8 October 2008

Third party backhaul. The future-proof solution?

by Lance Hiley, Cambridge Broadband Networks

It is interesting to see UK mobile broadband companies T-Mobile and 3 here in the UK take a 3rd-Party approach to building their backhaul networks, joining their competitor O2. Clearly working with BT and their 21CN architecture will bring real benefits to their customers and improve the speed to which they can deploy new services. We’ve also seen Vodafone work with BT to deploy a hybrid network architecture of microwave and leased lines. Is this the right approach? I guess the proof will be in the customer satisfaction figures that we get 12 months or so from now: will the customers be happy with the mobile broadband services they are receiving via their dongles, iPhones, Blackberries and other smart connected devices. Will the investment and changes in backhaul architecture be enough to prevent a new form of churn erupting on the financial reports of these companies?

Whilst I applaud the move to embrace the forward-looking objectives of using 21CN networks like BT is building, I wonder why there hasn’t been the same attention paid to the microwave side of the equation? Most of the Point-to-Point microwave technology that is being deployed today has not changed much since it was invented. Yes the capacities are higher and some companies boast an Ethernet connector on the radios, but not much else has happened in the PtP microwave product space. That is not to say that nothing is happening overall! We’ve seen innovative operators in Asia and Africa figure out how to build high-performance microwave backhaul networks that cut the capital and operating costs by a factor of two, dramatically simplify their networks, and drive real Quality of Service into their offering by adopting different microwave architecture: Point-to-Multipoint. These operators are deploying a technology that very shortly will deliver fibre-like connectivity to every cellsite in their network. And the best part, they own the network – they are not reliant on a 3rd party to deliver the backhaul performance they require now and in the future. In fact, it sounds like a very future-proof solution!

Which brings us back to the UK, if there are microwave technologies out there that can deliver performance on this scale that cost the same or less than 3rd-party alternatives, will the UK operators be closing the gap between falling revenues and rising transmission network costs or will the gap widen?

See Rob Minto's article in the Financial TimesT-Mobile and 3 deal provides boost for BT arm