United States Telecom Towers Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

United States Telecom Towers Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The global telecom towers market is expected to register a CAGR of 4.62% from 2022-2027. With the outbreak of COVID-19, the telecom industry has witnessed a significant increase in demand for internet services due to a major chunk of the population staying at home and remote working conditions. The increase in people working from home has led to increased demand for downloading, online video viewing, and communication through video conferencing, all leading to increased network traffic and data usage.

Key Highlights

• Over the past decade, the telecom tower market has seen significant evolution. Hence, the basic Towerco concept and business models have been effectively modified to meet the needs of new markets in the United States. Over the projected period, several Towercos are expected to focus on their primary business of building, purchasing, and leasing vertical real estate; as a result, many 5G antennae may still be added to these Towercos' structures.
• Several initiatives by telecom operators and other organizations, especially in low and middle-income countries, are expected to spur growth in the rural areas as the residents to gain increased access to internet connectivity.
• Numerous distinct factors have impacted how telecommunications infrastructure management is conducted. The development of TowerCos has been driven by changes in the financial requirements of the major telecommunications carriers, technical products, and customer demand.
• Furthermore, with businesses going mobile and adopting new concepts, like BYOD, to increase employee interaction and ease of use, it has become essential to provide a high-speed and quality network. The organizations have been looking forward to adopting BYOD aggressively in their operations, fueling the market growth over the forecast period. Furthermore, development in cloud-based services for mobile users and the roll-out of 4G LTE services worldwide have increased the investment into networks by carriers, which drives the demand for telecom towers.
• The increasing emphasis on improving internet connectivity to rural areas of the United States is one of the major factors stimulating the deployment and improvisation of the telecom infrastructure in these areas, thereby aiding the market's growth. Smartphone penetration, raising awareness, increasing penetration of digital technologies, and investments from several organizations and governments have been increasing the adoption of internet connections in the region.
• A delay in the production and delivery of network equipment in the United States appears to have hindered the development of 5G and fiber networks. The delivery of 5G was also pushed down by COVID-19, which affected revenue and expenditure projections.

Key Market TrendsAdoption of 5G to Drive the Market

• Due to the high demand for 5G telecom in the nation, the US market is one of the most competitive for big suppliers. Many businesses are striving for development. Various significant suppliers in the country are involved in rollouts, coalitions, collaborations, mergers, and acquisitions.
• The purchase of InSite Wireless Group LLC for around USD 3.5 billion was finalized, according to an announcement made by American Tower Corporation in December 2020. American Tower anticipates that in 2021, the assets it bought from InSite would have property revenues of around USD 150 million and gross margins of about 115 million dollars.
• The pandemic brought to light the capabilities of digital connection and technology in assisting people, organizations, governments, and societies. It raised prominence and political awareness of the benefits of digitization.
• Between 2022 and 2025, mobile operators will need to invest more than USD 600 billion in capex, with 5G networks accounting for almost 85% of that total.
• High-income nations continue to have a sizable digital inclusion gap. Operators in these markets are attempting to resolve this. For instance, Verizon is developing its project to offer cellular broadband to underprivileged neighborhoods in the US.
• SBA Communications is a well-known tower supplier in the US with over 10,000 towers nationwide with a concentration on wireless communications. The business also disclosed a long-term master leasing arrangement with DISH, which would give DISH access to SBA's extensive network of wireless communications stations.

Operator Owned Towers Hold Significant Share in the Market

• According to GSMA statistics, 90 percent of telecom towers in India were formerly held by operators but have now changed ownership to third parties, representing an estimated 10 to 15 percent of all buildings in the globe. Over a more extended period, penetration in the U.S. has increased to between 50 and 60 percent.
• However, American Tower, Crown Castle, and SBA Communications, three publicly listed corporations, own the majority of the cellular towers in the United States. These are, in fact, the top three American cellular tower firms.
• American Towers Corporation, one of the key players in the telecom industry, owns and operates the wireless and broadcast infrastructure in the United States and has more than 43,000 towers in the country and over 221,000 sites worldwide.
• Furthermore, there are around 154,000 towers in the United States overall, and a 2.3x tenancy ratio corresponds to 354,000 occupants. Notably, a significant fraction of all tenants in the United States is located at American Tower, Crown Castle, and SBA Communications. With a 2.6x occupancy ratio and 40,600 towers in the United States, American Tower Company has 106,000 renters.
• According to American Trade Corporation's 2021 annual report, there were 451 owned Distributed Antenna System (DAS) sites and 27,276 owned towers, and 15,363 operating towers in the United States.

Competitive Landscape

The United States telecom tower market is highly consolidated and has a few significant players. Some key companies currently hold a large portion of the market, such as American Towers Corporation, Helios Towers plc, Crown Castle International Corp., etc. These dominant firms are growing their consumer bases internationally. These companies are utilizing operator-owned towers to raise their market share and profitability.

• November 2021 - Helios Towers PLC plans to invest USD 100 million between 2022 and 2030 to boost the utilization of renewable energy sources to meet its aim of reducing carbon intensity per tenant by 46% by 2030. The company will combine new ideas with practical expenditures to minimize its dependency on generators and utilize more effective eco-friendly solutions to meet its 2030 objective.
• May 2021 - In exchange for USD 575 million in cash, Helios Towers has agreed to acquire the 2,890 sites in the passive tower infrastructure portfolio of Oman Telecommunications Company (Omantel). Helios Towers will enter the Middle Eastern infrastructure market as a result of the agreement. With 2,890 sites, it will become Oman's prominent independent tower infrastructure supplier.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

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