Andrew and American Tower compete to wire New York's subway stations
January 19, 2006 -- Following years of divesting itself of holdings that did not meet its core business model, American Tower Corporation has changed its strategy and hopes to wire 280 subway stations for cell phone use and run the system for 10 years, the Associated Press reported yesterday.
The New York City bids received Wednesday mark a significant step in a long-running effort to make cell phone service available to the millions of New Yorkers who lose mobile phone communications when using the subways.
Major cell phone companies have teamed up on one of the bids, including Cingular Wireless LLC of Atlanta; the T-Mobile unit of Germany's Deutsche Telekom AG Sprint Nextel Corp. of Reston, Va.; and the Verizon Wireless division of New York's Verizon Communications Inc.
A third team includes Andrew Corp. of Orland Park, Ill.; Dianet Communications Inc. of New York; the GE Capital unit of General Electric Co. in Fairfield, Conn.; and New York-based Time Warner Inc.'s Time Warner Cable subsidiary. Andrew Corp. last year acquired American Tower's construction group consisting of approximately 350 employees. They also pioneered the development of many of the antennas, lines and equipment that are currently being used for in-building systems. Andrew has recently completed the first phase of a multi-operator cellular system that will allow attendees of the Olympic Winter Games in Turin, Italy, to have wireless services, including broadband, anywhere in the city's underground transportation system.
Last year's American Tower and SpectraSite, Inc. merger opened up additional opportunities for expansion for the country's largest tower owner. In addition to a large portfolio of towers, SpectraSite maintained an in-building wireless division that had installed wireless systems in more than 50 malls. They have built neutral host distributed antenna systems in malls, hotels, and casinos across the country, including properties owned by MGM Mirage, Caesars Entertainment, Inc., and Trump Hotels & Casino Resorts, Inc. American Tower has exclusive agreements to install wireless systems in 300 malls nationwide.
New York City's Metropolitan Transportation Authority is not revealing the fourth bidder until MTA determines the viability of its offer.
An analyst told the AP that there is little money to be made in wiring stations, but that it represents a step toward winning a relatively lucrative deal to provide service on trains as they pass through tunnels. The 10-year contract calls for the winning bidder to wire only the platforms and not moving trains. But the companies were required to discuss how they would expand the network to the tunnels.