HOI MEA reinvents itself as a towerco

TowerXchange continues our profiles of the four licensed infrastructure providers in Egypt. HOI MEA has designed, manufactured and installed over 1,650 telecom towers in Egypt and Sudan, with a further 4,000 towers manufactured by HOI MEA installed in other countries. Their unique camouflaged multi-tenant towers have enabled them to become key partners of Vodafone Egypt and other operators, and the company has now commenced operations as an independent towerco.

TowerXchange: Where does HOI MEA fit in the tower industry ecosystem?

HOI MEA is headquartered in Egypt with offices in Sudan, KSA, UAE and Qatar. We provide full turnkey services (including design, supply, permitting, installation and managed services) in these countries, while also supplying our products to many other countries such as Algeria, Bangladesh, Ethiopia, Kuwait, Oman, Lebanon, Iraq and Libya.

Our company started trading as "House Of Invention" in 1997 as a contractor to Lucent Technologies in Saudi Arabia. We later moved to Egypt to make a joint venture with ASTE, becoming "HOI ASTE". Now we have rebranded as HOI MEA and use that name everywhere.

HOI MEA strives for the highest quality in the industry while not jeopardising the customer’s budget or project delivery date. HOI MEA design, fabricate and install a wide range of products from antenna mounting structures to shelters, electrical boards and panels, mobile and rapid deployment solutions, plus a comprehensive range of decorative structures.

TowerXchange: Please tell us about HOI MEA’s current role in the Egyptian tower market.

HOI MEA provides full end to end turnkey services for Egyptian cell sites: we design, manufacture, permit, install, add power solutions and maintain the sites.

We are very busy in Egypt working in both FTK projects for Vodafone and also in developing our own towerco business. While the Egyptian tower market is slightly down because of the political situation, we believe the market will recover as the country returns to political stability.

The Egyptian towerco market started at the end of 2010 but was on hold for some time because of new revolution in Egypt. The market is now starting again with all three operators, Vodafone, Mobinil and Etisalat, sharing existing and new sites.

Our regulator the NTRA awarded telecom infrastructure provider structures licenses to four Egyptian companies. HOI MEA was the first company win such a license and is the only company working on site sharing projects in Egypt with Vodafone.

We started with an order for 150 sites last year, 42 of which are already complete. We will continue to build 500 sites within the next three years in the Delta region in North-Central Egypt. About half of Egypt’s 80m population live in the Delta region, which includes the city of Alexandria. Network coverage is less of an issue than network capacity, compounded by residents’ bad reactions to putting cell towers too close to them, which is why our camoflaged tower designs have proved popular.

Many of the towers HOI MEA has installed in the Delta region are 60m self-support towers with capacity for up to five co-locations. Mobinil and Etisalat are already negotiating to lease some of the sites but there are other potential tenants beyond Egypt’s three mobile network operators such as government and police public safety networks.

TowerXchange: What’s your view on the potential for a tower transaction in Egypt, and what role would HOI MEA like to play?

Mobinil is considering offering some towers for sale, and an official RFP has been issued. I’ve spoken personally to Mobinil to express HOI MEA’s interest in acquiring those sites.

HOI MEA are interested in providing independent towerco services to gain more stability in our market and to develop our business a step beyond our competitors.

TowerXchange: What proportion of new towers you are installing have capacity for multiple tenants?

Around 40% of new tower orders we are receiving today are for designs that have capacity for multiple tenants.

TowerXchange: How do HOI MEA differentiate yourselves from your competitors through you manufacturing capabilities?

One of our main differentiators is our R&D department. We invest US $2-3m annually in R&D, far more than our competitors. HOI MEA have 16 engineers from different disciplines working in our R&D section, and that has enabled us to consistently develop several new product designs every year, ensuring our static asset product range meets all the latest customer requirements.

We own several specialist factories which produce steelwork exclusively sold by HOI MEA including a shelter factory producing telecom shelters fully furnished or flat packed; a factory dedicated to decorative support structures; another factory working under Schneider for electrical panels, control panels, ATS and power distribution; plus a copper factory for power cables, lightening rods, bus bars et cetera; and a tower factory in KSA for towers, monopoles, steel structures and galvanization with a capacity of 30,000 tons per year.

In the last five years HOI MEA have been the only supplier of towers to Vodafone Egypt, and we’ve been able to beat every competitor’s price because we offer end to end turnkey infrastructure services from design and manufacture to installation and maintenance services.

Every year our R&D team invent several new towers, rooftops and camouflaged structures every. For example, we’ve sold a lot of a new design for a permanent, 60m self-support tower that can be installed in just two days, thanks to using a prefabricated foundation.

TowerXchange: Has there been much demand for camouflaged towers in MENA?

We’re seeing a shift in demand in the Middle East and North Africa move from conventional towers, where the competition among manufacturers is fierce, towards environmental friendly, decorative camouflaged towers, where the competition is not so intense and the margin is good.

HOI MEA has sold 450 camouflaged towers in the last three years, including both conventional camouflaged towers and some of our new shapes. We design, manufacture and install cell sites decorated as palm trees, pine trees, rooftop gardens, water towers and flag poles. This is why HOI MEA are able to build sites in areas in areas where others find it very tough. With our hidden antennas, nobody knows a GSM site is there (of course all the permits are still secured).

HOI MEA’s camouflaged towers can be provided with capacity for single, two or three tenants. A fourth tenant can be added but would no longer be camouflaged. Very high wind loading capacity for four or more tenants requires use of a conventional tower. HOI MEA’s extensive range of camouflaged towers includes rapid deployment options and gives us a competitive advantage - securing an order for 100 camouflaged towers often opens the door to add several hundred conventional towers.

TowerXchange: Have you installed many hybrid energy solutions in Egypt and Sudan?

HOI MEA are also investing in green power and control, and have implemented 15 hybrid sites in Sudan in the last year and a further 5 in Egypt. When the Egyptian government takes the fuel service away in a few months, the only solution will be hybrid.

TowerXchange: What’s your view of the tower market in North and South Sudan?

HOI MEA are providing turnkey infrastructure services for three to four operators in North and South Sudan, through ZTE with one, providing services direct to the others.

While the Sudanese economy had slowed down, we feel it’s recovering now. In the first few months of this year we’ve received orders for more than 75 sites, whereas in the whole of last year we didn’t receive orders for even 100 towers. We’re also in negotiation with Huawei to add a further 125 sites in South Sudan this year.

Most of the work in Sudan is rural network extensions to remote areas that have never had connectivity before.