Cases

Entry Strategy for a Telecom Infrastructure Services Provider into the Build-Operate-Lease Market for Telecom Towers

Challenge

The client, a telecom infrastructure services provider was evaluating to enter the business of owning and leasing towers to telecom operators. The client needed a better understanding of the market size for telecom towers, the economics of the build-operate-lease (B-O-L) business, the key success factors and key players for a tower company, the impact of infrastructure sharing on the market, the occupancy ratios over the years, and with all these considerations, how best they could enter and operate in this space. Thus, the top management requested UC to develop an entry and growth strategy for its company.

Our Approach 

To define a strategy to enter the build-operate-lease market for telecom towers, UC adopted the following approach:

  • Conducted secondary research to build a perspective on the Indian telecom industry and its likely evolution over the next few years
  • Conducted primary research to understand the B-O-L market
  • Identified key drivers for infrastructure sharing
  • Applied data gleaned from secondary and primary research to develop three different market-sizing methodologies
  • Modeled scenarios for evolution of the industry over the next five years
  • Conducted extensive primary research by meeting telecom operators, tower manufacturers, tower companies and financial institutions to validate industry evolution scenarios
  • Identified key success factors required to enter the business
  • Identified and evaluated different funding options
  • Defined growth strategy for the client considering their internal execution capabilities
  • Developed exit options for the client in one, three and five year timeframes
  • Developed detailed financial projections for all funding options
  • Defined a detailed implementation plan with an indicative timeframe for completion.

Impact

The client received a highly granular view of the potential opportunity, along with the challenges and supported by a growth strategy and a financial plan.