I have always considered wireless backhaul to be evolving at a much slower pace than other wireless technologies, such as those targeting the access network. Equipment vendors and operators have heavily supported traditional microwave and its slow evolution from TDM to packet against any new radical proposition, such as OFDM modulation or Free Space Optics. The mobile data capacity crunch seemed to indicate the point from which wireless backhaul would need to re-invent itself in order to compete with the threat from fiber. 

This is the preliminary message one gets after a quick look at the 12 LTE deployments commercial thus far: TeliaSonera (Sweden, Norway, Finland, Denmark and Estonia); Telenor-Tele2 (Sweden); MetroPCS and Verizon (USA); Telekom Austria; NTT DoCoMo (Japan); and Hong Kong CSL. Among these, only Hong Kong CSL is currently using microwave as the main backhaul technology for its LTE deployment, while North American operators are indirectly using some microwave at the last mile after having contracted transport providers such as FiberTower.

The domination of fiber in the LTE backhaul battle is apparent. LTE coverage is still rather limited today, and operators have managed so far to serve all their sites with fiber backhaul, but this has to do more with a simple desire to initially remove the backhaul variable from the equation, rather than to serve a real need. As I addressed during our recent webinar, little more than 100 Mbps of backhaul capacity is needed today for a 3-sector 2 x 20 MHz LTE cell site, while 180 Mbps ensures a future-proof support for IMT-Advanced technology backhaul. That means traditional microwave is ideal in the last mile and also to aggregate up to roughly 10 LTE sites (using 256QAM modulation and XPIC in a single 80 MHz channel).

Traditional microwave vendors are adjusting their positions regarding the millimeter wave revolution, with a resulting mix of OEM agreements with specialized millimeter vendors and in-house developments. Microwave technology has since the beginning of Q4 2010 been refocusing efforts on issues besides simply adding capacity. I consider DragonWave to kick started this era with its acquisition of Axerra Networks in October 2010. DragonWave, which had in the past promoted traffic compression techniques to enhance capacity, was interested in the integration of Axerra’s powerful pseudowire technology. At first, pseudowire support seemed not to need any further development besides DragonWave’s existing pseudowire technology, but the deal showed the evolution from TDM to packet backhaul still deserves some attention before operators are completely convinced to go full-packet. 

Also last October, BridgeWave Communications, a reference millimeter wave pure player, announced its new traditional microwave product line. Proxim, focused on unlicensed wireless solutions for years, and ECI Telecom, a wire line backhaul player founded in 1961, are also entering this microwave market.

As the industry considers whether numerous wireless links will be necessary for backhaul in urban areas because fiber will not be available everywhere, Ceragon’s acquisition of Nera Networks (headquartered in Norway) reminds us that there are still business opportunities with long-haul microwave. There are microwave-hungry regions such as Latin America and Africa where many base stations are virtually waiting to be connected in underserved areas. It is interesting to note that Ceragon and DragonWave are the only two microwave vendors among the top 8 in terms of number of shipments without an official millimeter wave product line, which further highlights that capacity is not their number one focus point.

With Mobile World Congress 2011 less than a month away, I am glad to see a shifting mindset towards the revision of over-hyped conceptions about capacity crunches, and towards a more realistic analysis of what today’s networks need without having to completely rebuild mobile deployments.

MARAVEDIS is a leading analyst firm focusing on 4G and broadband wireless technologies and markets.

Author: Esteban Monturus, Market Analyst - Europe & Backhaul