The vHive team was at Tower Xchange Asia last month, meeting tower companies and stakeholders from all over the region and learning from them about their current priorities and the challenges that TowerCos in Asia are facing right now. In conversations with the major players, we see the region divided into two camps: those still stuck on measuring return only on cost reduction and efficiencies, and those who are looking forward on being a digital organization and understand the benefits of digitization, digital twins, and interoperability.
The Limits of Cost Reduction Analysis
Cost reductions and improved operating efficiency are valid measures of value, and certainly important to track. Digitization and new tools like digital twins offer significant cost savings over traditional methods of surveys, inspections, and management of field assets in most regions. In markets currently experiencing lower labor costs, however, those cost differences aren’t as great: and some companies struggle to justify the learning curve of adopting a new technology.
Delay on adopting new technologies- especially those rapidly becoming a standard in other regions – is increasingly risky. Those companies who hesitate to roll out digitization in their organizations are not protected against a change in labor costs or labor supply. Additionally, TowerCos relying on traditional means of surveying field assets may be falling behind the curve of technology and service levels and could find it more difficult to deal with other international firms on leasing or mergers and acquisitions.
The Benefits of Looking Forward
As Jon Lipton, CEO of Amplitel in Australia says, mergers and acquisitions are a major part of the industry right now. “366,513. That’s how many towers changed hands since we last met in 2019,” he says. “…The Australian market has been turned on its head by investors snapping up towers. Now those investors want to see a return on their investment.”
Australia is one of the most digital-oriented markets we’ve seen, with the major players – Amplitel, Indara, Wavecon, and NSW – all working to accelerate digital transformation. Lipton says that Amplitel is creating digital twins of all their field assets, developing a “metaverse of towers” to digitize their assets and make them “maximally available” to customers.
Amplitel describes their digitization process in terms of 5 stages, and digital twins are just the beginning. The company has digitized over 2000 sites to date, towards their goal of creating reality models and applying AI analytics. They utilize those models in CAD simulations, for more efficient design and engineering. The company can offer customers a more seamless experience by holding joint design sessions. They plan to move to a predictive maintenance model, evaluating site degradation and longevity. In the long term, company leaders see the metaverse of towers existing within the metaverse of cities, in the national metaverse. All of these stages rely upon the interoperability of systems, and the development of partnerships to ensure that services work together to leverage digital data effectively.
Summarized from the Amplitel presentation:
- Stage 1: Digital data gathering
- Stage 2: Digital twins and AI-powered Analytics
- Stage 3: CAD Simulations
- Stage 4: Joint engineering sessions and seamless approvals
- Stage 5: Predictive maintenance
The Australian tower industry is one of the most forward looking we’ve seen. While all of the players at TowerXchange Asia showed curiosity about digital twins, all Australia’s major players understand that digital transformation is critical to enable more leasing and better deals in a rapidly evolving environment.
Another important insight was that in a digital transformation, the role of management is to provide leadership and guidance to ensure the success of the initiative. This can involve setting a clear vision and strategy for the transformation, aligning the organization around this vision, and establishing governance processes to support the implementation of new technologies and processes. Management may also need to provide resources and support to teams involved in the transformation, may need to work closely with other stakeholders, such as customers and partners, to ensure that the transformation aligns with their needs and expectations. This can involve gathering feedback and incorporating it into the transformation plan, as well as communicating regularly with stakeholders to keep them informed of progress and address any concerns they may have. Overall, the role of management in a digital transformation is to provide direction and support to ensure that the initiative is successful and delivers value to the organization and its stakeholders.
The Best Time is Now
Digital Transformation is challenging. TowerCos are already working to manage the 5G rollout in the midst of a post-pandemic economy that requires all businesses to run more efficiently: any new technology necessitates a learning curve. Because digital transformation is difficult, it needs to be top-driven, while still getting buy-in from stakeholders in different groups, including customers.
Companies also need to understand that digital transformation is a process, not a product. The technology has room to evolve and develop, but users still receive significant benefit from the technology as it exists currently. Starting now allows partners to start small and grow naturally, rather than face a huge and disruptive new system implementation later to catch up with competitors. If your company is interested in learning more about digital transformation, you are invited to contact vHive.
We’ll be at the TowerXchange MENA in March – we hope to see you there!