Green Telecom Towers

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Opportunities in Green Telecom

Tower Market

June 2011

Sagar Gubbi

Managing PartnerEcoforge Advisors Pvt Ltd, Bangalore, [email protected] +91-97312-02201

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Telecom Revolution in India

2Green Telecom Towers, Jun 2011 Ecoforge Advisors Pvt Ltd, Bangalore, India

Source: Tel ecommunicati ons, I ndia Br and Equit y Foundati on (I BEF) and Ernst & Young (E& Y), Apri l 2010


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Telecom Revolution in India: Market Growth


Massive growth in telecomsubscribers in India in thelast decade.

.driven by largeincreases in wirelesssubscriber base


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Telecom Revolution in India: Market Growth


Market growth characterisedby large urban growth ininitial years but driven byrural growth in recent years

And huge growth in thenumber of telecom towersdeployed


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Operator Market Shares: Wireless


Source: TRAI , March 2011


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Market Players


Mobile Operators

TelecomEquipment

Vendors

Handset Makers

Telepower Vendors

Tower Companies


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Industry Trend 1: Future Growth in Rural Markets


Source: TRAI , Dec 2010 & M arch 2011


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Industry Trend 2: Falling ARPUs and MoUs


Source: TRA I , Dec 2010


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Industry Trend 3: Infrastructure Sharing


Infrastructure sharing has been a relatively new segment, which witnessedsignificant investment in the past 4 years.

While rising infrastructure costs, falling revenues and increased debt burden ofmobile operators were the driving force behind infrastructure sharing, the keytrigger for infrastructure sharing has been the Mobile Operator Shared Tower(MoST) initiative implemented by the DoT in 2006

Source: I ndian Telecom Tower Indust ry , ICRA , Feb 2011


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Telecom Tower Infrastructure Industry Overview


Telecom tower companies in India are of 3 types: Tower companies formed through joint ventures like Indus tower which is a joint

venture between Bharti Airtel, Vodafone Essar and Idea Cellular Tower companies formed though de-merger such as Bharti Infratel and Reliance

Infratel which are wholly owned subsidiaries of Bharti Airtel and RelianceCommunications respectively

Independent tower companies such as GTL

Source: I ndustr y/M edi a Report s & Ecofor ge Research, 2010

Tower company No of towersIndus Towers 110,000

Reliance Infratel 52,000

BSNL / MTNL 52,000

Viom Networks 38,000

Bharti Infratel 34,000

GTL Infra 33,000

Others 51,000Total 370,000


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Telecom Tower Company Responsibilities


Site planning, keeping in view thenetwork rollout plans of prospectivecustomers.

Obtaining of necessary regulatoryapprovals.

Erection and commissioning of towerand allied equipment.

Provision of support services such asback-up power, air-conditioning andsecurity.

Provision of turnkey solutions totelecom companies such as sourcing ofequipment, testing and maintenance.

Source: I ndian Telecom Tower Indust ry , ICRA , Feb 2011


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Telecom Tower Power Scenario: Grid Availability


As per some estimates, about 20% of Indias 370,000+ telecom towers are currentlylocated in off-grid areas

A further 20-25% of towers are located in unreliable grid areas

Completely off-grid towers typically run on diesel generators for 18-20 hours a day andon batteries for the remaining hours of the day

Towers in unreliable grid areas run on grid power for 8-10 hours a day, dieselgenerators for 8-10 hours and batteries for the remaining hours of the day

All telecom towers in India face power cuts for some hours of the day, with urbantowers facing power cuts for 2-3 hours per day on an average


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Telecom Tower Power Scenario: BTS Type


Indoor versus Outdoor Base Transceiver Systems

(BTSs) Indoor BTSs are of older type that require air-

conditioning to operate. Typical power consumption for asingle indoor BTS is 5-7 kW (DC power for the BTS andAC power for the air-conditioning)

Outdoor BTSs are of newer type that dont require air-conditioning to operate. Typical power consumption for asingle outdoor BTS is 1-1.5 kW DC power only

Switching capacity of the BTS BTSs Higher call switching capacity (3x3x3 or 4x4x4)

BTSs need more power than BTSs with lower switchingcapacity

Shared Towers Shared towers with 2-3 indoor BTSs require 12-16 kW of

power (DC and AC) whereas shared towers with outdoor

BTSs require 3-5 kW

Backhaul/Hub towers typically require higher powerbut they are small in number when compared toregular towers


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Green Telecom Market in India: Current Scenario


International Finance Corporation (IFC), the private sector financing arm of the WorldBank, invested a large USD 21 Million in equity in Delhi-based Applied Solar, whoseprimary business is to provide solar hybrid solutions to telecom towers

Some of the recent public announcements/articles on solar telecom towers in India arelisted here:

http://www.gsmworld.com/our-work/mobile_planet/green_power_for_mobile/index.htm

http://articles.economictimes.indiatimes.com/2010-10-22/news/27624636_1_solar-power-cell-towers-telecom-towershttp://www.indiaprwire.com/pressrelease/computer-electronics/2010120370426.htmhttp://dealcurry.com/20100422-IFC-To-Invest-21-Mn-In-Applied-Solar-Technologies.htmhttp://panchabuta.wordpress.com/2011/03/04/cellphone-towers-in-tribal-and-hilly-rural-areas-to-be-powered-by-solar-says-indian-minsiter-of-state-for-telecom-sachin-pilot/

http://panchabuta.wordpress.com/2010/05/17/indian-government-may-ask-telecom-companies-to-install-solar-panels-to-generate-backup-power-for-cellphone-towers/http://panchabuta.wordpress.com/2011/02/21/400-telecom-towers-to-be-powered-under-the-jawaharlal-nehru-national-solar-mission-jnnsm-solar-at-a-cost-of-rs-1-2-bn /


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Green Telecom Market in India: International


Bharti Airtel is now in 16African countries with theacquisition of Zains assetsin March 2010

Indian vendors such asACME Telepower have

followed Bharti Airtel toAfrica

Markets such as Nigeria,Kenya, Indonesia andPhilippines, which aresimilar to what Indianmarket was 3-4 years ago,offer great opportunities forIndian vendors

Source: GSMA, 2010


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Sagar Gubbi

Managing PartnerEcoforge Advisors Pvt Ltd, [email protected]+91-973 120 2201

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