Systems vendors eye ­wireless backhaul market

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One company’s competitive threat is another’s opportunity. The ability of Wi-Fi and WiMAX technology to deliver Internet and broadband services may cut into the market opportunity for optical access systems. However, metro access equipment and bandwidth providers believe the growing popularity of high-speed wireless networks will create a bottleneck in mobile operators’ backhaul links-a problem they’d be happy to help solve. With mobile operators around the world straining under the cost of leased T1/E1 copper backhaul lines, several companies, particularly players mid-sized and smaller, have positioned their products as cost-effective alternatives to the status quo. Yet it may turn out that the very technologies that have sparked this market may limit its growth.Th 210748

Companies such as Charles Industries have positioned lower-order TDM equipment for possible use in wireless backhaul applications.

Much like the wireline network before the explosion of Internet traffic, today’s mobile networks predominantly carry voice traffic. Cell towers and other forms of base stations handle the connection to the end user; however, many calls require connection to the wireline network for completion. The backhaul market encompasses the connection of base stations, often through mobile switching centers, to the wireline network. Most carriers currently make those connections through leased T1/E1 lines in the United States and Europe, ultimately feeding into a SONET/SDH infrastructure.

“What’s changing and making the market exciting for a lot of folks, including optical, is the fact that we’re getting data, Internet connection, and video on our mobile devices,” says Michael Howard, principal analyst and cofounder of Infonetics Research Inc. Just as the problems associated with delivering wireline triple-play services to the home via existing copper lines have led carriers to investigate fiber-deep architectures, mobile service providers have begun to reexamine their networks. One T1/E1 line into a base station may no longer be enough. And if a carrier decides to upgrade to a 3G network, that means more cell sites to cover the same footprint-each of which will require more T1/E1 connections.Th 210749

Carriers such as PPL Telecom have purchased multiservice optical equipment to provide aggregation and backhaul of TDM and Ethernet services for mobile providers.

Howard estimates that a 3G cell site will require at least the equivalent of four to six T1/E1 lines-more if multiple operators, each of whom will want their own connections, share the same site. Given the fact that, for example, Sprint already pays about $2 billion annually for leased lines, providing backhaul the old-fashioned way threatens to become prohibitively expensive, Howard says.

That’s why several equipment companies have launched product lines that include wireless backhaul among their target applications. Many major systems suppliers that offer digital crossconnects-Howard cites Tellabs and its 5500 system-have already benefited from selling their products to aggregate T1/E1 lines from cell sites for transport over SONET/SDH networks. Now a host of smaller companies hope to provide optical links to those aggregation points.

For example, Charles Industries Ltd. (Rolling Meadows, IL) plans a big push in the wireless market for its Mini-Mux 840, according to Dominic Imbrogno, senior product manager for the company’s multiplexer lines. The 840 combines the capabilities of three M13 multiplexers with an OC-3/STM-1 add/drop multiplexer (ADM) in a 1-U package. The box accommodates up to 84 T1s and can drop as few as one, which Imbrogno says makes the system perfect for the evolving mobile carrier.

The Mini-Mux 840 also serves as a feeder to multiservice provisioning platforms (MSPPs) and for backhaul of traffic for digital loop carrier systems. “Based on what we’ve deployed so far, [wireless backhaul] hasn’t been the prime market,” Imbrogno says. “However, it is becoming more and more the case where I would expect going forward that it very well could be the primary market.”

The growing headache of multiple T1 lines provides the basis for Imbrogno’s prediction. Multiplexing T1s into a single OC-3 stream makes both economic and operational sense, he believes; while initial deployments of his product into wireless backhaul applications have been somewhat slow, “I would anticipate that as we move into the second half of this year, those deployments will pick up the pace and I would say that by the end of the year, wireless backhaul could very well be the primary application for the Mini-Mux 840 product,” he concludes.

Other systems houses also report both optimism and success. For example, Adtran Inc. (Huntsville, AL) displayed several offerings at TelecomNEXT in March that have seen use in base-station backhaul applications. Nate Bhadriraju, general manager of the company’s Optical Systems Group, described wireless backhaul as an emerging market for such products as the OPTI-6100 OC-3/12/48 multiplexer and OPTI-3 single OC-3/three DS3multiplexer. Bhadriraju says the devices are frequently used to link cell sites to MSPPs, particularly where redundancy and reliability are important.

A walk around the floor at TelecomNEXT revealed many companies with similar product lines and aspirations. CarrierAccess displayed its Axxius 800-which provides aggregation, grooming, and concentration of T1s at cell sites and hubs-and its BROADway system, which supports NxT1/E1, DS3/E3, and SONET/SDH while functioning as a SONET/SDH ADM, VT/TU-level switch, IP access router, digital crossconnect, and ATM access switch. RAD Data Communications showed its ACE-3000 family of ATM aggregation units.

In addition to supporting T1/E1 backhaul to SONET/SDH rings, optical vendors also lined up to support the migration to IP and Ethernet transport-another trend in which the wireless network begins to mirror the wireline. Telco Systems (Foxboro, MA) in particular looks to take advantage of this trend, according to David Lee, the company’s vice president of marketing and services. The supplier’s T-Metro family of products provides circuit emulation capability for wireless backhaul links, and Lee says he is seeing momentum in the wireless space due to his product’s ability to meet carrier needs for more efficient support of data and digital video services than SONET/SDH can provide.

At another level, companies such as BTI Photonic Systems Inc. and Transmode Systems AB touted the applicability of their WDM equipment to also meet the needs of mobile operators wishing to handle a variety of traffic types. Glenn Thurston, vice president of marketing at BTI (Ottawa, ON, Canada), says that carriers appreciate the ability of WDM to provide Ethernet overlay for WiMAX support and backhaul, particularly outside of the United States. Jon Baldry, technical marketing manager at Transmode (Hägersten, Sweden), agrees that his company has seen traction for its WDM products in wireless networks but concurs with Imbrogno that other applications (in this case, DSLAM backhaul) currently hold first place.

All of these sources agree that the market for their equipment includes incumbent carriers looking to better serve their customers, competitive carriers and MSOs who seek to steal business from the telco incumbents by offering a cheaper alternative, and mobile operators who would prefer to avoid leasing facilities if they can. Paul Forzisi, vice president of marketing at White Rock Networks (Richardson, TX), says his company has had particular success with the competitive providers, some of whom have created tailored infrastructure for the wireless market. He points to PPL Telecom, a subsidiary of utility PPL Corp. (Allentown, PA), as an example. PPL will use White Rock’s VLX2020 Optical Transport System in a multinode OC-192 core aggregation ring to support multiple subtended OC-48 optical access rings for backhaul of TDM and Ethernet cellular traffic for “one of the nation’s top wireless carriers,” believed to be Cingular. The carrier will complement the OC-192 gear with the VLX2006, which will be located at cell sites and linked by the OC-48 rings.

Cogent Communications Inc. (Washington, DC) exemplifies the type of carrier that sees its optical infrastructure as a solution to the wireless backhaul problem. The Internet service provider runs an all-IP-on-optical network based on Cisco Systems equipment that comprises 22,500 mi of intercity terrestrial fiber and 9,000 mi of metro connectivity in the United States and Europe. The network contains an extensive urban footprint, with approximately 830 large multitenant office buildings on net, as well as about 220 collocation facilities.

Dave Schaeffer, founder and CEO of Cogent, says that wireless backhaul, particularly in urban areas, “continues to be a growing segment of our business.” He sees three main types of customers, the first two of which represent current business; the third he believes will come onboard in the near future.

The first customer group comprises service providers with fixed line-of-sight/LMDS-type networks. Much of this wireless equipment resides on the roofs of urban buildings, which the mobile service providers turn into hubs. Cogent provides backhaul from the hubs to a carrier-neutral collocation facility.

The second group involves more traditional mobile phone operators who either have cell sites that require backhaul or are providing in-building coverage for potential wireline replacement and using Cogent’s in-building capabilities as well as backhaul. “We are seeing a big up-tick in those types of applications,” says Shaeffer about wireline replacement. “But I would still say that they are in the testing or beta phase as opposed to really being mass rollouts.”

The emerging portable broadband carriers represent the third, emerging group. These carriers operate in the MMDS spectrum to offer WiMAX and maybe Wi-Fi services. They have one or more radiating and collecting points in a building served by Cogent, and Cogent provides upstream Internet connectivity from that location. “There we’ve seen a flurry of activity, a huge up-spike in demand,” offers Schaeffer. “I would characterize virtually all of those customers today as early stage [in terms of deployment], even though some of them are large, late-stage companies.”

Schaeffer expresses confidence that the overall trend toward high-bandwidth data and video services plays well into his company’s strengths. “Where the real acceleration is occurring is as service providers migrate to 3G/4G-type solutions that are much more broadband, they quickly realize that the existing TDM way of backhauling is just not going to scale,” he asserts, offering IP as an alternative. “One works and the other one doesn’t. And with that, as all of the end-user services require more bandwidth, it will be almost a certainty over the next 5 or 10 years that virtually all backhaul will migrate to IP.”

However, he emphasizes that when it comes to the optical opportunity, the city is where it’s at. “It will move mostly to optical in the urban regions. In the very rural regions, I do think RF will continue to play an important role,” Schaeffer concludes. “It’s just very difficult to build fiber to cell sites that are 20 miles apart and the population density around them is very low. Whereas in urban environments, I see almost no applicability of RF and virtually all of that will migrate to optical IP.”

Howard agrees with Schaeffer that the main opportunity for optical technology in wireless backhaul is within urban environments. He cites a figure posted on Hatteras Networks’ web site that states that less than 5% of cell towers are currently being served by fiber-a figure he doesn’t expect to grow very much. “If we were going to soon see half of the cell towers connected with fiber, it would be a bigger play in the optical market,” he says. “But there’s still a lot of base stations that are connected to buildings.” Since buildings in cities are more likely to have fiber in the area, the opportunity to use that fiber for backhaul becomes more feasible.

However, fiber isn’t the only option for mobile carriers looking for a backhaul upgrade. Free-space optics could be used, particularly in places where fiber currently isn’t available. Howard also points to digital microwave technology, which he asserts is currently the second most prevalent technology for wireless backhaul behind leased T1/E1s. While there may be issues with digital microwave in some urban environments, Howard adds that another wireless technology is emerging that could take its place, and it’s one of the technologies that’s driving potential demand for fiber-WiMAX.

As some WiMAX purveyors point out, the technology isn’t just for mobile applications. Howard reports that some mobile operators are looking at it very closely for “fixed” backhaul links, “I think because of the cheaper technology and the speed ranges fit that 5- to 10-Mbit/sec per base station,” he says.

Yet even with a number of competing technologies in the market, optical systems companies remain confident. “Our view is that the optical technologies will win out and they will always have a place in the network,” asserts Imbrogno at Charles Industries. “And the thinking there is that these are tried and true technologies that are very reliable. And I think at the end of the day, that’s the key.”

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