How TeleTower is dominating the Baltic tower market

Founded in 2009, TeleTower is the largest independent towerco in the Baltic region, with around 21% of towers in those two countries. In this exclusive interview, we spoke to CEO Marius Pilinka about how the company was founded, their footprint and plans for growth in the future, as well as building some context around the mobile and tower markets in the Baltic region.

TowerXchange: Please can you tell us about the history of Teletower and how the company was formed?

TeleTower was registered in November 2009, the company is responsible for ownership, management and development of towers and masts. TeleTower is part of Bite Group, the leading telco group in Baltics which consists of mobile operators Bite Lietuva (in Lithuania), Bite Latvija (in Latvia) and other related telco companies.

TowerXchange: What is your current footprint and remit?

TeleTower is the only infrastructure operator in our region with a focus on multi-tenant operations. Other big local players don’t have separate companies to look after infrastructure and its tenants. This model helps us to provide better services not only for Bite, but for our other tenants as well.

TowerXchange: How many towers do you own? What does that represent as a percentage of towers in the market you operate in? 

TeleTower is the second biggest infrastructure owner in Lithuania and Latvia, owning ~21% of towers/masts in Lithuania and Latvia. In total we own 485 towers and masts: 256 of them in Lithuania, and 229 in Latvia.

TowerXchange: Can you summarise the current situation in Latvia and Lithuania in terms of 4G/LTE rollout and anticipated 5G rollout?

Bite has one of the fastest and widest 4G/LTE networks in Lithuania. Bite Lietuva (that‘s the main tenant on our towers) made the biggest leap in 4G network coverage expansion in the first half of 2017, compared to other telcos in the country. At the moment the company covers 93-95% of Lithuania with its 4G/LTE network based on more than 1,000 base stations. Bite Lietuva plans to reach 99% coverage by the beginning of next year. Because of this, by the middle of next year, we expect all Lithuanian TeleTower/Bite geo locations will be equipped with 4G by one or two carriers per sector. Bite is also currently doing various tests and preparations towards 5G (LTE-A, Lean Carrier infrastructure, et cetera).

Latvia is only slightly lagging behind Lithuania in terms of 4G/LTE coverage. At the moment in the Bite Latvija network we have more than 500 LTE base stations (across one or two carriers) and cover ~75% of Latvia’s territory and ~90% of country’s population with 4G network. We are constantly expanding and upgrading existing sites to LTE and building new ones. In addition, we plan to upgrade existing 2G/3G sites to LTE by the next year; and build more than a hundred new LTE/UMTS sites. The situation regarding 5G rollout is the same as in Lithuania.

TowerXchange: Please describe what small cell and DAS penetration is like in Latvia and Lithuania? Are these growing markets? How does TeleTower plan to respond to the need for denser networks?

In Lithuania, Bite has a low amount of 2G small cells and there are no 3G or 4G small cells in the country. At the moment we are using passive DAS and sharing with all three major mobile operators (Bite, Telia and Tele-2). Growth in this area is very moderate and very sensitive to economic change.

In Latvia Bite deploys around 35 pico cells per year. At the moment in Latvia we have 160 GSM only pico cells and continue to expand them. We are thinking about a 3G/4G pico cell roll-out, however there is still no final decision because of the level of investment required. DAS solutions aren’t used in  in Latvia because it is too expensive.

TowerXchange: Can you tell us a little about how the company is structured operationally? What functions are managed in house and what is outsourced? Do you view yourselves as pure ‘real estate’ owners or do you offer more of a service to your clients?

As I mentioned earlier, TeleTower belongs to Bite Group, so our management team consists of former Bite employees who have a long and solid track record of managing and commercialising tower portfolios. At the moment we have three employees in Lithuania and two in Latvia.

We position ourselves as a pure real estate company, however, in partnership with Bite we can offer data internet, transmission and other project designing solutions. For example at the moment we are participating in huge European project – the European Aviation Network, which will provide in-air connectivity for airline passengers flying over Europe. For flights over Lithuania and Latvia TeleTower and Bite network infrastructure will be used (more information on this, click here and also here)

TowerXchange: Can you share any information about your tenancy ratios? Also, who are your main clients? How much of your tenant mix is telecoms vs other sectors?

TeleTower tenant ratio in Latvia and Lithuania combined is ~2x. Our main clients are other telco operators – Bite, Telia, Tele2, and the Lithuanian radio and television centr. We also have other clients including radio, security companies, government companies, forest fire detection systems, air navigation companies and  internet providers, et cetera.

TowerXchange: Finally, please can you share TeleTower’s vision for the future

The company will continue developing the tower infrastructure sector in Lithuania and Latvia (especially compact tower sites such as monopoles); servicing its existing tenants and increasing the base of tenants by acquiring the new tenants from sectors such as TV, radio and IoT.