Independent telecommunications tower operator, Nigerian-founded IHS Group, believes that half of the 170 000 base stations built by mobile operators in Africa will be considered for outsourcing within the next three to five years as pressure grows on tariffs and margins.
The market for independent tower operators in Africa is still in its infancy, says IHS Group chief commercial officer Rob Gelderloos, who was speaking to TechCentral on the sidelines of this week’s AfricaCom conference in Cape Town.
IHS looks after about 6 000 towers in six African countries — Ghana, Sudan, South Sudan, Côte d’Ivoire and Cameroon — either on a colocation basis or under an operations and maintenance agreement. It owns towers in three of these markets.
Four main players have emerged in the space in Africa in recent years: IHS, American Tower Corp, Helios Towers and Eaton Towers. In South Africa, the only tower outsourcing deal so far has been the one where Cell C sold its base station infrastructure to American Tower; MTN SA has said it is considering its options.
Gelderloos, who is former vice-president of operations at Celtel, says it is mainly in markets where tariffs and average revenues per user have comes under pressure that operators are turning to outsourcing their towers in an effort to ease financial pressures.
Tower companies usually buy the infrastructure in the hope of leasing capacity on the base stations to other companies — either existing market players or new entrants.
The companies that have been most aggressive in selling and outsourcing their tower infrastructure so far, according to Gelderloos, are MTN, Orange and Etisalat. Vodacom, another big player on the continent, is lagging behind.
“Of the 54 countries in Africa, at least a dozen have operators that are looking to outsource their towers,” Gelderloos says. “We see the number of outsource processes growing exponentially. There are 170 000 towers in Africa and probably half of those will be considered for some sort of outsourcing over the next three to five years.”
He says that if MTN were to sell all of its tower infrastructure in South Africa and Nigeria, which it has said it is considering, that would amount to almost 20 000 base stations. — (c) 2012 NewsCentral Media
