A new report by Deloitte said that mobile towers in India are increasing, in fact they are forecasted to double by the year 2020, topping to 1.2 million towers. It amounts to a compound annual growth rate of three percent over the next four to five years from the current 400,000. About 65,000 towers were added by telecom service providers between July, 2015 and February, 2016, Indian Minister for Communications and Information Technology Minister Ravi Shankar Prasad told ZDNet.
Prasad noted with the onset of Smartphones and data demands indicated a need for expansion into operations and stronger networks. Companies like Airtel, Vodaphone, Idea Cellular, and Reliance Jio Infocomm are heading into 4G territory in India. ZDNet reported other companies like Bharat Sanchar Nigam Limited are sharing “passive infrastructure, including towers with other telcos on techno-commercial consideration. That company has leased out 6,505 towers to other companies and hired 15,113 towers from other companies and infrastructure providers.
Recently, India’s industry has witnessed sell offs and acquisitions, with American Tower Corporation’s $1.14 billion acquisition of 51 percent in Viom Networks, which resulted in 42,000 additional sites in India. That led the way for Bharti Airtel to seek buyers for five percent of its Bharti Infratel.
Tower and Infrastructure Providers Association (TAIPA) Direction General, Tilak Raj Dua, told ZDNet sell offs and acquisitions will help India’s companies “manage their operating cash, achieve scale, and broaden their geographical coverage. Further, it can also optimize operations and energy costs through sheer economies of scale.”
Deloitte’s data also showed that tenancy ratio per tower is expected to grow from 1.77 in 2014-15 to 2.48 by 2020, and that number could be larger “if the cash-strapped companies do not buy spectrum in 700 MHz, depending on whether the government reduces the reserve price of 11,485 crore rupees (approximately $1.7 billion) per MHz, as recommended by the industry regulator TRAI. The spectrum in the 700 MHz band will reduce the capex for telcos in installing more towers,” ZDNet reported.