Our people are critical to us in achieving our goals. We prepare them for the future by developing the right skills and talent to ensure they deliver the right experience to our customers.

edotco's unique position in the industry enable us to offer exceptional opportunities to exceptional individuals. Our culture is based on integrity, accountability and hard work; whether you are working in the field or in the office, every day is different bringing its own interesting challenges.

Established in 2003, edotco Group is the leading independent telecoms infrastructure services company providing end-to-end solutions in the tower services sector including co-locations, built-to-suit, energy, transmission and operations and maintenance (O&M).

With a regional portfolio of over 13,000 towers across our home markets of Malaysia, Bangladesh, Sri Lanka and Cambodia; and 12,000 km of fiber in Pakistan, edotco strives to deliver outstanding performance in telecoms infrastructure services and solutions. As we move into a connected future, it is our aim to seize the opportunities that enables us to grow and meet the increasing demands of our community. At edotco, we shape the future by enabling connectivity to make a positive impact on the community we live in and lift the limits for a more connected tomorrow.

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edotco Cambodia: up to 750 new builds planned over next three years

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edotco Cambodia: up to 750 new builds planned over next three years

 

Additional opportunities in energy management, IBS, small cells and lamp poles to supplement organic growth

While not a tower market that typically generates a lot of buzz, edotco has been steadily growing its tower portfolio and team in Cambodia since its entrance in 2012. Six years into its journey, we catch up with Phillip Wong, edotco’s country leader and Chief Regional Officer for Growth Markets to find out the latest in the towerco’s local operations, as well as the status of the country’s mobile market. With growing data demand and a supportive regulatory framework, edotco is confident in the value it can bring to the local stakeholders, especially as it looks beyond the traditional steel and grass towerco model.

TowerXchange: Phillip, for the readers who are not familiar with the Cambodian market, how would you describe the current telecom environment and ecosystem?

Phillip Wong, Chief Regional Officer, Growth Markets, edotco:

Cambodia represents an emerging tower market with immense potential and opportunities. Having experienced strong economic growth over the last decade, mobile operators are faced with stiff competition given the booming consumption of mobile data. This provides tower companies like edotco the opportunity to play a very critical role, especially in terms of providing infrastructure access services.

Promising developments such as the launch of 4G, the rolling out of LTE and a light-touch regulatory approach are positive for the industry and its ecosystem.

To date, mobile penetration is over 110%. This growth in mobile connectivity will be a key driver in realising the Government’s vision of having 100% broadband service coverage in urban areas and 70% coverage in rural areas by 2020.

The lack of a mature telecoms infrastructure ecosystem remains a challenge, but our experience in developing and emerging markets positions us well to partner with the Government in addressing operational and geographical challenges in Cambodia.

TowerXchange: Could you please give us an update on edotco’s operations in the country?

Phillip Wong, Chief Regional Officer, Growth Markets, edotco:

edotco (Cambodia) Co. Ltd. was established in May 2012 with just five employees and 150 tenancies. Our team has since grown to 26 employees and we now have approximately 3,500 tenancies.

Our current portfolio comprises over 3,100 towers of which we directly own and operate more than 2,100, and provide managed services to an additional 1,000. The towers we directly own represent about 24% of the total tower count in Cambodia.

TowerXchange: Previous estimates for towers in Cambodia was ~9,000. How does this compare to your understanding? What’s the average number of builds per year in the country?

Phillip Wong, Chief Regional Officer, Growth Markets, edotco:

Based on edotco’s analysis of the Cambodian tower market, there are approximately 9,200 towers now.

edotco has plans to build about 200 to 250 towers per year for the next three years, in particular to meet the 4G and 4.5G capacity requirement of the MNOs. We also see a growing demand for small cells, IBS and lamp poles.

TowerXchange: And what is the status of the ~1,000 Mfone towers that eventually went to CooTel?

Phillip Wong, Chief Regional Officer, Growth Markets, edotco:

CooTel collaborates with edotco Cambodia under an “Exclusive Agreement” where we provide managed services to their current portfolio of towers.

TowerXchange: What is the prevailing business model in the country for a towerco? And what is edotco’s approach?

Phillip Wong, Chief Regional Officer, Growth Markets, edotco:

The prevailing business model has been predominantly property and asset focused. We try to improve our returns and pass through the cost benefits to operators through the diligent management of assets and increasing our tenancy ratios.

edotco is increasingly exploring new opportunities and business models to add more value to our customer proposition. One key area is passive energy solutions which we currently provide in other countries. Traditionally energy is still largely provided and managed by the operators themselves. However, we believe that as a towerco we are well positioned to extend the sharing concept to energy system provisioning and maintenance. With our strong focus on operational execution and through remote monitoring, we believe more efficient energy system management can create additional value for our customers in the future.

As mentioned earlier, we also see a growing demand for small cells, IBS and lamp poles and are steadily expanding our portfolio of innovative solutions to address Cambodia’s coverage and capacity needs.

TowerXchange: Site acquisition is always a challenge no matter what country or region. What is it like to secure ground rental in Cambodia?

Phillip Wong, Chief Regional Officer, Growth Markets, edotco:

Securing ground rentals can be a challenge from landlords, neighbors and local councils. Challenges include multiple stakeholders to manage which results in increased time taken to secure sites. At edotco, we understand these challenges and continue to engage regularly with all the stakeholders involved.

Alongside these efforts we continue to provide solutions through innovative approaches like camouflage towers and special structures that blend in with different environments. This also helps ease the challenges of securing ground and building rentals.

Our solutions are developed with the entire ecosystem in mind and we conduct our businesses in different countries by fully complying with the local laws and customs.

We have robust due diligence and risk assessment frameworks in place which ensure that our business practices are sustainable and in line with our values.

TowerXchange: How about ease and speed of deployments? What have you seen change over the years?

Phillip Wong, Chief Regional Officer, Growth Markets, edotco:

Both have improved over the years. A maturing regulatory framework in Cambodia and the enhanced skillsets among our employees, contractors and vendors have contributed positively to our deployment process.

We also do our best to reduce deployment time by providing our customers with administrative support so we can remove the load of paperwork and processing. Internally, we’ve improved our procurement processes by implementing a standardised framework which allows all parties to make fast decisions which also contributes to speeding up deployments.

MNOs are seeing the benefits of these value-added services and are increasingly partnering with us.

TowerXchange: In terms of operational ground realities, the last estimate was about 25% of the country being off-grid. Where does Cambodia stand right now and how is site energy being dealt with?

Phillip Wong, Chief Regional Officer, Growth Markets, edotco:

The number of off-grid sites have remained the same for the past couple of years, though the electricity footprint has increased from year to year with the support of both the private and public sectors. Operators prefer to manage this part of the business on their own and so far, four main operators have relocated their diesel generators to other off-grid locations.

There are no dominant players in the Cambodian energy market, and the industry is still heavily-reliant on fuel oil and diesel generators (DG). However, only a handful of companies are able to provide small-scale DG renting services to off-grid sites.

We believe that more can be done and have been working closely with MNOs to introduce energy efficient solutions including lithium-ion batteries, regeneration of batteries, high efficiency rectifiers and solar hybrid technology as part of our ongoing efforts to manage energy consumption and its impact on the environment. This underscores our commitment to be a long-term partner in nation-building initiatives in all the markets we have a presence in.

View source version:
https://www.towerxchange.com/edotco-cambodia-up-to-750-new-builds-planned-over-next-three-years/

Women in Towers: Asia

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Women in Towers: Asia

Part I: featuring executives from edotco Group, OCK Group Berhad and Protelindo

TowerXchange is committed to encouraging and enabling diversity across the telecommunications infrastructure industry. As part of our ongoing work in the tower community, we are pleased to profile some of the most senior women in Asian towers. Women in Towers is a live project and we will be updating it regularly, as well as adding content for the other regions we serve. We have been delighted with the industry response to this project and hope to together inspire the next generation of female leaders! If you’d like to be considered for this feature, or to nominate a colleague, please email me at cliu@towerxchange.com

edotco Group: Rema Devi Nair, Regulatory Advisor to CEO (Malaysia)

Please tell us about your background and current role within your company

A 28-year participant of the telecoms industry, my career in this exciting industry started in corporate planning and strategy at Telekom Malaysia and my specialisation evolved over time to regulation and public policy. After eight years, I joined the newly established Malaysian convergence regulator (the Malaysian Communications and Multimedia Commission) in 1998, focussing primarily on economic regulation.

After a four-year stint as a regulator, I accepted an invitation in 2003, to set up and head the regulatory management function at TM International, a regional role that involved managing regulatory risk and public policy advocacy across selected markets in the South East Asia and South Asia region. This role seamlessly transitioned to that of Head, Group Regulatory Affairs at Axiata Group, following the demerger of TM’s domestic and international businesses. This was a position that I held for nine years until 2012, key highlights of which included a four-term stint on the Chief Regulatory Officer’s Group of the GSMA and frequent speaking engagements on regulatory issues at regional and global fora.

After a short career break, I embarked on my current position as Regulatory Advisor to the CEO at edotco Group in mid-2014, an advisory role which involves providing guidance and oversight to the Group’s regulatory team. I am also a Board Member of selected national towercos within the edotco Group.

How did you enter the telecom infrastructure industry? And how have things changed since then?

As mentioned, my entry into the telecom infrastructure industry came through earlier roles in the fixed and mobile parts of the business, as well as specialisation in the regulatory management function. In fact, I would say that I have spent virtually my entire career in the telecoms infrastructure industry, given how key infrastructure is as the backbone of the telecom industry. However, it is only in the last four years that my regulatory focus has been on network facilities and infrastructure, primarily in relation to towers and passive infrastructure.

Four developments come to mind when I consider how things have changed in the telecom infrastructure industry over time:

  • First is the emergence of independent telecom tower companies, which have grown in a short span of 20 years to become a new infrastructure asset class of its own, estimated at some US$300bn (TowerXchange estimate).
  • Secondly, traditional infrastructure players aside, major internet players have begun investing heavily in connectivity infrastructure in core, radio access and even the last mile. Examples are Facebook’s Telecom Infra Project, Google’s Google Fiber, Cloud and Loon, and Microsoft’s MAREA.
  • Thirdly, passive infrastructure is becoming increasingly important for capacity purposes rather than coverage, especially given the need for high speed broadband delivery. Correspondingly, telecom infrastructure in the tower space is evolving from traditional ground-based structures to smaller, more innovative structures that can be more densely placed but are capable of delivering high speeds.
  • Fourthly, regulatory regimes in most markets have evolved so as to enable the licensing of pure-play facilities and infrastructure players. Accordingly, regulatory policies on infrastructure sharing have moved from being mobile operator-centric to being infrastructure-focussed, emphasising access to towers on commercial basis and minimising duplication.

What has been the greatest achievement in your career so far?

By its very nature, much of regulatory management is undertaken through the purview of written submissions and direct engagement with regulators.

Against this background, I believe the greatest achievement in my career thus far has been bringing fact and evidence-based approaches to the regulatory management function, as well as advocating exemplar and best practice approaches across emerging markets. The infrastructure industry in particular, warrants light touch regulation, which is the position edotco advocates across our markets.

And looking ahead, what is your greatest professional ambition?

I believe that I am at that point in my career where I am well placed to use my knowledge and experience to bring value through membership on company boards, especially in highly regulated industries. Whether from the perspective of strategy, risk assessment, compliance or governance, I believe a role either as independent or non-independent director would be my professional direction looking ahead.

This is an excerpt of Women in Towers: Asia interview. To view full interview, click here.

edotco Malaysia eyes higher market share

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edotco Malaysia eyes higher market share

By Chester Tay
The Edge Markets

KUALA LUMPUR: As the leading Asean mobile tower provider, edotco Group Sdn Bhd is perceived as the dominant company in its home turf here. However, it captures less than 20% of the total market share.

But edotco chief executive officer Suresh Sidhu is unperturbed by this. In fact, he sees it as an opportunity for the group to grow.

“Malaysia is a very attractive market for edotco, and not just because it is our home base. It is the country where we have the lowest share of the overall market, except Myanmar. In most of the countries that we operate in, we command more than 20% market share. Thus, we can do more in Malaysia,” he told The Edge Financial Daily in an interview recently.

edotco, a 62.4%-owned subsidiary of Axiata Group Bhd, owns about 4,000 telecommunication towers and manages another 5,000 towers for its customers in Malaysia through its wholly-owned unit edotco Malaysia Sdn Bhd.

edotco Malaysia managing director Wan Zainal Adileen Wan Puteh said there are currently about 22,000 telecom towers operational in the country.

“In Malaysia, we are still seeing demand for more [tower] sites. On our part, 2018 will be a year where we will be working closely with our customers to build more towers,” he added.

According to a 2016 industry report by TowerXchange, edotco Malaysia had the third-largest tower count in the country, at 3,600 as at end-2014, after YTL Communications Sdn Bhd’s 5,000 towers and Maxis Bhd’s 3,800 towers.

DiGi.Com Bhd, which ranked fourth in the report at the time, had 3,400 towers, followed by the combined portfolio of 3,200 towers owned by 14 state-backed tower companies (towercos).

Suresh said the Malaysian telecom tower industry has been growing consistently at a pace of between 1,000 and 2,000 towers per year.

“In the last few years, this pace of industry growth was probably okay. But given the increasing investment in 4G by [mobile network] operators, perhaps it can accelerate a little bit over the next one or two years.

“Data growth is really driving the change, basically customers want more and more what we call ‘infill’ to boost capacity on top of existing coverage. These infills or towers as we call them could be a lamp pole, a camouflaged structure or maybe a signboard. In Kuala Lumpur we can only [affix new small cell antennas] on lamp posts or street furniture now, and no longer build a tower,” he added.

Nevertheless, Suresh concedes that erecting towers in Malaysia could be a “complex” task compared with other markets.

“Malaysia is a market where we have to do a lot of innovation, coupled with a lot of complex stakeholders management, to build a new tower site. Take a new site in Kuala Lumpur, for example. Wan Zainal and his team will have to talk to many people, from the Kuala Lumpur City Hall to landlords, property developers and maybe the works ministry if the site is located near a road or drain,” he said.

Suresh said edotco is also interested in taking ownership of existing towers in both domestic and overseas markets.

“We are always open [to opportunities], but we take quite a disciplined approach to deals. The desire is there. We believe we can still grow … we have a capacity for growth, but we always want to make sure that any deal will be done on appropriate terms. So, yes, it is still a major focus, but we will only act when we think the deal is right,” he added.

The group’s immediate focus is to complete its acquisition of 13,000 towers in Pakistan from Pakistan Mobile Communications Ltd for US$940 million (RM3.73 billion). The deal is set to be completed by this month, which will increase the group’s portfolio to 31,000 towers — making it the eighth largest towerco in the world.

“We understand that the local companies are moving towards asset-light business models through outsourcing. That is good for us and we are very keen to work with the industry. At this stage, there is nothing major that we see about to happen, but we continue to be open to customers and even other towercos who are looking to maybe exit,” he said.

Suresh said in mature markets like Malaysia, there are less reasons for a mobile network operator to own telecom towers going forward because the difficulty of getting a site and the costs associated with it along with the operating expenditure, are increasing yearly.

“Industry regulation is moving more to common access [to a telecom tower]. That is what happens in mature markets where regulators want operators to compete on services, they want to have good quality services everywhere, and consumers pick operators based on what they like, be it price or network quality,” he said.

For edotco Malaysia, Suresh pointed out that more than 60% of the company’s towers are shared by more than one tenant, which is equivalent to a tenancy ratio of 1.64 times for the third quarter ended Sept 30 this year (3QFY17).

For edotco Group, the tenancy ratio stood at 1.5 times as at third quarter of financial year 2017 (FY17).

“The best industry practice is that if you are somewhere between 1.6 times and 1.8 times, that is a good tenancy ratio. [The company will be] profitable, stable and generating good returns that exceed its cost of capital,” Suresh said.

“Ebitda (earnings before interest, taxes, depreciation and amortisation) is always good in this business, but it is a capital intensive one. It is whether your return on capital can get above that, so normally we have to get quite a high tenancy ratio to achieve that,” he added.

For the first nine months of FY17 (9MFY17), edotco Group posted a net profit of RM152 million, which was 22.45% lower than RM196 million a year ago, despite revenue growing 9.68% to RM1.13 billion from RM1.03 billion in 9MFY16.

Suresh attributed the weaker earnings to unfavourable foreign exchange (forex).

“We are very pleased with the 2017 performance [and] we have also demonstrated a strong stable Ebitda over the last three quarters. [However,] at the end of the day, there has been a little bit of a drop in net profit, but all of that was entirely due to forex from many of our multi-country businesses. It is some of the things that we have to live with,” he said.

View source version:
http://www.theedgemarkets.com/article/edotco-malaysia-eyes-higher-market-share

 

A Tower Company’s Heaven: Pakistan to Get 40,000 New Towers in 10 Years

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A Tower Company’s Heaven: Pakistan to Get 40,000 New Towers in 10 Years

 

  • Pakistani operators currently own and operate around 35,000 towers and number is expected to double or more during next 8-10 years
  • With growing data demands, even if the coverage has been blanket, more and more towers will be needed to meet requirements
  • With tower sharing, telecom operators can reduce their tower operating costs by 35 to 55 percent
  • Tower tenancy rate in Pakistan is around 1.3, a lot lower than global average of 2.2
  • More than 60% towers in Pakistan — from different operators — are within close proximity (with-in 100-150 feet). Such towers can potentially be shared by a single tower company.
  • Tower companies manage the passive network while operators lease the tower and manage the active network
  • edotco is only independent tower company in Pakistan with 13,000 towers out of total 35,000 towers in Pakistan

Pakistani operators will need to double their towers with-in next 10 years to meet the growing data demands of cellular customers in the country.

This essentially means that all telecom operators will have to deploy around 40,000 more towers, combined, just to meet the demand, said Arif Hussain, Country Managing Director and Chief Executive Officer for edotco Pakistan.

What is edotco?

edotco is a tower company, headquartered in Malaysia and is known in Pakistan for its recent acquisition of close to 13,000 towers from Jazz for a whooping US 940 million dollars.

Arif Hussain, in an exclusive interview with ProPakistani, explained that his company has been in business since 2013 with close to 40,000 towers in Malaysia, Bangladesh, Myanmar, Sri Lanka, Cambodia and Pakistan.

With focus on south and south east Asia, edotco is the fastest growing tower company of the world.

For those who don’t know, tower companies own the passive part of network that includes tower itself, the building, managing energy (electricity or the back ups), security of the premises and essentially the lease of the land.

Telecom equipment (such as antennas, BTS) and cost of electricity is owned and maintained by the telecom operators.

Tower companies, while they own the place, offer the towers to operator on rental basis and allow them to install their antennas.

Tower companies, as it’s evident, make a strong business case as they can offer anywhere from 35% to 55% cost reduction for operators and more importantly, help telcos focus on their core-business.

With several innovations and best business practices (with experience in various global markets), tower companies tend to reduce costs. edotco, for example, was able to reduce energy costs for operators by 2-3% YoY per year.

With recent acquisition of Jazz towers, edotco is now the world’s 8th largest tower company and essentially the number one tower company in Pakistan.

Other than Jazz towers acquisition, edotco had 700 self-owned towers through which it offered services to wi-tribe and Ufone.

After necessary regulatory approvals, that may take couple of months, edotco will be able to offer more than 13,000 towers to other telecom operators in Pakistan.

Operators Will Always Need More Towers

While you may think that telecom operators have enough towers and there’s no need to build more towers — particularly in urban areas where there’s already blanket coverage — in actuality, mainly due to growing data needs, the coverage of towers will keep shrinking. And hence telcos’ need for towers will keep growing.

For example, the coverage area of a 4G cell site will shrink when more people will connect to it.

This means that one tower offering 2G coverage for certain amount of area will not suffice when the technology will be upgraded to 3G. Its coverage area will further shrink when it will be upgraded to 4G and so on.

Then when there are more people connected to a tower — on a data network — the coverage of tower shrinks.

So for instance if a 3G tower was offering sufficient coverage to 100 individuals with-in 5 KM of circumference, 500 individuals connecting to same tower might reduce the coverage span of same tower to 3KM of circumference.

While these numbers are hypothetical, they show that operators will always need to build more towers down the line.

This is where tower companies come into play as the way forward is not to have everybody build their own separate towers, but instead have a tower company to manage all sorts of tower centric services to not only reduce the cost but also the overhead.

Why Tower Companies are Important

As explained above, telecom operators are at an advantage of saving their operating cost from anywhere between 35 to 55 percent by outsourcing the passive part of the network.

This is not the only benefit they are usually looking at, as with tower companies in business, telecom operators are also offered the ability to make quick new deployments in uncovered areas or even in areas where they want to increase their tower density.

So for instance, if there is a telecom company that wants to deploy a new tower with-in days, instead of standard 100 days new deployment deadlines, tower companies are go to place for them.

Pakistan Presents Huge Potential for edotco

“There are reasons why we felt that Pakistan is one of the best markets for edotco to look at”, said Arif Hussain while adding that all regional markets have established tower companies but in Pakistan edotco is hoping to fill a huge gap.

“Cellular companies are essentially our only competition in Pakistan, that have tried to barter towers with each other at one time or another”, said Arif Hussain.

He said that there was a need for neutral company like edotco to step in and to offer more specialized tower centric services at scale to telcos.

With vast regional expertise and massive infrastructure in other markets, edotco is well placed to offer cost-effective and best practiced towers to telecom businesses.

With around a billion dollar investments in Pakistan, edotco said that it is very confident about the market and will only strengthen its position in Pakistan during coming years.

Future Towers in Pakistan will be Different

Arif Hussain explained that towers in future are going to be different for two reasons.

One because the high-speed data networks need more dense but low towers as compared to current high-rise towers that come with a lot of weight and overhead.

Second, with experience and innovation that edotco has gained in other markets, the tower sizes and shapes are going to be lot smaller that what we see around today.

Arif Hussain referred that cell phone towers will start becoming as low as street lights and in fact cell towers will become the new street lights of the future.

edotco’s entry in Pakistan is very much in line with what PTA has also been trying to do, that is creating infrastructure companies that support telecom operators.


View source version:
https://propakistani.pk/2017/11/24/tower-companys-heaven-pakistan-get-40000-new-towers-10-years/

 

Telecom Towers in Pakistan Could Be Greener and Much Smaller

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Telecom Towers in Pakistan Could Be Greener and Much Smaller

These bulky structures can become smarter, smaller and work more efficiently as camouflaged objects.

 Mudassar Jehangir

Do you know the telecom towers you see in your area could be dismantled and removed because there might be no need for such huge and bulky structures for providing next-generation 4G and 5G services?

Although this 45 meters high and ugly telecom tower has become a part of our lives, it could be simply a liability for many in the future.

At least, Jazz has off-loaded its 13,000 plus telecom towers and sold them to a Malaysian based company edotco – a tower rental firm that leases out the structure to telcos in six countries of South Asia and South East Asia, including Pakistan.

edotco took the license from PTA in 2015 for establishing itself as an independent tower company in the country for providing the infrastructure on rental to various telecom companies.

One reason for the tower sharing is to deploy one tower in any specific area and share the structure with the multiple companies instead of building four individual towers for each operator — a pattern well in practice today in Pakistan which is already creating problems for the environment, depleting energy resources, and changing social behavior. Back in May 2017, Interior Minister of Pakistan had revealed that telecom towers were causing major health issues.

So far, the Malaysian-based company has acquired and built some 700 telecom towers in Pakistan, and many of them are being availed by Wi-tribe and Ufone.

Their recent deal with Jazz will make them the most significant and only tower company in the country.

Once the contractual and regulatory approvals are taken, edotco Pakistan with the help of its local partner, Dawood Hercules Group who owns 45% shares in the company, will pay Jazz million of dollars half of which will come to Pakistan from the foreign source.

“We have got a nod from Competition Commission of Pakistan and waiting for approval from the PTA. Once conditions are satisfied, we are in a position to make payment very next day”, confirmed Suresh Sidhu, CEO of edotco.

Are telecom towers a liability for telcos?

Yes, they are. Ever since telcos acquired 3G and 4G licenses in Pakistan for approximately $ 2 bn, the pressure to capture a significant chunk of data users have made them more worried about spending extensively on their networks; not to mention that there is a price war going on.

“Not every cell tower serve a big customer base, no matter how few customers it is catering to, it has to be up and alive for even few hundred active customers. However, feeding such sites is a challenge”, explained Arif Hussain, Country Managing Director for edotco Pakistan.

Keeping a tower active for 24 hours to serve the consumers best is a painful task for a telecom company. Energy comprises 15 – 20% cost of tower cost and when there is no electricity, a telco has to burn a lot of diesel as an alternate power source. Deputing personnel for its maintenance, paying monthly rentals and dealing with government departments add a cost that when accumulated for thousands of towers nationwide, leave no other option at the disposal of telco but to compromise on the quality of the service.

Despite payment in advance, the customer usually cries for poor telecom services in Pakistan.(jazz mobile banking story) and the operator takes the cover of exorbitant costs and taxes as a primary reason.

What are the benefits of Tower Sharing?

In many developed countries, telecom towers are less visible, rather camouflaged and most of the times they are installed on lamp poles where they look like no more than a street light.

There are roughly 40,000 telecom towers in all the nook and corners of Pakistan installed by all four existing telecom operators including Jazz, Telenor Pakistan, Zong, and Ufone. These cell sites if planned well and optimized appropriately could be transformed into environment-friendly structures. Their bulkiness can be shrunk down to much bearable size, and their number can be spread efficiently for supporting higher data speed in Pakistan.

Jazz, which has provided some 20% 4G and 80% 3G coverage so far would like to multiply the expansion as early as possible given it doesn’t have to think about dedicating resources for planning, building and running a telecom tower. Their tower disposal initiative might save them a considerable Opex that can be put into the system for maturing their core services.

The second largest telco in terms of the number of subscribers, Telenor Pakistan is also thriving for wider 4G coverage that is hovering around 30% at this moment. The company had gotten hold of the 4G spectrum in back in 2016, however, recently the CEO Irfan Wahab hinted at a 4G conference that Telenor Pakistan would likely consider owning its towers, unlike the rival’s approach. But edotco is hopeful to convince them sooner or later.

“It would be much hassle-free task for a telco to provide a blanket 4G coverage in the country when another expert partner is making available the 4G cell sites where they need the most”, said Suresh Sidhu

“They would like to recoup the 3G-4G investment as early as possible for investing further on their core expertise — provision of digital services through seamless and high-speed data”, Sidhu further said while talking to media representatives.

Ever since the 3G and 4G licensing in the country, Pakistan badly needs arrangements to modernize the entire telecom ecosystem. There is a need for more players to optimize the networks so that subscribers could actually get the world-class service.

View source version:

https://www.morenews.pk/telecom-towers-pakistan-greener-smaller/

Pakistan has conducive environment to meet Teleco’s market goal

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Pakistan has conducive environment to meet Teleco’s market goal

Pakistan’s Dawood Group and Malaysia’s edotco have become partners in Pakistan and the local company edotco Pakistan has revealed its plan. In an exclusive interview with Pakistan & Gulf Economist(PAGE), Suresh Sidhu, Chief Executive Officer of edotco Group talked about various facts of the joint venture. Following are the excerpts from his conversation.

PAGE: YOUR COMPANY IS MOSTLY OPERATING IN SOUTH AND SOUTH EAST ASIA, ARE THERE SOME SPECIFIC REASONS FOR SELECTING THIS PART OF THE WORLD?

SURESH SIDHU: As you may be aware we are a Malaysia-based company and believe that we know the countries located in this part of the world better. The other reason is that many of the markets have already reached saturation level, which does not offer chances offering next generation technology as well as rapid. As against this Cambodia, Bangladesh and our latest entry in Pakistan offers enormous growth potential. On top of all we consider that it is our obligation to first cater to the needs of our neighborhood and then try to expand our outreach.

PAGE: WHAT ARE THE REASONS FOR SELECTING PAKISTAN AND WHAT SORT OF GROWTH DO YOU FORESEE IN THE COUNTRY?

SURESH SIDHU: While the numbers of reasons are many, I would prefer to refer a few only that makes Pakistan a preferred destination for investment. These are: 1) population of the country, 2) penetration of cellular phones, 3) growing market of data transfer, 4) business friendly policies of the Government of Pakistan and 5) economic indicators suggesting that per capita income is growing at a reasonably fast pace. Pakistan has moved to 3G and 4G technologies at a very fast pace. And now it is the time to improve quality of service, outreach and on top of all bring down cost of doing business. The telcos have already demonstrated their commitment to Pakistan and its people by investing billions of dollars. We believe that a company like us can help the telcos in achieving the above stated targets and the ultimate beneficiaries will be Government and the people of Pakistan.

PAGE: HOW MUCH DOES YOUR COMPANY AND THE LOCAL PARTNERS INTEND TO INVEST AND WOULD THERE BE NEW JOB OPPORTUNITIES?

SURESH SIDHU: As our business model consists of acquiring the existing towers and also constructing towers in less served areas, we believe that the anticipated investment of over USD1.5 billion can reach Pakistan at a very fast pace due to the fullest supported by the regulatory authorities. Having said that I believe the quantum of investment is directly dependent on the quantum of business we are able to generate and the growth of number of satisfied customers of telcos and other clients.

PAGE: PAKISTAN ALSO SUFFERS FROM HIGH COST OF ELECTRICITY AND OUTAGES, HOW DO YOU INTEND TO OVERCOME THESE TWO CONTENTIOUS ISSUES?

SURESH SIDHU: Pakistan is the only country that faces these two contentious issue. Our company offers solutions for both the problems. We mostly use solar or renewable sources of energy, which are dependable, cost efficient and above all spread less pollution. Since our company offers sharing of towers, we are confident that cost of energy, which is a huge component of the total operating cost, will be reduced substantially.

PAGE: ARE YOU CONFIDENT THAT TELCOS WILL BE WILLING TO PASS ON THE BUSINESS OF OPERATIONS OF THEIR TOWERS TO A THIRD PARTY

SURESH SIDHU: Had we and our potential clients not convinced on this sort of arrangement, the company would have not made major success in other markets. I am also convinced that telcos are keener in focusing on their core activities rather in the business of constructing and maintaining towers. I am pleased to share with you and the readers of Pakistan & Gulf Economist that we have already acquired 700 towers in Pakistan, Out these a reasonably large number of out of towers have been constructed by our company in FATA (federally administered tribal areas), which is a grossly un-served areas. We have almost finalized a deal with Jazz to procure their 13,000 towers, which are available for sharing with other telcos.

PAGE: HAS YOUR COMPANY COMPLETED ALL THE REGULATORY REQUIREMENT OF PAKISTAN?

SURESH SIDHU: We await formal approvals from different regulatory authorities that include: Competition Commission of Pakistan (CCP) and Pakistan Telecom Authority (PTA). We have already received the approval from the CCP and we await the approval from PTA, it is normal procedure, which requires some time. The positive point is that we are moving according to our plans, and don’t suffer from any hiccups.

PAGE: WHO ARE YOUR JOINT VENTURE PARTNERS IN PAKISTAN?

SURESH SIDHU: In August, edotco, a subsidiary of Axiata Group and its Pakistani partner Dawood Hercules Corp announced a deal to acquire Deodar, the tower unit of Pakistan Mobile Communications Ltd, known by its brand name Jazz, with an investment of US$940 million. The edotco Group and Dawood Group have 55:45 stakes in the joint venture.There are total 40,000 towers installed in Pakistan and tower sharing is likely to become a norm in Pakistan. The customers per tower in US stands at 2.2, while in Pakistan it hovers in the range of 1.2 to 1.3 that indicates the huge potential of the market that can be exploited with mutual consent. The market potential is evident from the fact that telcos have invested US$2 billion for procuring licenses of 3G/4G technologies to improve quality of services. We can help them in optimizing profit through cost saving.

PAGE: WILL SOME OF THE TOWERS NOT BECOME REDUNDANT AFTER SHARING BECOMES A NORM?

SURESH SIDHU: I am an optimistic person and strongly believe that we will be able to move the surplus towers to lesser served area, which will help the telcos in extending their outreach as well as enhance their revenue. I am also sure that hundreds of new job opportunities will be created in the country that will help in further boosting per capita income of Pakistan.

PAGE: WHERE WOULD YOU POSITION YOUR COMPANY OVER THE NEXT FIVE YEARS?

SURESH SIDHU: Keeping in view the population of the country penetration of cellar technology and growing demand for data transfer, I am sure edotco will become a significant player, both in terms of revenues and customers served. I am also sure that extending outreach of telcos will also enable them to offer innovative services that will improve the quality of life of Pakistanis.

 

View source version:
http://www.pakistaneconomist.com/2017/11/13/pakistan-conducive-environment-meet-telecos-market-goal/

Malaysian telecom tower operator ups ante in South Asia

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Malaysian telecom tower operator ups ante in South Asia
Aim is to be a ‘top five global scale player,’ edotco says

By CK TAN, Nikkei staff writer

KUALA LUMPUR — Telecommunications tower operator edotco Group sees potential in less developed markets in South and Southeast Asia and is targeting countries with low mobile penetration.

The group is seeking growth by strengthening its foothold in the six countries it already operates in, tapping the vast pool of talent and the technological prowess of its Japanese partner, Innovation Network Corp. of Japan.

“This is a business of scale,” Suresh Sidhu, edotco chief executive said in a recent interview.

The group is emerging as the largest independent tower company in Pakistan after it recently scooped up Tanzanite Tower for $89 million and Deodar for $940 million.

Both deals, sealed within three months, will add 13,700 towers to its portfolio, raising its total assets to 32,000 towers. Upon regulatory approval within the year for the Deodar buy, edotco, which also manages 8,000 towers on behalf of clients, will become the second largest tower operator in multiple countries, after American Tower Co.

Established in 2012, edotco has piggybacked on its majority shareholder Axiata Group’s first-mover advantage in South and Southeast Asia. Except in Myanmar and Pakistan, it operates in the same markets as Axiata — Bangladesh, Cambodia, Malaysia and Sri Lanka, providing services including tower leasing, transmission, operation and maintenance of mobile telecommunications companies.

edotco’s tower business has become significant enough that its earnings will be published in Axiata’s accounts in the next one or two quarters. Its success, Sidhu said, hinges on its presence in markets that are relatively new to the tower business, allowing the company to share expertise, from areas like regulatory frameworks to operations.

“We are good in emerging and frontier markets,” said Sidhu.

In Pakistan, edotco’s immediate task is to consolidate operations in Deodar, a unit of Pakistan Mobile Communications, the country’s largest mobile operator. Mobile penetration in the country is about 73%, considered low compared with mature markets such as Malaysia with 134%.

With a population of nearly 200 million, the coverage ratio is 3,000 to 4,000 people per tower, against Malaysia’s under two per tower. As such, edotco will increase the number of towers as Pakistan rolls out fourth-generation technology into rural areas.

“The ambition is to be a top five global scale player,” said Sidhu. That means focusing on expanding organically in the six countries where it operates, serving primary mobile operators and courting new customers at the same time. It is also harnessing the diverse talent and expertise in each market, exchanging ideas about the challenges each face and focusing on deploying the right staff for the right jobs.

For the latest technology in tower communications, edotco turns to Innovation Network Corp., a public-private consortium that includes Asahi Kasei and Mitsubishi Corp., for ideas.

“They are not here to tell you what to do but to open your eyes to what’s out there,” said Sidhu of his Japanese partners who have board representation.

Space-consuming satellite dishes operating on diesel generators are increasingly being replaced with innovative solutions using hybrid solar and battery-powered technologies. In cities, strict regulations compel operators to install environmentally friendly towers on lamp posts and camouflage structures atop buildings.

edotco said it would soon test lightweight devices from a Japanese maker on wind turbines in Bangladesh. Nepal and Indonesia, the two markets where Axiata has a presence, could be edotco’s next targets.

 

View source version:
https://asia.nikkei.com/Business/Companies/Malaysias-Edotco-strengthens-foothold-South-Asia?page=2

 

 

edotco expands footprint in Pakistan with two acquisitions totaling 13,700 towers at US$1.0289bn

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Interviews

edotco expands footprint in Pakistan with two acquisitions totaling 13,700 towers at US$1.0289bn
Addition of Towershare and Jazz assets makes it the world’s eighth largest towerco by sites

The summer of 2017 marked a significant milestone in Pakistan’s tower market, with edotco successfully executing on the country’s first landmark sale and leaseback (SLB), acquiring Deodar, market-leading MNO Jazz’s carveout towerco. This portfolio of 13,000 towers, along with an earlier acquisition of Towershare’s 700 towers means edotco will now own ~40% of the towers in the country. As Asia’s largest (and fastest growing) multi-country tower and infrastructure company, edotco is optimistic on the growth potential of the Pakistani market and will be scaling its operations accordingly to serve its customers with end-to-end and customised offerings.

TowerXchange: Congratulations Suresh on your announced acquisitions of Towershare’s subsidiary Tanzanite Tower in Pakistan as well as assets from Pakistan Mobile Communications Limited (PMCL). How did edotco get started in this market and what attracted you to it?

Suresh Sidhu, CEO, edotco Group:

We have been in business development activities for several years in Pakistan. We see excellent opportunities in the country for an independent towerco like us.

As a country with a relatively low mobile penetration rate at ~73% and data penetration rate ~24%, the opportunity for long-term growth in the mobile and data sphere is substantial.

Pakistan has a mature and clear regulatory and licensing framework for towers and telecom infrastructure even though the market is still at early stages of development. In addition, we see a thriving mobile market with four MNOs backed by international shareholders who have committed to investing into the country, presenting us with the opportunity to enable their growth further. The concept of infrastructure sharing is picking up in Pakistan and we believe we can play a key role in this transformation.

TowerXchange: Can you share some details on the 700 towers you are acquiring from Towershare?

Suresh Sidhu, CEO, edotco Group:

The Towershare portfolio has a colocation ratio of 1.6x and consists of over 70% urban with 40% being ground based towers.

The portfolio was built largely from acquisitions, with the majority of towers coming from previous WiTribe assets (post acquisition, Towershare leased back these towers to WiTribe). Tanzanite has all key MNOs and WLL players as tenants on these towers, with Ufone being our largest customer after WiTribe.

TowerXchange: And similarly, what can you tell us about the PMCL portfolio, of just over 13,000 towers.

Suresh Sidhu, CEO, edotco Group:

PMCL, which operates under the brand name Jazz owns a unique tower portfolio established over its 20+ years of operations in Pakistan. It is a balanced portfolio in terms of the urban-rural mix, and mainly tracks with the population concentration of Pakistan along the Indus valley with greater concentration of sites in the Central region, followed by the South and Baluchistan and KPK and North regions.

About 80% of the Jazz towers are ground-based as opposed to rooftop structures. Of these, a large majority are ready for colocation (hosting additional tenants) without any further strengthening capex required.

The current tenancy ratio of ~1.3x on this portfolio means edotco has potential to further collocate these towers with all MNO/WLL operators in Pakistan who need to achieve greater coverage/capacity targets.

All key MNOs and WLL players in the market have customer contracts with Jazz for sharing on their towers.

TowerXchange: With the Tanzanite transaction, it was 100% edotco, while the latter included a local partner Dawood Hercules Corporation Limited (DH Corp) who will own 45% equity. Can you share some of the thoughts behind these two approaches? What does DH Corp bring to the table in addition to the financials?

Suresh Sidhu, CEO, edotco Group:

Having the right local partner in our markets is an important strategy that edotco is always open to. On the Deodar deal specifically, having Dawood Hercules as our local partner was a major advantage from an operational and strategic point of view. The key terms of this engagement with Dawood Hercules allow full control and consolidation of assets of interest to edotco.

To be clear, Dawood Hercules is entering as a 45% shareholder of the combined portfolio. When we did Tanzanite, we needed an entry into a reasonably-sized asset in Pakistan and in the interest of time we felt that we should acquire that asset first on our own.

Dawood Hercules is a highly reputed listed Pakistani holding company conglomerate. To date, Dawood Hercules has established successful investment collaborations with IFC, GE, Mitsubishi and the World Bank. They are financially strong and well-integrated in the country and we believe will be an excellent partner in this business venture.

TowerXchange: And to clarify, this is a sale and leaseback with PMCL? What are the proposed arrangements moving forward with PMCL/Jazz as a tenant?

Suresh Sidhu, CEO, edotco Group:

Yes, this is a sale and leaseback transaction, and key terms of edotco’s long-term contract with Jazz are standard for such transactions and are benchmarked against international standards. Jazz will become edotco’s primary anchor tenant for this portfolio of assets.

TowerXchange: What does the current landscape look like in Pakistan now in terms of tower asset ownership by Ufone, Telenor, and Zong and their potential interests to divest?

Suresh Sidhu, CEO, edotco Group:

In its annual report for 2014-15, the Pakistan Telecommunications Authority (PTA) reported the total tower count stood around ~40,000 for the period. (TowerXchange currently estimates 34,305 total towers in the country).

Telenor, Zong and Ufone each own and operate portfolios sized between 5,000 – 10,000 towers. Currently, Pakistan has a mobile and data penetration of around 73% and 24% respectively which provides a significant opportunity for further organic growth.

With the introduction of 4G in the market and the need to deploy efficiently in the market for the MNOs, there are many positives for towercos. We think scale and scope of services are the key determinants of future success in this industry. The next few years will see an increased focus on optimising operational efficiencies and adapting to respond to ever-changing technology and exploding data consumption needs.

Given the need to invest in the core network, it is likely that the MNOs will look to monetise their passive infrastructure over time to remain competitive.

TowerXchange: As edotco continues its operations in Pakistan, what is some of your current thinking around network overlap and potential decommissioning? Also the contrast between parallel infrastructure in urban vs. suburban, and also the need for network extensions and rural coverage?

Suresh Sidhu, CEO, edotco Group:

Currently, Pakistan has approximately 40,000 towers in operations. Many of these towers are underutilised with the vast majority of the towers having low tenancy ratios and urban overlaps as much as 50-60%. Given this situation and an increased focus by operators on the reduction in operational expense, site consolidation is a major industry discussion point. For a towerco, this can be a key driver for establishing a higher colocation ratio for Pakistan. Having said that, consolidating large portfolios (in the magnitude of thousands) is an exercise that needs careful planning and execution. Consolidation typically guarantees total operating costs to go down and the benefits to be shared among all parties involved.

As for suburban and rural coverage, we believe the network overlap is not significant enough yet to consolidate in scale.

Achieving geographical mobile coverage in rural areas has been a challenge with Pakistan being a large country. The country is now starting to push mobile coverage to underserved areas through USF grants and this again is an opportunity well-suited for a towerco, where capex outlay predicated on expected multi-tenancy fits very well with our business model.

TowerXchange: To clarify, what is the current prevailing towerco business model in Pakistan – grass and steel or tower+power or mix?

Suresh Sidhu, CEO, edotco Group:

In the absence of substantial independent towercos to date, the prevalent business model for tower sharing in Pakistan has been mainly through inter-operator sharing on either commercial and/or barter agreements.

edotco has an end-to-end spectrum of service offerings in most of its markets, and we have seen different customers opting for customised asks. Our primary service offering will be the tower+power model. Through this model, our customers will be able to lease tower and ground space together with DC energy solutions.

Given the energy challenges of the country, we believe our customers are likely to adopt more complete service offerings, which will give them the most competitive total cost of ownership (TCO) rates as well as the highest up-time SLA.

TowerXchange: Could you help shed some light on the operational realities in Pakistan?

Suresh Sidhu, CEO, edotco Group:

Currently, less than 5% of the edotco sites are off-grid. The quality and consistency of power in Pakistan has improved significantly in the past few years due to enhancement in power generation and investments to improve the grid. We expect further improvements in the coming years as many additional large power generation projects come online that will substantially add capacity to the grid.

Other geographical challenges like the terrain and weather have become part and parcel of operations, and while Pakistan will have its unique conditions, we have experience from other markets to draw upon. Ultimately, we believe we have the patience and resilience to overcome these obstacles.

TowerXchange: Lastly, what will this mean in terms of your local team presence and strategy to grow manpower?

Suresh Sidhu, CEO, edotco Group:

Our current Pakistan operations are headquartered out of Islamabad and now post Tanzanite we have further offices in Karachi, Lahore and Peshawar bringing our full set of solutions and services closer to a wider range of customers.

Since we established in Pakistan we have been engaging mostly in business development activities with a small number of key executives based in Pakistan while leveraging on the expertise available at the Group. The completion of Tanzanite extended our resources and skill in terms of people considerably.

With the completion of Deodar, we will need to further develop our talent and believe the knowledge sharing opportunities between our new employees and our employees across the region will be a key element to developing a competent team. Human capital and talent are abundant in Pakistan and we believe the combination of the new team on the ground, experts from Jazz, the industry and our global talent available at edotco will result in a team that is able to continue providing quality services to our clients in a timely manner and meet the evolving market demands.

 

View source version:
https://www.towerxchange.com/edotco-expands-footprint-in-pakistan-with-two-acquisitions-totaling-13700-towers-at-us1-0289bn/

Read this article to learn:

  • Why edotco re-invested in Pakistan
  • What we know about the Towershare and Jazz portfolios edotco is buying
  • Parallel infrastructure: decommissioning versus infill
  • Power and people: operational realities in Pakistan

Malaysia Axiata unit edotco may rely more on debt to fund future growth – CEO

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Malaysia Axiata Unit edotco May Rely More On Debt To Fund Future Growth – CEO

By Jason Ng
Nikkei Markets

KUALA LUMPUR (Sep 18) — edotco Group, the telecommunication infrastructure unit of Malaysia’s Axiata Group, may rely more on debt to fund future expansion and finance acquisitions instead of raising fresh capital, its chief executive said Monday.

The most likely approach would be raising funds through syndicated loans and project financing, Suresh Sidhu told Nikkei Markets. The company could raise gross debt as a percentage of earnings before interest, tax, depreciation and amortization to 3.5 times from the current level which hovers below 2.5 times, he said.

“The plan is now to look at debt more holistically and increase our leverage closer to tower company benchmark,” Sidhu said. “Of course, we still have to work within Axiata’s debt covenant and profile.”

Axiata had initially considered an initial public offering of edotco by 2018 to unlock the value of its tower and infrastructure assets. edotco currently owns and manages more than 25,000 telecommunications towers across Malaysia, Bangladesh, Cambodia, Myanmar, Pakistan, and Sri Lanka.

edotco has been expanding its footprint through acquisitions since 2015. It recently announced purchase of 13,000 towers in Pakistan in a deal worth $940 million. On its part, edotco plans to fund the deal via $600 million debt and pump in $174 million as equity.

There is still unutilised cash from the company’s previous round of fund raising exercises, which is sufficient for small- to medium-sized acquisitions, Sidhu said. edotco has sufficient capital to tide over the next 24 months but may have to review its options if any larger acquisition comes along, he added.

The company remains open to prospects of more acquisitions and seeks to expand further, mostly in emerging and frontier Southeast Asian and South Asian countries, Sidhu said. “We’re patient, (the) deal has to be right (and) customers have to be right.”

Edotco, which was founded in 2012, has secured three new shareholders through a $700 million maiden equity private placement. Axiata remains the largest shareholder in edotco Group with a 62.4% stake following the entry of Innovation Network Corporation of Japan, Retirement Fund Inc and Malaysia’s state investment arm Khazanah Nasional. Axiata had said earlier that it wishes to retain a controlling stake in edotco Group.

Shares of Axiata ended 0.8% lower at 5.05 ringgit apiece, while the benchmark FTSE Bursa KLCI closed 0.2% down.

View source version:
https://asia.nikkei.com/Markets/Nikkei-Markets/UPDATE-Malaysia-Axiata-Unit-edotco-May-Rely-More-On-Debt-To-Fund-Future-Growth-CEO