Over the course of the last 25 years, the cellular industry has experienced tremendous growth. Cell phones have graduated from an ultra-expensive communication device to an inexpensive commodity. The cellular network ? the foundation that all cell phones depend upon for service - has rapidly expanded as well. Cellular networks have spent much of the past 25 years leasing property, building "cell towers," and establishing "cell sites" as quickly as possible in order to meet demand. Today, changing cellular technologies are causing cellular networks to re-organize their cell sites and towers (and their leases).
Back in the day when cellphone technology was just starting to make a name for itself, much of the hoopla was focused on erecting networks as quickly as possible. This happened in the late 80s and early 90s, fondly referred to as "the first and second generations" of cellular technology. It was during these times that "prime" locations of cell sites were considered to be of utmost importance. A number of properties and buildings offered "perfect" areas for coverage, and networks often paid excessive amounts of money for these "prime" and "perfect" locations.
How times have changed.
Today, we are now in the third generation of cellular technology, which is completely different than its predecessors of a few years back. The older cellular networks were far less sophisticated than the cellular networks of today. The older cell tower sites often had to use a higher antenna for better coverage. Today, that is no longer the case. Cellular carriers now need to have more sites that are actually closer to the ground in order to offer consumers greater bandwidth. This essentially means that cell towers and cell sites can now be placed almost anywhere.
The bottom line is that cellular networks no longer need to focus on finding the "best" locations for cell sites because cellular phone technology has changed.
While consumers have benefited from these advances in cell phones and cell towers, there has been a great decline in the amount of rent seen by many property owners with cell site leases. Cellular networks are now checking on each and every lease, and since many of these leases were signed back when the technology was very much different from it is today, they're often requesting a rent reduction or moving elsewhere. At the same time, these same advances in technology have also led to more competition for cell site leases. Since there's no such thing as a "prime" spot any more, plenty of property owners are offering low rental rates to attract high credit cellular network leases.
Advances in cellular technology in the last 25 years has been magnanimous, and the industry is still aggressively advancing. The physical needs for a cell site have changed, and cell tower leases are now being renegotiated. A good number of the property owners aren't quite happy about renegotiated leases and the lowering of their cell site and cell tower rents, but consumers - and even the entire country - are enjoying the benefits of improved performance, service, and the stability of wireless networks. It's not all gloom and doom as far as landlords are concerned, however. As part of a cell site lease renegotiation, many landlords are able to secure a long-term rent guarantee. Since cellular operators are also one of the best clients a landlord can have, a long-term arrangement is often considered "money in the bank." Still, technology and market forces are conspiring to force property owners to be more competitive in order to retain their tenants. Such is the march of capitalism.
Back in the day when cellphone technology was just starting to make a name for itself, much of the hoopla was focused on erecting networks as quickly as possible. This happened in the late 80s and early 90s, fondly referred to as "the first and second generations" of cellular technology. It was during these times that "prime" locations of cell sites were considered to be of utmost importance. A number of properties and buildings offered "perfect" areas for coverage, and networks often paid excessive amounts of money for these "prime" and "perfect" locations.
How times have changed.
Today, we are now in the third generation of cellular technology, which is completely different than its predecessors of a few years back. The older cellular networks were far less sophisticated than the cellular networks of today. The older cell tower sites often had to use a higher antenna for better coverage. Today, that is no longer the case. Cellular carriers now need to have more sites that are actually closer to the ground in order to offer consumers greater bandwidth. This essentially means that cell towers and cell sites can now be placed almost anywhere.
The bottom line is that cellular networks no longer need to focus on finding the "best" locations for cell sites because cellular phone technology has changed.
While consumers have benefited from these advances in cell phones and cell towers, there has been a great decline in the amount of rent seen by many property owners with cell site leases. Cellular networks are now checking on each and every lease, and since many of these leases were signed back when the technology was very much different from it is today, they're often requesting a rent reduction or moving elsewhere. At the same time, these same advances in technology have also led to more competition for cell site leases. Since there's no such thing as a "prime" spot any more, plenty of property owners are offering low rental rates to attract high credit cellular network leases.
Advances in cellular technology in the last 25 years has been magnanimous, and the industry is still aggressively advancing. The physical needs for a cell site have changed, and cell tower leases are now being renegotiated. A good number of the property owners aren't quite happy about renegotiated leases and the lowering of their cell site and cell tower rents, but consumers - and even the entire country - are enjoying the benefits of improved performance, service, and the stability of wireless networks. It's not all gloom and doom as far as landlords are concerned, however. As part of a cell site lease renegotiation, many landlords are able to secure a long-term rent guarantee. Since cellular operators are also one of the best clients a landlord can have, a long-term arrangement is often considered "money in the bank." Still, technology and market forces are conspiring to force property owners to be more competitive in order to retain their tenants. Such is the march of capitalism.
About the Author:
Author Jason Lancaster closely observes changing cellular technologies. Find more information on cell site leases and cell tower leases at Md7.com.
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