Click here for the online version. This e-mail was created for [email protected] Wednesday, July 20, 2016 Volume 4 | Issue 141 Twenty-eight Rural Wireless Carriers Bidding In The 600MHz Auction Last Friday, the FCC released its approved bidder list for the ongoing 600 MHz spectrum auction which includes 28 companies who have been given “rural wireless bidding credits,” reports telecompetitor.com. These credits will enable rural carriers to submit bids that are 15% higher than they will actually have to pay in order to obtain spectrum. Phase 1 of the auction concluded last month, and Phase 2, in which carriers bid on spectrum television stations are willing to relinquish, is expected to begin next month. Spectrum used for television is well suited for rural deployment due to its wide-ranging propagation, decreasing the number of towers needed to cover a large area. All major carriers, except for Sprint, are on the approved vendor list. Below is the list of carriers who have been approved for these credits: Continue Reading Neutral Hosts And Multi-operators Will Enable 5G Says Small Cell Forum Small cells have been climbing up the evolutionary ladder since 2007, according to ReTHINK Research, who says that the technology is “suddenly there,” and it happened “in the mainstream when nobody was looking.” Densification, LTE-advanced plans and movement to 5G are on the forefront of technology based around small cells, with heterogenous networks (HetNets) being integrated as well. ReTHINK said that the Small Cell Forum’s FAPI and nFAPI “will ease the process of mixing and matching these different options, and sourcing from multiple vendors, while allowing for future 5G technologies to be inserted into the existing framework rather than forcing a rip-and-replace.” Key players in the HetNet future are Facebook’s Terragraph design, OpenCellular’s focus on small cells and The Forum’s Release 7 blueprint for a self-optimizing HetNet. Continue Reading Analysts Warn Carriers: ‘Be Careful What You Wish For’ Verizon, AT&T and others are bidding for Yahoo!, and Bloomberg reports that a decision could come this week. How Yahoo’s construction is put together depends on the company doing the bidding, and each bidder sees things a bit differently. Bloomberg noted that Verizon “sees a complimentary set of businesses that could find a home alongside its AOL properties,” with Yahoo’s Flickr, Tumblr, Yahoo Finance and Sports, Flurry and BrightRoll. Some think Verizon may have a boost in the digital ad market by acquiring the internet giant. At a conference call, CEO Marissa Mayer said that Yahoo! is “deep into reviewing bids and will update shareholders at a prudent time.” Second-quarter sales were better than analysts predicted, an uptick since the bidding war began some seven months ago. Bloomberg says that Verizon, a partnership of Vector Capital Management and Sycamore Partners, along with Quicken Loans founder Dan Gilbert are expected to be among the high bidders, along with AT&T and private equity company TPG. Walt Piecyk, an analyst with BTIG told Bloomberg that the transformation from carrier to a more complex media and internet platform is not an easy one. “Companies don’t change stripes very easily,” Piecyk said. “Over the past 20 years we’ve seen operators try to inject themselves into new businesses and usually that’s ended up with poor outcomes,” he said. July 19, 2016 at Close Analysts Project Big Four Carriers’ 2Q Earnings The telecom market analysts at Wells Fargo Securities, led by Senior Analyst Jennifer Fritzsche, provided their expectations for each of the Big 4 carriers. All four will announce their second quarter earnings within the next week. *AT&T, INC. (T) (Earnings date: Scheduled for 7/21) - We expect lower service and equipment revenue driven by T's decision to not chase postpay growth at all costs. We estimate postpay net adds of 250K, postpay handset losses of -150K, and postpay churn of 1.0%. We project Q2 EBITDA of $7.4B (in line with Street consensus), and improving EBITDA service margin of 49.4%, up 90bps y/y and essentially flat sequentially. Key areas of focus: Integrated carrier promotions for wireless/video bundles, timing and details of DTV OTT (over-the-top) video plans, color on wireless expectations built in for iPhone refresh in 2H 2016. *SPRINT CORP. (S) (Earnings date: Scheduled for 7/25) - We estimate CQ2 total postpaid adds of 225K, 100K postpay phone additions (vs. Street 136K and 89K, respectively). Our postpay churn est. is 1.54% (vs. Street 1.58%), and we expect this to be a focus. We estimate CQ2 service revenue of $6.2B, down 4.3% y/y but flat sequentially, and equipment revenue of $1.3B. We estimate CQ2 wireless EBITDA of $2.4B, and EBITDA Margin of 31.0%, up from 27.5% y/y and 27.9% in CQ1. Key areas of focus: Cost reductions and transformation costs, Spectrum and Network LeaseCo developments. *VERIZON COMMUNICATIONS, INC. (VZ) (Earnings date: Scheduled for 7/26) - We estimate 734K postpay net adds, with 191K handsets (411K smartphones offset by -220K basic phone losses). Our wireless service revenue estimate is $16.95B (vs. Street $16.8B), and we project equipment revenue of $4.2B, up 9.3% y/y, driven by a greater contribution from EIP plans. We estimate Q2 EBITDA of $9.8B, EBITDA service margin of 58.1%. Key areas of focus: impact from the union strike, thoughts on recent pricing moves and competition, wireless video/Go90 and digital media strategy. *T-MOBILE USA (TMUS) (Earnings date: Projected 7/28) - We expect TMUS to lead Big 4 on subs adds, with postpay net adds of 897K (vs. Street 841K), including 717K handsets (vs. Street 637K). We estimate wireless service revenue $6.9B (vs. Street $6.85B), and equipment revenue of $2.2B. Our Q2 Adj. EBITDA est. is $2.4B (vs. Street $2.37B). Excluding our $399MM estimate for leasing revenue and -$80MM in revenue deferral from Data Stash, Adj. EBITDA is $2.1B, in line with Street ests. Key areas of focus: EBITDA/FCF trajectory, 700MHz expansion, subprime credit exposure (and recent moves to tighten credit standards). New Mexico City of Santa Fe Suing Developer For Building Tower Without Permission While NMSurf says it doesn’t need approval from the City of Santa Fe to build a tower, officials disagree. The city is taking the internet service provider to court over an 80-foot telecommunications tower built behind its own office on Apache Avenue near Salazar Elementary School. The Santa Fe New Mexican reported that NMSurf built the tower without a permit. The city told the news site that the provider “must submit to an administrative review process and get permission from the planning commission.” The company did request a permit in writing in April of 2015, stating that it already had two towers on its property and wanted to consolidate into a single, new structure 30 feet from the building. The New Mexican noted that city regulations state a tower must be set back from property lines the same distance as its height, which in this case would be 80 feet. According to the city petition, the proposal had the tower being 16.8 feet from the back fence. Continue Reading Arkansas More Internet Demand Means More Towers In Northwest Arkansas Internet providers are making a concerted effort to provide internet services in rural Northwest Arkansas, an area in the country that is currently underdeveloped in terms of wireless connectivity. AT&T Arkansas, Cox Communications, and Ozark Electric Cooperative have each announced plans to expand the availability of internet service, reports Arkansas Business. The growth in demand for internet services—with fast connectivity— necessitates a growth in the number of towers in the region as well. In order for providers to expand service, fiber lines must be installed from tower to relay points, a difficult process in sparsely populated areas. Providers are focusing not merely on coverage, but speed as well. In fact, tower companies are building new sites with this in mind. Tom Allen, the executive vice president of Arkansas-based Ventures LLC, said 1 gigabyte per second was the minimum speed for potential tenants. “They’re very concerned about having fiber and speed and capacity. It seems that all the requests we get, that is one of their requirements, whether it is available or not. We knew the tenants coming in would want that so we had already planned that,” Allen told Arkansas Business. Land Aggregators Expand to Central and Latin America The ground lease aggregation model is a fairly simple one—aggregators try to acquire land on which cell towers are constructed by offering a payment to the property’s landlord, thereby collecting revenue on the land from tower companies. Several companies have proven the model successful in the United States and are currently looking to expand into parts of Central and Latin America, reports TowerXchange from a recent seminar “Round Table” led by Michael Buhler of Terra Towers. AP Wireless, TowerPoint Capital and Unison Site Management are among the top aggregators looking for opportunities to expand in these regions. AP Wireless and TowerPoint have been most active in Brazil—the hottest spot in these regions for aggregation companies. Land aggregators actively reach out to landlords by going door-to- door, running advertisements in local newspapers and encouraging them to reach out. Continue Reading We’ve made some changes to our media kit. Click the button below to learn more about our new Feature Sponsorships. Latest posting from the FCC 7/18/16 Ericsson Field Service Operations – Telecom Tower Technician I Ericsson is currently looking for experienced Telecom Tower Technicians to join their organization in multiple cities across the United States.