Executive summary
The global telecommunications industry is at a crossroads. On one hand, it is a key engine for innovation, inclusivity and digital innovation driven by an explosive demand for data. On the other hand, telecommunications operators are under immense pressure as revenues have stagnated despite ever-growing costs and the need for fresh capital injection. There is an urgent need to adapt traditional business models and network deployment strategies especially with 5G on the horizon. Expectations from 5G are high – promising to be a bigger paradigm shift than the previous generations but this will entail massive requirements in infrastructure expansion and investments.
TowerCos have a pivotal role to play in this evolving ecosystem providing efficiency, scalability, and flexibility. TowerCos have built robust models that specialize in delivering multi-operator connectivity (neutral hosts), reducing the cost of deployment and operations of tower sites. TowerCos are evolving into digital infrastructure providers to better serve the dynamic demands of the sector – expanding from the traditional model of providing passive infrastructure to MNOs, to other activities such as enabling active equipment sharing, building alternate power options and improving operational efficiencies for clients. Overall, it is estimated that TowerCos in emerging Asian countries1 have the potential to create USD 10 billion of savings for MNOs by 2025, benefit consumers with up to incremental USD 67 billion2 due to price improvement and GDP growth, as well as reduce 5 – 17 million metric tonnes of carbon footprint by 2025.
Success will heavily depend on a conducive regulatory environment as TowerCos face challenges to realize the full potential. TowerCos require a conducive regulatory environment to play a pivotal role in the ecosystem, especially as they look to venture into new business models driven by the shifting landscape brought on by 5G and technological advancements. Five key regulatory dimensions are critical: 1) strong digital infrastructure mandate, 2) simplified and conducive licensing and ownership, 3) active promotion and guidelines for network sharing, 4) streamlined regulations for infrastructure deployment and 5) enablement of adjacencies. In emerging Asian markets, generally the regulatory environment is still evolving, with efforts underway to put in place more supportive policies and regulations. Overall, there is further room for growth in terms of regulatory and policy support which countries in emerging Asia can adopt compared to global best practices to enable the digital advancement in their respective countries
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In conversation with Freda Liu as a Moderator featuring Gayan Koralage, Panelist (edotco Group), Ahmad Ridhwan Azizan, Panelist (Roland Berger) and Tugay Yilmaz, Guest Panelist from International Finance Corporation (IFC).
Listen to them discuss insights from the Roland Berger report and provide context into the TowerCo industry in Asia.
