That’s what one reporter in Chattanooga, Tennessee wants to know. Go anywhere public in this day and age, and you’ll see dozens of people, face down, furiously tapping away at some sort of touch screen device. Those devices are almost useless without their wireless data connection. This fact has helped grow the multi-billion dollar wireless industry to where it is today. Their growing demand for data-gobbling uses, such as video, means users are on track to pass the $100 billion mark this year on data-plan spending, experts say, and U.S. demand for mobile data is expected to grow eight-fold by 2018. This “mobile data boom” helps explain why new cell phone towers are proposed around the Chattanooga region, from the top of Lookout Mountain to Finley Stadium, home field for the University of Tennessee at Chattanooga football team. As with any boom, there’s money to be had. U.S. leaseholders may get as much as $8.5 billion annually, based on figures from statisticbrain.com. The website says the nation has 190,000 cell phone towers with an average yearly lease rate of $45,000. But one expert says most leaseholders don’t get nearly enough rent, based on industry figures that show a single tower can have a gross profit margin of close to 80%.
Finley Stadium was offered either $853 a month or a 3 percent commission to allow a 150-foot-high cell tower disguised as a flag pole with a 20-by-30-foot American flag on stadium land near Main Street. “We need the revenue,” said Paul Smith, who took over in December as executive director of the 20,668-seat venue. “Finley Stadium, it’s never truly made money.” But 90 to 95 percent of the time, individuals and municipalities don’t ask for enough compensation, said Hugh Odom, a Nashville attorney who spent a decade working for AT&T and now helps people around the country negotiate cell tower leases through his business, Vertical Consultants.
“That’s where people miss the boat. They don’t even miss the boat — they miss the ocean.” Odom said. “You feel like you’re getting something, but you’re really not getting much at all.” Odom said that, on average, his customers get a 236 percent increase in their lease payment after the engineers and other experts at his business figure out what a cell phone tower site is truly worth. To support his argument that cell phone tower companies don’t pay enough for leases, Odom cites what he said are big profit margins at two industry leaders, Crown Castle International Corp. and American Tower Corp., both of which are traded on the New York Stock Exchange. In a publication for investors, American Tower explains that a cell tower with three wireless companies as tenants can have $60,000 in annual revenue against $14,000 in expenses, for a gross profit margin of $46,000, or 77%. “Their profit margins are not only large, they’re increasing. It’s because they’re making really good deals for themselves,” Odom said.
Reader Interactions