The Australian tower market 2020 – Telstra’s TowerCo

Australian MNOs pivot to tower divestment and small cell densification as 5G penetration is forecast to reach 67% by 2025.

David Kennedy · Venture Insights1 November 2020Period: November 202012 min read

Last updated 8 June 2026

$4bn+↑

Estimated valuation of Telstra tower business (Nov 2020)

1.34→

Telstra average tenancy ratio on existing towers (2020)

Locked

+1more stats

Companies covered:TelstraOptusTPGVHAAxicomDense Air

Abstract

This report assesses the Australian mobile communications tower market and the drivers for tower and small cell demand. It analyzes the shifting commercial dynamics as Telstra and Optus move to monetise tower assets, valued at over $488,000 per site. With the market for traditional macro-towers maturing, the focus of competition is shifting toward network capacity and small cell deployment, where 5G take-up is expected to reach 67% by 2025 under a no-premium pricing strategy.

Key Takeaways

Telstra's tower assets are valued at over $4bn, representing a significant premium over their $300m book value.
5G penetration is forecast to reach 67% by 2025 if no price premium is charged, but only 39% if a 15% premium is applied.
The Australian macro-tower market is mature, with Telstra (10,700 sites), Optus (8,900), and TPG (5,600) seeing only incremental growth.

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Frequently Asked Questions

Operators are prioritizing capital efficiency as the traditional macro-tower market reaches maturity. Telstra’s tower business is currently valued at over $4 billion, with individual sites commanding valuations exceeding $488,000.

5G penetration is projected to reach 67% by 2025, provided operators stick to a no-premium pricing model. This adoption is necessary to support mobile data demand, which is forecast to grow at a 33% CAGR through 2027.

The focus is shifting from broad coverage to network capacity and small cell deployment. Telstra currently manages 10,700 tower sites with an average tenancy ratio of 1.34, leaving significant room for densification and small cell growth.

The restructure is a tactical move to facilitate a future sale of its infrastructure assets. There is substantial valuation upside if the tower portfolios of Telstra, Optus, and TPG are eventually consolidated into a single entity.

The Australian tower market 2020 – Telstra’s TowerCo

Abstract

Key Takeaways

Frequently Asked Questions

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