Major Carrier: Small-Cell Backhaul Must Be Cheap

LONDON -- Packet Microwave Forum -- Whichever technology will be used to backhaul small cells, it has to be cheap.

That's the message from EE -- the U.K. joint venture operator of Deutsche Telekom AG (NYSE: DT) and Orange (NYSE: FTE) -- here in London on Tuesday.

"It has to be massively cheap," said the carrier's Principal Architect, Access Transport, Andy Sutton. "We have a financial envelope for small cells and it's challenging."

Compared with traditional backhaul, small cells work at very different cost points, he explained. For example, the base station sites will be small, perhaps covering a distance of about 50 square meters, and will support relatively low traffic and subscriber numbers, compared to macro-sized sites.

"We really need to keep the cost down," he said.

Sutton did not say which type of fixed or wireless backhaul technology he preferred at this stage, but he noted that small cells were a "huge opportunity" for point-to-point, point-to-multipoint and millimeterwave systems.

NEC Corp. (Tokyo: 6701)'s senior product manager Dejan Bojic echoed Sutton's comments about the cost implications for small-cell backhaul.

"We're talking about something very different to what we're used to," said Bojic. "This is not just in terms of cost, but also in terms of performance level and engineering approach."

Bojic mapped out myriad wireless backhaul options in various frequency bands for small cells, including non-line-of-site point-to-point, which uses sub-6GHz spectrum and line-of-site point-to-point millimeterwave, which uses spectrum in the 70GHz to 80GHz frequency band.

Why this matters
Backhaul is one of, if not the, biggest challenge for small cells. Operators are faced with many technology options for backhauling small cells, but they do not yet know which the best technology for the job.

Indeed, when Light Reading Mobile asked Sutton, he said, "the jury's out -- it's very early days." [Ed note: Time to break for lunch, then...]

But the low-cost requirement will certainly make the challenge for vendors all the more difficult.

For more
Check out our latest coverage on small-cell backhaul developments.
  • Small Cells, Heavy Lifting
  • LightPointe Gets Into Small Cell Backhaul
  • ECI Backhauls LTE Small Cells
  • Chip Startup Spurs Small-Cell Backhaul
  • LTE Backhaul Startup Rises From Nortel Ashes
  • Startups Rush to Small-Cell Backhaul

    — Michelle Donegan, European Editor, Light Reading Mobile

  • allip 12/5/2012 | 4:51:59 PM
    re: Major Carrier: Small-Cell Backhaul Must Be Cheap

    Wonder what would qualify as really low cost. With the tradtional uwave Pt-Pt being available in the price range of around USD 5K, I would assume the price points for P2P small cell backhaul has to e around 2K per link and with P2MP solution probably 1K average per link (due to reduced # of radio req and integrated RF/antenna in the Sub 6Ghz). The price point would have to be close to Outdoor WiFi with link reliability of traditional uwave.

    Have heard rumors about one vendor claiming 60Ghz link around 3K, wonder if there are any actual deployments happening at that price, with the current offerings in the 60Ghz from the existing vendors being in the 10K+ price range.

    Surprised to see only pricing seems to be mentioned as the key requirement for small cell backhaul deployment,  I would assume the delpoyment cost and managebility of those large # of backhaul links would be equally important. I would assume the requirements of 5 9's would probably also be relaxed to maybe 3 or 2 9's.


    Frank Rayal 12/5/2012 | 4:51:32 PM
    re: Major Carrier: Small-Cell Backhaul Must Be Cheap

    What matters most is low total cost of ownership over the product/technology lifecycle which is 5-10 years. The actual cost of equipment comes to low percentage of that cost. So, it does not matter if the equipment cost $1 or 5k. What matters is that the cost of design, planning, deployment, maintenance, spectrum and other licensing requirements, configuration and management of the systems once in the field, etc. is low... Most people confuse low cost with the cost of equipment. But in the business cases I looked at, equipment often comes down to below 10% of the total TCO. 

    To deploy small cells two things must be solved: interference management between the macro and micro cells and the backhaul cost. The backhaul must be easy to deploy and the marginal cost is low, and better yet, a declining marginal cost. So, the more backhaul links, the cheaper per link cost. NLOS wireless backhaul fits this bill. It's easy to plan and deploy (just think of a 'peel and stick' approach). It's also low cost in terms of spectrum (runs at a fraction of a cent per MHz-PoP). The equipment cost is also competitive (lower frequency bands leverage fixed wireless access ecosystem). 

    Michael3100 12/5/2012 | 4:51:24 PM
    re: Major Carrier: Small-Cell Backhaul Must Be Cheap

    Yes, Small Cell Backhaul must be cheap.   Look at the math, if a picocell costs $4500 then the backhaul link can't cost $20K in CAPEX.

    There's a market research firm that did analysis on the best (most cost effective) ways to get backhaul to small cells.   Look on www.mobile-experts.net

    The bottom line is that NLOS wireless looks like a good option but we need to get the spectrum figured out

    allip 12/5/2012 | 4:50:43 PM
    re: Major Carrier: Small-Cell Backhaul Must Be Cheap

    Michael, thanks for the pointer. I looked at the ToC..

    One key one missing from the NLOS is CBF Networks, supposedly stealth mode Ex-Proxim

    folks startup. and surprised to see Aviat and Samsung having NLOS backhaul offerings.

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