Market Trends of UAE Telecom Towers Industry
5G Deployment to Address the Increasing Market Demand
- With the growing number of mobile internet users and IoT connections, the country's demand for improved and advanced telecom infrastructure is increasing. The evolution of cellular network technology has allowed users to experience faster data speeds and lower latency and has prompted the rapidly increasing use of services and data-heavy applications.
- Moreover, the significant rise in the volume of data carried by cellular networks has been primarily driven by consumer demand for video and business and consumer moves to cloud services. This factor is expected to drive the need for a more resilient and stable network, such as the 5G connection, which offers fast and high-capacity networks. As of June 2024, the United Arab Emirates (UAE) recorded an average median speed exceeding 323 Mbps, according to Speedtest.
- Compared to 4G LTE, 5G may bring lower latency, higher bandwidths, and increased connectivity to mobile broadband. The 5G connections may make more data travel faster over broader coverage areas. The 5G bandwidths are projected to be ten times higher than 4G LTE, contributing to faster data transmission, images, and videos. Hence, the growth in the deployment of 5G across the country is expected to accelerate the demand for telecom towers during the forecast period.
- Since early 2022, the adoption of 5G technology among mobile users has surged. By Q3 2023, the United Arab Emirates recorded a 5G penetration rate of 26.86%, as reported by GSMA Intelligence. For instance, as of December 2023, Statcounter reported that mobile phones accounted for approximately 75.3% of all webpages served to web browsers in the United Arab Emirates. Additionally, the number of users in the United Arab Emirates stood at 9.46 million.
- Moreover, in July 2024, in a significant move, the Abu Dhabi National Oil Company (ADNOC) teamed up with UAE operator group 'Etisalat by e&' to roll out the energy sector's most expansive private 5G network, stretching across 11,000 square kilometers. This state-of-the-art network is anticipated to encompass both ADNOC's onshore and offshore operations, facilitating IoT connectivity for sensors installed in more than 12,000 wells and pipelines. Such expansions drive the demand for the market studied during the forecast period.
- In the future, such developments, increased data traffic, increasing connected devices, and the rollout of 5G services globally may significantly boost the demand for telecom towers to cater to the growing data needs.
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Rooftop to Witness Growth
- As cities in the United Arab Emirates become more densely populated, finding suitable land for traditional ground-based towers becomes increasingly challenging. According to World Bank data, the population density is 114 individuals per square kilometer in the United Arab Emirates. Furthermore, the three largest emirates - Abu Dhabi, Dubai, and Sharjah - collectively house almost 85% of the total population.
- Mobile network operators (MNOs) will need to make significant infrastructure investments for 5G to expand, and rooftop infrastructure will be essential to these investments. Building facades and rooftops are ideal real estate for MNOs wishing to densify their networks and expand their capacity or coverage. Antennas on the 5G network can deliver 5G signals straight to customers through a more significant line of sight on rooftops in an urban setting. In this approach, 5G reception can be reliably obtained by people and devices on the ground and close to the boundaries of surrounding buildings.
- As mobile network operators upsurge 5G capabilities, rooftops will play a key role. The growth of 5G will require massive infrastructural investment by mobile network operators (MNOs), and rooftop infrastructure is expected to play a pivotal role in this investment. For instance, in December 2023, du, a subsidiary of Emirates Integrated Telecommunication Company (EITC), successfully rolled out its Solar on Tower (SOT) solution, effectively tackling space constraints at mobile sites. This groundbreaking approach entails the installation of solar panels on monopole towers, facilitating the solarization of multiple sites across Dubai.
- However, with space constraints and rising land costs, rooftop towers have found higher attractiveness amongst telecom tower players and mobile network operators. The initial implementation of telecom towers are backbone components that enable the rolling out of these technologies incur high costs; therefore, the market players are adopting different strategies for cost-effective deployments of telecom towers.
