Growth opportunities for TowerCos in the United Kingdom

Introduction

The British mobile market comprises several operators, of which four have their own networks: EE, O2, Three and Vodafone. Regarding mobile telecommunications, MNOs are the main player of interest for TowerCos. The objective of this report is to provide a summary of the current opportunities for TowerCos in the country as a preliminary estimate.

This report provides this summary based on the following KPIs:

• Differences in coverage by MNO: not all MNOs may have the same coverage 4G and 5G along the country. Global and regional differences may help TowerCos to properly approach MNOs.
• Degraded coverage areas: areas of the country where the network (in 4G and possibly 5G) shows degradation.
• Potential co-location opportunities: co-location agreements (site sharing agreements) reduce the building, installation and maintenance costs for MNOs, while improving profitability for TowerCos and optimizing space usage and resources for everyone.
• Potential BTS opportunities in urban areas: urban areas are some of the most interesting zones for performing BTS (new deployments) for MNOs.

This report is divided in two great blocks:

• Block 1, with an analysis at a global level.
• Block 2, focused on BTS opportunities in urban areas, where deployments are more adjusted and optimized.

Summary

The United Kingdom, the 6th largest economy in the world, home to around 68 million people, is a world-class economy with a consolidated telecommunications market ripe with opportunities.

Four mayor players dominate the mobile market with their own networks: EE, O2, Three and Vodafone.

O2, owned by Liberty Global and Telefonica, is the largest MNO in the UK with a 32% of market share . EE, subsidiary of the BT Group, follows closely with a 29% of market share. Vodafone is the third contending operator with a 25% of market share, and, finally, Three (part of the CK Hutchison group) has a 14% of market share. All these figures include MVNOs subscribers. Vodafone and Three have established collaboration agreements and have proposed a merger that is currently being probed by the Competition and Markets Authority in the UK amidst fear of a less competitive market. This scenario makes the British market a very dynamic and attractive one.

Co-location opportunities in the whole territory

• O2 and Vodafone sites have similarly interesting co-location opportunities for both EE and Three. However, they provide a smaller interest to each other, due to their similar deployments strategy and their historic collaboration agreements.
• EE and Three sites provide co-location opportunities to all their competitors at similar rates.

Potential BTS opportunities in urban areas

• Vodafone has the highest number of BTS opportunities, whereas O2 (the first MNO in the country) has the least number BTS opportunities.
• All MNOs, however, exhibit great number of BTS opportunities in a similar range.
• Due to the consolidated nature of the British market, it is expected that many of these BTS opportunities could be shared by different MNOs.

Methodology

Under this section an in-depth description of each analyzed KPI can be found, including the methodology and rationale behind them. At a more general level, the following paragraph describes the data collection methodology.

At a more general level, Weplan Analytics collects crowdsourced data from more than 200 million devices in 31 countries. For this analysis, 1777 million measurements collected between January and March 2024 were used.

The following map shows the density of measurements taken throughout the UK by Weplan Analytics.

The most relevant insights can be found in the Summary section above. A detailed account of each one comprises the rest of the report below.

As the four aforementioned MNOs serve their networks to other parties (such as VMNOs, due to roaming agreements or as part of emergency coverage) they have been filtered by the network provider reported in the SIM card.

More details about the methodology can be found here.

Block 1A: Differences in coverage by MNO in the whole territory

O2 has a more extense coverage area than its competitors. This difference in coverage means that Vodafone has the most potential for BTS opportunities.

The images show the coverage area for each MNO.

100%

98%

81%

79%

Block 1B: Degraded coverage areas in the whole territory

An estimate of the percentage of the coverage area that shows signs of degradation can be calculated. Some global highlights are the following:

• Globally, Vodafone is the carrier with less percentage of its coverage area showing signs of degradation (around 23%).
• O2 and Three are nearly tied with 29% and 30% of their area, respectively, showing signs of degradation.
• Approximately a 34% of the coverage area of EE shows signs of degradation.

Not degraded

Degraded

Percentage of degraded and not degraded coverage area in all the UK by MNO

Block 1C: Potential co-location opportunities in the whole territory

An estimate of the percentage of the current coverage area where there could be co-location agreements can be estimated. Some global highlights are the following:

• O2 and Vodafone sites have similarly interesting co-location opportunities for both EE and Three. However, they provide a smaller interest to each other, due to their similar deployments strategy and their historic collaboration agreements.
• EE and Three sites provide co-location opportunities to all their competitors at similar rates.

The following chart shows in the horizontal axis the carrier providing a co-location opportunity, and in the vertical axis the MNO that would benefit from it. The color indicates the offering MNO, that is, the representative color throught the report for the MNO in the horizontal axis:

Block 2: Potential BTS opportunities in urban areas

A downward estimate of the number of sites needed to support the already existing deployment can be calculated.

This takes into account both areas with degradation and areas where a MNO has no coverage. For this calculation densification needs have not been taken into account.

Only urban areas have been considered, to ensure that all MNOs are compared under similar situations.

Some global highlights are the following:

• Vodafone has the highest number of BTS opportunities, whereas O2 (the first MNO in the country) has the least number BTS opportunities.
• All MNOs, however, exhibit great number of BTS opportunities in a similar range.
• Due to the consolidated nature of the British market, it is expected that many of these BTS opportunities could be shared by different MNOs.