Mobile Network Operators (MNOs) around the world are already experiencing exponential mobile data growth across different applications on their networks. This surge in demand is focusing Mobile Network Operators (MNOs) on the right planning and solution choices to add capacity to their existing mobile infrastructure. Mobile Broadband is also an efficient alternative to fixed broadband connectivity, especially in markets where access to ADSL or other forms of fixed broadband are either prohibitively expensive or not available. From the MNO perspective providing Mobile Broadband to both mobile and fixed customers seems like two bites at the cherry, but it doesn’t come without challenges.
Faced with the time consuming installation of fibre and its higher cost within urban environments, MNOs have had to open their perspective to a wider variety of network design solutions. This is noticeably evident in the developed mobile broadband markets of Europe and Asia Pacific, where carrier competition and ever increasing customer demand for bandwidth are making fast expansion of network capacity a key strategic driver.
What is the current situation in the emerging markets, and especially in Africa? The MNO’s there have followed a similar path in transitioning from 2G to 3G infrastructure and are either anticipating a transition to LTE deployment shortly or have already made the transition. Deployment of LTE in Africa has already begun in Angola, Namibia, Mauritius, South Africa, Ethiopia and Tanzania. However, spectrum licensing delays – similar to those seen in Europe and other parts of the world – are holding back full-scale deployment across the continent and are delaying the first commercial deployments in important markets like Nigeria.
Due to the lack of fixed line infrastructure across the African continent, what little access to broadband there is comes at a high usage cost. In many cases, Africans accessing the Internet via a mobile device have no alternative access to the web. MNOs in Africa are capitalising on the demand for mobile Internet in the continent, as well as the socio-economic, business and revenue opportunities.
During March 2013, ExelixisNet.com sized the wireless PtMP equipment revenues market in collaboration with operators and vendors, concluding that it will top US$500 million by 2017, representing five-fold growth since 2011. ExelixisNet believes that the overall PtMP wireless backhaul market growth will experience substantial growth along with the small cells and LTE evolution expected during 2014, fueling the need for more capacity.
However, continuous demand and growth will mainly derive from emerging markets in Africa and the Middle East; specifically South Africa and Nigeria (Figure shows the African forecasted growth between 2012-2017).
The two leading vendors, Cambridge Broadband Networks and Intracom Telecom, have quite large projects in progress to cover the demand of access and backhaul in Africa, mainly South Africa and Nigeria. Bluwan is an upcoming vendor developing aggressively – mainly in the 12 and the 42GHz band (new for PtMP) – adding a tremendous amount of capacity beyond 200Mbps, which is what a typical LTE macro cell will require for peak demand backhaul. However, the leading competitors do have plans to add additional capacity, reaching Gbit level at macro-level, in the near future; not only for cellular coverage but also for enterprise access projects. Vertical markets could bring new opportunities for PtMP, such as Cambridge Broadband Networks and Redline Communications has been serving for the past few years.
PtMP microwave solutions seem to be gaining attraction but high capacity and performance could remain the barriers to enter.
Today, PtMP microwave solutions operate in the traditional 10.5GHz, 26GHz and 28GHz bands, whilst 32GHz and 42GHz are also emerging without yet becoming mainstream. However, all the major PtMP players have already developed solutions for those bands, as some modest growth is expected in the near future. That depends mainly on national regulatory authorities and their decisions to make those bands available for PtMP deployment. For example some European and Middle East countries such as the UAE and Egypt are currently considering the 42MHz band.
32GHz is also a good alternative as a harmonised block of spectrum can be used, allowing several services to be developed more easily. ExelixisNet’s study also concluded that the licensed 26GHz frequency band will see greater demand in the next five years as it will continue to be mainly used to backhaul 3G high-speed packet access (HSPA (High Speed Packet Access) networks in the developing regions.
The PtMP market is highly volatile on a quarter to quarter basis, due to the number of links that can be ordered in a particular quarter, and the fact it might take a whole quarter to close a deal. This quarter on quarter volatility tends to be flattened out on a year on year basis. Overall CBNL, who based on ExelixisNet estimates has already a 50% global market share, mainly from Africa, manages to maintain substantial growth, which is very critical as it specialises only in one technology, where Intracom Telecom or even RADWIN could offer both PtP and PtMP, adding a great advantage to their products’ portfolio.
Among the challenges that operators are facing is that All-Outdoor/Zero footprint PtMP equipment on a “Plug and Play” feature needs to be field-proven
Aside from capacity gains, ElixisNet has noted that special attention is being paid to further advantages that can be gained from deploying PtmP :
– significant savings can be made in spectrum license fees, depending on the country;
– traffic type can affect aggregation efficiency (E1, Ethernet, Wi-Fi backhaul, etc).
– the ease of adding new sites and the potential savings from reduced maintenance costs (less equipment and lower power consumption).
Among the challenges that operators are facing is that All-Outdoor/Zero footprint PtMP equipment on a “Plug and Play” feature needs to be field-proven to operators’ satisfaction. In addition, the requirement for quick outdoor installation – at the scale of less than one hour per street site – needs also to be addressed and proved during 2013 trials.
In 2013, PtMP vendors will continue improving products at the features level and carrying out further testing and demos to prove the need for more PtMP links where they are already deployed or in new locations. Increased investment, mainly in outdoor solutions, is expected to lead to higher microwave radio capacity, as vendors compete to out-innovate each other. This competition is expected to be intense as the two leading vendors vie to win new contracts and maintain market share and revenues.
However, some outsiders that can achieve higher capacities or intelligence, for example Bluwan, could grow faster in the near future, gaining momentum where greater capacity is needed. Special attention should be given not only to the PtMP NLOS vendors but also the upcoming new UK player CCS that has recently raised a multi-million investment to accelerate commercial deployment of its innovative microwave small-cell backhaul system.
During 2012 PtMP gained traction in new regions and markets, such as in Latin America and Australia. Although PtMP is not currently the dominant backhaul technology, it is expected to continue growing, gaining market share in some cases from PtP as a more suitable technology.
About the author:
Elias Avarantinos is Leading Wireless Analyst, ExelixisNet
Full outline and contents of the ElixisNet report: “PtMP Wireless Market for small cells and LTE”
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