As mobile operators scramble to bring new cell sites online ahead of the competition, the companies tasked with completing this work are finding that oversight and involvement by the carriers is increasing. Firms that contract with Tier 1 operators say they are performing much more work in-house, in part because they need to be more closely connected to their carrier clients. Major providers including MasTec, Black & Veatch and Nexius are all taking on deliverables that were once sub-contracted to third parties.
“The trend is certainly shifting for the carriers, in that they want Nexius and others to self-perform more services,” said Matt Glass, executive vice president of network services at Nexius, which handles large contracts for AT&T and Sprint. “We self-perform 70% of the services we provide across the different areas, and we are getting pressure from the carriers to self-perform more,” Glass said. Nexius now handles all its own construction management and project management, and handles most site acquisitions as well. But the firm still outsources about two thirds of its tower work.
By encouraging infrastructure service providers to perform more work in-house, carriers can more easily enforce quality standards, and they may be able to exercise better cost control. Fewer contractors means fewer suppliers building in their own profit margins into a job. For the infrastructure service providers, taking on more parts of a contract can increase exposure to financial risk and to liability, but when executed thoughtfully it can also be a sound investment.
“Self-perform really is more about controlling your destiny,” said Rick Suarez, president of MasTec Network Solutions. When you make a commitment to loyal customers you want to be able in the end to deliver that plan on the expected due date. So when you rely on a lot of contractor resources it’s a little tougher. … Bringing more work in house helps us ultimately control our destiny. It does put more risk on us from an operating expense standpoint, but then having volume in that area for us ultimately affords us the opportunity to do more self-perform.”
Suarez said MasTec plans to hire roughly 1,000 tower climbers over the next year, many of whom will be deployed in the eastern and northeastern parts of the country. He said MasTec is also hiring technicians for DAS and small cell deployments, but the vast majority of hiring remains focused on outdoor deployments.
The number of cell sites in the United States rose 41% between 2007 and 2012, and continues to climb. That has meant increased demand for all wireless infrastructure services, and especially for tower climbers. Large providers cannot complete all their jobs without tapping third party providers for tower technicians. And even these suppliers are racing to find new talent. Members of the military returning from active duty have been heavily recruited by the tower industry, which values the work ethic, focus on safety, and ability to follow directions that are often associated with active duty military personnel.
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