Telefonica turns to blockchain to help telcos flog towers

Telefonica and partner Atrebo have unveiled plans to use blockchain to gain greater visibility and control of telecoms towers, something that will be very useful for any party looking to offload these types of assets.

Telefónica Tech, the Spanish incumbent’s digital arm, said it will use its TrustOS blockchain platform to register the 200,000 tower sites managed by Atrebo. Seville-based Atrebo has spent the past decade helping tower companies and mobile operators automate and manage their infrastructure assets, its customers including Telefonica and Vodafone’s Vantage Towers. Adding blockchain into the mix essentially gives more timely information to infrastructure managers, including near-real-time status data.

The platform will record incidences and issues at the towers, service levels, traffic data and other activity-related information. It will also provide records of maintenance operations, whether or not equipment has been removed or replaced, and events related to the ownership or lease of sites, licences, energy management and so forth.

While this is all doubtless highly useful information for those responsible for managing telecoms towers, the platform really comes into its own when it comes to the sale of tower assets. And, to state the obvious, there have been a fair few of those in recent years.

“Once a tower has been digitized and created as an asset in TrustOS, the use of blockchain makes it possible to easily certify and audit not only its current status, but also the history of the actions carried out on it,” Telefónica Tech and Atrebo explained, in a joint statement.

The firms are bringing together the work of the Tower Automation Alliance, a community founded by Atrebo last year with the mission of helping the telecom industry to reach 100% digitally run operations, and the digitization and traceability of blockchain to create what they have styled as the market standard for auditing information associated with telecoms towers.

“[This] will greatly facilitate future valuation exercises of this type of infrastructure in M&A operations,” the firms said. “The availability of this individualized traceability information will even make it possible to discriminate between the different towers and estimate higher or lower returns depending on their locations, the equipment incorporated, its state of conservation or the accumulated issues and repairs.”

The indelible record that is at the core of blockchain makes it ideal for the purpose, which is, essentially, cutting through the vast amount of admin associated with brokering towers deals. And Telefonica is no stranger to that, having completed the sale of its Telxius Towers operation, comprising 31,000 sites in Spain, Germany and Latin America, to American Tower as recently as June.

There are also benefits to applying blockchain to towers aside from M&A though. Telefonica and Atrebo note that it will facilitate innovation in the towers space and the development of new business models, such as the “tokenisation of towers via NFTs, the commercialization of a tower rights based on the issuance of these NFTs or the implementation of crowdfunding mechanisms based on their future returns to finance their operation or future deployments.” NFTs, or non-fungible tokens, are essentially unique digital tokens that effectively act as a certificate of ownership.

“This exciting new agreement will allow Atrebo to continue on the path with Telefónica towards the complete digital transformation of telecommunications asset and infrastructure management”, said Jesús del Estad, CEO of Atrebo.

Meanwhile, for Telefonica, the deal is part of a much broader foray into blockchain.

“With this operation, we are extending the successful blockchain-based asset management model that we have been developing since we started to adopt blockchain for managing our supply chain in Brazil,” said José Luis Núñez, head of the blockchain business at Telefónica Tech. “It is another milestone in the adoption of the technology with which we demonstrate how it can be applied in real projects and build new business models based on trusted ecosystems.”

The potential new business models are fascinating, but for now, this is a much bigger deal for telcos and others looking to monetise towers assets. And that market remains hot.