NATE Chief: Wireless Industry Must Change How It Does Business

Todd Schlekeway, president of NATE: The Communications Infrastructure Contractors Association, called for changes in how the wireless industry does business with tower companies. Schlekeway's open letter came as earnings season begins for carriers and NATE members.

“The current ‘take it or leave it’ matrix or unit pricing used by wireless carriers is a significant challenge,” Schlekeway wrote Thursday. “These pricing models, which are often far below industry standards, do not reflect the true cost of doing business safely and effectively deploying communication sites.” Qualified contractors “are struggling to maintain profitability, while the industry sees a rise in lower tier ‘fly-by-night’ contractors who may compromise network security and workforce safety.”

Schlekeway also warned that NATE members face payment issues under terms imposed by carriers. “What was once a standard 30-day payment window has now ballooned to 60, 90 days, or longer,” and “these delays are compounded by increasingly complex closeout requirements and additional troubleshooting responsibilities added to contractors’ workloads without corresponding adjustments in compensation."

Contractors must store carrier equipment at their facilities for extended periods without compensation, Schlekeway said. “This requirement exacerbates cash flow challenges for contractors, who are forced to absorb storage costs and delayed projects,” he added. “Contractors should be compensated for the carrier’s mandates that we store their equipment.” Schlekeway also complained that NATE members must sign “one-sided” master service agreements with providers. The agreements “are slanted in favor of carrier interests and transfer all liability along with scores of uncompensated mandates to the contractor” and are offered on a “take-it-or-leave-it” basis “with no possibility of negotiated changes,” he said. “Contractors should have a voice in negotiating these agreements and competitive pricing models should take into account the costs associated with transferring liability and responsibility to the contractor.”

Schlekeway said NATE has engaged in discussions with wireless carrier executives but with limited results thus far. “This lack of progress has led some to question whether the industry is sustainable in its current form,” he said: “Without urgent action, the support infrastructure for all wireless carriers, tower owners, and smaller operators could cease to exist for the reasons discussed here, jeopardizing network maintenance upgrades, and security.”