That’s it, we’ve run a pretty comprehensive update of the towerlocation.com database of all towers and sites used for cellular and broadcasting purposes… and the results are that, in the last 8 months, 2,292 new towers were added (on a net basis) giving a new total of 272,282. On an annualized basis, that’s a growth rate of 1.3%. Not bad for a mature industry!
Where is the growth coming from?
It is difficult to draw too many hard conclusions from this update, the reason being that we don’t know for a fact whether these new towers were built or were only recently identified… Still it’s interesting to see that 1,800 of the net adds are lattices and masts as these two categories account for only 3% and 1% of the total number of towers in the country. Is there really a push at the moment to build such high structures? We’d love to hear your take on it. The other interesting result is that Verizon contributed to 23% of the total increase, which would confirm that at least one of the two largest carriers is still actively building out its infrastructure; on the other hand American Tower, Crown Castle and SBA Communications each contributed only 3% of the new sites, somewhat surprising given the emergence of independent tower operators to date. Lastly it is worth noting that about a quarter of these new towers were erected in just 3 states, namely Texas, California and Ohio: that kind of makes sense as these three states account for 24% of the US population…
What are the main growth drivers?
Adding towers is mostly about the carriers improving service coverage. Both Verizon and AT&T offer good coverage pretty much everywhere in the US but it’s not necessarily the case with Sprint PCS, T-Mobile, US Cellular, etc. These carriers have been under some pressure to improve their coverage though it doesn’t necessarily mean they need to add new towers. Indeed a lot of these carriers’ transmission equipment sits on towers owned and operated by independent tower operators e.g. Crown Castle and American Tower Corp. These operators make a business of co-locating the carriers’ equipment on their existing towers, which means there’s less of a need to build new towers…
How do these numbers compare with other countries?
If you look at the current number of sites in the US, it equates to a coverage per site of 1,132 people for an average area of 30 sq kms. Ideally we’d compare these stats with other countries to check how the US tower market fares; if only we had them… Towerxchange.com assesses the number of towers (excluding rooftops and DAS) in Europe to be approximately 600,000: that implies a coverage per site of 1,238 people for an average area of 17 sq kms, which overall is fairly consistent with what we observe in the US market.
How many more sites should we expect in the next few years?
The question is whether we’re going to end up with 500,000 sites in 10 years. Ultimately you need to be a mix of a radio planning engineer and a technology wizard to address that question! In a world increasingly reliant on wireless communications, it’s easy to see more towers being added whether it’s because more antennae need to be installed or because the increasing use of high frequency radio signals will require a higher density of towers. It’s likely, however, that we’ll see existing towers being strengthened before operators decide to add new towers, for cost and planning permissions reasons. And let’s not forget that in urban settings micro-cells may end up substituting a few existing sites. On a net basis, however, continued and steady growth is the more likely scenario!