The Impact of Shared Telecom Infrastructure on Digital Connectivity and Inclusion

TL;DR

Sharing telecom infrastructure through tower-sharing deals significantly reduces prices, boosts mobile connections, and enhances internet access, especially in rural and female-headed households, thereby promoting digital inclusion in low-income countries.

Contribution

This study provides empirical evidence on how tower-sharing agreements improve connectivity and market competition in low-income countries.

Findings

Prices for mobile and data services decrease after tower-sharing deals.

Mobile connections and internet access increase in rural areas and among women.

Tower-sharing agreements enhance market competition.

Abstract

Nearly half the world remains offline, and capital scarcity stalls new network buildouts. Sharing existing mobile towers could accelerate connectivity. We assemble data on 107 tower-sharing deals in 28 low-income countries (2008-20) and estimate staggered difference-in-differences effects. Two years after a transaction covering over 1,000 towers, the PPP-adjusted mobile-price index falls USD 1.60 (s.e. 1.10) from a baseline of USD 3.16, while data prices drop USD 1.00 (0.29), baseline USD 3.41 per GB. The number of mobile connections increases. Rural internet access increases by 4.7 pp and female-headed households by 3.6 pp. Tower-sharing agreements increase product market competition as measured by Herfindahl-Hirschman Index.