Research Notes

Strand Consult’s program to improve mobile infrastructure shortlisted for global industry award

Strand Consult is pleased to announce that its program “How to improve mobile coverage and regulation” is one of three services shortlisted in’s Awards for services to telecom operators for 2015. This program addresses a key challenge for the telecom industry, the rising cost and difficult to build and run mobile infrastructure. This is a global problem, but only one country in the world has been able to address it with success – Denmark – because of the help of Strand Consult.

Creating a mobile network requires either purchasing or leasing land on which to erect masts and towers. These locations are scarce and expensive. In practice, operators have to negotiate building and rental agreements for each of these locations, the price of which is high and increasing. On top of that operators face a range of barriers from residents and local government which will either delay building permissions or object to infrastructure for health, aesthetic, environmental, historical preservation, or other reasons.

Mobile infrastructure rent for mast locations is the fastest growing category of OPEX for the industry. In spite of the intelligence and experience of many talented leaders among mobile operators, the industry has not succeed to reduce these challenges, and the problem is getting worse around the world.

The challenges operators face means that not only is it more expensive to roll out new networks, it is taking longer just at the time that people are demanding better coverage. As a result a single mast can take 12 – 36 months to deploy and cost €100,000 – 300.000. Operators find that they cannot deploy infrastructure on all the necessary sites.

There have been sporadic attempts to solve parts of these challenges around the world, but no real success, expect for one country: Denmark.

The process – and we make result every week.

In the period June 2011 to July 2015 Strand Consult has conducted a process to improve the conditions for operators to build and run mobile networks. Before the project, there was a heated debate about mobile coverage in Denmark in which operators were blamed for their unwillingness to invest in infrastructure. It took up to 4 years to get a building permission for a mast, and the price for site rental was increasing by 12-15% per year.

Strand Consult’s activities included publishing a report examining the prices of site locations across Denmark, the various contract conditions, and the role of municipalities. Strand Consult also fostered a multi-stakeholder process between operators, the minister of telecommunications, politicians, municipalities, media, and other stakeholders about the challenge to deliver good mobile coverage.

In addition to facilitating the dialogue on high rents and long waiting times for building permissions, Strand Consult conducted an education campaign to inform the public about how to understand mobile coverage and the various factors that influence customer experience on mobile networks.

The results are nothing less than a complete turnaround. There is now a comprehensive framework to build and run mobile networks to deliver good coverage. Today is significantly faster and cheaper to roll out new infrastructure. The price of some rental locations has fallen by as much as 70%, a savings that is realized every year over a period of 10 years.

Instead of rental increases, operators experience a price decline of 5-8% per year on the total base. This has translated into millions of euros in savings for Danish operators. There is now a greater understanding of the many factors needed to create good mobile coverage.

In contrast to the failed attempts we have seen in other countries, Strand Consult has made a significant improvement for operators’ operations day to day and their financial position in this area for the long term. Getting results even in a country as small and relatively homogeneous as Denmark has required a lot of work, but with an unconventional approach, Strand Consult has achieved results that others only dream about.

The debate on mobile coverage is dominated by an ill-informed attitude that operators are unwilling to build more networks. Rarely is there a discussion about the role of smartphones, municipalities, landlords, or regulation.

There is an unfortunate tendency of the press and politicians to think that better mobile coverage is simply a function of an operator’s CAPEX. In fact, as our research shows, many operators cannot spend their budgeted CAPEX because they fail to get the municipality’s permission to erect the necessary masts.

The results we have made have not only an immediate effect, they have a positive impact on these budget line for the next 10 years.

Strand Consult’s project in Denmark has resulted into reduced OPEX for operators (and a positive impact on CAPEX), political success for regulators and the telecom minister, and more satisfied subscribers.

Best of all, the goal of improved mobile coverage is achieved. These results can be replicated in other countries, but it takes the comprehensive, dedicated multi-stakeholder approach that Strand Consult has driven.

To receive more information about our concept “How mobile operators can reduce cost for mobile masts and improve mast regulation” and how we have helped mobile operators overcome these challenges, contact us.

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