The Wireless Pulse 1st Edition

The following information was gleaned from a Wireless Cap Ex briefing on January 6th, whereby multiple telecom professionals across all spectrums participated. The information is based on their opinions:

1.      Expect a 20% increase in fiber build out in Q1. Last year fiber builds were generally site specific. This year it will be a combination of site specific and non-site-specific construction.

2.      There will be a smaller growth in fiber to backhaul and data centers as opposed to urban and suburban builds.

3.      There is a record backlog of RFP activity for all tier 1 carriers.

4.      The biggest challenge is finding skilled labor to actually build or upgrade cell sites. These are not high school diploma jobs.

5.      There are massive delays in delivering large and specialty fiber. Usual wait time from order was 6 to 12 weeks. Now 12 to 24 weeks from order to delivery.

6.      Even though hundreds of thousands of Americans no longer have land lines, fixed land line growth will see an uptick reversing the trend.

7.      The demand for fiber is so great, Corning is building a new plant to manufacture fiber.

8.      Expect new macro tower construction to be a custom fit for the carriers and all in-fill related.

9.      Due to the change in work from home, suburban growth is key to macro and micro cell deployment.

10.  There is a huge backlog of Tier 1 carrier upgrade and deployment. All believed it’s the best it’s been in years.

11.  Verizon and ATT put the brakes on Q3 and Q4 2020 because there was no consumer spending on 5G devices.

12.  We’re finally starting to see Dish build out sites. That’s a sign that they are finally living up to expectations about being the 4th carrier.

13.  Bill Berkman, Managing Director of Radius Global owns AP Wireless. For years, APW has acquired cell leases throughout the US by buying the income streams. They now have approximately 5,000 cell leases in their portfolio. It’s unclear what their future plan is at this point. Might be time to sell the portfolio.

14.  ATT and Verizon want to own their fiber as opposed to T-Mobile and Dish who are comfortable leasing fiber.

15.  Even though fiber is badly needed in urban areas, the ROI to build fiber in urban areas is poor at best. Hard to pull the trigger when you can leverage money elsewhere and for better return.

16.  As opposed to suburban fiber ROI, urban areas don’t have the same issue. From a return standpoint, we bet money will flow into space with the best return.

17.  In 2020 Dish was on the cheap and failed to pay the going rate for good people. They have taken a 180 degree turn and have hired talented people away from wireless service providers like Samsung and SAC Wireless to take Dish to where it needs to be.

18.  The same can be said for Dish’s 2020 RFP’s where they tried to contract with equipment suppliers, labor and support companies on the cheap. They now realize they can’t hire a contractor and pay them $50.00 to climb a tower and install antennas. This is a major turning point for Dish.

19.  Dish will be using Open RAN site builds. To date, when you open an equipment cabinet, you would see Erickson, or a Nokia equipment filled cabinet. If Dish is successful in their Open RAN equipment, they will set the standard to future equipment deployment.

20.  If Dish can prove Open RAN works, the other carriers will step up and Open RAN will be the standard and future of equipment deployment.

21.  With the fiber explosion, Corning and CommScope hold all of the cards.

22.  Earlier we discussed Verizon and ATT hitting the brakes on 5G upgrades. They have no choice but to get going in 2021. T-Mobile may be the 2nd carrier, but they are in the best position moving forward.

23.  Demand for equipment is at an all-time high. Lead times for all products such as, Batteries, Antenna’s, Solar Panels, Switch Gears and Smaller Equipment have increased.
To say the robust activity of telecom will be solid for next 3 to 5 years is an understatement. Everything in this piece inevitably affects real estate and especially, the owners of real estate. Having a cell lease deployed on your property is basically free money. You have no capital expenditure and generally paid much more for a postage size piece than you could lease to any other user. Not keeping up with the trends is like still using a dial up modem. Yes, people still use them.

Have a question? Call David Moore at 909-542-3325.