Crown Castle CEO: 5G deployments have driven historic level of tower activity

Crown Castle is experiencing the highest level of tower activity in the company’s history due to 5G deployments in the U.S., the company’s CEO Jay Brown said during a conference call with investors.

“We continue to generate significant growth in cash flows and dividends from the deployment of 5G in the U.S. We are experiencing the highest level of tower activity in our history. This record level of activity is tied to the existing wireless carriers increasing their spend to add more equipment to tower sites and Dish starting to build a new nationwide 5G network from scratch,” Brown said.

The executive said that the company was expecting this elevated level of activity to continue beyond this year and support future growth on its tower business. “While driving strong growth in our tower business this year, the initial focus by our customers in the tower segment has also led to some delays in our small cells deployment shifting the timing of when we expect to complete the nearly 30,000 small cells contractually committed in our backlog,” Brown said.

Crown Castle now aims to deploy approximately 5,000 small cells during 2021 and another 5,000 next year, with the remaining nearly 20,000 from its current backlog completed beyond 2022. Crown Castle currently has over 50,000 small cells on air.

“This delay has not impacted our view of long-term attractiveness of small cells since the fundamental need for small cells continues and the unit economics remain in line with our expectation,” he said. “We have already seen how important small cells are as a key tool used by the carriers to add network capacity by reusing their spectrum over shorter and shorter distances. We believe, small cells will be an even more important tool going forward as the nature of wireless networks requires continued cell site densification to meet the increasing demand for data, especially if 5G networks are deployed.”

The executive also highlighted that one of the core principles of Crown Castle’s strategy is to focus on the U.S. market as the firm believes it is the best market for communications infrastructure ownership with the most attractive growth profile and the lowest risk.

“With that view in mind, we have invested nearly $40 billion in shared infrastructure assets that we believe are mission critical for today’s wireless networks and sit in front of what is expected to be a massive decade long investment by our customers to deploy 5G in the U.S.,” Brown stated.

Crown Castle owns, operates and leases more than 40,000 cell towers and approximately 80,000 route miles of fiber supporting small cells and fiber solutions across every major U.S. market.

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