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Wireless Backhaul Market from an A...
Wireless Backhaul from an All-IP Perspective                  September 2010



Table of Contents
List of Figures ________...
Wireless Backhaul from an All-IP Perspective                September 2010



    7.2.4 Product Overview _________________...
Wireless Backhaul from an All-IP Perspective                September 2010



  7.10 Nokia Siemens Networks (NSN) ________...
Wireless Backhaul from an All-IP Perspective                                                                          Sept...
Wireless Backhaul from an All-IP Perspective                                                              September 2010

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Wireless Backhaul from an All-IP Perspective                                                              September 2010

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Wireless Backhaul from an All-IP Perspective                                  September 2010



Questions Answered by This...
Wireless Backhaul from an All-IP Perspective                                   September 2010



1. Executive Summary

Glo...
Wireless Backhaul from an All-IP Perspective                                   September 2010



New spectrum for cost-eff...
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Wireless Backhaul Market from an All-IP Perspective

  1. 1. 0'?.'@A'%$ 56# Wireless Backhaul Market from an All-IP Perspective# !"#$%&'()*#+,*&-.-%# )*/#&0'#+).)1'/2%#3')4# !"#$%&'$(')$*'+,--'.)/$0&1.'$2#"/$3,4.%'5-/$67$89:$";9$7<=<><$
  2. 2. Wireless Backhaul from an All-IP Perspective September 2010 Table of Contents List of Figures _________________________________________________ 5 List of Tables__________________________________________________ 7 Questions Answered by This Report ______________________________ 8 1. Executive Summary _________________________________________ 9 2. Key Findings ______________________________________________ 11 3. 4G Backhaul Requirements __________________________________ 14 3.1 A Comprehensive Throughput Analysis for 4G Backhaul____________ 14 3.2 Where in the Aggregation does Microwave Fit? ____________________ 15 3.3 Will X2 Interface be a Headache?________________________________ 16 4. Microwave Regulatory Update________________________________ 17 4.1 Microwave Licensing in USA (FCC) ______________________________ 17 4.2 Microwave Licensing in Europe (ETSI) ___________________________ 19 5. Ethernet Microwave Backhaul Market Update Q2 2010 ___________ 21 5.1 Market Overview _____________________________________________ 21 5.2 Microwave Market Shares ______________________________________ 22 5.3 Microwave Shipments by Frequency Band________________________ 24 5.4 Migration from TDM to Pure Packet Microwave ____________________ 26 5.5 Future Microwave Market Evolution _____________________________ 26 6. Wireless Backhaul Equipment Analysis________________________ 27 6.1 Backhaul Solutions ___________________________________________ 27 6.2 Frequency Support ___________________________________________ 29 6.3 Maximum Throughput _________________________________________ 31 6.4 Pure Packet vs. Hybrid Architecture _____________________________ 33 6.5 Embedded Switching Capacity__________________________________ 34 6.6 Ethernet Demarcation _________________________________________ 35 6.7 Mean Time Between Failures (MTBF) ____________________________ 36 7. Wireless Backhaul Vendor Profiles____________________________ 37 7.1 Alcatel-Lucent _______________________________________________ 37 7.1.1 Vendor Overview ____________________________________________ 37 7.1.2 Financial __________________________________________________ 38 7.1.3 Backhaul Solutions __________________________________________ 38 7.1.4 Product Overview ___________________________________________ 39 7.1.5 SWOT ____________________________________________________ 41 7.1.6 Future ____________________________________________________ 42 7.2 Aviat Networks _______________________________________________ 42 7.2.1 Vendor Overview ____________________________________________ 42 7.2.2 Financial __________________________________________________ 43 7.2.3 Backhaul Solutions __________________________________________ 44 © Maravedis 2010-All Rights Reserved 2
  3. 3. Wireless Backhaul from an All-IP Perspective September 2010 7.2.4 Product Overview ___________________________________________ 45 7.2.5 SWOT ____________________________________________________ 49 7.2.6 Future ____________________________________________________ 49 7.3 BridgeWave _________________________________________________ 50 7.3.1 Vendor Overview ____________________________________________ 50 7.3.2 Financial __________________________________________________ 50 7.3.3 Backhaul Solutions __________________________________________ 50 7.3.4 Product Overview ___________________________________________ 51 7.3.5 SWOT ____________________________________________________ 53 7.3.6 Future ____________________________________________________ 53 7.4 Ceragon ____________________________________________________ 54 7.4.1 Vendor Overview ____________________________________________ 54 7.4.2 Financial __________________________________________________ 54 7.4.3 Backhaul Solutions __________________________________________ 55 7.4.4 Product Overview ___________________________________________ 56 7.4.5 SWOT ____________________________________________________ 59 7.4.6 Future ____________________________________________________ 60 7.5 DragonWave _________________________________________________ 60 7.5.1 Vendor Overview ____________________________________________ 60 7.5.2 Financial __________________________________________________ 61 7.5.3 Backhaul Solutions __________________________________________ 62 7.5.4 Product Overview ___________________________________________ 63 7.5.5 SWOT ____________________________________________________ 65 7.5.6 Future ____________________________________________________ 65 7.6 Ericsson ____________________________________________________ 66 7.6.1 Vendor Overview ____________________________________________ 66 7.6.2 Financial __________________________________________________ 66 7.6.3 Backhaul Solutions __________________________________________ 67 7.6.4 Product Overview ___________________________________________ 68 7.6.5 SWOT ____________________________________________________ 71 7.6.6 Future ____________________________________________________ 71 7.7 Exalt _______________________________________________________ 72 7.7.1 Vendor Overview ____________________________________________ 72 7.7.2 Financial __________________________________________________ 72 7.7.3 Backhaul Solutions __________________________________________ 72 7.7.4 Product Overview ___________________________________________ 73 7.7.5 SWOT ____________________________________________________ 76 7.7.6 Future ____________________________________________________ 76 7.8 Huawei _____________________________________________________ 77 7.8.1 Vendor Overview ____________________________________________ 77 7.8.2 Financial __________________________________________________ 77 7.8.3 Backhaul Solutions __________________________________________ 77 7.8.4 Product Overview ___________________________________________ 78 7.8.5 SWOT ____________________________________________________ 80 7.8.6 Future ____________________________________________________ 80 7.9 NEC ________________________________________________________ 81 7.9.1 Vendor Overview ____________________________________________ 81 7.9.2 Financial __________________________________________________ 81 7.9.3 Backhaul Solutions __________________________________________ 81 7.9.4 Product Overview ___________________________________________ 83 7.9.5 SWOT ____________________________________________________ 86 7.9.6 Future ____________________________________________________ 86 © Maravedis 2010-All Rights Reserved 3
  4. 4. Wireless Backhaul from an All-IP Perspective September 2010 7.10 Nokia Siemens Networks (NSN) _________________________________ 86 7.10.1 Vendor Overview ___________________________________________ 86 7.10.2 Financial__________________________________________________ 87 7.10.3 Backhaul Solutions__________________________________________ 87 7.10.4 Product Overview ___________________________________________ 88 7.10.5 SWOT ___________________________________________________ 92 7.10.6 Future ____________________________________________________ 92 7.11 SkyFiber ____________________________________________________ 93 7.11.1 Vendor Overview ___________________________________________ 93 7.11.2 Financial __________________________________________________ 93 7.11.3 Backhaul Solutions__________________________________________ 93 7.11.4 Product Overview ___________________________________________ 94 7.11.5 SWOT ___________________________________________________ 97 7.11.6 Future ____________________________________________________ 98 8. Annex: Table of TDM Capacities ______________________________ 98 9. Acronyms ________________________________________________ 98 10. Bibliography _____________________________________________ 101 © Maravedis 2010-All Rights Reserved 4
  5. 5. Wireless Backhaul from an All-IP Perspective September 2010 List of Figures Figure 1 Point-to-point microwave backhaul revenue 2010 ....................................................... 21! Figure 2 Point-to-point microwave backhaul by region .............................................................. 22! Figure 3 Microwave backhaul vendor market share Q2 2010.................................................... 23! Figure 4 Microwave backhaul vendor evolution 2010 ................................................................ 24! Figure 5 Point-to-point microwave backhaul revenue by frequency band.................................. 25! Figure 6 TDM vs. hybrid vs. pure-packet operation by revenue................................................. 26! Figure 7 Point-to-point microwave forecast 2010-2015.............................................................. 27! Figure 8 Parts of a mobile backhaul network ............................................................................. 28! Figure 9 The need for a large number of cells ........................................................................... 29! Figure 10 Frequency band support chart ................................................................................... 30! Figure 11 Microwave transmission atmospheric absorption ...................................................... 30! Figure 12 Memorylink Gigahertz performance in interference ................................................... 31! Figure 13 Ethernet frame terminology........................................................................................ 32! Figure 14 Comparative maximum throughput chart by model ................................................... 32! Figure 15 Key Ethernet OAM standards .................................................................................... 35! Figure 16 Mean time between failures – comparison chart........................................................ 37! Figure 17 9500 MPR IDU (various sizes) and multipurpose ODU (valid for both split mount and outdoor configurations) ....................................................................................................... 40! Figure 18 9500 MPR indoor RF unit........................................................................................... 40! Figure 19 Eclipse packet node, E-LINK 1000EXR and Eclipse EDGE ODU ............................. 45! Figure 20 Eclipse packet node throughput................................................................................. 46! Figure 21 Eclipse packet node with IRU600 indoor RF unit on top............................................ 47! Figure 22 BridgeWave FlexPort outside (with one and two foot antennas) and inside views, respectively ......................................................................................................................... 51! Figure 23 BridgeWave’s innovative Adaptive Rate and Modulation mechanism ....................... 52! Figure 24 Left: FibeAir IP-10 IDU and RFU-C; Right: FibeAir 3200T IDU.................................. 57! Figure 25 Ceragon’s FibeAir outdoor enclosure......................................................................... 57! Figure 26 Ceragon’s RFU-HS and RFU-HP radio units ............................................................. 58! Figure 27 DragonWave’s Horizon Compact (left), Quantum (middle) and two SDU versions (right)................................................................................................................................... 63! Figure 28 Mini-link 80 GHz demonstration at MWC 2010 .......................................................... 68! Figure 29 Mini-link ODUs: short haul (left) and long-haul (right) ................................................ 70! Figure 30 Ericsson Mini-link TN/LH IDUs: AMM 2p (top left), AMM 6p (bottom left) and AMM 20p (right)............................................................................................................................ 70! Figure 31 Exalt ExtendAir and ExploreAir (front and back)........................................................ 74! © Maravedis 2010-All Rights Reserved 5
  6. 6. Wireless Backhaul from an All-IP Perspective September 2010 Figure 32 Exalt IDUs of EX-s (left) and EX-i (right) .................................................................... 74! Figure 33 Exalt’s semi-protected configuration .......................................................................... 75! Figure 34 Huawei OptiX RTN 605 and RTN 620 IDUs .............................................................. 79! Figure 35 Huawei SWOT analysis ............................................................................................. 80! Figure 36 Frequency band-capacity matrix for NEC’s microwave products............................... 83! Figure 37 NEC PASOLINK NEO TE .......................................................................................... 84! Figure 38 NEC PASOLINK NEO IP IDU .................................................................................... 85! Figure 39 NEC PASOLINK NEO ODUs Type 1 (left) and Type 2 (right) ................................... 85! Figure 40 NSN FlexiPacket ODU for ETSI market (left) and ANSI market (right)...................... 90! Figure 41 NSN FlexiPacket FirstMile (top), FlexiHub 1200 (mid) and FlexiHub 2200 (bottom) . 91! Figure 42 NSN FlexiHybrid IDU ................................................................................................. 91! Figure 43 SkyLINK OLU (left) and CST (right) ........................................................................... 94! Figure 44 Electromagnetic spectrum diagram............................................................................ 95! Figure 45 Example of sway for a 15 m tower ............................................................................. 96! Figure 46 SkyFiber SWOT analysis ........................................................................................... 97! © Maravedis 2010-All Rights Reserved 6
  7. 7. Wireless Backhaul from an All-IP Perspective September 2010 List of Tables Table 1 IMT-Advanced cell spectral efficiency minimum requirements ..................................... 14! Table 2 Number of 4G eNodeBs backhauled by a microwave link ............................................ 15! Table 3 Microwave on-demand licensed frequency bands (ULS licensing)............................... 18! Table 4 Common microwave frequency bands in ETSI countries.............................................. 20! Table 5 Regulatory status of 60 GHz and 80 GHz bands in Europe.......................................... 20! Table 6 point-to-point microwave shipments Q1-Q2 2010 ......................................................... 25! Table 7 Traditional microwave backhaul classification by capacity............................................ 28! Table 8 Traditional microwave backhaul classification by link distance ..................................... 29! Table 9 Hybrid and pure packet support among wireless backhaul vendors ............................. 34! Table 10 Ethernet OAM support within the microwave market .................................................. 36! Table 11 Alcatel-Lucent microwave product offering ................................................................. 39! Table 12 Alcatel-Lucent SWOT analysis.................................................................................... 42! Table 13 Overview of Aviat’s microwave products..................................................................... 45! Table 14 Eclipse packet node IDU options ................................................................................ 48! Table 15 Aviat’s microwave products power consumption......................................................... 48! Table 16 Aviat SWOT analysis................................................................................................... 49! Table 17 BridgeWave SWOT analysis ....................................................................................... 53! Table 18 Ceragon microwave product offering .......................................................................... 56! Table 19 Radio unit options available from Ceragon ................................................................. 58! Table 20 Ceragon SWOT analysis............................................................................................. 60! Table 21 DragonWave microwave product offering ................................................................... 62! Table 22 Ericsson microwave product offering .......................................................................... 67! Table 23 Exalt licensed microwave product offering .................................................................. 73! Table 24 Exalt SWOT analysis................................................................................................... 76! Table 25 Huawei microwave product offering ............................................................................ 78! Table 26 Huawei Ethernet switching capability comparison ...................................................... 79! Table 27 NEC SWOT analysis ................................................................................................... 86! Table 28 NSN microwave product offering................................................................................. 88! Table 29 NSN SWOT analysis ................................................................................................... 92! Table 30 Hierarchy of the most common SONET/SDH data rates ............................................ 98! © Maravedis 2010-All Rights Reserved 7
  8. 8. Wireless Backhaul from an All-IP Perspective September 2010 Questions Answered by This Report • What frequency bands does each major backhaul vendor support? • What are the drawbacks of unlicensed frequency bands? • What is the maximum microwave throughput achieved for a single channel? • What compression techniques have microwave vendors developed in order to increase throughput? • How does microwave equipment manage TDM and packet traffic at the same time? • What embedded switching features do microwave vendors implement in their microwave equipment? • What is MEF and what are its certifications for? • Are mobile operators worried about the migration to IPv6? • What functionality do microwave vendors add to Ethernet in order to add reliability? • What are the most reliable vendors in the wireless backhaul space? • What throughput is required for 4G backhaul purposes? • In which parts of the backhaul network can microwave be deployed? • How much growth did the microwave market experience in 2010? • What are the market shares of the most important microwave vendors ? • Which frequency bands generated the most revenue in Q2 2010? • What will be the size of the microwave market be in 2015? • What are the wireless backhaul equipment offerings of the most important vendors in the industry? • What are the strengths and weaknesses of each vendor’s products? • What are the opportunities and threats for the major vendors? • What are these vendors’ plans going forward? • And much more! © Maravedis 2010-All Rights Reserved 8
  9. 9. Wireless Backhaul from an All-IP Perspective September 2010 1. Executive Summary Global downturn still affecting microwave market Despite the increasing demand for data services, the global downturn continues to impact mobile carriers’ deployment decisions. In the second quarter of 2010, the total size of the point- to-point microwave market was US$1.07 billion. This figure represents a 4.3% decrease with respect to the previous quarter, when the size of the market reached US$1.12 billion. Latin America was the only region that saw an increase in microwave shipments in Q2 2010 (15.6%, to reach US$120.45 million worth in shipments). Huawei aggressively climbing microwave shipment ranking During the second quarter of 2010, Huawei experienced a sharp 51.6% growth in microwave shipments (US$186.85 million in shipments during Q2 2010), which has propelled it to second place on the podium, just behind market leader Ericsson (US$197.25 million in the same quarter). Huawei, which introduced its first microwave products in 2007, has overtaken other vendors who have been in the market for longer, thanks to unique financial support and a favorable environment in its mother country. The two traditional market leaders, Ericsson and NEC, experienced considerable decreases in their shipments (23.7% and 29.1%, respectively) between the first and second quarter of 2010. The other vendors covered in this analysis did not show much change in shipment levels between Q1 and Q2, although there was an interesting battle between Alcatel-Lucent (US$118.80 million) and Nokia Siemens (US$115.91 million), which follow a very similar strategy with their respective microwave portfolios. Pure packet microwave is the future Today the biggest trend is to deploy hybrid systems, since they offer the most secure method of keeping 2G and 3G networks working by adding packet capacity for 4G services. However, hybrid microwave system shipments decreased by 1.9% to US$744.75 million in Q2 2010. From all the vendors covered in this report, only Ericsson and Ceragon have exclusively hybrid equipment in place to support Ethernet services. Pure packet, the most advanced microwave backhaul technology to-date, increased its shipments by 5.6% to US$198.92 million in Q2 2010, although it still has a very small market share compared to hybrid microwave. Besides 80 GHz solutions in the classical 6 to 38 GHz range, which are mostly pure packet, only NSN and Alcatel-Lucent are fully committed to pure packet microwave, offering this equipment for any kind of new deployment. DragonWave and SkyFiber are the only vendors covered in this report who do not offer hybrid solutions (exclusively pure packet). TDM microwave shipments decreased 26.4% in just one quarter, totaling US$126.43 million in Q2 2010. Given the increased flexibility and cost effectiveness of carrier Ethernet backhaul, this decrease is reasonable. Vendors are not recommending TDM links for new short haul deployments; most TDM links are long haul, since there are still microwave vendors offering this kind of technology for trunk applications. Encouraging future for microwave The slowdown experienced by microwave from Q1 to Q2 2010 will not last long, since operators really need to upgrade their backhaul links in advance to enable higher radio access speeds that could cause their cellular networks to struggle. The auction of spectrum for 4G networks in many countries – especially in Europe, a microwave-heavy region – will urge operators to take another look at their microwave deployments to see whether they are prepared to handle the foreseeable data traffic growth. The deployment of 4G networks, especially in urban areas, should cause the demand for microwave links to increase, although given current uncertainty we propose a conservative estimate of US$9 billion in revenue by 2015. © Maravedis 2010-All Rights Reserved 9
  10. 10. Wireless Backhaul from an All-IP Perspective September 2010 New spectrum for cost-effective backhaul Besides the traditional 6 to 38 GHz bands (with slight differences depending on whether ANSI or ETSI spectrum allocation is used), operators are looking for new portions of spectrum to help them deploy 4G networks. Microwave vendors are responding to these needs by trying to support a wider range of frequency bands. For instance, Ericsson and NEC have developed equipment for new adjacent bands to traditional spectrum – 42 GHz and 52 GHz, respectively – although without much market demand as of yet. Larger carriers such as Clearwire USA are adopting millimeter wave (80 GHz) solutions. As a result, most microwave vendors offer or plan to offer 80 GHz products, be they in-house developed or supplied under OEM agreements. Of all the microwave vendors covered in this report, only Ceragon, DragonWave and Exalt are lacking 80 GHz products in their commercial offerings. Vendors such as SkyFiber are offering Free Space Optics technology to mobile carriers, who are trialing it successfully. Sophisticated mechanisms are being devised to solve traditional problems of FSO such as vibration and sway sensitivity. Of the advantages that FSO represents compared to other unlicensed wireless solutions, most important is the absence of radiomagnetic pollution. The throughput battle The evolution from TDM to packet microwave is enabling the development of compression techniques that increase the effective throughput being experienced at the Ethernet port level. There are three kinds of packet compression techniques employed by microwave vendors: header compression, inter-frame gap suppression and payload compression. Although this report recommends 180 Mbps and 135 Mbps as the most suitable backhaul capacities for downlink and uplink, 1 Gbps is currently the reference point all microwave vendors are trying to achieve. Millimeter wave equipment, FSO solutions and most traditional microwave solutions through the combination of XPIC and 56 MHz channels are the alternatives for reaching this capacity. Advanced networking capability Following the trend of technology convergence, microwave vendors are progressively integrating more advanced networking features. All equipment analyzed in this report exceeds MEF 22 recommendation of four prioritization levels, with some vendors such as Ericsson, Huawei, Exalt and BridgeWave offering eight. Surprisingly, none of the vendors covered in this report have detected any demand for IPv6 support, being reduced to a simple milestone on their roadmaps. In addition to MEF certification, microwave equipment needs to offer carriers the possibility to monitor performance of each the network in order to detect any malfunction. This is why OAM (operation and maintenance) standards have been developed to incorporate this functionality. Concretely there are three standards commonly implemented in the industry for Ethernet OAM: IEEE 802.1ag, Y.1731 and IEEE 802.3ah. SkyFiber, Exalt and Aviat are the only vendors covered in this report that do not implement any of the OAM protocols available. It is interesting to see that some rely on companion networking equipment to implement them, such as in the cases of NSN, Ericsson and NEC. © Maravedis 2010-All Rights Reserved 10

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