UScellular CEO says network sharing will be a necessity

UScellular CEO LT Therival is reviving the concept network sharing as a way to reduce costs and make 5G deployments feasible in rural America. Network sharing isn’t a new phenomenon but traditionally U.S. operators have been opposed to any network sharing arrangements, other than sharing space on cell towers.

This attitude is quite different from other regions of the world where network sharing is more commonplace. In Canada, for example, Bell and Telus have a reciprocal network sharing agreement in which they share spectrum, antennas, radios towers and backhaul but operate different core networks.

During UScellular’s recent 2Q 2022 earnings call with investors, Therival reiterated his belief that it doesn’t make sense to build four or five duplicative 5G networks in rural America. “It’s difficult to justify when you have really low customer density,” he said.

Instead, Therival said that he believes network sharing is going to be a necessity. “We’re pursuing conversations to that end,” he said, noting that these types of deals don’t happen quickly but that he believes there’s opportunity for some type of network sharing arrangement.

The company does still own all of its 4,323 towers and has a master lease agreement with Dish Wireless and Therival said that he believes UScellular has an opportunity to work with Dish, as it does with other operators that want to expand their connectivity in areas where the company operates.

In 2Q UScellular’s tower business saw is revenue grow 13% by getting more tenants on its towers. However, Therival envisions UScellular sharing more than just tower space including other “passive” network infrastructure such as backhaul, power systems and cell site shelters.

According to the GSMA, passive infrastructure sharing is the easiest form of network sharing because operators are able to share these elements but still maintain their strategic competitiveness.Active network sharing, which involves sharing of electronic infrastructure including antennas/transceivers, base stations, and the core network increases the complexity but it also enables greater cost savings. However, the GSMA warns that it is more difficult for operators to maintain strategic differentiation and it also is more complicated to operate.