Market Failure in the Wireless Communications Infrastructure Service Industry

This report, prepared for NATE: The Communications Infrastructure Contractors Association, examines market failures in the U.S. wireless communications infrastructure services industry—specifically the tower climbing and construction sector. Drawing on economic theory and original data from a comprehensive survey of NATE members (the Brattle Survey), we find compelling evidence that the current market structure is failing to sustain the skilled workforce necessary to build and maintain critical wireless infrastructure. The result is a growing risk to national security, public safety, and the future viability of wireless innovation in the United States. The industry is dominated by three national mobile network operators (MNOs)—Verizon, T-Mobile, and AT&T—who collectively control over 97% of the market. These MNOs act as concentrated buyers in a market of hundreds of small infrastructure contractors, creating a classic monopsony structure where buyers have market power. The Brattle Survey reveals that MNOs impose rigid, non-negotiable matrix pricing agreements that fail to cover the actual costs of labor, equipment, and region-specific deployment conditions. 80% of respondents reported that pricing offered by the MNOs is insufficient to cover their costs, and 96% say these agreements fail to account for local labor, terrain, or weather factors. Contractors also face a growing list of uncompensated costs passed down by MNOs—including warehousing, third-party compliance fees, and expanding training requirements. As a result, the industry is contracting.