TowerXchange: Does Brookfield and DigitalBridge becoming GD Towers’ additional shareholders change your business model and strategy?
Bruno Jacobfeuerborn, CEO, GD Towers:
The partnership has primarily led to changes in the shareholder structure. Deutsche Telekom now owns 49% with DigitalBridge and Brookfield jointly holding 51% of shares in the GD Towers Holding GmbH. DFMG Deutsche Funkturm GmbH and Magenta Telekom Infra GmbH from Austria are both grouped under GD Towers. Together they hold a portfolio of approximately 40,000 sites in the two markets. With our three shareholders on board, we will continue our growth story to establish GD Towers as the Europe’s leading towerco.
The operational business and management of DFMG and MTI remain unchanged. In Austria, Christian Bauer is the CEO and Michael Sertl is the CFO. At DFMG I am still the CEO and as of March Thomas Ried took over as COO while Philipp Pohlmann has become our new CFO.
TowerXchange: In addition to the traditional macro-tower of co-location business, do you see additional revenue coming from expansion into adjacencies?
Bruno Jacobfeuerborn, CEO, GD Towers:
It’s no secret that Germany in particular has one of the most ambitious network expansion and modernisation programmes in Europe. Last year alone, we built 1,200 sites in Germany and 100 in Austria. We will continue to expand our portfolio in the coming years - every year we plan to add more than 1,000 new mobile communications sites to our portfolio.
Our focus has been, and remains to be, to support the network roll-out for our anchor customer Telekom Deutschland GmbH (DT). However, it is important to say that we already market about half of our suitable mobile communications masts to at least one other MNO besides DT and make a quarter of our turnover with other customers besides Telekom Deutschland. We have expanded the third-market business in recent years, and we will resolutely continue along this path with the new owners. With the expertise and capital of DigitalBridge and Brookfield, we get even more flexibility for our third market business.
TowerXchange: Looking into the future, what opportunities do you see for GD Towers to maximise the use of the towers you operate?
Bruno Jacobfeuerborn, CEO, GD Towers:
Many of our sites, but our TV towers in particular, have great potential to support the so-called "real-time internet". TV towers usually have an excellent fibre optic connection, special power supply backup systems and provide sufficient space for edge data centres to be built in the areas surrounding them. The high-performance computers can process the data in milliseconds and send it at a fast speed due to short cable routes to the antennas. The towers are in close proximity to the end customer and the communication paths can be kept very short. This helps applications to react at lightning speed, for example for gaming. Due to their height, TV towers also offer great coverage.
In general, the topic of edge computing is therefore an exciting one for us. The development of the edge computing market is still in its early stages and the use cases for extremely low latency are still relatively small. However, we are convinced that this will change in the next few years.
TowerXchange: How do you respond to the requirements to address the rural coverage gap for example to do with 5G roll-out in Germany?
Bruno Jacobfeuerborn, CEO, GD Towers: Rural coverage gaps are mostly located in challenging locations with a difficult topography and relatively low mobile communications usage. These conditions often exceed the limits of economic viability. As Deutsche Funkturm, we are playing a major role in the common goal of limiting white spots in Germany. Only recently we have received funding for the first mobile communications site under a nationwide funding program on behalf of the federal government with the aim to close rural coverage gaps.
We cooperate with the German government’s mobile infrastructure company (MIG) which helps address coverage gaps in remote locations or places with challenging topography by funding the construction of towers and their operation for a period of seven years. MIG identifies locations for new sites and manages the acquisition and pre-contractual securing of land on which the subsidised mobile phone infrastructure is to be built. We have the first funding commitment by MIG for the construction of a subsidised mast in the district of Cham in southeast Germany, followed by a further commitment in northern Germany. This sends an important signal for promoting digitisation in rural areas. The practical experience gained will flow into future work in order to be able to close existing gaps even more quickly with subsidised mobile communications infrastructure.
In addition to private and subsidised funding, infrastructure sharing, and cooperative expansion are very central factors in white spot limitation. Ultimately, we can only achieve the goal in cooperation and if we use the entire toolbox.
To hear more on what GD Towers will do next, join us at TowerXchange Meetup Europe in London where Bruno Jacobfeuerborn will be speaking.
