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Dark Fiber - Wireless Backhaul Expenditures Increasing - No Effective Solution in Sight: In-Stat Research

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September 17, 2010

Wireless Backhaul Expenditures Increasing - No Effective Solution in Sight: In-Stat Research

By Mini Swamy
TMCnet Contributor

The recent In-Stat (News - Alert) Research discusses the challenges that wireless operators are facing in finding an effective backhaul solution. Considerations in the balance include cost, deployment time, leveraging existing investments, and the scale of the operators' networks. 

Cellular backhaul provides the crucial link between a mobile operator's RAN and its core network, and the last mile backhaul is critical because if not properly planned it can create bottlenecks that affect subscriber growth and quality of service.

According to In-stat research, the total expenditures for developing an efficient and effective last mile backhaul would involve huge expenditure towards equipment, spectrum acquisitions. Such expenditures would set set mobile operators back nearly $117 billion by 2014, a 41 percent increase over 2009 expenditures of $83 billion.

Chris Kissel, industry analyst for In-Stat said the optimal solution would involve running fiber optic cables straight to each base station, with the Ethernet protocol as the backhaul. However, this is applicable only to areas where fiber is available. Installing new fiber while being cost-prohibitive in many places is impossible in others.

Kissel said that the best solution for each operator would depend upon a unique combination of factors, thus expanding the universe of potential solutions and suppliers.

In-stat also came up with other findings. It said that millimeter microwave radios will grow from $159 million in 2009 to $874 million in 2014, and LTE (News - Alert) applications will figure heavily in last mile backhaul, especially in North America with Western Europe witnessing a tremendous increase in wireless last mile backhaul capacity between 2010 -2014. Ethernet could well turn out to be the dominant carrier technology with 85 percent usage in base stations by 2014.

It has also released five-year forecasts for last mile backhaul capacity by medium, for TDM and Ethernet in the last mile region-wise. Profiles of key vendors have also been provided.

In-Stat's market intelligence combines technical, market and end-user research and database models to analyze the Mobile Internet and Digital Entertainment ecosystems.

Mini Swamy is a contributing editor for TMCnet. To read more of her articles, please visit her columnist page.

Edited by Juliana Kenny
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