Spark plans to invest the remainder as it continues to move away from traditional telecommunications towards higher-growth digital services.
“As we looked at separating our tower assets out of Spark, we understood we needed a mechanism to provide support services back to the TowerCo,” says Singh.
“TowerCo was envisaged as a smaller, leaner organisation. It was never meant to have its own field crew. Our initial idea was to form a ServeCo to support TowerCo.
“Then we realised that by doing that we get to recreate a small subset of what we are already doing and that didn’t make sense.
“At this point we thought about bringing all these businesses together and asked ourselves what an end-to-end IT services, infrastructure, build and delivery company might look like. So, we brought in Connect8 and all the field service teams out of Spark.
“This includes the mobile design teams and the radio frequency engineers.
“We then created an end-to-end infrastructure company that allows us to design, build, support and maintain everything whether it is fibre networks, mobile networks or IT infrastructure.”
Spark is a major customer and owns 100 per cent of the business, yet there’s sufficient separation for it to be able to service other telecommunications companies without running into conflicts.
It already does this, but soon there will be greater separation.
Singh’s team is preparing to move to new headquarters away from Spark City on Auckland’s Victoria St. For now, Spark employees are not allowed to enter the new company’s space in the existing building.
New branding is in the pipeline.
Entelar Group has its leadership team including finance, legal and HR. Singh says there are three board members to govern the operation, but they don’t get access to revenue lines or to know what is sold to customers: “Just the top line numbers”.
The previous Entelar business already had a high degree of separation from Spark.
It was, and remains, a distributor of a range of products and services from companies like Cisco and Nokia supplying Spark and its competitors. That earlier business needed independence to give its customers a sense of comfort.
While he can’t name the other companies Entelar works with yet, he says “we already do some mobile builds with other mobile operators”.
Singh says the challenge he faces at this stage is getting businesses to understand that Entelar is independent and that it offers a unique set of skills in one place.
“There isn’t anyone else in New Zealand that can provide the breadth of services and then you can overlay this expertise with a certified distribution layer.
“We can go in to build and maintain fibre and mobile networks. In fact, there are few companies anywhere in the world who can do this.”
Singh says the focus of his customers at the moment is on delivering 5G mobile networks.
Spark recently said it is on track to have 90 per cent of the population covered by its own 5G network by the end of next year. The other mobile companies are pushing as hard to extend coverage.
“Each of the MNOs [mobile network operators] has selected their preferred vendors and is scaling up to deliver 5G,” says Singh.
“There is a finite pool of resources in New Zealand for doing that and a limited number of vendor partners. We have brought in new resources from offshore to help and we continue to invest in bringing on new local talent.
“Spark uses Samsung and Nokia technology; Vodafone uses Nokia and 2degrees is with Ericsson. Each has its own requirements in terms of skills and training.
“We make sure our teams are adequately trained for the different types of infrastructure. Riggers climb towers and install radio masts.
“There’s also a civil engineering component.
“If you’re building a new tower, then you need to lay foundations and construct the tower.”
New Zealand is set to get a lot more towers in the coming years. Spark has committed to building at least 670 new towers in the next decade, the other mobile carriers have similar plans.
When new millimetre wave 5G frequencies become available, the carriers will need denser tower networks to increase data capacity.
Being an end-to-end infrastructure service delivery business means everything — from the initial planning of a new tower site to designing the project, procuring the site, digging holes, standing up the tower and having the technical expertise to install the hardware. It then means both proactive and preventative maintenance.
Finding talent is challenging for all New Zealand technology businesses. There’s a worldwide demand for these skills and recent restrictions during the pandemic make matters worse.
The move to combine Spark’s service delivery operations relieves some of the pressure as the larger organisation can use resources more efficiently.
The component companies were already recruiting overseas workers and that will continue.
Singh says a tranche of people coming from overseas are being interviewed now and should arrive here early in the New Year.
Away from 5G, Entelar’s other major infrastructure work programme is building out more fibre.
Spark operates its one fibre network that is quite distinct from Chorus’ residential UFB fibre.
A web of fibre crisscrosses the country connecting cities, towns and key locations.
There is also the fibre that runs to mobile towers carrying traffic back to central exchanges.
Work on these networks largely happens out of public sight and is continuous.
- Spark is an advertising sponsor of the Herald’s Infrastructure report.
