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African network operators prepare to share cellphone towers

Eaton Towers expects mobile operators to share 25000 cellphone towers in Africa by 2013 as they increasingly realise the benefits of outsourcing such infrastructure, CEO Alan Harper said yesterday (18 January 2011).

The company's strategy is to own, build, manage and maintain telecoms towers and related passive infrastructure for cellphone operators so they can reduce costs and focus on providing services to clients.

Telecommunications network operators are increasingly seeking ways to cut capital expenditure and operating costs. Some governments are pressuring companies to share the infrastructure for environmental purposes, Mr Harper said.

In 2009 there were 500 towers shared by operators in Nigeria, he said. The figure rose to 4000 last year and is expected to double this year.

There are 250000 cellphone towers in Africa. "All major African mobile operators have work under way to initiate tower sharing," he said.

Mr Harper said that most cost savings were achievable by sharing fixed costs including site rental, tower, container, generator, diesel and security.

Research firm Delta Partners estimated two years ago that $8bn in capital expenditure could be saved if operators shared towers.

Eaton has so far bought towers owned by Vodafone Ghana and is targeting Uganda, Kenya, Nigeria, Tanzania and SA.

However, SA is not an easy market as opportunities and cost savings are difficult to realise, Mr Harper said. It has lower operational costs and few operators. South African operators spent lower amounts a month on maintenance, rentals and electricity.

"Although there will be savings for South African companies, it might be lower," he said. "But we can still deliver some savings."

Source: Business Day


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