The competition between television broadcasters and wireless
communication services is giving rise to a new sub-industry of tower
companies. They are vying to tie together far-flung clusters of
local transmission antennas into national webs that will bring next-
generation technology to customers.
Stunning growth projections for wireless services are drawing big-
name investors to this infant industry. With outside investment
capital nurturing their national ambitions, these little-known tower
companies have been transforming themselves over the last two years
into integrated operators that can offer wireless carriers an array
of services from finding new sites to tower building to leasing
antenna space on underused radio towers.
"It came from nowhere," said Brian G. Coleman, a wireless
communication analyst for BT Alex. Brown in San Francisco.
Among the dominant players in the antenna business are American
Tower Systems of Boston; Omni America Wireless of West Palm Beach,
Fla.; Telecom Towers of Alexandria, Va., and Castle Tower and
American Tower, both based in Houston.
Demand for transmission towers and antennas is soaring. Driving
the demand is the expected shift by the nation's 1,500 television
stations to high-definition television and new federal regulations
that allow a handful of wireless services to compete in a single
market. So far, just 3 percent of telecommunications traffic is over
the current wireless network, most of that cellular phone
conversations. But that is expected to change. Already, some of the
new wireless services, called personal communications services or
PCS, are carrying not only phone chatter but Internet data and
The tower companies expect a near-term flurry of activity from
broadcasters retrofitting or replacing their existing towers, so-
called "candelabras" that can support a small cluster of television
or radio antennas. A tall tower can be 2,000 feet and cost, on
average, $3 million. Even more capital is needed to meet demand from
wireless services, whose tiny 2.2 million subscriber base is
to increase to 54.3 million in a decade, according to Paul Kagan
Associates, a media research firm in Carmel, Calif.
That sort of consumer acceptance would require adding 80,000 PCS
antennas to the 20,000 already built over the last 15 years for
cellular customers. PCS antennas, at about $200,000 each, have a
range of one to six miles and need to be only 200 feet in the air.
By contrast, cellular antennas now are six to 12 miles apart.
But the growing demand for antennas coincides with growing
opposition to them for esthetic and health reasons. An increasing
number of municipalities have been imposing moratoriums on tower
construction, even though part of the Telecommunications Act of 1996
prohibits banning towers but does not address moratoriums. Tower
companies are resorting to such costly "stealth" solutions as
embedding antennas in clock towers, cemetery crosses and palm trees.
Others are striking roof-top management deals, luring owners with
promise that every multistory building will become a revenue-
producing cell site.
Given the zoning hurdles, companies with existing towers are
likely to prosper first. "Most wireless carriers would like to go
out and lease 40 towers in a region rather than contacting 40
different landowners," Coleman said. …