After acquiring majority stake in Viom Networks and purchase of standalone towers of Vodafone India Ltd., ATC India has now over 78,000 tower sites in India, second after 123,000 of Indus Towers. With this, ATC India has close to 50% of global tower presence of American Towers across 16 countries it is present in. This makes India one of the key markets for the global passive infrastructure company.
However, the year has not been a great one for the company in terms of standalone operations. It lost a lot of tenancies due to consolidations and discontinuation of services by various operators. ATC was servicing operators like Tata Teleservices, Aircel, Reliance Communications and Uninor; all of whom have either sold their businesses or stopped operations. This has affected the tenancy ratio of the company to 1.4x from its earlier average of 2.18x. This is lower than industry average of 1.9x.
But, after Viom portfolio the pie has grown registering a 43% increase in its revenue.
Other than Indus Towers and BSNL, ATC is the third player having a wider tower presence across the 22 circles of the country. Jio has created its own towers and also acquired the RCom infrastructure, which is still inadequate for this coverage and expansion. Looking at the exponential data growth over Jio networks, it will have to invest in the infrastructure including towers. ATC India could be a good partner for them as Jio may not want to go with Indus Towers for Bharti Group having 84% stake in it and BSNL infrastructure might not attract them for various reasons. Also, it might be difficult and time consuming to pursue the case with the state-owned operators.
Jio is a great opportunity for ATC India to strategically partner and offer tenancy over its wide network of close to 80,000 towers across the 22 circles in India. Jio started its operations with over 100,000 towers across the country and had announced doubling up the number in due course to offer better coverage and support heavy data traffic.
In line with global trends, where operators are investing in applications rather than infrastructure to compete with infra-less OTTs, the operator would be keen to align with the global trends and be thin on infrastructure leveraging the infrastructure sharing benefits.
The story for American Towers has just begun in India, and it could be said that the company is now in its new avatar, ready with its 2.0 version with strong portfolio for operators to offer. Further with consolidation, the weaker operators, which were on its tenancy are out of picture now and this can bring in revenue assurances to the company. The Viom Networks acquisition is also adding to its strengths and bringing in a strong customer portfolio that shall take its tenancy and revenues in the upward direction only.