As more and more wireless carriers in the United States take full advantage of fiber in order to supply backhaul and other connections to small cells in anticipation of 5G deployments by the end of this decade, it is pretty understandable why some would think that traditional tower companies would feel threatened. But according to MoffettNathanson Research, tower companies should not be too worried.
It is hard to deny the increase in small cell roll outs in recent months, and it appears that in the near future, there will be similar deployments. Last week, Lowell McAdam, the chief executive officer of Verizon Wireless, stated during an analysts’ meeting that the biggest mobile operator in the US is looking to roll out 1,700 strands of fiber in every cable it will deploy in order to further strengthen both its wireless and wireline network in the city of Boston in the state of Massachusetts. McAdam had further hinted in a separate occasion that the Big Red is planning to make full use of four to six strands of fiber in order to attach a small cell on a regular street lamp to the network.
And Verizon Wireless is only one example of a major US wireless carrier that is employing a new approach to developing its network architectures, at least one that is different from what the industry has come to expect over the years. Another provider, Sprint, has significantly lowered its capital expenditures over the last year and a half as it continues to explore other means (like smaller transmitters) as opposed to just the usual macro cell set ups.
Still, as explained by MoffettNathanson, small cell deployments are mainly being initiated by wireless carriers right now as a way to complement their existing traditional towers, especially in terms of enhancing geographical coverage as well as boosting network capacity. And it is interesting to note that operators are starting to be more open about doing small cell roll outs in-house.
But while Verizon’s ambition is evident (based on its planned deployment of 1,700 fiber strands in Boston), MoffettNathanson believes that it will be easier said than done for the Big Red to replicate that scale in all other markets. The research firm also believes that for other mobile operators out there, they will likely try to strike a balance between doing in-house work and teaming up with third party small cell vendors.
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