Fisher German, telecommunication experts have been investigating recent announcements by operators of their intentions to share network sites and the implications this may have for land and property owners. Chris Hicks reports;
Continuing plans for telecom operators pursuing their drive for cost saving efficiencies now sees Hutchinson 3G and T Mobile announcing their intention to share network sites. Vodafone and Orange also announced this intention earlier in the year. These moves are brought about mainly as a result of fierce competition and the need to deliver improving value to shareholders.
It is understood that these deals will see operators continuing to manage their own customer base and revenues independently whilst remaining fierce competitors in the UK markets. Indeed Nick Read, CEO of Vodafone UK reportedly said as much in a recent statement; "This proposal is industry leading and will enable the two companies (Vodafone and Orange) to remain vigorously competitive against each other in the market."
So what does this mean for land and property owners? These collaborations between telecom operators will most likely result in a reduction in the total number of planned and existing mobile phone masts across the UK. Operators may try in future to exercise break clauses that may not be entirely legal. For example, operators may try and use the termination break right "for operational reasons" when the reality is that they are trying to break the contract for economic reasons. This could result in a loss of rent for land and property owners with existing installations from any of these operators. Caution is needed and those affected should be very wary of planned changes to their site which might facilitate the merger of the above operator's networks.
Consideration should also be given as to whether the existing contractual obligations of the lease between the parties would be breached should a sharing of structures, equipment or indeed frequencies occur without the landlord's consent. Quite often, where the two wish to share a site, there may be the opportunity for landowners to negotiate substantial additional sums of money to facilitate the arrangement.
Chris advises that these operators may first concentrate on lower earning rural sites and land on costal peripheries; however any land or property owner who thinks they may be affected by these recent announcements should seek clarification immediately. For further advice on this and all aspects of telecommunications property, please contact Chris Hicks of Fisher German on 01858 411202 (Market Harborough) or visit www.fishergerman.co.uk.
This article is intended to be an informative guide and the opinions offered should not be relied on wholly for the advice that may be needed in specific circumstances.
