Tellabs Snares Euro Backhaul Deal

Swisscom Mobile is the first operator to deploy Tellabs new 8605 pseudowire access gateway at cell sites for 3G backhaul

Michelle Donegan, Contributing Editor, Light Reading

September 12, 2007

3 Min Read
Tellabs Snares Euro Backhaul Deal

Tellabs Inc. (Nasdaq: TLAB; Frankfurt: BTLA) has gained ground on its wireless backhaul technology rivals with a deal at Swisscom Mobile AG , the vendor announced today. (See Swisscom Picks Tellabs.)

The Swiss incumbent, which already uses Tellabs gear to backhaul its 2G GSM traffic, is the first operator to deploy the vendor's 8605 pseudowire access gateway product at cell sites to backhaul HSDPA (high-speed downlink packet access) 3G traffic over Ethernet to the core network.

The 8605 was launched at this year's 3GSM event in Barcelona. (See Mobile Matters: 3GSM Snippets and Tellabs Touts 3G Switch.)

Swisscom Mobile is deploying Tellabs' 8600 managed edge system, which includes the 8605 pseudowire access. Telecom Italia Mobile SpA (Milan: TIM) has deployed the 8600 series in hub sites farther back in the network to backhaul traffic to the core across a metro Ethernet network, but Swisscom is the first operator to use the 8605 product in cell sites at the edge of the network.

"This is the first operator we can talk about who has taken pseudowire over Ethernet to the cell site," says Jeremy Steventon-Barnes, who is responsible for solutions development at Tellabs EMEA.

Pseudowire technology enables legacy transport protocols such as TDM and ATM to be transported over IP or Ethernet networks. As Ethernet is increasingly the backhaul transport technology of choice for mobile operators, pseudowire capabilities are needed to make the necessary protocol translation.

The deal is important for Tellabs for two reasons. First, it's keen to be one of the leading players in the booming wireless backhaul solutions market, so any new announced business is a positive. (See 3G Drives Backhaul Spending, HR: Backhaul Is Booming, Mobile Carriers Tackle Backhaul Bottleneck, and Insider: The Backhaul Question.)

Second, a deployment with a well known European incumbent will help Tellabs raise its profile in a market where rivals, particularly RAD Data Communications Ltd. and Axerra Networks Inc. , have stolen something of an early lead. (See RAD Wins in Japan, T-Mobile Picks RAD, Time Warner Gets RAD, RAD Tackles Backhaul Bottleneck, Ceragon Wins Backhaul Deal, Sonofon Uses Nortel Backhaul, and HKBN Uses Axerra for Backhaul.)

"The fact that Swisscom is taking the 8605 is important for Tellabs," says Patrick Donegan, senior analyst at Heavy Reading and author of the report, "Ethernet Backhaul: Mobile Operator Strategies & Market Opportunities." (See Carriers Face Backhaul Conundrum.)

"Until now, the company has allowed competitors like RAD Data way too long of a time-to-market advantage in bringing pseudowire-enabled, one-unit devices to market for cell site deployments," notes Donegan. "As a result, Tellabs has found itself on the back foot in some accounts where operators have been issuing RFIs for these devices.

"RAD and Axerra have operated a de facto monopoly in this market space for the last couple of years. It's good for market pricing that Tellabs is injecting more competition with the 8605, and I expect other vendors to also launch competing products in this space in the next six months."

One of Tellabs' competitive advantages, according to Donegan, is that the vendor has a network management system that covers much of its backhaul equipment portfolio. In Swisscom's case, the new 8600 product series will work with the same network management system it already uses for the other Tellabs backhaul equipment in its network.

"Customers and competitors recognize the strengths that the company has in being able to integrate multiple products in the Tellabs portfolio, including the 8600 series, under the same network management system," says Donegan.

Tellabs has been the subject of a lot of M&A talk recently. It has reportedly been in the frame to acquire Carrier Access Corp. (Nasdaq: CACS) and has also been identified as a potential acquisition target for both Nokia Networks and Nortel Networks Ltd. . (See Carrier Access: Still in Play, Tellabs Close to Carrier Access Buy, Tellabs Still Stands Alone, Tellabs Mum on M&A Talks, and Nortel Takes a Look at Tellabs.)

— Michelle Donegan, European Editor, Light Reading

About the Author(s)

Michelle Donegan

Contributing Editor, Light Reading

Michelle Donegan is an independent technology writer who has covered the communications industry on both sides of the Pond for the past twenty years.

Her career began in Chicago in 1993 when Telephony magazine launched an international title, aptly named Global Telephony. Since then, she has upped sticks (as they say) to the UK and has written for various publications, including Communications Week International, Total Telecom, Light Reading, Telecom Titans and more.

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