we participate well in the ecosystem, we envision not only gates and cabinets, but gensets, fuel containers, fibre-optic nodes, battery shelters and anti-climbs all controlled easily and without friction from the one phone – something we all carry with us anyway<


Keywords: Americas, Business Case, Energy, Energy Efficiency, Energy Storage, Fuel Cell, Fuel Security, Hybrid Power, Meetup preview, Microgeneration, O&M, Off-Grid, On-Grid, Opex Reduction, Outdoor Equipment, Renewables, ROI, SerEnergy, Site Level Profitability, Unreliable Grid, Who’s Who

Methanol fuel cells making inroads into the telecoms sectorAn interview with SerEnergy, provider of silent and emission free power solutions for telecoms

TowerXchange: Please introduce SerEnergy, its activities and footprint.

John Lindegaard Kjær, Sales & Marketing Director, SerEnergy: SerEnergy has been in the market since 2006, developing and manufacturing power systems. We focus on the stationary market for backup, supplementary and primary or hybrid power sources. We distribute our systems globally.

SerEnergy’s products are based on High Temperature PEM fuel cell technology that improves our clients efficiencies around 40-45%, while reducing cost and replacing conventional, pollutant technologies such as diesel generators.

With a green mindset SerEnergy aims to contribute to the world’s transition from fossil fuels to renewable energy, as well as overcoming some of the obstacles within the renewable sector such as flexibility and availability.

Headquartered in Aalborg Denmark, SerEnergy is a leading fuel cell manufacturer. Owned by German company (Fischer Group) we have 2,500 employees, strong financial capabilities and the ability to support our customers globally.

TowerXchange: Fuel cells have not been spoken about much in the TowerXchange Journal, can you explain what grid situations they are most suited to and how extensively they have been deployed?

John Lindegaard Kjær, Sales & Marketing Director, SerEnergy: There are various types of methanol

Read this article to learn:< SerEnergy’s footprint, activities and production capacity< The different use cases of fuel cells and comparison with other sources of power generation< Serenergy’s fuel cell efficiencies and space requirements for indoor and outdoor scenarios< How to install and maintain fuel cells< The positive impact of fuel cells on emission reduction

John Lindegaard Kjær, Sales & Marketing Director, SerEnergy

SerEnergy is one of the largest methanol fuel cell manufacturers in the world and a pioneer in powering telecoms infrastructure with this kind of solution. TowerXchange speaks to the company’s Sales & Marketing Director, John Lindegaard Kjær to understand where fuel cells can bring real benefits to telecom sites regardless of the grid conditions.


fuel cell systems, but in general they can be used for backup power, supplementary power or primary power.

Backup powerA lot of customers around the world need to be able to run communications systems at all times, which puts more stress on the reliability of the systems and on grid availability. This means that even if you are based in areas where loss of grid (down time) only happens every second year or less, you still need a backup system that is always able to provide power so that your systems keep running. If you need longer than six or eight hours of backup time, batteries typically become too heavy, space demanding and expensive.

Traditional diesel generators offer longer backup time, but for systems that are not running very often they still need to be maintained, and you need to make several startups per year to make sure they can run in a backup situation. Our fuel cells offer great advantages in those cases, since they are able to be used for both short and long backup time. At the same time, they are more or less self-maintaining and even if they are not in use, the systems are able to be kept in optimal conditions through self-test programs and automatic start-up cycles.

Core telecom sites and security networks are some good examples, and we could also highlight systems located in regions where you often see extreme environmental conditions such us earthquakes or typhoons that cause long grid blackouts.

Supplementary powerIn many situations and regions, you need a supplementary power system which is able to take over when the primary power source is not running. The system could run several hours per day or per week. This could be for regions with unreliable grid, but it could also be part of a green installation with solar panels, wind turbines or other energy sources where the fuel cells can ensure that the system is running 24/7. In many parts of the world, especially Asia and Africa, the grid is highly unreliable and in order to keep telecom sites up and running you need either an alternative to grid power or a system that can run several hours a day or per week due to outages. Methanol fuel cells offer an ideal solution to conventional power sources like diesel generators due to low fuel cost and less maintenance requirements.

Primary powerMethanol fuel cell systems are also a great alternative to traditional diesel generators when it comes to providing power for off-grid sites.There are large investments involved in connecting remote sites to the grid, so together with the low operation cost and the relative little investment, the fuel cell system can offer large cost benefits for the customers. Both maintenance and fuel cost are in most cases much lower when operating a methanol fuel cell system if you compare them with diesel generators.

TowerXchange: What advantages do fuel cells offer above other sources of generation?

John Lindegaard Kjær, Sales & Marketing Director, SerEnergy: The fuel cell technology has a number of advantages compared to batteries and diesel generators. First of all, the fuel cell system is a technology that offers up to 70% reduction of CO2-emissions. Besides that, the fuel cell technology offers several clear advantages compared to diesel generators. Especially in densely populated areas where the surroundings are quite sensitive to noise, vibrations and harmful emissions. Diesel generators will give you all three at the same time, while the fuel cell system can offer you low noise, no vibrations and no harmful emissions due to the nature of the technology. This allow customers to set up the base-stations where the coverage is best, and it also makes it easier to get the required approvals from the owner of the property as well as the authorities.

Fuel cell solutions offers a very compact design per kW. It can be installed in either an outdoor cabinet next to the actual telecom equipment or it can be integrated into an existing indoor solution. In an outdoor solution, the footprint for up to 15 kW is typically not bigger than 1×1 metre including cabinet, modules and tank while in an indoor installation offers an even smaller footprint integrated into e.g. a 19’’ rack system. Not only is it convenient on existing sites but it also saves money on rental cost and installation.

Our fuel cell system is fully monitorable, not only when it comes to power output but you are also able to monitor the state of the inside of the system e.g. fuel cell stack, reformer et cetera. At the same time


the system is running fully automatically and will be more or less self-maintaining and conditioning. The monitoring system also allows you to monitor fuel levels, state of the grid and alarms making it possible for the customers to respond faster to alarms, service requests etc.

The efficiency of the fuel cell system is another area where it outperforms existing technologies. The fuel cell system is dimensioned according to the exact needs of the customers and it runs at a very high efficiency no matter if it is delivering 30% of its capacity or 100%. The electrical efficiency rate is typically between 40-50%.

Methanol fuel cell offers a cheap fuel source. Methanol fuel cells runs on a blend of water and methanol which is easily accessible in most parts of the world and at low rates. At the same time the use of methanol offers a CO2-neutral alternative to traditional fuels, depending on the source of the methanol.

TowerXchange: How robust is the system and how simple is it to install and maintain?

John Lindegaard Kjær, Sales & Marketing Director, SerEnergy: Fuel cells offers a robust design, meaning that the technology is equipped for the most extreme conditions. The installation of the fuel cell system is quite easy and in most cases, offers more flexible and faster installation options than traditional power sources – like the options for integration into existing enclosure solutions. The fuel cell system is a compact and lightweight design which is a big advantage for base stations

with limited space and also for installations in city areas on rooftop sites, in buildings et cetera.

TowerXchange: What kind of opex reductions can fuel cells provide and how does TCO compare to other sources?

John Lindegaard Kjær, Sales & Marketing Director, SerEnergy: Our methanol fuel cell systems offer low maintenance because they are self-conditioning and maintaining, and the systems can be monitored remotely, resulting in large savings in terms of service cost, unplanned site visits et cetera. As mentioned, previously methanol is a cheap fuel source and, in most cases, and in most parts of the world methanol is cheaper than traditional fuel sources.

TowerXchange: How do SerEnergy differentiate themselves from other fuel cell providers in the market?

John Lindegaard Kjær, Sales & Marketing Director, SerEnergy: SerEnergy was established back in 2006 and has since then worked intensively with the implementation of the technology into stationary applications like telecommunication. That also means that the SerEnergy fuel cell systems have been tested and deployed in many markets and with many customers giving a proof of concept which not many competing companies can match. SerEnergy is committed to serving our customers commercially and technically meaning that we support our customers remotely and locally in a way that not many of our competitors are able to offer









Embracing complexity: how Sitetracker is helping infrastructure owners level up their assetsSitetracker’s platform can help MNOs and towercos in the race to 5G

TowerXchange: Please introduce Sitetracker, your company, and footprint.

Giuseppe Incitti, CEO, Sitetracker: Our mission is to power the successful deployment of critical infrastructure. As the global standard for managing high-volume projects, the Sitetracker Platform enables growth-focused innovators to optimize the entire asset lifecycle. From the field to the C-suite, our software enables people to perfect how they plan, deploy, maintain and grow their capital asset portfolios. Our customers are market leaders in the telecommunications, utility, smart cities and alternative energy industries, including Verizon, Nokia, Cox Communications, Alphabet, and Tillman Infrastructure. They rely on us to manage millions of assets and projects representing over $19 billion of portfolio holdings globally.

TowerXchange: Tell us about your solutions – can you give any examples of what you’ve delivered in telecoms to date?

Giuseppe Incitti, CEO, Sitetracker: We work with companies across the telecommunication industry, including fibre, engineering, small cell, DAS, and tower companies. Some of our telecommunications customers include Verizon, Cox Communications, ISCO International, and Tillman Infrastructure. Our tower customers, for example, use Sitetracker to manage assets, leasing, co-location, site acquisition, maintenance, and more. So, we’re working with leaders in tower construction, site and tower asset maintenance, and site acquisition who have embraced change and are ready to succeed at this inflection point in the telecommunications industry.

Read this article to learn:< Who Sitetracker are and what they have delivered to date

< Why having control and insight into assets is critical for MNOs carving out towers

< What tower owners need to consider when preparing for 5G rollout

< Which smart city solutions Sitetracker has got up and running

Working with high profile clients like Verizon, Nokia. Cox Communications and Alphabet is testament to Sitetracker’s results and usability. Now more than ever, telecom infrastructure owners need to understand and manage their assets to plan, deploy, maintain and grow the value of their portfolios. As the number of points of presence globally proliferates at a huge rate, the processes of construction, colocation and maintenance become increasingly complex. We spoke with Sitetracker CEO Giuseppe Incitti, to find out more about how their solutions can help infrastructure owners manage complexity and position themselves for 5G success.

Keywords: 5G, Alphabet, Asset Lifecycle Platform, Asset Register, Co-locations, DAS, Energy Efficiency, Europe, Fibre, Monitoring & Management, Noka, Operational Excellence, Site Level Profitability, Site, Management System, Site Surveys, Site Visits, Sitetracker, Small Cells, Smart Cities, Verizon, Wi-Fi

Giuseppe Incitti, CEO, Sitetracker


TowerXchange: Sitetracker works across many verticals within critical infrastructure. Can you tell us about some of the similarities and differences between telecommunications and other verticals you work in? What does it tell us about the telecoms market?

Giuseppe Incitti, CEO, Sitetracker: We work with other industries, including utilities and smart city companies, which, similar to the telecommunications industry, have very unique challenges that lay ahead. Utilities are looking at issues like load growth and integrating renewable and distributed resources into the grid. These challenges will result in increased project complexity for the utility industry, so that’s definitely a parallel between telecom and utilities, but that’s not the whole story.

Telecom companies are facing an unparalleled shift in the types of projects needed and how those projects need to be executed. 5G and network densification are completely new challenges that changes the dynamic of the industry. At this critical juncture, it’s imperative that industry telecom leaders embrace change. The race to 5G is a uniquely telecom-related challenge.

Explosive growth in mobile data traffic means companies must make an important choice about their operations. The telecom industry is at an inflection point. As our communities become more connected, the volume, velocity, and variety of telecom-related infrastructure projects are exponentially increasing. Leaders in the industry

are adopting purpose-built software to effectively plan, deploy, maintain, and grow the value of their asset portfolios. In order to keep up with the rate of innovation and increasing connectivity, successful companies are improving their operations with technology built for the management of site-based, repeatable projects like new tower construction, co-location, and tower maintenance.

These projects still require roughly the same end-to-end process for planning, deploying, and maintaining assets, including site identification, acquisition, regulatory approvals, design, construction, testing, validation, and more. But, instead of being vertically integrated, mobile network operators are increasingly relying on third-party service providers, who may, in turn, contract-out work to specialists for different project phases. More parties working on a higher project volume means higher complexity, making effective collaboration more crucial than ever before.

Throughout the industry, inadequate technology fails to offer live interaction between project managers and field workers, lacks the agility to handle the increasing variety of projects, and scatters mission-critical information across disconnected systems. We’re seeing this across a lot of other industries, too.

TowerXchange: With so many towers in Europe changing hands or being carved out at the moment, where can Sitetracker add value for tower owners?

Giuseppe Incitti, CEO, Sitetracker: There are over 600,000 towers in the Europe right now and, increasingly carriers are selling their towers to independent tower companies. This provides many benefits to carriers, but it does increase complexity by increasing the number of parties involved in co-location and leasing. Carriers must now work more with tower companies. If we had to sum this all up, we’d say that the industry is facing the greatest level of complexity it has ever seen and we believe the only way to navigate the complexity is through finding operational improvements on your way to operational excellence. That’s where we add value.

TowerXchange: Tower owners are starting to evaluate their macro assets ahead of the load and support changes which will come into play as 5G rolls out – can you give us examples of some of the things tower owners will need to bear in mind, and how that information can best be used?

Giuseppe Incitti, CEO, Sitetracker: As 5G begins to roll out, tower owners will need to maintain and optimize their towers. Tower owners will need to embrace the changing telecommunications landscape and ensure that the pillars of telecommunication, towers, are in the best shape possible to support 5G. This means rigorous maintenance and upkeep, as well as coming up with new ways to make the most of existing towers.

The second thing I would say tower owners need to think about is how co-location will take place in the future. Some carriers are starting to work together


on new builds, investing in the same, shared infrastructure. This means that tower companies could have multiple stakeholders from the outset of a new tower build. Managing complexity like this requires tower companies to embrace new planning and deployment technology in order to adapt to this new era.

TowerXchange: As well as telecoms, you also have a Smart City solution – can you talk to us about the scope of that offering? Do you find it is converging with your telecoms offering as tower companies and Mobile Network Operators begin to move into this vertical?

Giuseppe Incitti, CEO, Sitetracker: So, one example I’ll give is LinkNYC. The City of New York partnered

with Intersection to create LinkNYC, a pioneering smart cities program to convert over 7,500 public payphones to kiosks and create the largest and fastest free wifi network in the world. This project lives at the convergence of telecommunications and smart cities. Beyond the challenge of creating an all-new, purpose-built fiber optic network, each kiosk deployment requires approximately 450 tasks, spread across 15 teams, from start to finish. Not only was Intersection deploying kiosks in New York City, but they also took on this project in the UK through their LinkUK program.

In New York, they were able to simultaneously manage over 4,000 kiosk builds effectively in phase one of the project, including coordination across 15 teams and the city government, shorten time to

revenue for a $500 million opportunity in digital advertising over 12 years, efficiently forecast project completions, and share deployment progress with all stakeholders through dynamic maps.

Intersection recognized that they were embarking on a new, innovative kind of program and needed a correspondingly innovative way to manage it. Sitetracker enabled the entire LinkNYC team — from Intersection’s project managers and executives to vendors’ field workers and city representatives — to instantly see the status of all of their projects through easy-to-use reports, dashboards, and dynamic maps. Sitetracker keeps the public informed, too: a map of Link locations on LinkNYC’s website, showing in real time which kiosks are online and coming soon, is a standard Sitetracker feature.

In addition to this kind of tracking, the LinkNYC team is able to understand the maintenance status of all of their assets and keep a schedule of maintenance projects, ensuring that kiosks kept in working order. The Sitetracker Platform also enables Intersection to perform work management for each of these projects, ensuring that the right people with the right skills are in the right place at the right time.

We see Sitetracker as a solution for companies looking to embrace change, whether that means new types of projects at the intersection of telecom and smart cities or a new way of managing projects to scale with demand<

Effectively manage and monetize the full lifecycle of tower projects

Conduct capacity planning

Accurately forecast milestones

Connect project timelines

Maximize the value of your assets

Shorten time to revenue

Optimize processes

Stay on top of project financials

Easily manage entire portfolios

Report on projects in real-time

Plan Grow

Deploy


Keywords: Anchor Tenant Privileges, Due Diligence, Infrastructure Sharing, MLA, Novation of Leases, Regulations, SLA, Service Level Agreements, Transfer of Assets, Vinson & Elkins

UPDATED: The Sale & PurchaseAgreements & Master Lease or Service Agreements that underpin tower transactionsA closer look at two important parts of the contractual framework for infrastructure sharing

TowerXchange: What are the key components of a Sale and Purchase Agreement (SPA) in a tower transaction?

Rob Dixon, Partner, Vinson & Elkins: There are of course many components common to all SPAs, but let’s concentrate on those components which are unique to towers deals. A key example is the structure and content of the conditions to closing. First, we’ll typically have a set of transaction conditions precedents that need to be fulfilled before the deal can happen at all. These would include any over-arching regulatory requirements (for example an operating licence or a competition approval). It’s in the tower company’s interests, however, to close as swiftly as possible to minimise asset deterioration in the interim period.

Secondly, we’ll typically have a set of conditions precedent that need to be fulfilled (or waived) before a specific tower can be transferred. These would normally include good title, satisfactory ground lease arrangements (for example, the right to sub-lease the tower to third party co-locators and to assign leasing arrangements in security) and compliance with regulatory requirements (for example, building permits and environmental consents)… It’s potentially a long list!

The buyer will require a certain number of towers before the deal is economically viable. Typically, therefore, the deal will be structured so that closing does not happen unless and until a certain number of towers are ready to be transferred (i.e. the tower-specific conditions precedent are satisfied or waived).

Read this article to learn:< The conditions precedent that need to be fulfilled before assets are transferred< What happens to towers that aren’t transferred in the first close< Why the real value lies in the MLA < How critical towers are sometimes treated differently

The devil is in the detail – the detail of painstakingly constructed and hard negotiated Sale and Purchase Agreements (SPAs) and Master Lease or Service Agreements (MLAs) that define the main terms in any tower transaction. Jeff Eldredge and Rob Dixon, Partners at Vinson & Elkins, have advised on numerous sale and leaseback transactions in the last few years across Africa, Asia and Europe. Rob and Jeff kindly agreed to meet with TowerXchange and to provide us with an overview of tower sharing SPAs and MLAs. Jeff Eldredge and Rob Dixon, Partners at Vinson & Elkins


Jeff Eldredge, Partner, Vinson & Elkins: One key point in the process is the extension of ground lease terms. Towers deals can involve thousands of different parcels of land. Different ground leases will expire at different times, giving uncertainty on future costs. The buyer will therefore seek to have the ground leases extended for a reasonable period as part of the transfer process.

Rob Dixon, Partner, Vinson & Elkins: As a result of that and certain other conditions taking time to satisfy, there are typically a number of closings as the tower-specific conditions are gradually satisfied. In the interim, the buyer might take over the operation of the non-transferred towers on a managed services basis. Different deals are of course structured differently – some deals go further to synthesise the buyer’s ownership of non-transferring towers from first closing.

TowerXchange: What happens to any towers for which the CPs cannot be satisfied?

Rob Dixon, Partner, Vinson & Elkins: The treatment

of ‘stub sites’ depends on the deal. The operator is unlikely to have the ongoing capability (or desire) to maintain and operate the sites so the towerco may agree to manage the sites (with the operator retaining ownership). The buyer is likely to conduct legal diligence on a representative sample of sites so that it has a reasonable idea of the position before signing the deal. The SPA is, of course, only one part of a sale and leaseback deal. It’s relatively short-lived compared with the MLA which will often govern the parties’ relationship for many years. The MLA needs to be as future proof as possible.

TowerXchange: So tell us about the critical consideration when drafting Master Lease Agreements.

Jeff Eldredge, Partner, Vinson & Elkins: The MLA is where the real value is for the tower company and where most of the real complexity lies in a deal. It’s a long term contract (with a significant initial term and then options to renew) and a large value contract. The operator needs sufficient flexibility to manage its needs to deploy and maintain equipment, while the towerco needs sufficient control to maximise the co-location opportunities and create a robust long term revenue stream – that’s how they build value. Thus, there’s a natural tension that needs to be resolved to everyone’s satisfaction. Effective governance mechanisms are important.

The MLA is an umbrella agreement which – traditionally – defines the operator’s rights as anchor tenant in terms of leasing space and capacity (wind load) on the transferring towers and

the towerco’s obligations to the anchor tenant in terms of such space and capacity (including the service levels which apply). Different rights and obligations typically apply to different towers. For example, network planners can get very nervous about sharing particularly critical towers with other operators and therefore a small number of the towers might be identified as exclusive to the anchor tenant.

Rob Dixon, Partner, Vinson & Elkins: The service levels for different classes of towers are also likely to vary and be closely negotiated. These will typically be set out in a service level agreement, which may form part of the MLA. The impact of IFRS16 on the way in which tower companies provide services is a key topic. There are also of course other agreements which are important in most towers deals – for example the Build to Suit Agreement – but perhaps all of that is for another time!

Phased close

It’s common practice to have at least two phases of closing a sale and leaseback transaction, giving extra time to finalise documentation for troublesome towers. As Alan Harper, CEO of Eaton Towers explained “With Warid, 90% of the towers were included in the first close, but we take over 100% of the towers whilst the last complicated paperwork is finalized.”

Capacity crunch

Operators err on the side of caution when it comes to reserving capacity on towers for future upgrades. But every square meter the operator reserves is a square meter less for the towerco to sell, and that goes directly to the value of the tower. When it comes to the Master Lease Agreement, “it’s important to help operators avoid reserving more capacity than they really need for upgrades”, to use the words of one senior towerco executive










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