Market Trends of Saudi Arabia Telecom Towers Industry
5G deployments are a major catalyst for growth in the cell-tower leasing environment
- Saudi Arabia's telecom tower market is witnessing robust expansion, driven by the swift adoption of 5G technology. Unlike its predecessor, 4G, the deployment of 5G requires a denser network of cell sites. Since 5G utilizes higher frequency bands, it covers shorter distances and faces greater obstruction challenges. This underscores the urgent need for bolstered infrastructure in Saudi Arabia. Consequently, this increased demand has spurred the construction of new towers and enhancements to the current infrastructure.
- To meet rising demands, mobile network operators (MNOs) are transitioning from the conventional approach of constructing their own sites to leasing from independent tower firms. This leasing approach allows MNOs to rapidly broaden their 5G networks without incurring hefty initial expenses. Concurrently, tower firms benefit from increased occupancy rates and extended contract lengths, presenting them with substantial market expansion prospects.
- As 5G technology expands, Mobile Network Operators (MNOs) are prioritizing the upgrade of their sites to be 5G-compatible. This shift has spurred a heightened demand for leased tower space. In Saudi Arabia, telecom towers are increasingly turning to leasing strategies to strengthen 5G coverage, especially in urban and suburban locales. This underscores the importance of both established and newly built towers.
- In March 2024, Zain Saudi Arabia and Nokia inked a Memorandum of Understanding, collaborating on the advancement of 5G technology and charting a definitive course for the establishment of next-generation ultra-broadband networks in Saudi Arabia. The two companies would leverage their expertise to create use cases, define requirements, and outline deployment scenarios for 5G technologies.
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Ground-based to Witness Significant Growth Opportunities
- Saudi Arabia's telecom tower market is rising, driven by an increasing demand for ground-based telecom towers. Prioritizing rural connectivity, the push for broader coverage has resulted in a notable surge in ground-based installations. These installations have effectively catered to the needs of the nation's expansive and less-developed areas.
- Saudi Arabia's expansion of its 5G network is driving the rapid growth of ground-based telecom towers. A denser network of towers is crucial for delivering widespread high-speed connectivity. This expansion meets the rising demand for advanced digital services and bolsters initiatives like IoT and smart cities.
- Saudi Arabia is enhancing connectivity in its predominantly rural areas, leading to a surge in the establishment of ground-based telecom towers. These towers ensure extensive coverage in regions lacking urban features, such as high-rise buildings for rooftop insulation.
- Government initiatives to boost digital inclusion and upgrade telecommunication infrastructure have driven this growth. Furthermore, the rising demand for mobile and internet services propelled by the widespread adoption of smartphones and ongoing digital transformation highlights the urgent need for extensive network coverage. Considering this, ground-based towers stand out as the favoured option, capable of covering vast geographical areas and bolstering the nationwide commitment to dependable telecommunication services.
- Moreover, the growing influence of social media is fuelling the expansion of the telecom tower market. This growth is attributed to the rising need for widespread and reliable mobile internet access. With a rising population in Saudi Arabia actively using data-intensive social media platforms, telecom operators are under pressure to expand their networks and maintain consistent service quality. To address this heightened demand, telecom companies are constructing new towers, focusing on both underrepresented rural areas and bustling urban hubs.
- According to StatCounter, Facebook is the most popular platform in Saudi Arabia, with approximately 42.81% usage, trailed by Twitter and Instagram. A rise in such usage will drive the market growth opportunities significantly.
