Mobile Network Sharing
Mobile network sharing is on the increase, driven mostly by the need to reduce the high cost of network infrastructure. Three clear trends are emerging:
- Mobile network sharing Joint Ventures (“JVs”) between Mobile Network Operators (“MNOs”) have more than doubled in the last five years and active sharing has increased significantly as a proportion
- JVs or sale/leaseback agreements with third-party tower companies (“TowerCos”) have grown to become almost one third of all network sharing deals
- Some MNOs are taking sharing to the extreme and participating in in-market mergers or acquisitions.
MNO Network Infrastructure Sharing Deals by Year (2001-14)
To identify potential sharing options, operators need to consider five dimensions: technology scope, geographical scope, architectural scope, potential partners and sourcing.
From a large number of theoretical options, a few core ones should be evaluated and compared against a “no-sharing” base case. There will also be a number of “what-if?” scenarios to evaluate.
Ultimately network sharing is driven by the need to maximise Enterprise Value. The major benefit from network sharing is a net reduction in network CapEx and OpEx. Typical benefits range from 10-40% saving of the in-scope costs dependent on the sharing option. As with any major programme, there are numerous risks that need to be analysed and, where possible, mitigated.
Coleago’s approach is applicable regardless of the sharing option selected. It is designed to work as well for a tower deal with a TowerCo as it does for an active RAN share with another MNO.
Coleago’s Four Step Process to Mobile Network Sharing
Typically, it takes between 9 and 15 months for the first three phases depending on the sharing option, regulatory approval(s), the need to transfer assets and the willingness/ambition of the partners. The Transformation phase may take several years to deliver all the savings.
During the last decade our consultants have built up experience across most types of mobile network sharing deals and phases. We provide a complete range of services to support or lead your project team throughout the process.
Stefan ZehleT: +44 7974 356 258
Graham FriendT: +41 79 855 1354
Chris BuistT: +43 664 352 1068