Experts participating in the site design and improvement working group represented several leading Asian markets, from mature telecom infrastructure markets like India and Malaysia to the fast-changing markets of Myanmar and Bangladesh. Buyers across the table discussed the key challenges and pitfalls they encounter during new rollouts. From the difficulties of sourcing skilled contractors to the challenges of negotiating with landlords, towercos discussed ways to improve upon their work and ensure projects are delivered on time and meet their high quality standards.
Working group participants
MNOs and towercos: edotco (Bangladesh, Cambodia, Malaysia, Myanmar, Pakistan, Sri Lanka), Indus Towers (India), Myanmar Infrastructure Group (Myanmar), MPT (Myanmar), Reliance Jio (India)
Suppliers: Abloy, Camusat International, Dreamline, Ericsson, Ganges Internationale, GSM Telecom, Invendis Technologies, MAFI, NANHUA Electronics, Orissa Wicomm, Qowisio, Ramboll, Skipper Limited, Siterra (An Accruent Product), Tarantula, T.C.C. Industry and Engineering
Key learnings
LEARNING 1: Rolling out new sites on time isn’t easy in Asia as a result of the difficulties faced during the site acquisition and permitting process. Negotiations with landlords are proving more complicated and as land prices go up, thus towerco lease rates must increase as well.
LEARNING 2: Finding high quality contractors and subcontractors is a real challenge although conditions across the region are improving. Towercos need to create stable relationships with good vendors to standardise and speed up projects.
LEARNING 3: Meeting Health & Safety international standards is a must but can be tricky in certain countries. Training local staff is one of the most effective ways to improve the level of work in many emerging markets.
LEARNING 4: The Not In My Back-Yard (NIMBY) mentality remains an issue. Communities need to be educated on the impact of towers and radiation, and deploying safely and on time only helps the acceptance process. Noise reduction solutions should be adopted if and when communities raise complains about the noise of diesel generators.
LEARNING 5: Importing goods can be a lengthy process and can considerably delay rollout.
LEARNING 6: Weather conditions should be taken into account when negotiating SLAs, especially in countries affected by monsoon rains. During rainy season, inland transportation can be impossible.
LEARNING 7: Design layouts should be standardised and follow common criteria. Exceptions can be made when projects incorporate unusual elements such as VSAT solutions.
LEARNING 8: MNOs and towercos could work together on a set of standardised layouts especially in countries where infrastructure sharing is heavily adopted such as Indonesia, India and Myanmar.
LEARNING 9: The optimal design and deployment of tower foundations can deliver considerable savings to a project.
LEARNING 10: Certain markets such as India do benefit from direct access to local manufacturers and this reduces the complexity of new rollouts and supply chain management. Other markets have to be more diligent in managing their international supply chain.
LEARNING 11: Security and fuel theft are an issue across Asia. Batteries are a common target as well. Optimised RMS solutions and access control tools can help reducing the problem.
LEARNING 12: Ongoing training and development of local staff is key to create and retain the next generation of tower experts and the benefits are visible in the short term as demonstrated in markets like Myanmar.
Executive summary
During the site design and improvement working group hosted at the 3rd Annual TowerXchange Meetup Asia, buyers from five different towercos and MNOs were asked a series of questions around best practices in site design, new deployments and supply chain management. In this summary, we explore the most relevant findings from the session.
New site rollout: what keeps you up at night?
Participants agreed that meeting deadlines is a crucial challenge in Asian tower rollouts. New deployments can be complicated, in particular in those countries where the site acquisition phase is tough and negotiations often delay the process. In fact, increased land lease prices mean higher towerco rental fees to MNOs as a consequence.
The quality of work of contractors is another crucial element for the success of any civil work. Leaving contractors unsupervised is sometimes a necessity - especially when deploying multiple projects at the same time - but it can also jeopardise the final result. The group agreed that finding qualified contractors is a vital element of any new deployment.
The level of expertise and professionalism of contractors isn’t only relevant with regards to the final product but also to ensure safety measures are followed throughout the project. Towercos often have to deal with untrained staff, unsure about their role and not technically ready. The group mentioned Myanmar as an example and its evolution towards better H&S standards. In fact, if three years ago 80% of contractors were from out of the country because of the impossibility of finding trained local workforce, today 90% of contractors are from Myanmar and have been trained on how to properly rig a tower and work with electrical components.
In general, the group agreed that H&S is sometimes an overlooked element of the construction phase and that high standards should be guaranteed at all costs. Parallels were drawn with African markets where workforces have evolved to be more skilled and to comply with H&S standards.
The NIMBY mentality does play an important part when installing new towers and is a real concern in certain markets. Residents complain about diesel generator noise as well as about the impact of radiation. And while noise reduction solutions can be implemented, explaining to the local community the dynamics of the telecom industry, what they can expect from a new site in their neighbourhood, and the risks of radiations is often the only solution towercos have to continue with the deployment.
Permitting, weather conditions and supply chain management challenges
Permitting is often a bottleneck. Myanmar was once again brought up as an example due to the lengthy procedures needed to acquire all the necessary paperwork. Government bodies involved in the process aren’t necessarily connected and this can considerably slow down the issuance of new permits. Training local staff to handle correctly the permitting phase can result in considerable time and money savings for towercos.
The delivery of materials - from the actual tower to the cabinets and other components - can delay the completion of a project. And in certain countries the port clearance process can take weeks to be completed. Importing can be a costly and slow process, compounded by the complications related to inland transportation, especially during rainy seasons.
Weather conditions can be an extremely costly factor in the timely delivery of any project in countries affected by monsoon. In Myanmar as well as in Bangladesh and other areas of Asia, it can rain for twenty-two weeks almost non-stop and this has a major impact on Service Level Agreements (SLAs), which must take weather into consideration.
Overcoming logistical challenges is possible thanks to strong project and supply chain management governance. And some markets are easier than others when it comes to accessing goods. For example, Indian towercos have direct access to local steel manufacturers which makes supply chain much easier.
Balancing standardisation and customisation needs
The group agreed that while layouts are often standardised across multiple projects, some level of customisation is needed, especially when VSAT solutions are being adopted. Towercos should think carefully about optimising the design of the foundations since significant cost savings can be found here.
Additionally, the rising cost of camouflaged towers are limiting the possibilities of towercos to customise sites, in spite of a certain volume of requests for such solutions. Having a good volume of business does help to drive down the cost of camouflaged towers - or any other project - and the savings do end up being shared with the final customers in the form of lower prices.
Lastly, the group mentioned the need for MNOs and towercos to cooperate to come up with standardised designs for multi-tenant sites, especially in markets where infrastructure sharing is very common like Indonesia and Myanmar.
Which capex priorities do towercos have when acquiring existing sites from an MNO?
The group discussed the high level of capex on the towercos’ balance sheet when acquiring sites from MNOs. Once an acquisition closes, towercos need to devote plenty of time, resources and capital to upgrade sites that would be otherwise unsuitable for sharing. As well as upgrades to increase structural capacity, this can also include improving site monitoring and access, and investing to improve the reliability of any primary or backup energy generation and storage systems.
What are the biggest issues in O&M of sites?
Security at sites was mentioned as the number one concern from an operations standpoint. Specifically, fuel theft was high up on the list followed by vandalism and battery theft. Optimised RMS systems and access control solutions do help to increase the level of security at sites but don’t solve the issue entirely.
Another element of concern is the unreliability of power supply, which include power blackouts and fluctuations in voltage (which could damage electrical equipment permanently).
Some group members raised the point of the accuracy of data delivered by monitoring systems which isn’t always reliable.
What challenges exist when recruiting, training and retaining staff and contractors?
Members of the discussion agreed that the human factor is crucial and that working with well trained and capable staff is the only way to ensure quality projects are delivered.
The industry is experiencing a phase of high attrition and retaining talent isn’t easy. Similarly, sourcing and maintaining relationships with high quality contractors is a challenge. The group agreed that the way to go would be to form vendor partnerships to ensure long lasting business relationships.
Experts who work in new markets mentioned how the industry is indeed evolving. Myanmar had close to zero competency in terms of rollouts just three years ago. Players that entered the country trained staff to work with computers, speak English, communicate properly and become experts in permitting, construction and leases. And while emerging Asian markets look at India and Indonesia as benchmarks for their skills and quality of service, investing in local resources does pay off and is playing a crucial and positive role in markets like Myanmar today.
