CGM Assignment 6: Location Decisions for US Telco

Objective of the Assignment:

 To understand the challenges in making location decisions
 To test the conceptual and analytical skills that are required to make location decisions
(This assignment has been adapted based on a Deloitte Mavericks case from earlier years.)

US Telco
Company Background:
US Telco Limited is a holding company that operates as a real estate investment trust (REIT) which
owns, operates, and develops multitenant communications real estate. US Telco’s major presence
is in the United States with some presence in Canada and EU through its fully owned subsidiaries.
Its primary business is property operations, which includes the leasing of space on communications
sites to wireless service providers, radio and television broadcast companies, wireless data
providers, government agencies and municipalities, and tenants in various other industries. Its US
property segment includes operations in the United States, and its services segment offers tower-
related services in the United States.
In addition to leasing space on towers to wireless communications companies, US Telco plans to
expand its services segment in other regions and provide customized colocation solutions through
in-building systems, distributed antenna systems and other right-of-way options, managed
rooftops, and services that increase the speed of network deployment.
The company has a strong asset base that can cater to new tenants and new equipment for existing
tenants on its sites. The company's communications real estate portfolio consisted of 85,000
communications sites, including 35,000 domestic communications towers and 50,000 international
communications towers. The company has a well-established domestic and international tenant
base. Around 65% of domestic revenues come from five clients and 45% of international revenues
come from four established global clients in India (two clients with 25% of international revenue)
and Nigeria (two government agencies with 20% of international revenue).
As part of its growth strategy, the company is currently looking at various organic opportunities
that will facilitate strong growth and increased presence in both the national and international
market. US Telco has also identified the following four locations after a preliminary screening:
1. Argentina
2. Chile
3. Hungary
4. Czech Republic
In order to achieve the above-mentioned goals, the management has approached Deloitte to
provide its expert opinion on various growth options.

1
Industry Trends:
 The global wireless network infrastructure market stood at $52 billion in 2014
 Global Long-Term Evolution (LTE) revenue is up 9 percent year-over-year, totaling $6.1
billion
 Significant economic incentive exists for carriers to choose a colocation model over
building their own site
 Approximately 63% of sites in the US are on owned land or have a ground lease with at
least 20 years until renewal

Question:
Which country do you recommend for US Telco as their next target for global expansion? What
are your supporting reasons?

Note for Submission:

1. Use the word document template shared earlier for writing your answers to the above
question. Your answer should not exceed a single page.
2. Prepare a separate excel sheet containing the calculations and appendices, if any. Use
remarks to inform me about the steps and format the sheet properly before submission.
3. Upload both the word document containing your answers as well as the excel sheet as part
of submission. I will evaluate your assignment only if both submissions are made.
4. The submission deadline is 10:00 AM, July 22, 2019.
5. Feel free to write to me or call me for any queries.