The following discussion should be read in conjunction with the response to Part I, Item 1 of this report and the consolidated financial statements of the Company including the related notes and "Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A")" included in our 2008 Form 10-K. Any capitalized terms used but not defined in this Item have the same meaning given to them in our 2008 Form 10-K. Unless this Form 10-Q indicates otherwise or the context requires, the terms "we," "our," "our company," "the company," or "us" as used in this Form 10-Q refer to Crown Castle International Corp. and its subsidiaries.

General Overview

Overview

As of September 30, 2009, we owned, leased or managed approximately 24,000 towers for wireless communications. Revenues generated from our core site rental business represented 92% of our third quarter 2009 consolidated revenues, of which 95% was attributable to our CCUSA operating segment. The vast majority of our site rental revenues is of a recurring nature and has been contracted for in a prior year.

The following are certain highlights of our business fundamentals:

• potential growth resulting from wireless network expansion;

• site rental revenues under long-term leases with contractual escalations;

• revenues predominately from large wireless carriers;

• majority of land under our towers under long-term control;

• relatively fixed tower operating costs;

• high incremental margins and cash flows on organic revenue growth;

• minimal sustaining capital expenditure requirements;

• vast majority of debt has contractual maturities after five years and has fixed rate coupons; and

• significant cash flows from operations.

Our long-term strategy is to increase stockholder value by translating anticipated future growth in our core site rental business into growth in our results of operations on a per share basis. The key elements of our strategy are:

• to organically grow revenues and cash flows from our towers by co-locating additional tenants on our towers; and

• to allocate capital efficiently (in no particular order: purchase our own common stock, enter into strategic tower acquisitions, acquire the land on which towers are located, selectively construct or acquire towers and distributed antenna systems, improve and structurally enhance our existing towers, and purchase, redeem or refinance our debt or preferred stock). See also "Item 2. MD&A-Liquidity and Capital Resources."

Our long-term strategy is based on our belief that opportunities will be created by the expected continued growth in the wireless communications industry, which is predominately driven by the demand for wireless telephony and data services by consumers. As a result of such expected growth in the wireless communications industry, we believe that the demand for our towers will continue and result in organic growth of our revenues due to the co-location of additional tenants on our existing towers. We expect that new tenant additions or modifications of existing installations (collectively referred to as "tenant additions") on our towers should result in significant incremental cash flow due to the relatively fixed costs to operate a tower (which tend to increase at approximately the rate of inflation).

As mentioned in our 2008 Form 10-K, our site rental revenues typically result from long-term contracts with (1) initial terms of five to fifteen years,
(2) multiple renewal periods at the option of the tenant of five to ten years each, and (3) contractual escalators of the rental price. More recently, we have been able to successfully negotiate up to fifteen year terms for both initial and renewal periods for certain of our customers and are endeavoring to continue that trend. As of September 30, 2009, our customer contracts at CCUSA have an average remaining life of approximately seven years, exclusive of renewals at the customer's option.

In March 2009, we entered into an agreement to provide certain management, construction and acquisition services for a third party as to certain tower opportunities in the United States for a period of 24 months. The arrangement should permit us to maintain our construction and acquisition capacities and expertise and further our good relationships with certain major customers with limited capital commitments and expenditures as to such towers.

The following is a discussion of certain recent events which may impact our business and our strategy or the wireless communications industry:

• Consumers increased their use of wireless voice and data services according to the CTIA U.S. wireless industry survey issued on October 7, 2009.

¡ Wireless data service revenues for the first half of 2009 were more than $19.4 billion, which represents a 31% increase over the first half of 2008;

¡ Wireless users exceeded 276 million as of June 30, 2009, which represents a year-over-year increase of nearly 14 million subscribers, or 5%; and

¡ Minutes of use exceeded 1.1 trillion for the first half of 2009, which represented a year-over-year increase of 3%.

• In January 2009, Verizon Wireless completed the acquisition of Alltel Corp., a provider of wireless services to primarily rural markets. As has been the case with other customer consolidations in the recent past, we do not expect lease cancellations from duplicate or overlapping networks as a result of this acquisition to have a material adverse affect on our results.

• The challenging credit markets and global economic recession continued during 2009. However, the credit markets improved somewhat during 2009 from the fourth quarter of 2008, as seen in the decrease in credit spreads and improved liquidity in the market place. The extent and length of the global economic recession is difficult to predict; and although the economic outlook has improved during 2009, a pronounced or prolonged expansion of the economy is not assured. The following is a discussion of the potential impact on us from the credit markets and global economic recession:

¡ Historically, aggregate capital spending and the associated demand for our towers by wireless communication companies have been relatively stable over the last several years, although we did see reductions during prior economic downturns. We do not expect the current economic conditions to significantly impact the long-term growth in wireless voice and data demand, which has historically been the predominate driver of demand for our towers over the long-term. In addition, this global economic recession has not significantly impacted our existing recurring revenues, including with respect to customer defaults or bankruptcies. Consequently, we currently do not anticipate any material negative impact on our revenues over the foreseeable future. In addition, we expect site rental revenues for 2010 of between $1.645 billion and $1.665 billion, representing growth rates from the estimated full year 2009 of between 7% and 8%.

¡ As seen in our issuances of debt during 2009, our borrowing costs on these new debt issuances are higher than on our existing debt. Unless credit markets improve, our prospective debt refinancings may result in an increase in our weighted-average cost of debt. In light of the current challenges in the credit markets, beginning in the fourth quarter of 2008 we (1) extended the maturity of our debt by refinancing a substantial portion of our debt during 2009 and
(2) reduced our discretionary capital expenditures in order to retire our indebtedness. Over the near term, we expect to continue to invest the majority of our available cash toward the retirement of debt, settlement of our interest rate swaps and resumption of discretionary investments depending upon the credit environment. See "Item 2.

Consolidated Results of Operations

The following discussion of our results of operations should be read in conjunction with our condensed consolidated financial statements and our 2008 Form 10-K. The following discussion of our results of operations is based on our consolidated financial statements prepared in accordance with GAAP, which requires us to make estimates and judgments that affect the reported amounts (see "Item 2. MD&A-Accounting and Reporting Matters-Critical Accounting Policies and Estimates" and note 1 to our consolidated financial statements on our 2008 Form 10-K).

Comparison of Consolidated Results

The following information is derived from our historical consolidated statements
of operations for the periods indicated.



                                         Three Months Ended               Three Months Ended
                                         September 30, 2009               September 30, 2008
                                                       Percent                         Percent
                                                        of Net                          of Net          Percent
                                        Amount         Revenues         Amount         Revenues        Change(b)
                                                                (Dollars in thousands)
Net revenues:
Site rental                           $  396,466             92 %      $ 353,984             92 %             12 %
Network services and other                32,613              8 %         30,364              8 %              7 %

                                         429,079            100 %        384,348            100 %             12 %


Operating expenses:
Costs of operations(a):
Site rental                              114,899             29 %        115,758             33 %             (1 )%
Network services and other                21,613             66 %         20,541             68 %              5 %


Total costs of operations                136,512             32 %        136,299             35 %              -
General and administrative                39,230              9 %         37,437             10 %              5 %
Asset write-down charges                   3,073              1 %          2,902              1 %              6 %
Acquisition and integration costs              -              -                -              -                *
Depreciation, amortization and
accretion                                131,463             30 %        131,714             34 %              -


Operating income (loss)                  118,801             28 %         75,996             20 %             56 %
Interest expense and amortization
of deferred financing costs             (111,169 )          (26 )%       (88,138 )          (23 )%            26 %
Impairment of available-for-sale
securities                                     -              -          (23,718 )           (6 )%             *
Gains (losses) on purchases and
redemption of debt                        (4,848 )           (1 )%             -              -                *
Net gain (loss) in interest rate
swaps                                    (58,327 )          (14 )%         2,404              -                *
Interest and other income
(expense)                                  2,569              1 %           (847 )            -                *


Income (loss) before income taxes        (52,974 )          (12 )%       (34,303 )           (9 )%             *
Benefit (provision) for income
taxes                                     21,836              5 %          2,096              1 %              *


Net income (loss)                        (31,138 )           (7 )%       (32,207 )           (8 )%             *
Less: Net income (loss)
attributable to the noncontrolling
interest                                     501              -                -              -                *


Net income (loss) attributable to
CCIC stockholders                     $  (31,639 )           (7 )%     $ (32,207 )           (8 )%             *

*: Percentage is not meaningful

(a) Exclusive of depreciation, amortization and accretion shown separately.

(b) Inclusive of the impact of foreign exchange rate fluctuations. See "Item 2.
MD&A-Comparison of Operating Segments-CCAL"

                                         Nine Months Ended                 Nine Months Ended
                                         September 30, 2009                September 30, 2008
                                                       Percent                           Percent
                                                        of Net                            of Net          Percent
                                       Amount          Revenues          Amount          Revenues        Change(b)
                                                                (Dollars in thousands)
Net revenues:
Site rental                          $ 1,140,577             92 %      $ 1,047,540             92 %              9 %
Network services and other               101,286              8 %           86,942              8 %             16 %

                                       1,241,863            100 %        1,134,482            100 %              9 %


Operating expenses:
Costs of operations(a):
Site rental                              337,979             30 %          341,884             33 %             (1 )%
Network services and other                64,683             64 %           60,772             70 %              6 %


Total costs of operations                402,662             33 %          402,656             35 %              -
General and administrative               113,969              9 %          110,915             10 %              3 %
Asset write-down charges                  14,459              1 %            9,199              1 %             57 %
Acquisition and integration costs              -              -              2,504              -                *
Depreciation, amortization and
accretion                                396,236             32 %          395,643             35 %              -


Operating income (loss)                  314,537             25 %          213,565             19 %             47 %
Interest expense and amortization
of deferred financing costs             (327,006 )          (26 )%        (266,040 )          (23 )%            23 %
Impairment of available-for-sale
securities                                     -              -            (23,718 )           (2 )%             *
Gains (losses) on purchases and
redemption of debt                       (90,174 )           (7 )%               -              -                *
Net gain (loss) in interest rate
swaps                                   (114,060 )           (9 )%           2,404              -                *
Interest and other income
(expense)                                  5,572              -              1,669              -                *


Income (loss) before income taxes       (211,131 )          (17 )%         (72,120 )           (6 )%             *
Benefit (provision) for income
taxes                                     78,276              6 %           87,079              7 %            (10 )%


Net income (loss)                       (132,855 )          (11 )%          14,959              1 %              *
Less: Net income (loss)
attributable to the
noncontrolling interest                     (375 )            -                  -              -                *


Net income (loss) attributable to
CCIC stockholders                    $  (132,480 )          (11 )%     $    14,959              1 %              *

*: Percentage is not meaningful

(a) Exclusive of depreciation, amortization and accretion shown separately.

(b) Inclusive of the impact of foreign exchange rate fluctuations. See "Item 2.
MD&A-Comparison of Operating Segments-CCAL"

Third Quarter 2009 and 2008. Our consolidated results of operations for the third quarter of 2009 and 2008, respectively, consist predominately of our CCUSA segment, which accounted for (1) 95% and 94% of consolidated net revenues,
(2) 95% and 94% of consolidated gross margins, and (3) 106% and 92% of net income (loss) attributable to CCIC stockholders. Our operating segment results, including CCUSA, are discussed below (see "Item 2. MD&A-Comparison of Operating Segments").

First Nine Months 2009 and 2008. Our consolidated results of operations for the first nine months of 2009 and 2008, respectively, consist predominately of our CCUSA segment, which accounted for (1) 95% and 94% of consolidated net revenues,
(2) 95% and 93% of consolidated gross margins, and (3) 99% and 154% of net income (loss) attributable to CCIC stockholders. Our operating segment results, including CCUSA, are discussed below (see "Item 2. MD&A-Comparison of Operating Segments").

Comparison of Operating Segments

Our reportable operating segments for the third quarter of 2009 are (1) CCUSA, primarily consisting of our U.S. (including Puerto Rico) tower operations, and
(2) CCAL, our Australian tower operations. Our financial results are reported to management and the board of directors in this manner.

See note 12 to our condensed consolidated financial statements for segment results, our definition of Adjusted EBITDA, and a reconciliation of net income
(loss) attributable to CCIC stockholders to Adjusted EBITDA.

Our measurement of profit or loss currently used to evaluate our operating performance and operating segments is earnings before interest, taxes, depreciation, amortization and accretion, as adjusted. Our measure of Adjusted EBITDA may not be comparable to similarly titled measures of other companies, including companies in the tower sector, and is not a measure of performance calculated in accordance with GAAP. Adjusted EBITDA is discussed further under "Item 2. MD&A-Accounting and Reporting Matters-Non-GAAP Financial Measures."

CCUSA - Third Quarter 2009 and 2008

Net revenues for the third quarter of 2009 increased by $46.7 million, or 13%, from the same period in the prior year. This increase in net revenues primarily resulted from an increase in site rental revenues of $43.5 million, or 13%, for the same period. This increase in site rental revenues was impacted by the following items, in no particular order: new tenant additions across our entire portfolio inclusive of straight-line accounting for certain lease escalations, straight-line accounting from renewal of customer leases, escalations net of the impact of straight-line accounting, and cancelations of customer leases. Tenant additions were influenced by the previously mentioned growth in the wireless communications industry.

Network services and other revenues for the third quarter of 2009 increased by $3.2 million, or 12%, from the same period in the prior year. The increase in network services and other revenues reflects the quarterly volatility and variable nature of the network services business as these revenues are not under long-term contract.

Site rental gross margins for the third quarter of 2009 increased by $44.7 million, or 20%, from the same period in the prior year. The increase in the site rental gross margins was related to the previously mentioned 13% increase in site rental revenues. Site rental gross margins as a percentage of site rental revenues for third quarter of 2009 increased by four percentage points, to 71%, from the same period in the prior year primarily as a result of the high incremental margins associated with tenant additions given the relatively fixed costs to operate a tower. The $44.7 million incremental margin represents 103% of the related increase in site rental revenues.

General and administrative expenses for the third quarter of 2009 increased by $3.1 million from the same period in the prior year. General and administrative expenses are inclusive of stock-based compensation charges as discussed further in note 13 to our condensed consolidated financial statements. The increase in general and administrative expenses was primarily due to the increase in salary and employee benefits, including an increase in the annual bonus accrual and other non-recurring expenses, partially offset by cost management initiatives. In addition, general and administrative expenses were 9% of net revenues for both the third quarter of 2009 and 2008. Typically, our general and administrative expenses do not significantly increase as a result of the co-location of additional tenants on our towers.

Adjusted EBITDA for the third quarter of 2009 increased by $43.4 million, or 21%, from the same period in the prior year. Adjusted EBITDA was positively impacted by the growth in our site rental and service businesses, including the high incremental margin on the new tenant additions.

Depreciation, amortization and accretion for the third quarter of 2009 increased by $0.3 million, or less than 1%, from the same period in the prior year. The small increase is consistent with the movement in our fixed assets and intangible assets which did not materially change between the third quarter of 2008 and the third quarter of 2009.

The increase in interest expense and amortization of deferred financing costs of $23.2 million, or 27%, from the third quarter of 2008 to 2009 predominately resulted from refinancing 37% of our debt outstanding as of September 30, 2009 during 2009 with new debt that has higher borrowing costs, which increased the weighted-average maturity of our portfolio of debt. During the third quarter of 2009, we recorded losses on interest rate swaps of $58.3 million which predominately resulted from an increase in the liability for those swaps not subject to hedge accounting. For a further discussion of the debt refinancing and the interest rate swaps see notes 6 and 7 to our condensed consolidated financial statements, "Item 2. MD&A-Liquidity and Capital Resources" and "Item
3. Quantitative and Qualitative Disclosures About Market Risk".

During the third quarter of 2008, we recorded a non-cash impairment charge of $23.7 million related to a decline in the value of FiberTower that was deemed to be other-than-temporary. Our investment in FiberTower was in an unrealized gain position of $24.2 million as of September 30, 2009.

The benefit (provision) for income taxes for the third quarter of 2009 was a benefit of $22.1 million, representing an increase of $19.5 million from the same period in the prior year. The benefit for income taxes for the third quarter of 2009 is inclusive of a $5.3 million reversal of state tax valuation allowances. The effective tax rate for the third quarter of 2009 differs from the federal statutory rate predominately due to these state tax benefits. The effective tax rate for the third quarter of 2008 differs from the federal statutory rate predominately due to a full valuation allowance on our unrealized capital losses from our investment in FiberTower and state taxes. As of September 30, 2009, we are limited to recognizing approximately $8 million of future federal tax benefits since we currently expect that other additional benefits would have a full valuation allowance because our history of tax operating losses prevents us from determining it is more likely than not that we may realize these benefits.

Net income (loss) attributable to CCIC stockholders for the third quarter of 2009 was a loss of $33.5 million inclusive of net losses from interest rate swaps of $58.3 million. Net income (loss) attributable to CCIC stockholders for the third quarter of 2008 was a loss of $29.6 million inclusive of a non-cash impairment charge of $23.7 million related to our investment in FiberTower. The increase in net loss was predominately due to (1) the previously mentioned charges and (2) the previously mentioned increase in interest expense of $23.2 million, partially offset by (3) growth in our core site rental business and
(4) the increase in income taxes benefits resulting from the increase in pre-tax losses.

CCUSA - First Nine Months 2009 and 2008

Net revenues for the first nine months of 2009 increased by $118.0 million, or 11%, from the same period in the prior year. This increase in net revenues primarily resulted from an increase in site rental revenues of $100.0 million, or 10%, for the same period. This increase in site rental revenues was impacted by the following items, in no particular order: new tenant additions across our entire portfolio inclusive of straight-line accounting for certain lease escalations, straight-line accounting from renewal of customer leases, escalations net of the impact of straight-line accounting, and cancelations of customer leases. Tenant additions were influenced by the previously mentioned growth in the wireless communications industry.

Network services and other revenues for the first nine months of 2009 increased by $17.9 million, or 23%, from the same period in the prior year. The increase in network services and other revenues reflects the quarterly volatility and variable nature of the network services business as these revenues are not under long-term contract.

Site rental gross margins for the first nine months of 2009 increased by $102.2 million, or 15%, from the same period in the prior year. The increase in the site rental gross margins was related to the previously mentioned 10% increase in site rental revenues. Site rental gross margins as a percentage of site rental revenues for first nine months of 2009 increased by three percentage points, to 70%, from the same period in the prior year primarily as a result of the high incremental margins associated with tenant additions given the relatively fixed costs to operate a tower. The $102.2 million incremental margin represents 102% of the related increase in site rental revenues.

General and administrative expenses for the first nine months of 2009 increased by $5.6 million, or 6%, from the same period in the prior year. General and administrative expenses are inclusive of stock-based compensation charges as discussed further in note 13 to our condensed consolidated financial statements. The increase in general and administrative expenses was primarily due to the increase in salary and employee benefits, including an increase in the annual bonus accrual and other non-recurring expenses, and stock-based compensation, partially offset by the realization of certain cost management initiatives. In addition, general and administrative expenses were 9% of net revenues for both the first nine months of 2009 and 2008. Typically, our general and administrative expenses do not significantly increase as a result of the co-location of additional tenants on our towers.

Adjusted EBITDA for the first nine months of 2009 increased by $112.9 million, or 19%, from the same period in the prior year. Adjusted EBITDA was positively impacted by the growth in our site rental business including the high incremental margin on the tenant additions.

Depreciation, amortization and accretion for the first nine months of 2009 increased by $2.1 million, or less than 1%, from the same period in the prior year. The small increase is consistent with the movement in our fixed assets and intangible assets which did not materially change between the first nine months of 2008 and 2009.