 Good morning, and thank you viewers for tuning in on JSA TV and on Periscope Welcome to telecom exchange CEO roundtables both for our guests here at telecom exchange as well as our virtual guests We would like to thank our Wi-Fi sponsor Transbeam for making this happen here for us today. We appreciate that and I Love our Jeff Moochie our RCR wireless Partner friend Now our first panel here is we're wireless and wireline meet The trends the technologies the opportunities. We're going to discuss UC small cell and tower connectivity As I mentioned we're our moderator is the Jeff Moochie. He's the CEO and editorial director of RCR wireless He's also the managing partner of Arden operating company Owner of RCR wireless news and telecom careers a leading industry job board founded in 1999 before the bubble burst Over the past 20 years Jeff's been involved in many facets of running day-to-day operations for telecom wireless Commercial real estate and energy services companies. So welcome Jeff and welcome to our steamed panelists Thanks for having me here today. The topic is going to be where Wireless and wireline meet we're going to talk about some of the key trends and delighted to have some key guests We're down one man. Jay Lawrence is not going to be able to join us due to travel But we have Hugh Shannon from a voters and we have Felipe Alvarez CEO of axiom fiber networks And finally we have Greg Weiner partner of Vertex Consulting Why don't we just take a minute each of you introduce yourself and tell us a little about your companies sure Hugh Shannon director of business development for a voters by way of background on myself some personal detail I started in telecom in 1981 when I was 10 years of age So but anyway a long time ago and Right now with the voters a voters is a company that basically for has been in business for about 30 years What we do is we provide companies with visibility and actionable business intelligence on the communication Application usage so that includes voice mobility Unified communication application so we collect all that data. We run it through our proprietary Technologies and we can provide companies with insights Into that data so that they can make better and more intelligent decisions on how to operate their environments and Obviously try to give them some guidance on how they can save Costs for the services that they're using as well The Felipe Alvarez axiom fiber networks We are a telecom infrastructure provider in the New York City greater metro area We're essentially a brand new startup company started putting fiber in the ground in october Launched the brand in the January of this year And we are pure and simple an infrastructure provider focused on dark fiber and custom networking solutions This will be my third fiber building the last 15 years in New York City so Stay tuned because at some point it seems like the the need for fiber always At some point there's too much fiber in the ground But a reality that Doesn't seem to be and I think some of the things we're going to talk about will drive to that point Good morning. Greg Weiner with particularly something we're a small consulting firm Typical management consulting type company providing services focused on the telecom space a lot of wireless work but as They've started to bleed over into the the wire line sign. We provide services to msos as well You know the breadth of our services it's kind of typical to To that of your larger consulting firms, but our focus is of course on telecom So everything from acquisition due diligence to asset integration business strategy Sourcing and outsourcing activities and deployment program management work So really broad spectrum of services across the space Okay, thank you Yeah, my name is Jeff Mucci with RCR wireless news. I always enjoy coming to this event each year For a couple reasons one It does give me a chance to talk with folks who are in the wire line or fiber infrastructure business and RCR wireless news Is a publication we cover the wireless Industry but with small cell densification And in building wireless these two worlds do collide And when I first came to this event three years ago It was like old home week My background I was early in my career with met problem fiber systems mfs They bought a company I was with and running at we had a 100 million square feet nationally in 100 office buildings Classy office buildings around the country offering in building Phone service mfs bought us pre 1996 telecom act and when I came to this event three years ago I bumped into a lot of my old friends who were in the fiber business back in the first wave with a cci and and Um Mfs and brooks and all those guys so for me It's really nice kind of like a coming home week to come to this event But I think the the the topic today is the intersection of wireless and wire line And the first question is our our wireless technology is going to replace some of the existing wire line Technologies or or are they a complement and we'll just go down the uh, and if you How's it changing your business? Uh, frankly, uh Well, I mean I think when you begin to talk about wire line and wireless You're talking about two things and you're talking about with wireless capacity and spectrum and I think that To achieve the broadband objectives that have been set for the future in terms of the amount of broadband capacity that is Going to be delivered to the typical end user and especially we you know later on in rural areas Which have other complications the the issue really becomes anytime that you have a wireless network And you're going to increase your your broadband capacity. It carries significant significant costs associated with it so wire line has been incorporated by These firms because it is the most economical and cost efficient way To do broadband delivery, especially with optical backhaul So I see wire line and wireless as being Integrated together in a way that they can't really be separated. So I don't think one supplants the other I think they they complement each other and I think that they actually are So dependent on each other that we could honestly say that you're not going to have a high capacity wireless Network over the future without strong wire line support behind it You know, if you if you look Right now. I saw an interesting statistic this morning With the growth of video Every minute of the day in the united states. There are 300,000 Photos and video sent every minute of the day. That's 216,000 216 million photos and videos sent in a 24-hour period and I guess it's nilson's law says that the high end users Of data are going to grow exponentially by 50 percent year over year I will not tell my kids, but I think most those photos are from my kids and friends. They might be So so if you extrapolate that out and say that 50 percent of these Are high end users whose capacity is going to grow 50 percent year over year I mean now we're into, you know 400 million images and that The The need for video puts such a stress on the network that it exhausts the capacity Of existing networks very easily. So I so I think they're there in wire line is critical To supporting and fleet. This is your third run in building a network here in nyc So, um, maybe you should think about this question talk about the generational differences in your wire line technologies That's being shaped by the demands on the wireless side. Sure. Look, I mean, I agree with Hugh. I mean, they're highly complementary There's a boundary condition in which case some will be replaced by another but it's a very narrow boundary condition the What makes a wireless interesting not only from a for from a carrier perspective But also from an end user perspective is the mobility, right? What makes fiber interesting is the fact that high capacity, but it's fixed to the ground So it's a marriage a highly complementary marriage of the two The the challenges that come along with that is is is really how do you manage the one is the increased requirement for High quality of service and transmission at the wireless level in urban environments like new york And there's three ways to do it. I mean you increase spectrum Which is costly it takes a long time and it's not always available You go to new technology like 5g, but in some cases. I mean, I think you got to finish up with the previous Versions of technology before you get to that and that's again. It's an economic and lead time Issue and then you have infrastructure and this this was something that came up at the wireless The new york state wireless forum last week on wednesday. I mean addressing the It's almost an oxymoron that infrastructure seems to be the fastest way to allow for an increase in Penetration of wireless An increase of granularity of being able to deliver that bandwidth for video photos and everything else the internet of everything That's happening out there And that means that fiber has to be driven very very deeply into the urban environment To enable small cell microsoft on all the new infrastructure architecture developments that the Whether it's the wireless infrastructure carriers or the actual carriers are deploying So that's where the two Mary very conveniently And one of the rationales for us launching this business She's putting even more fiber into new york is the fact that we see that as a very large driver for For fiber demand and penetration With a caveat that is a very different type of architecture and deployment Then most of us know from a carrier perspective So it's going to it's a challenge. It's going to be interesting, but definitely complementary It's not antagonistic. I don't think the two can live without the the other correct Yeah, so I agree with both both gentlemen. I think even beyond complimentary. They're symbiotic. I think You know to your final point They can't survive without one another if you think about, you know usage patterns Everywhere we used to use wired networks, whether that was In the workplace or anywhere. It's it's all wireless from a user perspective, right? I mean, I have my iMac sitting on my desk at home next to a network jack on the wall and I'm on wi-fi Right, I don't even think about getting an internet cord plugging it in and I think that's that trend applies everywhere So that that last connection is wireless So that demand for wireless that demand for that last that wireless connection Is is stimulating the need for more robust wire line networks and and vice versa more robust wire line networks are Enabling the ability to push wireless everywhere and whether that's we'll get into a little later in the conversation Whether that's small cells or macro cells or whatever the case may be There's this symbiotic relationship now that I think You know was starting to become more apparent five years ago, but these days it's You one's not going to exist without the other Greg you mentioned earlier Mobile video and video streaming. I think jsa is actually with periscope. You're streaming this To the to the world Talk about what impact mobile video is having on wireless wire line and even the the co-location fiber infrastructure world Sure from a wireless perspective. It's it's bringing networks to their knees, right? They were You know originally designed to handle voice calls really basic voice calls And then obviously texting came, uh, you know demand grew and and then data and now video Um, you know, there are finite resources in wireless. You've got you've got spectrum constraints and that's Uh, not the only resource that's you've also got the ability to site Cell sites whether it's small medium or large cell, you know, you've got regulatory constraints environmental constraints Real estate constraints all all kinds of constraints on the wireless side that make it really difficult to To satisfy this growing capacity demand from video. So, um, you know carriers are having to rethink How they engineer and operate their networks in in today, you know with the demand curve that's coming up so, um, I think You know, we talked about the growing big demand of video and you've got you know, verizon others looking at that lte broadcast Which is um, you know interesting technology. It's not clear if there's a business case for it, but it's certainly Certainly one means of reducing the the the demands on the wireless networks of video But there's a wholesale shift coming in in how carriers are operating and deploying their networks because they simply None of them have enough spectrum and and even if they did they don't have enough sites and they don't have enough backhaul capacity And they don't have uh, frankly enough revenue, right? There there's the the bottom line is You know all of this demand for video everybody sitting and watching youtube or whatever or sharing videos on facebook or whatever it is I'm sure my kids know all of their apps that I don't use but You know, there's no incremental revenue to the wireless carrier. So you're seeing the trends the arpu trends are going down Um while the network demands are going up and um, something's got to give right? So until there's a meaningful incremental, you know revenue opportunity for the for the carriers, whether that's You know to broadcast or it's um, some types of of sponsored data or something. It's going to be really tough to keep up And flip a uh, you know, you lost your service in in january this year mobile video. How'd you build that into your business plan? It's uh, it wasn't really about mobile video. It was more about looking at The the the demand trends overall. I mean, I think mobile video is the current driver for all of this all this uh file Sharing and so on and so forth. But if you step back for a second if you think about the internet of everything, right? Which right now could mean Look, I mean, I don't know who wants to know what the refrigerator is doing in the middle of the day But eventually all of that Tiny data Will amass itself into an avalanche of data that's going to eclipse probably the video Driver anyway, so we looked at it and I said, well, who's Well, what is the underlying basic? block actually that allows that a lot wireless Traffic to actually connect to what we call the mainstream network if you will and inter exchange all that traffic Between points not only in new york, but then across the globe and so on and so forth So one of the drivers was wireless expansion. Uh, I think Sort of like tempered a little bit by the fact that as as as you mentioned as greg mentioned You know, where's the revenue, right? How do the carriers make money out of this thing? And you know kind of goes back to the the old ethernet and sonnet Challenge, right, you know, ethernet came out clearly a more efficient technology But the adoption rate for ethernet over sonnet. I mean has taken I don't know at least a decade So I think the challenge is not going to be demand I think it's the timing of demand as these new architectures and deployments the infrastructure upgrades roll out Driven primarily by the economics If something works works well, you have to make a major investment to take it out and deploy something new I mean, you know carriers will ask a hard question. Where is the money and this thing? I'm part of it that may be driven to it by quality And the exit start exchanging end users and go back to the beginning where they were fighting over end users And it won't be over a price. It might be more over quality of transmission than anything else That's a great segue. Hugh talk about your business and how mobile videos impact in these different settings I'm just going to piggyback on his observation and say that In addition to where the money is where is the technology innovation that's going to achieve some of these needed improvements in Managing the the available spectrum I think the cta noted That you could if you could manage all of this spectrum in the united states It wouldn't be equal to the capacity of a strand of fiber And so right there it sort of encapsulates the issue from a spectrum standpoint And to gain greater efficiencies over the available spectrums that they have Use it. Let's use Verizon as an example. I think nationwide their average is about 116 megahertz in most markets That is not considered adequate Okay, even in urban areas to meet the demands that are going to be placed on the network with all of the Need for video and other applications. So There's only so much spectrum at the moment till the government releases more, you know, as they try to do but The the question really becomes there are some some technologies that are In the offering, but they're not here necessarily yet that could improve the use of the spectrum But it's a real challenge and the and the challenge is is the demands on the network going to outpace their ability to Be able to Come up with ways to utilize the networks and the spectrum more efficiently. So I think that that's that's a big concern And the next question Felipe will start with you When you talk about this high quality video and you think about the segment of the market you serve of the The cable companies and the the mobile operators and the wire line operators How has the quality of video demand or need for quality of video Affected or changed the way you architect your network here in New York City Well, I'm not a wireless expert. So I can really address the front end of it But from a fiber networking perspective, I mean, I think it just continues to drive the The need to deeply deploy fiber into the into the environment, right? So you're talking about unfortunately, you know, the the economic challenges that most of these sites will need only a Preferably a strand of fiber but a cup a pair at the most So it makes that that's our challenge, right? I mean, how do we make it happen economically? But you continue to drive the Having to make fiber available very deeply almost to just about every building and buildings that in the past We as fiber builders will not have considered attractive buildings So I call it class b and c real estate not to be, you know Insulting to anyone but the reality is the smaller buildings five-story buildings 10-story buildings areas that previously were only served Or let's say that were underserved from a fiber provider perspective very little or no choice except incumbent So maybe a cable company that both which did not want to sell dark fiber So that that's our ability as a community of fiber builders to drive that fiber deeply into the environment basically the Geography enables then a lot of the technological advances or in some cases They may just actually enable the process of rolling out new advances At the edge which would be the wireless architecture So it's a very simple You know, it's it's it's very black and white. I mean there isn't a lot of Nebulousness about it. I mean we got to put fiber deeply Into the the urban environment And again continuing in that vein flip it, you know in the early days of again when I was a metrolic fiber systems It was pretty easy to do the network planning You knew where the t1s were you knew which buildings were dense and needed ds3s or gigabit type service And you could plan your route accordingly today with the organic nature of wireless networks Where you have an ebb and flow of traffic throughout the day and you mentioned internet of things Where you may not know where the demand is going to come from with telemedicine might be enabled and NYU all of a sudden might need a a lot of bandwidth at a small center So when it comes back to your your core architecture Conduits number strands in each conduit split points for these these minimal laterals Is that a challenge to plan for or do you have that covered? This is a conversation we have daily I look back in the room, you know a patty polo who had Anything that has to do with making these happen on axiomining where we have this conversation every day Where do how do we do this? How do we make sure that? It's efficient enough in the network deployment that We can take advantage and serve the needs of multiple multiple customers a potential customers and sectors Look at the core you have to have a very strong backbone network that enables you to that gets you close to Just about every location you want to serve. So that's the approach we're taking and that's a traditional fiber network I count The second principle is it's almost you put as much fibers you can stuff into the Into the available conduit because you never know, you know when you're going to have availability a conduit In the certainly Manhattan and in New York City The second aspect of it is it's you just You take a chance in many cases as to where you drop off some of the stuff out fibers to serve certain sections of the geography And you have to admit to yourselves that you're going to be wrong Almost no matter what you do you're going to be right in some cases you're going to be wrong in others But that's okay because you know The wireless industry itself doesn't know let's say where they're going with some of these deployments They just know they'll need fiber. They'll need it quickly and they're and they'll only need a couple of pairs here and there In multiple buildings. Um, so it's a challenge I think the the other aspect of the challenge which has to do with uh, and I'll deal with Manhattan specifically is the The the the Empire City subway system, which is a conduit system. It has a franchise holder You're allowed to use It is built on a what we'll call the early 1900s model, right? And this is an industry issue To deliver services in a very linear very well planned kind of environment So there's not a lot of options on how do you get off that system, you know efficiently To drive small fiber requirements on a single unit basis not on aggregate and So we're working through that and it's just not just us anyone who's building a fiber network in New York And the challenge part of the challenge is also dealing with the economics The city of New York imposes through the franchise, which is not it doesn't provide an incentive or deep fiber deployment And that's something that I think will change Hopefully in the short term But that'll help essentially Incent us to drive fiber deeper and it's it's an economic incentive, which is not there right now Yeah, Greg any comments on the network architecture driven by the need or potential need for quality video? Uh, yeah, I mean from a wireless perspective. We said, um, you know, you've got spectrum constraints So you're forced to what we call cell splitting or network densification smaller and smaller cells to reuse spectrum more and more often You're going to do that up to a certain point And you've got cost constraints as well as I mentioned earlier. So, um, yeah, I mean the demands, you know video and You know other demands are certainly driving the need for that densification Um, you know availability of fiber is a challenge, you know right now You know small cells take many forms, but a lot of carriers have taken the approach Of pushing fiber to all their small cells, you know, they haven't pursued, you know, at least Haven't deployed much in the way of alternatives, whether using, you know, likes the copper networks non-linosite or linosite microwave or other option or mesh type networks So, you know availability of fiber is certainly a challenge But you know the architecture is evolving It's it's turning into many thousands or hundreds of thousands of sites instead of tens of thousands of sites And I think take it a step further. Ultimately That content is going to need to be pushed further out to the network as well It's something the wireless carriers aren't Very good at I would say generally it's not it's not an area they've they've played in in the past They just built delivery mechanisms But now they need to get to content delivery mechanisms and that's I think that's a trend that we're going to see certainly the msos Have a lot of experience with that I think we're going to see the the wireless carriers start to get a whole lot smarter in that area as well And start to push this content for closer to the edge of their networks Can you paint a picture what in terms of what that looks like? Not yet So some of the commentary I've been hearing is that you'll actually have Mobile operators almost at the cell tower Putting in some sort of blade server very low-cost server which becomes the content delivery network And so ideally that would push more more than two strands of fiber Maybe or at least diverse fiber because you've got to you got to deliver on the net Netflix stream But do you have any insights in terms of hypothetically what that new architecture might look like? Yeah, I mean it's a much more virtualized network You know to begin with to allow the ability to to move capacity around But you're right. This could be pushing as far as the edge of the network all the way to the macro sites It's it's certainly a challenge when you start getting to small cells Which by the very nature needs to be small portable easy to easy to deploy and install But the pushing servers, you know as far out into the network as possible With you know can dramatically improve the overall performance of the network As well as the experience of the end user. So You know what that architecture looks like is still, you know in labs and in theory and in design phase on the wireless side I mean, as I said the wire line side has been doing that for a lot of years and the msos Have certainly been you know is with a more predictable demand Scenario than the wireless companies have have really gotten good at pushing that content to the edge of the network Well, and maybe you can help me answer this question So right now the hot trend in wireless networks is network function virtualization software to find networks Which is really bringing all that network functionality to the cloud And at the same time they need to push more hardware to the edge So what what is that really good? What's that mean? Yeah, no, it's it's a it's a good question And I think the virtualization of the network is the 18 t's and the varieties of the world certainly Recognizing that that's the long-term trend and they need to balance Kind of that that central processing and pushing the intelligence to the center of the network With this need to push the content to the edge of the network. So Not a trivial undertaking Particularly as you try and It sounds disparaging, but you try and make the devices at the edge of the network a little dumber Right so you can you can distribute capacity. You can get a little bit smarter on how you allocate resources across your network It also allows for the the the operations and management of that edge network to be a lot more efficient a lot more effective So it's certainly going to be a challenge to accomplish both of those objectives Um, it'd be interesting to see over the next decade how that plays out We're at the very very worth the first inning of network virtualization on the wireless side very first inning So you What's your commentary? We talked about the demand from Video at the edge storage at the edge from a management standpoint. What's this going to mean to the carriers? Well, to be honest with you It's uh, you know 25 years at AT&T I can kick in with my two cents that there has to be always a strong ROI scenario or for them to do a build I'm not so sure You know if you look at it from a carrier perspective But if you begin to look at from a business demographic perspective across the united states And how much medium-sized businesses there are in the u.s. And where they're located Are these people who are we going to wind up with a have have not situation where it just isn't worth it? As philippe was saying, you know from an ROI standpoint for the carriers to do certain builds into certain areas to deliver That capability that makes businesses more competitive Okay, so I mean from from our perspective does that have a social implication to us if we don't Deliver to them a higher bandwidth capability the cause of the constraints economically to to do so Got it. Well, uh, rc our wireless We write a lot about a term called densification small cell densification Wi-Fi offload heterogeneous networks And as you start looking at the the network topography to support a dense network I'd like to talk a little bit about the the the code Where's the head end going to go and let me give you some background here So two years ago AT&T announced they were going to build 40,000 small cells I don't think they've realized that dream But when you're carrying you start to planning out these this densification of your network You're looking at securing rideaways pull attachment agreements small antennas or radio units on a light tower or a light lamp post And then you got to bring it back to a centralized head end So as we look at you can either co-locate in a bell ceo You can go to an existing co-local co-location center or I guess the question is will you see a new neutral host Head end start to arise and and with room for 10 years of growth because if AT&T Verizon T-Mobile are going to build a a dense network with Greg you mentioned lots and lots more of instead of going 300,000 cell sites You might have a million plus cell sites and all that's going to come together Um I'll tell whoever wants to take the question. I'd love to hear about you know, where's that? Where's the centralized head end going to be in these markets? yeah, so It's a great question because You know so far what we've seen is the carriers as they're building small cells They've used their mac their existing macro sites as the head end effectively and when I talk about small cells Not necessarily talking about distributed antenna systems DAS systems which require a fairly robust head end. Oh, that's a good point on the end building DAS systems. They are building a Head end at the basement of building but all of a sudden you you can't afford to build 100 of those in manhattan Right, that's exactly right. So, you know a lot of times you're seeing the carriers bringing via fiber dark fiber in a lot of cases The traffic back to a macro site and putting the processing at that at that at a serving macro site at a macro site That's close by That model works generally pretty well If you can get dark fiber back to the macro and and that's you know, that's certainly been a challenge, you know the embedded players So the large embedded players are reluctant to Provide dark fiber in those scenarios. They certainly want to provide the lit service and then escalate that that over time You know some of the upstart some of the newer providers in the marketplace and you know folks that have have Have been much more willing to provide dark fiber type services So, you know, there's but there's an alternative here that I think the carriers are going to be exploring and have already started to explore And that's actually using their network for back home So you've got these the small cell devices out there and they're in an area with with sufficient coverage But maybe now maybe without sufficient capacity So Actually hopping from small cell to small cell wirelessly whether it's mesh or it's a non-line of site microwave And and aggregating at a small cell and taking it back to a macro site or taking it back to a head end somewhere else So I think what we're going to see is all different types of architectures dictated by spectrum availability Whether that's licensed or unlicensed spectrum The specifics of the environment whether you get line of sight or not the availability of fiber The ability to put to centralized head ends in whether it's you know neutral hosted locations or existing data centers I don't think there's going to be a one size fits all is the long and short of it. You're going to see a really Diverse set of solutions from dense urban to Suburban ex urban role. You can see all types of solutions. We'll just go right down the line Felipe All right Look, I mean, I think correct capture of the target snapshot I as we look at this and as the discussion progresses here I mean, it's sort of like I made some notes because I you're going to see a This is from a very practical perspective probably a to the the large colo Uh model if you will I think it's uh, I mean, I'm not predicting the demise of the colo model But you're gonna see my The large maybe the demise of their of how they charge money to be in there But that's a different topic for a panel a different panel Look at the end of the day. I think one of the solutions it will be a micro colo sites I mean non-traditional deployments of centralized locations that may or may not be owned by single carrier That may or may not be part of a cdn and hubbing architecture But you're going to find them in locations that non-traditional locations It could be in some of these sort of a class b and c real estate because the real estate may be more Open to do that kind of solution and enabled by fiber fighters like us To distribute to capture distribute traffic and more efficient than backhauling everything back to a central large point and that's something different and You know, I've heard of discussed in terms of the for small cell deployment But the reality is that it should go beyond that right and encompass other things of the cdn Right to enable more of the screaming More economically, you know, you got a lot of companies doing that now wired basics. Anyway, so So I think that's an interest in development actually which obviously will try more business for me And you and you mentioned b and c Rated buildings if you will in terms of demand, how about the tier two three and four markets dsc What sort of trends do you see and this is unscripted here? But we've been talking about a lot about new york city, but how about the the next tier and third tier and fourth tier markets? What what do you see happening in those markets? This is based on discussions we've had with wireless infrastructure companies How they're looking at But only the urban environment, but also outside of that Certainly tier two it'll get to tier two but It seems like the the the amount of traffic that's in those locations obviously is less And the ability to probably put more traditional infrastructure in place. It's still sufficient So I don't see them at least from their perspective. They're not immediate requirements But like everything else. I mean if you see the trend in an environment like new york, I mean a dense metro environment That there's only matter of time before that moves on to the next to the second tier tier two but it's not a Again based on our conversations with those companies I mean they're looking at these years down the road, you know, their immediate focus is how do we handle situations like New york, uh, chicago places where there's a very dense urban environment And it's not the density of the urbanity of it. It's really more of the traffic density Which is driven by the amount of people. I mean, it's just a very simple equation so here any comments on the uh The centralized head end or co-location facilities and then the second third tier markets are far better To address that than I am but Greg, I saw you know on your head on the on the second tier third tier fourth tier markets Yeah, I think I think it's a good point the um You said 18 team mentioned several years back. They were going to play 40 000 cell small cells Then you just decide not to do it. They couldn't do it because the business case didn't work Um, and the business case doesn't work in places like Manhattan, which it's a challenge here It's not great with all the demand that you've got here the business case for small cells Is difficult to justify they're expensive to deploy right now It's if it didn't work here with with this kind of demand It doesn't work in the tier twos tier threes tier fours except in maybe very specific pockets So I think um, it's it's really comes down to the business case. We keep come back to that point a number of times, but um Prices have got to come down dramatically from a capital and a recurring optics perspective in order to make The business case work even in the tier one market. So you're talking about small cells specifically So what are some of the when you look at what are the hurdles? What are the specific hurdles? Is it securing the right of ways? Is the recurring cost of what the rent they have to pay on a poll? What is it? Is it the technology? Or all the above. Yes all the above. I mean So take technology off the table for for just a moment. Um, the carriers historically have deployed Three to six thousand macro sites a year and they're built to deploy those types of macro sites They're familiar and comfortable with the regulatory environment the zoning the environmental process That's they're very comfortable with engaging with with landlords Um, and the the real estate side of it is matured on the tower side As you know, you've got a small number of companies that own a big percentage of the towers It makes it really efficient to deploy macro sites All those things that make it efficient to deploy macro sites make it really inefficient to deploy small cells single carrier locations Disaggregated real estate environment Not large structures with real estate where you can bring five or two It's you know, all all those challenges are there. So finding a location that you can Engage a landlord and get a low rent You can get through environmental and you know, every other regulatory review that's going to be possible Whether it's a conservancy board or just a municipality Um Dealing with the handout requests, you know, oh, you're going to install something there I'd like you to replace the pole pour a new foundation put a streetlight in add this add that right gets expensive Um availability of backhaul and we you know Is there fiber? Can we get fiber there affordably availability of commercial power? Not a challenge to be overlooked. Um, and then once you've gotten through all past all those hurdles You still have to get this to integrate cleanly into your network where a user can hand off to the macro and hand back to the small cell So, um, yes, it's all of the above, you know from equipment all the way through the siting leasing zoning All of it's it's it's a challenge from top to bottom and we're going from spending $200,000 on a macro site To try to get small cells down to $10,000 a piece And that is that is a significant undertaking Particularly when the folks that are trying to do it are the folks that have been building $200,000 macros for the last 25 years So their mindset is very much Elsewhere, okay. Well, we're coming up. I'd like to wrap up with um Kind of a fast-paced question here. Um, two-part question Will we ever see small cell deployments? That's a yes or no and if you say yes when and so Hugh will start with you Um, to be honest with you, I'm not a my expertise is not in small cell technology So I think Greg and Felipe probably can do justice to it better than I can So will we see small cell deployments in volume if so when yes, I mean, it's happening now It's just nascent, right? So I think I would take the typical projection and cut it in half and that will give a good time for him So I think it'll probably hit the stride. Uh, probably about 36 months or so. Yeah, great. Yeah, I think that's right I think we're starting to see some momentum But you can probably chop a zero off of any of the four of any of the forecasts you see Because there's so many technological and deployment management hurdles that we still have to get past So it'll happen. It'll happen where it makes business sense. Um, it'll happen with one fewer zeros Okay, why don't we open up for some audience questions and Yes, sir state your name So let's repeat the question so it's for everybody we have uh, the door smith atlantic a cms question about Wi-Fi offload to Greg Uh, yeah, so, uh, number one is their business case for it, right? So can the carriers justify the investment in that tight integration and on the provider side the you know Whoever's providing the Wi-Fi network is their business case for them to actually charge for it So that's that hasn't fully shaken out. Uh, the second thing is, uh, You know, while you have a you've obviously had a positive experience on the data side On the voice side, it's not nearly as favorable experience And that's a challenge for the wireless carriers because you walk into a starbucks or mcdonalds And you don't have You don't have Macro network coverage maybe but you have Wi-Fi, you know, the typical end user were fairly technologically advanced group in this room I'd say on average But the typical end user, you know, if you make it truly seamless where they can now they're on Wi-Fi and now they can You know browse the web to stream video They also want to be able to pick up their phone and make a call and they walk out of that restaurant They don't be able to not drop that call That seamless integration has been a challenge for the carriers and it hasn't it's an area where T-Mobile has probably invested the most Kind of by necessity because of the the they're you know, they're overall macro networking with their coverage profile looks like So there are absolutely technological hurdles It's uncomfortable for the wireless carriers because it's a it's a network quality that they no longer control You're outside of their environment. They're not managing that that access point They don't control the the real estate underneath it. They don't control the back call agreement So it's there's a lot of of non technical challenges in addition to the the technical challenges that you're aware of Any other questions question So Is the wireless space at this point really all about small fell and gas It's basically supporting the cellular carriers or You know over the years people have launched and failed and launched again sort of Wireless broadband businesses. It's going to point to point to multi-point. They never seem to work Maybe some of the point to point down the very high end, but that's about it Or just you know anybody's thoughts as to Whether this will at some point become a viable business model even an obvious expense of the fiber every building Just is that how Someone's going to be able to make work Look, I'll take a first crack at answering that from a very practical perspective Small cell is is is viable. I mean it's happening now, but it's still in what I call the hype stage. This is just You know bluntly speaking. There's a lot of A lot of talk about this is going on. That's going to we're going to deploy like like Rex said, I mean tens of thousands hundreds of thousands of this Deployments for this. Uh, it's starting to hit reality hit reality. That's why I said eventually probably in about three years I mean you're going to start seeing the a realistic movement, you know in that direction It's viable If anything because It's been tried tried again and it's still being tried now right you've got the partnership between Was addition sprint and some markets in texas where they're trying it on a on a residential basis Using sprints two out five spectrum Spectrum is one of the constraints You know the ability to to provide a service like that at high capacity Potential require a decent amount of spectrum and potentially to control again to control quality doing in a licensed in a licensed span so Sprint who holds a lot of two out five is probably a good candidate for that But it's it's a very different business model, right? And it's a very challenging business model highly fragmented customer base who aren't walking into retail stores or ordering from the carrier website So, um, you know, I think all the carriers the wireless carriers have dabbled in that space at various points But the lack of a the lack of trucks to roll to your home or to an office building to do the dish install and optimize it and Manage that customer relationship. I think Nobody's really thrown their way behind it. There's been a lot of technology trials but the the business case for The return on investment for traditional wireless handsets and devices is It's just too good. And that's where they're keeping their kit. That's where they're putting their capital dollars right now So that's where you start to see, you know, with a dish T mobile or a dish sprint or, you know, you know A company or direct TV AT&T where they've got a field force They've they've got, you know, folks that have interacted with customers on site can install equipment on site Whether it's a a residence or an office building Starts to get a little more interesting because they they can get over some of those operational hurdles It's a question what it'll it'll those will be competing for capital dollars just like the war against the wireless networks Another question Yeah, curious, uh Why wouldn't the if the carriers need Wi-Fi offload? First of all, why wouldn't they just build it themselves? as and and also, uh Tower stream talks a lot about this Wi-Fi offload Curious if you know what you guys know about them or is anything happening? Yeah, I don't know anything about the tower stream model. Yeah, that's I do not why don't they build themselves? I mean, it's Yeah, it's it's not dissimilar from building small cells all over the place. So that's um, you know I think what we're going to see over the years that these small cells do ultimately are ultimately multi-mode devices supporting Wi-Fi In a lot of cases when you're walking through a restaurant office building, that's one of the sales points to try and get You know low or no rent type of scenario is maybe offering Wi-Fi to to folks in the building So I think you'll see there. There'll be some convergence on that side But you know all the same challenges exist in in deploying wireless active Wi-Fi access points as deploying small cells Yes, sir. Hi, Rob Hodeo. So it's not it's not right. I guess this is from a salvage What are your biggest challenges in new york city? Is it the franchising? Is it permitting and construction? Maybe it's maintaining the networks and dvc, you know, work out orders and stuff like that. What are your biggest challenges here in new york? Everything nothing is easy in new york But some things have gotten easier franchising is really not an issue I mean the city has made that very very structured They have a they have a method to the craziness. I mean which will peak at In a few years when all the franchise basically ends, you know coterminus and that's so we'll see what happens there So that that's not an issue. I think the economics of the franchises are an issue That's something that appears it doesn't encourage deep deployment, you know, essentially, it's it's a linear per foot charge per year And it doesn't matter how much you deploy where you do one foot or you do a million feet. It's the same charge. So The construction side of it. I mean, it's some things have gotten worse since I last did this in the you know, maybe five six years ago The capacity of the conduit system is difficult. There are sections that are congested There's no relief in sight for that. So it forces you to actually find workarounds So it's still viable, but it's gotten a little more difficult I think the largest hurdle is an economic hurdle and not necessarily on the street or the construction cost or anything like that It was a fairly stable. I mean, I think some of the the real estate the landlords have gotten You know very savvy as to how to handle telecom folks. So there the economics have changed deeply I mean and things that in the past were seen as an amenity to the tenant base Now are being charged for so we're getting charged significant amounts of money, you know, to be in certain buildings And I think that's it's good for the landlords I suppose I don't think it's so good for the tenants for tenants and overall for the city doesn't really lead to a better infrastructure But if you if you title together, I mean, I had spoken of construction of a fiber network in New York City Is a very carefully orchestrated dance We know how to do it the people we work with know how to do it. So it happens the dance comes off well But uh, it's sort of like underestimates, you know to the trained. I mean, you know what's going on But to the untrained. I mean, it's difficult But so speaks to you need to work with folks that actually know how to do it have experience through this now Yeah, another question here You guys talk about wi-fi being difficult to deploy as far as the carriers using it for It seems as though the mso's have figured that out, right? They've got a pretty dense wi-fi coverage, especially in urban areas. Do you see any Co mingling of those two groups to sort of solve the wi-fi problem? Yeah, I think they're all dancing, you know, but not exactly sure If they like one another as partners, right? Certainly the mso's have figured it out because they have A wire line network to plug them into And relationships with you know, whether it's the residences or the businesses. So they've they've got a serious leg up They're also a potential partner On the small cell side When you look at, you know, maybe not in Manhattan, but you go all over the country and they've got Strans attached to utility poles and those strands have power those strands have backhaul They've already got the right-of-way agreements They potentially bring, you know, we talk about the concept of small cells of service They are a very interesting partner for the wireless carriers But on the other hand, they also provide a lot of macro site backhaul to the carriers So they're very concerned about cannibalizing that existing business because the price structure as I mentioned has to be very different for small cells And it does for macros and they're just waiting for the day when they Dramatically drop the price of fiber to a small cell for the first carrier to raise their hand and say I got a macro site two blocks away. Why is that one costing me four times as much? So There's some, you know, kind of strategic challenges the parties need to get past But they are that relationship. I think we're going to see over time Got potentially some mergers, but certainly some deeper partnerships So, um, yeah, I'm from Austin, Texas saying last week I'm going to do informal poll people in the audience and some of the panelists here, but Jonathan Adelstein who is a former FCC commissioner He's CEO of the wireless infrastructure association He spoke last week at the new york state wireless association And there was a big headline wireless new york city the wireless envy of the world So i'm curious do folks here think that new york city is the wireless envy of the world? Does anybody get a good signal here? Uh, so, you know, uh, why aren't you getting good signals and good service in new york city anybody want to take that? This is not an easy place. I mean, this is not, you know We talked about the challenges of small cells, but just from a macro perspective look at the last 20 years It's been macro sites and this is a tough. This is a look outside How do you cover the ground and the 80th floor of these buildings? How do you do it in a way dealing with pretty sophisticated landlords to high construction costs union labor? I mean this is and this is a confluence of Of everything that you know when you talk about the risks of deployment that you know that one risk slide could apply to You know entirely to new york city. So It it shouldn't be Such a a great wireless experience here. I would say based on the environment Anybody else want to comment on the new york city being the wireless envy of the world? The thing it depends what carrier is So who's the best who's the unit going record today on who's the best carrier in addition to the demise of co-location? We're going to get additional comment Let's give the speakers a big round of applause. Thank you so much