T-Mobile’s Mayo Points Out Pain Points

May 25, 2016

By J. Sharpe Smith

Mayo

DALLAS — May 25, 2016 — T-Mobile executives are nothing if not forthright. Dave Mayo, senior vice president-technology strategy, finance and development for the carrier, led off the keynote speakers at the Wireless Infrastructure Show yesterday with some outspoken advice for tower owners.

“We usually talk about we are doing for our customers as the uncarrier,” Mayo said. “Today, I would like to turn it around. What are my pain points as a customer of the wireless infrastructure industry, and what would I ask you to do to solve them?”

The first pain point Mayo brought up was operator access to tower sites, saying that oftentimes the carrier’s personnel cannot enter the site because of an incorrect lock combination or the wrong keys or sometimes even a nesting bird.

“You would be amazed how much time and energy we exert trying to get access to the towers that we spend so much money on rent every month,” he said. “Invariably there are several hundred towers that we’d love to upgrade but we cannot, because there is a bird nesting on the tower.

Can somebody figure out a way to keep the damn birds off the towers?”
When site access is impaired, routine tasks like structural analyses can take weeks when they should take days, he added.

Mayo called current fee structures overly complex and unsustainable, comparing it to dealing with the banks. “We get nickeled and dimed for fees on everything,” he said. “It takes a lot of process work to make changes to the network. We’ve got to find a way to simplify it and make it easier.”

Small cells are becoming a pain point for carriers, according to Mayo. He noted that carriers are going to need a lot of small cells in the future. He urged the industry to maintain good working relationships with municipalities and develop processes to speed the deployment of small cells.

“I am concerned that we are being too cavalier in some cases and messing up the relationships with municipalities,” he said. “The processes we use to deploy macrosites are not scalable. We need to make it really screamingly easy for the operators to add small cells to their networks and that is going to take a lot of work with the municipalities.”

As with the fee structure, Mayo called the process of determining how much tower loading costs
“an administrative nightmare” and called on the industry to simplify it.

“We recently had a situation where we had to replace a tower-mounted amplifier (TMA) that was 3 pounds heavier than the previous TMA, and it costs us an extra $5 a month,” he said. It’s not the $5 that bothers me but the time and energy for two companies to figure out that it costs $5. It’s crazy.”

Mayo said that if the wireless industry would have known when it began that its towers would be upgraded six to eight times, it would have make the whole process a lot simpler and cheaper.

“The opportunities for cell tower developers [to solve these pain points] include simplified rate structures, lower escalators, protection from consolidation and cash back from signing bonuses to ease operator transitions,” he said. “There will be operator transitions in the coming years. We will have to get off some of those high-cost sites, which creates opportunities.”

As for T-Mobile, Mayo painted a bright picture. The carrier had a $32 billion market cap and 65.5 million customers at the end of the first quarter. Since the failed AT&T merger, T-Mobile has added 23 million customers, including 2.2 million customer adds in Q1 2016. “Pretty remarkable for the little company that everyone declared dead,” he said.

T-Mobile spends $22 million on a daily basis, which is equal the total that it spent to build out its first market in Hawaii under the name Voice Stream.

“Our churn rate [1.33 percent] is down precipitously, primarily because of the impact of the 700 MHz band spectrum and getting Band 12 handsets to our customers,” Mayo said. “We have coverage of 258 million in population with our low-band [700 MHz] licenses. The impact of low-band spectrum is phenomenal.”

Of the 258 million pops of low-band licenses, T-Mobile has acquired 70 million in pops in the last six months, which it will build out during the balance of this year and into 2017, he added.