American Tower Corporation (AMT) Earnings Call Transcript & Summary

Okay. Well, good afternoon, everyone. Thanks for joining us. I'm Nick Del Deo with MoffettNathanson. This is our Seventh Annual Media & Communications Summit. I'm thrilled to be joined by Igor Khislavsky, VP of Investor Relations at American Tower. Igor, thanks so much for joining us.

Hey, thanks, Nick. I appreciate you having me. And before we get started, I just want to say, I hope everybody listening on the line is healthy and well and stays that way.

Terrific. Well, I think per that, the topic of the day is COVID. It certainly hasn't had a noticeable impact on the operations or outlook for your core business, and the industry seems pretty sanguine about its ability to navigate through the crisis. Some people are kind of to split over what it might mean in some developing or, call it, middle-income markets, where the impact could potentially be more severe, though it's not clear at this point. What sort of things have you done to prepare for a potential worsening of the outbreak in some of these markets, like sub-Saharan Africa or India or Brazil? And how do you think the business would hold up if conditions there start to deteriorate noticeably?

Sure. Yes. So it's a really good question, Nick. First and foremost, I think what we're concerned with is the health and safety of our employees, contractors, their families, our tenants. And so before you even really saw a lot of the lockdowns that have been instituted in certain regions globally, we had gone to a primarily work-from-home environment really across our footprint as part of that commitment. We've bolstered some of our IT resources to facilitate that. A lot of the emerging markets where we operate, our towers actually serve as a backbone to a lot of that traffic because there's not a lot of fixed line available. And so to this point, as you alluded to, the impacts have been fairly modest, I'd say, across the bulk of our geographies. Part of what has helped us in that respect as well is that our infrastructure has been recognized as critical infrastructure in the U.S. and across the vast majority of our portfolio. And so we are able to, with the right safety precautions, of course, with additional PPE and social distancing, we're able to access our sites. We're able to do the work that needs to get done and to grant access to our tenants for them to do the work that needs to get done in order to maintain connectivity in these markets where it is so critical. And so no one can predict the future, obviously. We don't know exactly how this will unfold across the world. But to this point, the business has performed well. We're obviously delivering an absolutely critical service, especially in a time like this. And so we're optimistic that we can continue to perform in line with where we have been performing. And the business model itself has proven to be very resilient across a number of different types of environments. We feel like we're well positioned right now. And so we're monitoring it. We have internal discussions regarding business continuity, really on a daily basis, frankly, where we are checking in with all of the regional heads. We're making sure that we can deliver the levels of service that our customers are used to, albeit in a slightly different way, right? Most of these interactions are now remote rather than face to face, as you would expect. But so far, I think we've gotten good feedback. We've been able to deliver those high levels of service. And we're fortunate in that a lot of our back-end processes really lend themselves to working from home. We can process leases from home. We can do all of that remotely. There are field techs that are out in the field. They're taking, as I mentioned before, the necessary precautions from a safety perspective. But really, in most of these markets, it's been not business as usual but fairly close to it.

Okay. So as close as it feasibly could be. Okay. That's good to hear. Yes, as we think about coronavirus in the U.S., again, obviously, core tower business seems largely unaffected. One aspect that really hasn't been discussed that much, at least not that I'm aware of, is how it might impact your indoor DAS business. As many of the venues you serve, like casinos as well as airports and so on are closed, you are seeing pretty dramatic reductions in foot traffic, and that might continue for some time. Can you remind us how much indoor DAS contributes to your results? And should we expect any sort of revenue hits or contract restructurings or anything like that?

Sure. So in the U.S., it's probably around 2% to 3% of our overall property revenue, not huge but a good business. We're probably the largest independent indoor DAS provider in the country at this point. We haven't seen any disruption to the stage like our tower leases, indoor DAS leases or long term in nature, noncancelable. In the grand scheme, I think most of these venues have operating expenses that are far in excess of what these operating leases represent. And so we're fairly low on the totem pole in terms of the overall OpEx. But clearly, these venues have been impacted, as you said. We continue to monitor the space. I don't know but there's a lot of new construction going on the indoor side, as you would expect. But candidly, there wasn't much new construction assumed in our plan for the year anyway. And so you're not going to see really an impact there. So again, to this point, no disruptions. We're hopeful that as states do begin to open up on a selective basis and as some of these venues do begin to open up that you'll get a little bit closer to normal. But it will take time. I think regardless, DAS business continues to perform well. And we continue to monitor it. But to this point, no disruptions in payments or anything significant.

Okay. Okay. Good to hear. The other aspect of your domestic portfolio that I thought you might be seeing some sort of impact is broadcast given what it means for the customer, right? So broadcasters' revenue streams are generally advertising-based, and some of the pressures they've already faced are pretty -- are being amplified by the crisis. So again, can you kind of size this vertical and the growth you're seeing from it and talk about if there are any indications of incremental stress on those customers that might affect you?

Sure. So broadcast revenue comprises roughly 3% to 4% of our U.S. property revenue. So again, broadly similar to what DAS book is. Here again, long-term noncancelable contracts, so we haven't seen any kind of notable impacts to this point. Broadcast is sort of in the middle of a broadcast repack process that has been ongoing for a couple of years now. Some of that may be slowed a little bit. And so we could actually conceivably see a little bit of delayed churn out of this, believe it or not. The net-net, though, that's going to be a very small impact overall. And so here again, I think the underlying stability of these contracts, the long-term nature of them, the fact that this is an ongoing business and continues to be, really lends itself to essentially being more or less business as usual. We're going to have some level of broadcast churn. I think we would have had it anyway, and a lot of that just simply relates again to that broad repack process where spectrum is being freed up for other uses, which, to us, long term, I think, is a net positive. But no departure from kind of the normal underlying trend that I would highlight.

Okay. Okay. Understood. On the flip side, crises can create opportunities for players that are well positioned with solid balance sheets, like AMT. Have you seen any indications that the current crisis might shake loose some assets that you could pick up, whether towers, land parcels, human capital? Or is it just too early to tell?

It's probably a bit too early at this stage. We are positioned to be opportunistic is how I would put it. We have over $5 billion in liquidity. We're within our target leverage range. We continue to generate a lot of cash. And so to the extent that we do see some attractively priced assets that come up for whatever reason, we're in a good position to act on those. But to this point, given the recent nature of these events and how fast things have developed, you really haven't seen a lot of that to this point. We'll see it if the second half of the year looks a little bit different. A lot of that's going to revolve around the timing of certain exits for different folks out there that may be holding these assets and so on. But we have the liquidity to be opportunistic, and we'll look for those opportunities.

Okay. Terrific. Well, on that note, let's transition away from the crisis towards other themes. Let's go over to 5G. Obviously, that's something people are talking about, excited about. Do you see 5G as an upgrade cycle that's really going to accelerate growth for the industry, the way 4G did? Or are the attributes of 5G is such that it's more likely to help sustain growth over time?

Sure. I think our base case is probably more the latter, where if you think about the elements of the 5G build-outs that have been discussed over the last couple of years now, frankly, there's a lot of new spectrum that's going to be deployed. A significant chunk of that spectrum will be mid-band in nature, which really hasn't been deployed to a significant extent previously. That should be a clear net positive for us. We continue to believe that much of the sub-6 gigahertz spectrum that gets deployed in the U.S. will end up on macro towers. So we think we're well positioned there. You're also going to have presumably DISH coming in and building a network. That clearly should be a net positive for us. DISH is a tenant today, but very, very small. And so the build-out that they have started talking about publicly will certainly be a much more significant driver than what their narrowband IoT build was in the past. And so if you look at those couple of things, our sense is 5G will take a significant amount of time to deploy similar to 4G and 3G before it. On the mid-band spectrum side, you're going to need to have a C-band auction, for example, occur to get more mid-band assets in the hands of the carriers. That will take some level of time. And so I think we're optimistic that you could see a -- some sort of a growth inflection associated with the build-out of 5G as well. But the base case is really that 5G, given its long-term nature, given the multiple spectrum bands that will be involved and given the sustained high levels of capital investment that we would expect to see across the industry, will provide us with a really good springboard to extend solid levels of organic growth over a long period of time. Now to the extent that we can layer on top of that baseline growth some additional innovation-related initiatives, for example, to the extent that we can find some new revenue streams, some different customers and sort of add a couple of layers to that kind of baseline bread and butter for wireless-based growth, that could also help us potentially accelerate some of those growth numbers. So we're optimistic, I think, at a minimum, it gives us a really good level of visibility for a long-term growth path. We're working today to try and augment that through some of these other initiatives.

Okay. Cool. I definitely want to get back to some of those initiatives you alluded to in a little bit. Have you seen the carriers preposition any equipment that's usable for 5G in any material way? Or is it really -- is there a lot of runway in that front?

Sure. So I think it's carrier by carrier, really. Some of the initiatives that you've seen the carriers undertake over the last couple of years have involved, per their public commentary, some work that gets them ready to deploy 5G. I think AT&T has sort of stayed as much with respect to their one-touch build, for example, that they've talked about publicly. So there's been some prep work that's been laid on these networks. I think having said that, to deploy 5G across the country, you're still going to have a lot of incremental work being done. And again, I'll go back to the spectrum angle here. T-Mo has talked, for example, pretty extensively development need to use significant amounts of mid-band spectrum as part of their 5G deployment. That's new, right? That's new to the industry in many respects. The other carriers, I imagine, will be deploying mid-band spectrum along with some of their other lower-band spectrum assets as well over time. And so for us, it's almost less about 5G versus 4G because we're not inherently charging for the use of a different technology per se. It really has more to do with what these spectrum deployments look like, what the antennas that are propagating the spectrum look like on our towers and what the footprint being occupied looks like. And so a lot of those things -- really, all of those things are, in our view, largely yet to come with 5G. Obviously, you've had some early 5G deployments, some with millimeter wave that have been kind of more focused on dense urban areas, on rooftops, so small cells. But other deployments in suburban and rural, like you've seen with 600 megahertz spectrum, for example. So I think there's definitely been a lot of prep work done. The carriers have done a really good job in terms of getting ready for these deployments. And as we look over the next 5 to 10 years, we see a lot of incremental activity over and above all those things that should bring meaningful growth for us over time.

One of the concerns with 5G is that unlike with 4G, where there's kind of a clear use case, right, data to support smartphones, there's not necessarily an obvious use case for 5G to incent the carriers to invest. Are you concerned at all that, that lack of an obvious use case today is going to inhibit the pace of adoption -- or rather, the pace of investment?

It's a good question. I think in our view, interestingly enough, the initial catalyst for 5G deployment probably has more to do with serving the existing mobile data usage growth trends in the most efficient and effective manner than necessarily that sort of killer app right upfront. 5G, of course, is much more especially efficient than 4G, I think, roughly 3x. There's a lot of technological advancements that are layered into 5G technology that will allow networks to be smarter and more optimized to handle that increasing data usage. And so out of the gate, I think 5G is going to be more of a cost imperative than anything else over the years. Over time, though, I think we are very hopeful that we see a lot of different innovations once this 5G ecosystem starts to develop. And that can include everything from the traditional sort of autonomous use cases, smart factories, smart cities, various edge compute use cases, potentially, AR, VR. And to your point, I think some of those are a little bit less tangible right now simply because we don't have the exact blueprint of what all of those things look like. But we are hopeful that 5G is -- will inherently be a monetizable technology for the industry. I think it will be. But folks will have to figure out exactly how to do that and how to go about that over time. And I think the good thing is these builds are going to take the better part of a decade. So it doesn't need to be done upfront. Once you have a lot of the infrastructure and the network in place, you can really do some dynamic things, in our view. And we look forward to that. I look forward to that as a consumer myself, right, and I think most people do. And so we'll see how that all shakes out. But initially, I think the obvious case for early 5G deployment is that even in the absence of these new and different applications, mobile data use is growing 30-plus percent every single year in the U.S., you have to handle that somehow. And I think the advancements that are inherently included within the 5G standard will allow the carriers to handle that level of data traffic in a better and more efficient and ultimately more cost-effective way.

All right. Let's turn to T-Mobile, Sprint. Obviously, a lot of attention being paid to that as -- given the way it's reordering the wireless market here. You have -- at least among the big 3 tower cos, you have the shortest average remaining Sprint contract term. But it kind of introduces a funny dynamic where, if you think that T-Mobile can't upgrade those sites in advance of the lease expiration, it might be in a position where it has to extend them. Or alternately, that dynamic will get priced in some sort of MLA, you might sign them. So does that make the roughly 2 year, maybe 1.5 years, at this point, average remaining lease term that you have with Sprint a bit of a misleading statistic to evaluate your exposure?

Sure. It's a good question. And I think from a renewal perspective, a lot of these Sprint leases will come up for renewal in September of next year. Given we had signed a comprehensive MLA with Sprint back in late 2011, I believe, that essentially extended all of the leases they had with us for 10 years. I think we'll see how this develops over time. Our goal is, as you would expect, to work very closely with the new T-Mobile to help facilitate them building out their 5G network. We think we're well positioned to do that given what our portfolio looks like, given the nationwide reach that we have. And so figuring out the exact dynamics around this Sprint lease renewal date, if you will, will certainly be a part of those discussions and an important element of how our relationship evolves. That can be wrapped into a comprehensive MLA agreement, potentially. And we could also elect to go pay by the drink as some of our peers have done and approach it that way. In our view, we can be successful in both scenarios, but we're certainly open to discussing a potential contractual solution whereby there is some sort of a -- perhaps a mixture of extending some of that churn out over a longer time period, trading some of it for potential contractual new business commitments as we've done in the past in other instances or something like that. And so I think all options are on the table. We're -- we think we know what the new T-Mobile is looking to do just given a lot of the public statements that they've made and their build-out targets and goals, which are aggressive, and we applaud them on that. And I think our main goal here is to really help them achieve what they're looking to achieve but at the same effectively monetize our real estate within the context of doing that.

Okay. You alluded to the contract you signed with Sprint back in 2011 when they were doing the Network Vision project. If I remember correctly, there was a provision in that arrangement where Sprint is continuing to pay for iDEN sites even after they were decommissioned in exchange for some other goodies. And at the time, I remember some of your executives saying that Sprint would pay for those sites forever, was the terminology. Is there anything about the way that those leases were structured that might lead to additional or embedded risk for American Tower above and beyond the exposure you've laid out? For example, a chunk of iDEN -- old iDEN leases rolling off that are above and beyond the overlapping -- they're on overlapping towers -- or I guess not on overlapping towers, rather.

Sure. So what that contract basically did was it eliminated the distinction between iDEN leases and non-iDEN leases clearly across the portfolio. We -- as part of that contract, we had provided a significant incremental level of flexibility for the tenant to move sites within our existing network at the time, take what maybe had been an iDEN site and convert it into something else at no incremental charge. And there were some other trades made within that structure, as you would expect. And so I don't know if there's anything unique to really think about it in that regard. Over time, obviously, their network has evolved from what it was back in 2011 to what it looks like today. I think it's safe to assume that they've used some of that flexibility that was written into the contract. And so beyond that, we tried not to get into a lot of the details with respect to specific contract terms and lease terms and things like that. But I think, in aggregate, there was a lot of value provided on both sides for that contract, and now you're coming up to another renewal date where we'll be looking to, once again, provide the flexibility and the value that both sides are looking for.

Okay. It sounds like on the tone of your comments, there's not a chunk of risk we should be concerned about.

Well, look, I mean, if you -- and we've disclosed these numbers, if you look at the sites where you have both a Sprint lease and a T-Mobile lease on the same site and you assume that the Sprint lease is canceled upon the renewal date or the expiration date of the lease, you're looking at somewhere in the neighborhood of 3% to 4% of our total company revenue that would be churned off if that occurred. And so that's kind of the way that we framed the revenue risk as it relates to this renewal date. Now of course, you're going to have some offsets to that given the investments that will presumably need to be made on the T-Mobile side of a network as Sprint customers are migrated from the Sprint network. We're hopeful that in the event that you do have a contractual solution to this that you could have some other offsets in there. But yes, there's absolutely some churn risk involved.

Okay. Yes. Or really -- I mean excess churn risk as it relates to some of those iDENs.

Yes, nothing that specifically comes to mind at this point.

Okay. Let's talk about DISH for a moment. Obviously, you alluded to them as a potential driver of the business looking forward. Are you able to share anything about the degree of sophistication or seriousness with which they seem to be approaching the project based on your discussions you're presumably having? Or is that too customer-specific for you to get into?

Sure. So I don't want to get into any of the specifics, but I think they've made a number of public statements reiterating their commitment to this network, building it out. I think they've made a number of hires relative to folks that have been in the industry for a significant number of years and are very well respected. They've started to develop their network strategy and have brought in some firms to help them do that. And so from our vantage point, it certainly seems like they're all in on this. We have no reason to doubt that. We're ready to support that build-out. Again, given our portfolio, we think the locations are highly desirable or will be highly desirable to them as they deploy that network. And so we're ready to support them in that initiative. I think we'll sort of defer to them to lay out the exact timing and the pacing as it relates to that build-out. But yes, I mean, I think, certainly, we're excited about it, this an incremental layer of potential growth that you could see here in the fairly near future. And exactly what the magnitude of that growth is and exactly when it happens, I think, is less certain because there are a lot of different elements that you have to consider in that calculation. But clearly, there's been public discussions of 10,000, 15,000 sites to start. That's a significant number of sites, but those sites are not there today. And so at a minimum, that will be a net positive for the industry. I don't think there's any question.

Okay. And they're starting with a clean sheet of paper. They probably have somewhat more flexibility in terms of choosing initial tower locations, the network is lightly loaded, and it's already larger versus a more established player. Is it possible that someone like American Tower with the big national portfolio could, say, cut a deal offering lower rents or some other attribute to win a materially larger share than your fair share from DISH? Or is that sort of an unworkable conspiracy theory?

Sure. I mean, if you look at the way networks have been deployed in the past by more traditional wireless operators, there's always been a distribution across the public tower portfolios and even some of the private guys as well. And so at a high level, I think, to build a nationwide network, typically, you're going to be leveraging infrastructure from a number of different parties. So I wouldn't expect it to be different in this case necessarily. There are a lot of considerations that go into various pricing discussions. I think, in large part, we're pricing tower space based on the height and the weight of the equipment that's being put on that tower. There are a number of other strategic elements to think about. But we'll have those discussions with them as well our peers. And so I don't know that there's any kind of assumption that you should make relative to either American Tower or somebody else necessarily taking a lion's share of these deployments. My sense is it's more likely to be spread out.

Okay. And DISH has also talked about using new technologies or new approaches to reduce their CapEx and their OpEx. I mean aside from deploying the gear to support a single technology instead of multiple technologies on the tower, maybe using a little less ground space, that's really not relevant for your business, is it?

That's exactly right. And I think there's been a lot of discussion about things like O-RAN and C-RAN and innovations like that, I think similar to what Rakuten has done in Japan, to some extent. For us, what we're charging for is really the space being occupied on the tower structure itself. And so to the extent that a tenant is not using the ground space that they're allotted under a tenant lease because they don't have the need for a base station, for example, and they're virtualizing that functionality instead, that really doesn't impact our business, to your point. And so we've seen some of this already over the last couple of years with C-RAN, where initially, when C-RAN was talked about, there was some level of concern that tower leases would be impacted negatively by it. What we've actually seen is, as C-RAN has been deployed, we've seen more and more remote radio heads end up on our towers. And so you take the base station out from the base, but you're seeing more things being put on the tower itself. And so if anything, it's probably been a bit of a net benefit for us rather than a net negative. And so as you think about things like O-RAN and some of these other technological innovations, the theme is similar in that the equipment that has to be mounted on the tower itself doesn't really change. It certainly doesn't become any less important. And so you're exactly right. I think the question will be not so much is O-RAN being used or C-RAN being used. It's going to be what does the actual antenna equipment looks like in terms of what DISH will be rolling out on the tower itself. And we'll be learning, I think, more about that as time goes on.

Okay. Got it. Verizon is a big customer of yours. A few years ago, you signed an MLA with them, which I think has helped to sustain your domestic growth despite their increasing focus on small cells at the margin. As we think about the future deployments from Verizon, whether it's MIMO antennas or C-band or something else, should we be thinking of that MLA as having pulled forward any revenue that you might have otherwise received for them? Or is what they've been doing consistent with the incremental rent they're paying you under the MLA?

Sure. So I'm going to half punt on this question just because I think we don't really want to get into kind of the details of what may be included and activity levels and different things along those lines. What I would say more broadly, though, is Verizon has been very, very steady relative to their contributions to our growth for a long period of time. I think year in and year out, they continue to invest in their network and have done so for a number of years. And so whatever the specific contractual elements are of the relationship, our expectation is that, going forward, as you move into a 5G environment, they, like our other tenants, will continue to spend significant amounts of capital on deploying new spectrum, on enhancing their existing network and the other initiatives that they're undertaking. And so I think they've been an important component of our growth over the last 3-, 5-, 10-, 15-plus years. Our expectation is that they will continue to be an important part of our growth going forward. And some of that may be layered into a specific contract. Some of it may be more in the pay-by-the-drink variety. But I think overall, we continue to feel really good about our relationship with Verizon, just like the other tenants as well. And so we'll see kind of the exact cadence. But like I said, it's been very, very steady for a long time.

Okay. Fair enough. I want to hit on a few of the overseas markets in which you operate. There's been a ton of activity in Europe, whether M&A or other structures, separations, and there's a lot more in the pipeline. You don't seem to embrace that region like you have some others. If I'm not mistaken, one of the reasons that you've been more cautious is because of the prevalence of master service agreements, or MSAs, rather than more traditional leases. So is that a correct assumption? And to what degree is the carrier's interest in MSA structures weighed on your interest relative to more general pricing or other considerations?

Sure. The MSA issue is really not, I think, the driving force here. I think we can be flexible in terms of the way that these sale-leasebacks are structured. And so the MSA thing is probably a distant second. I think the main issue that we've had historically in Europe has revolved around valuation. So that's in the context of the overall organic growth profile long term a lot of the asset portfolios that have been available. And so we've been in Europe for a number of years. We started with a small portfolio in Germany that we picked up from a carrier called KPN, I think, back in 2012. We also have a relatively small business of [indiscernible]. And so we've got those kind of initial positions in the region. We've been involved at some level in many of the transactions that you alluded to. We've evaluated these assets. In many cases, we participated in the bidding process. Obviously, we haven't won a lot of those assets. And again, that comes down to primarily valuation issues for us. I think part of it has to do with the fact that we have a global view. And so when we've looked at some emerging market assets -- for example, the Eaton portfolio that we picked up late last year. When you look at an asset like that, number one, you would expect much higher organic growth; number two, you would expect that organic growth to persist for a much longer period of time; number three, the valuation of an asset like that is significantly lower relative to a multiples basis than what we were looking at in Europe. Now on the other hand, obviously, the risk profile is different, right? A portfolio across Africa inherently has a different risk profile than operating a portfolio in Europe. And that's part of this equation. But even when we've adjusted for that risk differential, it's been very tough for us to justify deploying that incremental dollar of capital towards much slower growth assets in Europe rather than higher-growth assets in Latin America or [Audio Gap] So that's been the issue. We've been very consistent relative to our capital deployment strategy, the components of that strategy, the guidelines within that strategy. And look, I mean, we're continuing to look at assets in Europe. I think we would like to get bigger. We'd like to get additional scale there. But we'll be doing that on our terms. We don't want to get bigger for the sake of getting bigger. And the luxury that we have is we can deploy that capital elsewhere. If you have, on the other hand, a strictly European mandate and you're looking for assets, you're in an environment where you have negative interest rates, frankly. You may be willing to take a lower yield on some of these portfolios than perhaps what we would be willing to take. And that's fine. I think the folks that have been rolling up assets in Europe have done a tremendous job. The market has rewarded them for it. But we'll participate in that to the extent that we can get there from a return perspective. And to the extent we can't, we'll run the businesses we have in Europe, which are good businesses, not huge, but generate a lot of cash, and then deploy that capital potentially in other regions where you have more attractive risk-adjusted returns.

Okay. That's great color. India has been a tough market over the last couple of years. The AGR tax issue now, it's conceivable that Vodafone Idea might go under. And if it were to come to that, India would look far different than the other major markets in which you operate, and it would basically be a duopoly, kind of setting BSNL's -- BSNL aside. How would you envision the Indian tower market performing under that sort of outcome? I mean, would the independent leasing model really even work with only 2 real players?

Sure. No, I mean, look, I don't think there's any question that if you were in a scenario where a Vodafone Idea was not part of that industry and you basically had Jio and Airtel left plus BSNL, of course, that would not be an ideal market for an independent tower company. It's funny, for years in India, the issue was you had too many carriers, between 15 carriers in the space. And now we're talking about potentially 2. But look, I think from a lot of different angles, it makes a lot of sense for Vodafone Idea to continue in India, right? You obviously have to solve the AGR issue that's out there now. I think there have been a couple of proposed solutions, specifically with respect to establishing a very long time line for the AGR payment, where instead of having to pay the penalty upfront, they would have something like 20-, 25-plus years to do that. And so to the extent that, that happens, I think we're optimistic that, that gives Vodafone Idea, the near-term ability to sort of manage through their short-term liquidity considerations and participate in the ongoing market repair that you're starting to see within the Indian wireless market. And so we're hopeful that, that happens. And I think it's certainly by no means a forgone conclusion that the Indian wireless market becomes a duopoly in our view, I think there's still a long way to go before we get there if we get there. And I think from the perspective of bringing 4G to the Indian population, from a perspective of expanding access to mobile broadband, having and preserving the current Indian market structure in wireless makes a lot of sense. And so we're hopeful for a reasonable outcome. I think some of that has been sort of pushed to the side right now given the ongoing COVID issues in the marketplace. The carriers are focused now really exclusively on providing the connectivity that's needed given that in India, like a lot of other places across our footprint, there really is no significant fixed-line penetration. And so folks that are working from home in India are doing it over mobile connections, which, again, reinforces just how important our infrastructure is in that market, just how important mobile connectivity is in that market. And so there, again, given that emphasis, we're optimistic that you can have a reasonable solution to the AGR issue and move forward.

Okay, terrific. I want to spend the time that we have left talking about some of the potential new revenue streams that you alluded to earlier because you have some meaningful aspirations for those in the coming years. On your earnings call 1.5 weeks ago, Tom kind of teased that -- or he said 15% of your non-MLA new business came from nontraditional tenants in the first quarter. So help us size what that actually means? Can you share what portion of your new business is not MLA related and how that 15% has changed over time?

Sure. So at a high level, I'd say that more than half of our new business commitments -- commencements in the first quarter were related to those comprehensive MLA agreements that we had. And so as a part of the overall new business pie, the 15% that was referenced to is less than half of that. I think that portion of our new business has always been a minority, right. As you would expect, the big 3 generate 85-plus percent of our revenue and a very significant portion of our new business. And that bucket will include everything from government entities, local municipalities, emergency response, various federal and state agencies. It will include broadcast, as we touched upon earlier. It will include customers from a number of different areas of the economy. What's interesting is as we sit here today, we probably have somewhere in the ballpark of 3,000 different customers in the U.S. Everyone obviously thinks of the big 3, but you have a tremendous number of other customers that make up that overall bucket. And I think over time, what we're trying to do is, in addition to maintaining government entities and the broadcasters and some of these other folks that have been part of this bucket for years and years, we're trying to add more of the next generation of customers to that market. So the follow-on question to that, of course, is, okay, well, who is that, right? So part of that is going to be DISH, presumably. So that will be a very obvious uplift to that bucket of new business. But part of it could be associated with some of the other things that we're looking at. The edge data center solution that we're in the middle of developing, hopefully, will generate some new customers that we can add to that bucket. Some of the in-building CBRS-based systems that we're working on could potentially generate some new customers into that bucket. So the goal, over time, is not only to grow the size of that new business component but also to expand the scope of it. And so that's a metric that, I think, we'll look to kind of check in on every quarter or 2 and see how we're doing. I think, candidly, with a lot of these initiatives we're very early on. The edge data initiative, the CBRS initiative is really in its trial stages. So it will take some time before we're able to scale those things. But we do think it's a real opportunity. We do think that there -- as the 5G ecosystem especially develops, that there will be some very interesting opportunities for us to participate in ways that are maybe a little bit nuanced than what you've seen in the traditional tower model.

Okay. The idea of edge deployments, edge data centers is one that's really captured investors' attention. Yes, I've always thought it is -- I can see how it makes a lot of sense from an engineering perspective for certain applications, but the economics seem a little less clear to me. So again, recognizing it's early days given the sort of work you've done, how appealing do you think the economics might be? And what customer set or what applications might find it particularly appealing?

Yes. It's a great question. It's a question that we're spending an inordinate amount of time on internally within that innovation program to try and figure out. And so I think the big driver of edge in many respects is the need for lower latency applications within this, again, overall 5G ecosystem. And I think as you continue to migrate more and more computing power to the edge to support some of these emerging applications, the question in our minds is, what can we do to make our tower sites the preferred venues for these edge facilities? And so you've heard and seen some developments in the industry where certain carriers are using their own CoS, for example, as facilities, right, and that's one flavor of it. That, of course, will have one carrier as the linkage there. What we're trying to figure out how to do is to position our tower sites in combination with all the precursors that are already on site. So access to power, you're going to have a fiber connection at all these tower sites. You're going to have probably at least 2, if not 3, of the big communications providers on site already at the tower. And so the question is, can we put together a platform where we can develop a neutral host model where instead of having just one operator isolated at its own [indiscernible] and then doing all of its own linkages? Could you develop a multioperator, multicloud micro data center at these towers? That's the high-level theoretical goal. And what we're trying to do, at this point, is figure out exactly what elements of this model we need to tailor to attract those customers. So part of that has been, for us, we picked up an interconnect facility in Atlanta last year. Really good business on a stand-alone basis. It's small. I think it's generating $6 million or $7 million a year in revenue, so completely immaterial to the overall pie. But -- and we didn't buy it for the $7 million in revenue. We bought it to learn as much as we possibly could about what the tenants in that interconnect facility are doing. What are their priorities? What are they moving from traditional data centers to the edge? Or what are they adding on top of that that's being brought to the edge? And can we get to know these tenants that we maybe didn't really get to know in a traditional tower sense historically? Can we bundle some offerings with our tower sites that are proximate to that facility to try and figure out kind of what these business models could be. And so now we have probably half a dozen or so trial edge data sites at our own towers in the South trying to do exactly that. And so it's very early. We're encouraged by what we've seen so far. There's still a lot of work to be done in terms of figuring out exactly how to craft that platform that I referenced earlier. But we are starting to see some momentum. It's something that we would expect to talk about more as time goes on. Still early days. Still probably, I think, as Tom alluded to on the call, a couple of years away from being [ anything ] you see in numbers, frankly. But we're excited about it. It's one of those things that could enable us to tack on that incremental layer of growth. By the way, not only in the U.S. but also across other geographies potentially because eventually, this technology, in our view, is not going to be isolated to just the U.S. You're going to see it deployed in Latin America, you're going to see it deployed in Africa, you're going to see it deployed in India probably a number of years down the line. But can we take advantage of our geographic diversification in positioning us to be the preferred sort of intermediary or the preferred neutral host, if you will, with a lot of these folks that may also be looking for growth in international markets?

Great. It's going to be really interesting to see how that plays out in the coming years. Unfortunately, we're out of time. I wish we had more. I guess on that note, are there any kind of closing thoughts or insights that you want to share with the listeners?

Sure. Well, hey, Nick, thank you for having me. Obviously, again, I want to reiterate my best wishes to everyone listening in today. I think, really, what we're focused on at the company is what we've been focused on for a number of years, right? And that is to continue to provide significant levels of connectivity to folks around the world to earn an attractive economic return for stockholders while doing that. And I do think that the connectivity mission in today's world is probably more important than it has ever been before. And so we've sort of redoubled our efforts to make sure that we're doing everything possible to deliver that critical connectivity. And we look forward to providing more updates as we go along.

Okay. Well, terrific. Well, Igor, thanks again for joining us. It was a very interesting discussion from my perspective, and I appreciate you taking the time.

Great. Thanks, Nick. Appreciate it.