American Tower says satellites still need terrestrial infrastructure

Steve Vondran, chief executive officer of American Tower, recently told investors that the company views satellite and terrestrial wireless infrastructure as complementary rather than competing infrastructure models

In sum – what to know

Satellite interest grows – American Tower says satellite providers are showing growing interest in more direct participation in the U.S. wireless market.

Terrestrial remains essential – The company says providers seeking to compete at scale ultimately need towers, fiber, backhaul, power and Edge interconnection.

Infrastructure opportunity – American Tower sees satellite and terrestrial networks as complementary and views additional wireless participants as an incremental opportunity.

Growing interest from satellite providers seeking a more direct role in the U.S. wireless market could create additional opportunities for terrestrial infrastructure, according to American Tower.

Steve Vondran, chief executive officer of American Tower, recently told investors that the company views satellite and terrestrial wireless infrastructure as complementary rather than competing infrastructure models. “Satellite can extend coverage and support specific use cases, but broad, reliable, high-capacity wireless service still requires terrestrial infrastructure,” Vondran said.

American Tower’s position is that satellite connectivity can address particular coverage requirements while terrestrial networks remain important for broader wireless capacity. The company said it is seeing increasing interest from satellite providers seeking more direct participation in the U.S. wireless market.

Terrestrial network layer remains necessary

Vondran said providers seeking to compete at scale in the U.S. market will ultimately need a terrestrial network layer. “Any provider seeking to compete at scale in the U.S. will ultimately require a terrestrial network layer that includes towers, fiber, backhaul, power, and Edge interconnection,” he said.

The company therefore sees the development of satellite services as potentially complementary to existing terrestrial infrastructure.

American Tower said it views additional participants in the wireless market as an incremental opportunity. Vondran pointed to the company’s nationwide footprint and neutral-host model as allowing existing and emerging providers to deploy infrastructure quickly, efficiently, and at scale.

The company did not frame satellite as a replacement for terrestrial wireless infrastructure. Instead, its argument is that satellite and terrestrial networks can serve different roles, with satellite extending coverage or supporting specific use cases while terrestrial infrastructure provides the broader network layer.

That creates a potential infrastructure opportunity as satellite providers seek greater participation in the U.S. wireless market.

The executive had said that American Tower sees several overlapping catalysts that could support wireless infrastructure demand well into the next decade, with the company pointing to four developments: the next phase of 5G, a new spectrum deployment cycle, the transition to 6G, and growing AI traffic.

The first is the evolution of 5G from an initial focus on coverage toward capacity and performance. “Early 5G deployments focused on coverage; the next phase is increasingly about capacity, performance, and densification as traffic grows,” Vondran said.

A second catalyst is the deployment of additional spectrum. American Tower expects approximately 800 MHz of additional mobile spectrum to become available over the coming years, beginning with upper C-band in 2027 and potentially followed by 2.7 GHz, 4 GHz and 7 GHz bands.

The third catalyst is the eventual transition to 6G. While commercial 6G deployment remains ahead, Vondran said the industry is increasingly aligned around network architectures that are more intelligent and distributed and rely more heavily on Edge computing.

The fourth catalyst is AI. American Tower said AI could significantly reshape wireless network demand. It cited a CTIA expectation that AI traffic will grow three times faster than traditional wireless traffic and could account for nearly one-third of broadband traffic by 2034.