New Wireless Networks to Fuel Growth for Tower Operators

Shared spectrum, 5G expansion, network proliferation will offer new revenue opportunities.

DENVER (August 11, 2020) — Wireless tower operators stand to benefit from a host of industry shifts that will create new business opportunities and revenue streams over the next few years. Citizens Broadband Radio Service (CBRS) deployments, 5G expansion and new wireless providers entering the market are all tailwinds for the tower industry. Small cell growth represents some risk for operators with urban and suburban tower assets but does not present a risk to rural operators.

A new report from CoBank’s Knowledge Exchange assesses the emerging opportunities and risks facing tower operators as the wireless industry is poised to evolve due to shifting business models and technological advances.

“New spectrum bands and wireless business models will fuel growth in the tower industry for the next several years,” said Jeff Johnston, lead communications economist with CoBank. “Cloud-based technologies and virtualization have made building a wireless network much more cost-efficient, and tower operators will benefit from more network fragmentation.”

In rural America, tower owners should benefit from T-Mobile’s planned 5G expansion. The company has said it will offer 5G to 99% of the U.S. population within six years, which will require deploying a large number of rural cell sites. Given the challenges associated with building rural towers, including access to labor and backhaul, T-Mobile will likely utilize existing tower infrastructure in rural America to increase its 5G coverage map.

Network consolidation is never a good thing for tower operators, but in the case of Sprint/T-Mobile there is a silver lining. While T-Mobile indicated that it will see a net decrease of 25,000 cell sites once the two networks are combined, the company’s strategic deal with Dish Network should translate into a good number of these sites being salvaged as Dish it builds out its nationwide wireless network.

Cable operators Comcast, Charter and Altice have all entered the wireless market in recent years via a network wholesale model. Based on the cable industry’s increasing interest in wireless and expected growth, expectations are that the cable operators will build regional wireless networks to reduce their operating costs. CoBank estimates these network builds could include 20,000 cell towers.

The Federal Communications Commission (FCC) has planned two spectrum auctions in 2020, both of which are central to 5G network builds and should positively impact tower revenues. The CBRS auction, which started in July, included 70MHz of mid-band spectrum and the upcoming C-Band auction includes 280MHz of spectrum.

Both auctions are expected to garner significant interest from all national wireless operators and cable operators. Since these spectrum bands are newly available to carrier networks, additional antennas are needed to broadcast the signal. Adding new equipment to towers typically triggers lease amendments, resulting in a new revenue stream for the tower owner. Although these network upgrades will have less impact on rural tower owners than urban and suburban operators.

“The CBRS spectrum auction will introduce a broad range of new network operators, which could include energy companies, municipalities, large tech companies, manufacturers and universities,” said Johnston. “We expect there will be many more wireless network operators coming in all shapes and sizes.”

Small cells are expected to play a larger role in wireless networks, which represents a headwind for the tower industry. To deploy millimeter wave spectrum, carriers need to install small cells which are typically located on light poles, rooftops and utility poles versus cell towers.

Johnston indicated small cells are a potential issue for tower operators with urban and suburban tower assets, but not for rural owners because deploying millimeter wave spectrum in rural markets does not make sense.

The full report, “New Networks and Spectrum to Fuel Tower Industry Growth,” is available on

About CoBank

CoBank is a $152 billion cooperative bank serving vital industries across rural America. The bank provides loans, leases, export financing and other financial services to agribusinesses and rural power, water and communications providers in all 50 states. The bank also provides wholesale loans and other financial services to affiliated Farm Credit associations serving more than 70,000 farmers, ranchers and other rural borrowers in 23 states around the country.

CoBank is a member of the Farm Credit System, a nationwide network of banks and retail lending associations chartered to support the borrowing needs of U.S. agriculture, rural infrastructure and rural communities. Headquartered outside Denver, Colorado, CoBank serves customers from regional banking centers across the U.S. and also maintains an international representative office in Singapore.

Media Contacts

Julie Davis
Corporate Communications

Sherry Johnson
Corporate Social Responsibility

Dave Harding
Knowledge Exchange