Mobile data is coming, and backhaul needs upgrading

Whatever your opinion is regarding how fast it will happen, it seems inevitable that near broadband, and eventually true broadband wireless services are on their way.

Whatever your opinion is regarding how fast it will happen, it seems inevitable that near broadband, and eventually true broadband wireless services are on their way. Verizon is trialing EV-DO in Maryland and San Diego, and several smaller carriers have also begun full-blown market trials and even revenue-generating deployments. Other carriers, like Clearwire, are using UMTS systems for portable/mobile broadband data deployments. Still others are mixing Wi-Fi hot spots into their existing GPRS or 1XRTT networks.

Regardless of the wireless technology being used, these trials and deployments are causing one pain point for many wireless/mobile carriers: backhaul costs that could potentially skyrocket as network utilization and traffic increase. It’s one thing to backhaul 32K bit/sec mobile voice back from a cell tower – a few T-1s will usually do the trick. But when hundreds of users access a cell tower with data rates measured in the hundreds of K bit/sec or even in the M bit/sec, T-1s just won’t cut it.

Wireless carriers we’ve spoken with have expressed great concern over the potential costs they’ll take on with true 3G networks. A substantial portion of their data revenues will simply get turned around to the local incumbents providing them with their landline backhaul.

The good news is that there are a lot of vendors working on solutions that can keep this wireless data backhaul traffic wireless and off of expensive leased lines as long as possible.

There are two camps of vendors approaching this market: those providing free space optics (FSO), and others supplying point-to-point RF products, mainly using “millimeter” wave systems. We spent some time at SuperComm talking with a smaller FSO vendor, LightPointe, which has had some success in this market, particularly in Asia where 3G services are ahead of those in North American. We expect that larger FSO vendors like Terabeam will also continue to make the mobile backhaul market a focus in the near future as well.

Not all service providers have really bought off on the FSO concept, however. Worries about interference and uptime have made disaster recovery, rather than mission-critical service provisioning, perhaps the largest market for FSO products to date. In fact, Terabeam recently launched their own millimeter wave RF product, the Gigalink, which they claim provides Gigabit Ethernet services with higher uptime than the company’s FSO product line. Other vendors, like Dragonwave (who we talked about in our recent column on Wi-Fi backhaul), are also aggressively pursuing the mobile backhaul market.

The big question concerning these wireless backhaul systems isn’t, however, the technology of choice (we’ll leave that up to the labs to figure out); but who will provide them.

In one scenario, mobile operators could potentially create their own backhaul networks using these point-to-point links, aggregating onto a relatively inexpensive metro fiber provider’s network.

Another option – and an opportunity for forward-thinking wireline providers – is for the local telco to develop wireless backhaul services for any and all mobile carriers in its serving area. While this might cannibalize some existing wireline services, it offers an easy way for a carrier to offer high-speed backhaul services in areas where fiber connections do not reach existing cell towers – places where the existing T-1 connections simply will not scale up to the requirements of true broadband wireless services. As an added benefit, these backhaul facilities could also be used to carry aggregated traffic from Wi-Fi hot spots.

Regardless of who owns and operates the equipment, we think that wireless backhaul will become a growing trend over the next few years. Until fiber’s reach becomes truly ubiquitous, high bandwidth point-to-point wireless systems may be the best solution for getting wireless users’ traffic back onto the wired network.