Chairman's Corner - 2023 Tower Times Volume 3
As we emerge from our NATE Member Congressional Fly-In Event in D.C. and other prominent industry conferences this past spring, it is clear that there is a change in the air. The primary conversations evolve around work slowdown, bankruptcies of major vendors, matrix pricing cuts, and additional flow down of duties and responsibilities to the contractors who perform the work. We have inflation at 15%, compared to the Carter Administration in the mid to late 1970's which peaked at 14.6%, and we have interest rates rising at a pace only surpassed during the Carter years.
This is a time when we can look at the landscape as a glass half full or half empty; with every downturn in the economy or event in our history, we can look to people that take these opportunities to either hang their heads or innovate and improve themselves.
As contractors, engineers, suppliers, and manufacturers in the telecom industry we know one thing, people will always need to communicate, and we are the people that enable the connectivity to make that a reality.
As NATE member companies, we have all been riding a hectic pace for over 10 years of increasing build plans as we rolled from 3G to LTE to 4G and now into 5G. We have seen a tremendous boom in the macro tower business and a constant uptick in small cell and fiber deployments. There has been a lot to do.
The upside is that these installations need to be maintained and continually expanded. The work that was done 10 years ago by the carrier’s field technicians is now done by NATE member companies. The radio heads are now mounted on light fixtures, telephone poles, and towers. This is a time when companies that invest or have invested in technical training will lead the next generation, building and maintaining our communication infrastructure.
Over the last several years, there has been an increasing rate of access to cheap capital, and many larger companies acquired into the telecom space assuming the bubble would never burst. Some companies agreed to subpar pricing for the opportunity to tie up large volumes of work and now with increased inflation and interest rates, that pricing no longer looks quite as good as it did 18 months ago. As the owner of a contractor business for over 30 years, my advice is to know your costs and understand what it takes to operate your business profitably.
During the recent round of NATE C-Suite meeting visits with some of the industry’s major customers (carriers and vertical real estate/tower owners), we had some great dialogue discussing the pricing and, although it will take some time to get major change, we are delivering a compelling and worthy message. NATE UNITE 2024 in Memphis will also have several educational sessions on business management topics that will provide immense value and I look forward to seeing you there.
Victor Drouin is the Chairman of NATE and President of Green Mountain Communications, Inc. in Pembroke, New Hampshire. He can be reached at 603-717-7117 or [email protected].
