AT&T and Verizon strike tower deal in bid to reduce costs

Wireless carriers AT&T and Verizon announced they reached a deal with Tillman Infrastructure to build hundreds of cell towers. The companies say this agreement is a more cost effective deal than traditional lease deals, Inside Towers reports.

There has been a growing tension over the standard tower lease agreements in the past year during earnings calls and other financial discussions between tower companies and the country’s major wireless carriers. “We need more alternatives to the traditional tower leasing model with large incumbents,” AT&T SVP Susan Johnson said in a statement. “(The current model) is not cost-effective or sustainable.”

Surveillance CameraVerizon’s Chief Network Officer stated the carrier is looking at all of its long-term contracts as they come up for renewal. “We’re excited to develop new vendor partners to diversify our infrastructure providers.”Tillman owns and operates a variety of assets that include small cells, smart cities infrastructure and macro towers. The carriers will lease the towers and they will co-locate and co-anchor them. Construction is expected to begin during the beginning of 2018.

The deal is for macro towers only, according to the carriers. Verizon stated the deal is the first of its kind between a major carrier and a tower company in the carrier’s history.

Meanwhile, AT&T said, “All of our desired site locations are being considered (with the Tillman agreement),” in a statement.

Verizon said its macro cells are used for 3G, 4G and 4G LTE Advanced technologies when asked what type of projects the towers would be used for.

“The macro towers with Tillman will be capable of all these technologies,” the company said in a statement. Verizon also mentioned the towers will be able to handle any new technologies going forward such as 5G.

AT&T told Inside Towers that the Tillman deal is geared towards new sites and would not change current lease deals with other companies. A company spokesman said it plans to build new sites and update current ones with its first responder network in mind when asked if the new towers could help with the FirstNet build out.

“With the plan we put forward, FirstNet will happen across all of AT&T’s LTE bands giving public safety access to the coverage and capacity they need when and where they need it,” the company said in a statement. “So as we build new sites and extend the coverage of our LTE network, it will positively benefit subscribers on the FirstNet network.”

“This agreement is intended to diversify our infrastructure providers so Tillman will be an additional vendor to the other ones we currently have,” Verizon added. “This diversification will help us reduce operating costs.”

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