Cleargol: Can Brazilian towers accommodate multiple tenants?

Arlin Bleclic is the President of CLEARGOL Towers Brazil, a subsidiary of CLEARGOL Technologies Inc. a U.S. based system integrator. Thanks to his entrepreneurship and personal ties to Brazil, he has recently embarked on a journey to enable his company’s expertise and technical abilities to serve the ever-growing Brazilian telecom tower industry. In this exclusive interview, Arlin shares with us his views on the tower construction business in Brazil, key differences between the U.S. and Brazilian tower industry and expectations for his new venture.

TowerXchange: Please tell us about CLEARGOL, its activities and footprint.

Cleargol Technologies is a system integrator founded in North America in 2008. Its footprint is mainly in the mid-atlantic region comprising DC, Maryland and Virginia among other states. We work with wireless carriers and turnkey vendors to develop and build telecom sites and, additionally, we have expertise in specific areas such as VoIP and other internet-based activities. However, our main focus is on the tower construction industry. CLEARGOL employs forty-five people in North America.

We have recently decided to enter the Brazilian market. This business decision came in light of the continuous expansion of its national telecom industry. In fact, we believe that to date, there are more growth opportunities in Brazil than in North America.

In Brazil, we will focus our attention on the tower construction and maintenance business. However, we are also considering the acquisition of a small tower portfolio. Currently, we have a team of seven people active in Brazil and this is likely to increase as we start developing projects. Our goal is to start working in the field by Q3 of this year.

We are currently in talks with three Brazilian system integrators/construction companies that we are considering acquiring. These acquisitions would give us an opportunity to take over a fairly large portfolio of projects and clients. These companies have the right contracts in place with key stakeholders in Brazilian towers, but they lack the funds and experience to take them to the next level. This is what CLEARGOL will focus on.

TowerXchange: Who are your main clients and in which countries do you operate?

In North America, we work with major carriers and turnkey vendors.

In Brazil, we currently have one member of staff developing our business by talking to all major tower companies such as American Tower and SBA Communications. At this stage, we are going through the qualification process with them in order to be able to acquire their projects.

TowerXchange: Can you give us a comparison between the North American and the Brazilian telecom tower industries?

First of all, most of the tower related work in the States comes from large system integrators whereas this isn’t yet the case in Brazil. I would say Brazil is an open landscape still being shaped. This is the main reason we decided to create an opportunity to establish our local presence, and focus on our core skill-set of building and managing sites.

Health and safety standards and working conditions are still a bit more challenging in Brazil than in the U.S.

In Brazil, demand for towers is greater than the supply. There is a huge need for experienced contractors able to meet the growing demand to build new towers. In fact, as of now, Brazilian towercos are still more focused on the leasing aspect of the business rather than on build-to-suit (BTS) projects. CLEARGOL wants to fill that gap and become the leading contractor dealing with most of the tower construction work in Brazil.

In the US just like in Brazil, there are several construction companies trying to compete against each other. I believe that a lot of them lack the knowledge of technology and active equipment-related aspects of the network, and are only focused on the construction side of projects. Nowadays, construction and technical skills need to go side by side when developing projects for the telecom industry.

Another challenge in Brazil is that lots of contractors can be very skilled when it comes to building sites, but they don’t know how to handle the related paperwork. I am referring to site packages, site pictures and other necessary documents that some companies just don’t seem to know how to manage. CLEARGOL developed its own system and procedures which greatly simplify every aspect related to paperwork and bureaucracy.

In Brazil, we are bringing systems and processes which took us years to establish, and we believe that the telecom industry will benefit from the presence of an experienced integrator.

TowerXchange: Are new towers in Brazil generally being designed to host multiple tenants?

There are hundreds of towers in Brazil being transferred to towercos which aren’t suited to host multiple tenants. These towers were built following old engineering principles and they simply cannot handle the wind load of more than one tenant. This is an important issue for towercos looking at monetizing their portfolio acquisitions. In the U.S. there are better managed central databases to store information related to sites, and most towers are suitable for the co-location of multiple carriers’ equipment.

To my knowledge most new towers in Brazil are being built to host multiple tenants.

With regards to upgrading existing towers, there isn’t always the right business case to invest, so some towers are literally being rebuilt from scratch. Ultimately, this is a business decision tower companies need to make as they discover these issues, taking into account the related engineering cost and the potential revenue each specific tower can generate.

TowerXchange: What percentage of your work comes from carriers vs towercos?

In the U.S., it really depends on each specific project and I expect it to be the same in Brazil.

Ideally, we would like to work directly with carriers but when sites are owned by towercos, it depends on the structure of their contract. In fact, as carriers and towercos split responsibilities with regards to site management and maintenance, we are likely to work with both depending on the nature of the project.

TowerXchange: Which states are you focusing on in Brazil?

For now, we are focusing our attention on São Paulo, Rio de Janeiro, Paraná and Minas Gerais.

On one hand, this is due to the fact that the contractors we are looking at acquiring are based in these three states. Moreover, the states are host to major metropolitan areas with several opportunities for companies like ours.

This is the same approach we have followed in the U.S., focusing on one specific area rather than covering the whole country and then grow our business from there.

TowerXchange: What is CLEARFLOW? And how does it optimise the flow of information between the different stakeholders in the passive infrastructure ecosystem?

CLEARFLOW is a web-based system we created to store and update information related to the lifecycle of each project we develop. A system without processes is nothing and CLEARFLOW is supported by a strong set of procedures we have set up over the years to streamline our workflow.

Thanks to CLEARFLOW and our internal expertise, we are able to track every single aspect related to a project, including site acquisition, health and safety concerns, zoning issues, the status of each license, stock of material, contractors management, et cetera. It’s a very solid web-based system which supports an experienced and organized team.

With CLEARFLOW we are able to generate daily reports on the progress of a specific project, load pictures of new sites as they are being constructed, send these details to the client in real time, produce final reports at the end of the project as required by carriers and, in general, communicate to our clients and contractors important information without wasting any time.

TowerXchange: Finally, please sum up how you would differentiate CLEARGOL from other TI providers?

CLEARGOL is becoming a stable partner for telecom companies looking at developing new projects in Brazil. Our past performance in the U.S. serves as a great reference to fully understand the quality and commitment we put in every project.

I also believe that CLEARFLOW sets up apart from the competition. Having a powerful in-house tool combined with skilled personnel with years of experience in North America is a definitive plus.

We build and develop sites. And along with it, we strive to keep track of every aspect of our work, update our clients regularly and keep innovating.