Jay A. Brown
President and Chief Executive Officer at Crown Castle
Thanks, Ben, and good morning everyone. Thanks for joining us on the call. As you saw from our second quarter results and updated full-year outlook, the strength of the US market continues to stand out. We are seeing the benefits of a strong leasing environment as we support our customers' growth initiatives with their deployment of 5G. This activity drove 6% organic revenue growth in our tower business in the first half of the year, which we believe will meaningfully continue through the remainder of the year, and as a result is resulting in higher operating performance relative to our expectations at the beginning of the year. In addition, we expect to double the rate of small cell deployments next year compared to the 5,000 nodes we expect to put on air this year to meet the growing demand from our customers as 5G networks require small cells at scale.
Looking further out, I believe our strategy and unmatched portfolio of 40,000 towers, 115,000 small cells on air or under contract, and 85,000 route miles of fiber concentrated in the top US markets have positioned Crown Castle to achieve our long-term annual dividends per share growth target of 7% to 8%. Dan will discuss the financial results and updated outlook, so I'll focus my discussion on our strategy to deliver the highest risk adjusted returns for our shareholders by growing our dividend and investing in assets that will generate future growth. To that end, we are focused solely on the US because we believe it represents the best market in the world for wireless infrastructure ownership when considering both growth and risk. As you saw on the release, to better reflect our strategic focus on the US market we are changing our company name from Crown Castle International Corp to Crown Castle Inc. while our ticker will remain CCI.
As you can see on Slide 3, the demand drivers for our infrastructure have been strong since the early days of wireless network investment in the US. We have benefited over time from persistent growth in mobile data that has required hundreds of billions of dollars of network investment by our customers. During the 2G deployments in the mid '90s, wireless operators invested approximately $125 billion over eight years to enable wireless voice services nationwide. As network and handset technology rapidly improved, that investment cycle gave way to the development of nationwide 3G which enabled basic mobile Internet browsing that consumed significantly more data than legacy voice services. Over the next eight years or so, wireless operators invested approximately $200 billion, both to deploy new spectrum on existing cell sites, and deployed thousands of new cells in order to add to the network capacity needed to keep pace with the substantial growth in mobile data. The virtuous cycle continued with network investment and technology innovation allowing our customers to meet the increasing demand for mobile data that US consumers are willing to pay for.
As we entered a new decade in 2010, wireless operators began deploying nationwide 4G that delivered a step function change in how fast data is transferred from cell sites to mobile devices. This innovation led to the development of data rich applications and use cases that were simply not possible with 3G networks, including mobile video, e-commerce and social media platforms, which drove another step change in mobile data demand. Over that decade, wireless operators invested approximately $325 billion to develop their 4G network, and mobile data demand increased by a factor of 96 times during that same period.
As a result of the quality of the network and the user experience enabled by this level of investment, US consumers have used their wireless devices more and more, and they have been willing and able to pay for that improving mobile experience. In turn, the US wireless operators have taken the cash flows generated from their customers and invested even more in their networks and the cycle continued. The combination of this persistent growth in mobile data and the value we deliver to our customers by providing a low-cost shared infrastructure solution has enabled us to consistently generate growth through various macroeconomic cycle.
As you can see on slide 4, our business has a long track record of delivering growth through periods of US economic expansion and contraction. Similar to past generational network upgrades, we expect 5G to drive sustained growth in our tower business as our customers upgrade existing cell sites and add new sites to our 40,000 towers. We also believe 5G will be different as it will require the deployment of small cells at scale to increase the capacity and density of wireless network as more spectrum deployed across existing macro towers will not be sufficient to keep up with the growth in mobile data demand. As a result of the requirement to build out this denser network, we believe the duration and magnitude of 5G investment will likely exceed prior cycles further extending our runway of growth. With this view in mind, we have invested $16 billion of capital in high capacity fiber and small cells that are concentrated in the top US market. That capital is yielding more than 7% today, and with more than 60,000 contracted small cell nodes in our backlog including a record number of co-location nodes, we expect the yield to increase over time as we put those small cells on air.
To put this in perspective, our tower investment began more than 20 years ago at approximately 3% yield when we built and acquired assets that we could share across multiple customers. As we have proven out the value proposition for our customers and leased up our tower assets over time, those assets now generate a yield on invested capital of 11.5% with meaningful capacity to support additional growth. To provide investors with additional visibility into how our Fiber segment investments are progressing, we have updated the analysis we have provided each of the last two years outlining the activity and returns for five specific markets.
Looking at the collective view of how these five markets have performed over the year -- over the last year on Slide 5, growth from both small cells and fiber solutions has contributed to solid returns with yields that are largely consistent year-over-year. The performance across these markets demonstrate our ability to generate strong overall returns as we co-locate additional customers on our fiber assets while also investing capital to build new assets and expand the long-term growth opportunity. To that point, we are seeing co-location at scale with solid returns. Across our entire fiber business, about a third of the small cell nodes we have deployed since the beginning of 2018 have been co-located on existing fiber with returns that are consistent with the target that we have communicated.
Looking at how well our overall strategy is performing since 2018 we have increased our consolidated return on invested capital by 160 basis points to 9.5%, returned nearly $9.5 billion to shareholders through our dividend that has increased at a compound annual growth rate of approximately 9%, while also investing $7 billion of capital into attractive assets that we believe will support the future 5G build out and contribute to dividend growth in the future. I believe that combination highlights how compelling and differentiated our strategy is. We provide investors with the most exposure to the development of next-generation networks with our comprehensive offering of towers, small cells, and fiber, a pure play US wireless infrastructure provider with exposure to the best growth and the lowest risk market, a compelling total return with a current yield of 3.5% and a long-term annual dividend per share growth target of 7% to 8%, and the development of attractive new assets that we believe will extend our runway of growth. When I consider the durability of the underlying demand trends we see in the US that provides significant visibility into the anticipated future growth for our business, the deliberate decisions we have made to reduce the risks associated with our strategy and our history of steady execution, I believe Crown Castle stands out as an excellent investment that will generate compelling returns over time.
Before I wrap up, I did want to draw your attention to one other announcement that we made yesterday. We released our 2021Environmental, Social and Governance Report and we also launched a new ESG website as a part of our effort to provide timely and accessible ESG disclosures. Our business is inherently sustainable, with our shared infrastructure solutions supporting connectivity that is vital to our economy while limiting the proliferation of infrastructure and minimizing the use of natural resources. We continue to build an inclusive and diverse community at Crown Castle and are committed to further improving the impact we have on the communities in which we operate with specific goals to be carbon-neutral in Scope 1 and 2 emissions by 2025, and meaningfully increase our addressable spend with diverse suppliers by 2026. We hope you find these new disclosures and the website helpful. And with that, I'll turn the call over to Dan.