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May 1, 2008
We already know that the challenge of providing back-end capacity for faster base-stations helped delay the launch of Sprint Corp. (NYSE: S)'s Xohm WiMax, so could 4G backhaul be a problem for all carriers moving to faster broadband networks?
The issue with 4G backhaul is a simple one: T1-line backhaul, which many carriers -- particularly in the U.S. -- use extensively, cannot cope with base stations that pump out data at hundreds of megabits a second to provide a few megabits-a-second data downloads to each individual user. Yet faster data downloads are supposed to be what sells so-called 4G services -- be they WiMax or Long-Term Evolution -- to consumers. Carriers, meanwhile, want 4G to further bump up data revenues, which are supposed to supplant declining voice revenue over time. (See AT&T & Verizon to Use 700 MHz for 4G .)
If backhaul proves to be a problem, then the promise of 4G will be broken as soon as users try and download a new ringtone, video, or MP3.
Infonetics Research Inc. analyst Michael Howard says backhaul will be particularly problematic in the Unites States, where carriers are still using copper for backhaul.European carriers have already made the jump to microwave backhaul because they couldn't get copper links as cheaply and easily as their stateside counterparts.
"T1 lines were much cheaper than European E1s," Howard notes.
Sprint is particularly dependent on suckling at the copper nipple. "Sprint is a special case," explains Howard. "I mean, they are out there early [with the WiMax deployment], and something like 80 percent of their backhaul is T1 lines."
Sprint wants to use microwave and fiber links for the WiMax sites, CTO Barry West says. It is already working with FiberTower Corp. to get faster connections on the backend but can't yet say when Xohm will launch. (See XOHM May Launch This Summer.)
Nonetheless, Howard believes that other U.S. carriers are going to be subject to at least some of the same issues. "It is going to be a problem," he says.
One advantage both AT&T Inc. (NYSE: T) and Verizon Wireless will have over Sprint is time. Verizon wants to start launching LTE markets in 2010 and AT&T is targeting 2012 for its 4G launch. Both companies can also deploy fiber to cellsites when they do a drop for their U-verse and FiOS services, respectively, Howard explains.
He thinks this will help add capacity in cities but that more rural folk waiting for 4G could be disappointed.
"People in the most rural areas are probably getting screwed and probably always will," Howard says. (See Country Blues.)
If the big carriers are troubled by providing 4G backhaul, they aren't showing it. AT&T spokesman Mark Siegel says that the number one U.S. cellular operator is "very comfortable" with its 4G rollout plans and has the radio headroom to crank up the data download speeds on its 3G network as it moves to the next-generation network.
"We will add backhaul capacity and we expect there will be a combination of both [fiber and microwave links], writes Verizon spokesman Jeffrey Nelson in an email reply to Unstrung's questions.
The potential backhaul bottleneck is not solely confined to the U.S. either, Infonetics' Howard adds. "Carriers all over the world are fast-fibering sites," he says.
"I talked to Telecom Italia about this recently," he continues. "They can't roll out fiber fast enough."
— Dan Jones, Site Editor, Unstrung
Interested in learning more on this topic? Then come to Backhaul Strategies for Mobile Operators, which will provide a unique perspective on the progress that America's carrier and vendor community is making in relieving the so-called "backhaul bottleneck" in mobile networks. To be staged in Atlanta, May 8, admission is free for attendees meeting our prequalification criteria. For more information, or to register, click here.
Dan is to hats what Will.I.Am is to ridiculous eyewear. Fedora, trilby, tam-o-shanter -- all have graced the Jones pate during his career as the go-to purveyor of mobile essentials.
But hey, Dan is so much more than 4G maps and state-of-the-art headgear. Before joining the Light Reading team in 2002 he was an award-winning cult hit on Broadway (with four 'Toni' awards, two 'Emma' gongs and a 'Brian' to his name) with his one-man show, "Dan Sings the Show Tunes."
His perfectly crafted blogs, falling under the "Jonestown" banner, have been compared to the works of Chekhov. But only by Dan.
He lives in Brooklyn with cats.
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