LTE Upgrades and Lease Modifications

Steel in the Air, Inc. is regularly retained by independent tower owners to provide assistance with valuing wireless infrastructure modifications, like LTE deployment. In most cases, tower owners are entitled to additional compensation when wireless carriers upgrade their existing networks and/ or collocate space on their towers to other carriers. The terms should be clearly defined in the collocation lease agreement from the get go. Some agreements permit the installation of additional antennas, for instance, while others do not. If you are party to a collocation lease or cell site agreement, we’re happy to review it (and any amendments) to determine whether you should be asking for compensation, and if so, for how much.

We advise our potential clients and clients alike. If you’ve received a proposal to amend your cellular lease, you should be fully aware of your rights and bargaining position before settling on final terms. For instance, wireless carriers might agree to compensate you for equipment modifications and prepare a contract with additional amendments, such as an extension of the duration of the lease. We advise tower owners to address these issues separately. Lease amendments, even simple ones like consent to allow carriers to upgrade equipment, open the door for renegotiations. In other words, it might be a good time to consider whether your lease was properly valued from the get go. If not, you might want to take the opportunity to request a higher rent. We can review the drawings and the structural assessment provided by the carrier to effectively position you in a best-case scenario.

Our services are remarkably reasonable compared to your passing on tens of thousands of dollars in future revenue because you aren’t familiar with how the industry prices LTE modification requests to tower collocation leases.

About LTE Deployment

lte tower collocation leases

LTE (already deployed nationwide by Verizon) is the only true 4G network, yet AT&T and T-Mobile also claim to have “4G” networks, and only get away with this because their HSPA+ networks are significantly faster than their old 3G networks. However, since it’s become undeniable that Verizon’s LTE mobilization is the fastest yet, AT&T, Sprint and T-Mobile (along with the majority of the nation’s other wireless carriers) have followed suit and are revamping their networks (as much as their existing spectrum allowances and revenue allow) to LTE frameworks. The 5-10 year goal is to deploy LTE across all networks, however this strategy comes with one significant caveat – the LTE specification was designed to handle mobile data, not voice and text (which are typically handled by circuit-switched networks like GSM and CDMA). This means that in order to ubiquitously deploy LTE networks, a VoIP solution must also be formulated.

Current LTE Network Upgrades Across Top Ten Wireless Carriers

Verizon In November, 2012, Verizon was the nation’s first and foremost provider of LTE services, covering a population base of over 250 million (the company had decided early on to dedicate a nationwide block of spectrum to LTE deployment). By March, 2013, along with its LTE in Rural America Partners, LTE was deployed to service 2.8 million rural customers across 14 states. By June of 2013, Verizon had completed its 500th market and announced that its LTE roll-out was complete. Verizon’s 4G LTE network now covers 298 million people, 95% of the market. Verizon is already working on its next generation of LTE, and says that going forward, Verizon will use small cells networks to improve its LTE capacity performance.

AT&T As of November, 2012, AT&T’s LTE network covered a population base of 150 million. In July, 2013, they increased their year-end goal of deploying LTE to 80% of the U.S. population (250 million POP) to 280 million, and they seem to be on track to achieve this (As of July AT&T had deployed LTE to 326 markets).

Sprint As of July, 2013, Sprint’s LTE network spanned 100 markets, but did not include some of the major cities, like NYC and San Francisco. One reason that Sprint is behind its own schedule as far as deploying 4G LTE is because it lacks the appropriate backhaul (fiber optics infrastructure) due to its original preference of WiMAX.

T‐Mobile is projected to expand LTE network to 2 million people by year-end 2013.

Leap (Cricket) In 2012 Leap (Cricket) completed its initial transition to 4G LTE, which was deployed to a potential population base of 21 million.

US Cellular launched its 4G LTE network in 2012 in selected cities in Iowa, Main, North Carolina, Oklahoma, Tennessee and Wisconsin. The continued deployment in 2013 in additional markets in: Illinois, North Carolina, Oklahoma, Oregon, Tennessee, Virginia, Washington and West Virginia. U.S. Cellular has pledged to revamp their network to 87% LTE by year-end 2013.

C‐Spire In 2012, C-Spire purchased $192 million worth of 700 MHz spectrum, which is considered to be some of the most valuable due to its ability to travel long distances and penetrate obstacles. Their goal was to deploy a 4G LTE network to service its entire customer base. However, due to some equipment incompatibilities (and costs), brought on by AT&Ts manipulation of the 700 MHz band, C-Spire has been unable to complete this objective. They currently risk penalties from the FCC if they do not manage to utilize their 700 MHz licenses.

ATN (Alltel) ATN controls spectrum in the 700 MHz, 850 MHz and 1900 MHz bands. The proposed acquisition of ATN by AT&T would greatly complement AT&T existing network, however ATN’s network uses CDMA technology, so AT&T would need to covert the existing customers to its GSM network.

Cincinnati Bell controls 50 MHz of spectrum in the Cincinnati area and 40 MHz in Dayton, Ohio, which are spread between the 1.7/2.1 GHz and 1.9 GHz bands. As of 2013, Cincinnati has made no plans to deploy LTE across its network.

nTelos currently uses 23 MHz of its 1.9GHz spectrum holdings to support its CDMA services. Approximately 20 MHz of its 1.7/2.1 band has yet to be deployed. nTelos will begin deploying LTE services across its network in 2014, which are projected to cover over 70% of its potential customer base by the end of the year.