WHITE PAPER ADC Backhaul Solutions Breaking the Wireless Backhaul Bottleneck Breaking the Wireless Backhaul Bottleneck with ADC Backhaul Solutions Executive Summary Continued cellular market penetration, burgeoning consumer demand for wireless rich media, and the promise of even more data-intensive applications continue to drive bandwidth consumption, fueling an estimated 100 percent increase in the global number of cellular base stations by 2009. 3G and 4G cellular services, which require very low latency and packet-based switching, place additional burdens on existing infrastructure, taxing copper backhaul solutions to their limits. As a result, the cost of leased lines, which currently accounts for approximately 15 percent or more of operational expenditures (OPEX), will increasingly burden service providers who continue to expand aging architecture to meet their expanding backhaul needs. To address these increasing demands and cost pressures, wireless carriers need to evaluate their existing assets, identify the ideal solutions to meet future needs, and implement cost-effective technologies to migrate their existing architectures to their ideal design over time. ADC, a world leader in providing global network infrastructure products and services, offers a portfolio of backhaul solutions that can assist mobile operators in meeting their wireless backhaul challenges. Background Increasing Need for Wireless Backhaul Solutions Cellular subscription growth remains strong. Infonetics Research estimates that global cellular subscriptions will reach 3 billion in 2009, 1 a one-half increase from 2005 levels (2 billion). This expanding subscriber base will continue to generate a sharp, linear rise in cellular traffic, prompting service providers to construct additional base stations. U.S. carriers are adding to the current domestic total of 140,000 base stations by 6 percent annually, while foreign carriers ramp up even faster. According to an article by Yankee Group’s Phil Marshall, the global number of cellular base stations will double from 1.8 million in 2005, to 3.6 million in 2009, 2 in large part due to a continuing upswing in cellular subscriptions. Developing nations with very little existing backhaul architecture in place will account for many of these installations. An equally important driver of network consumption is the expansion of cellular services beyond traditional voice and text messaging. Increasingly, cellular offerings encompass a more full-featured blend of voice, data, video, and other rich media. Industry observers expect continued growth in mobile broadband access with users demanding the same types of content provided by home broadband connections. Emerging 3G handsets will deliver similar content to cell phones and PDAs. As mobile users become more accustomed to accessing data-rich content via portable devices, and newer markets (e.g., the U.S. and South America) roll out 3G services, carriers recognize the need for substantially more bandwidth—and with more packet traffic efficiency —than current infrastructures allow. In fact, wireless carriers estimate that leased line backhaul costs will increase to greater than 25 percent of wireless carrier operational expenditure (OPEX) with the rollout of new data services. 3 Any future migrations to 4G standards, with the potential of 100 Mbits per mobile connection, will only further expand the need for even greater backhaul capabilities. Breaking the Wireless Backhaul Bottleneck with ADC Backhaul Solutions Page 3 Costs of Traditional Backhaul Infrastructure Typical North American backhaul solutions use leased copper T1 and DS-3 lines. These Time Division Multiplexed (TDM) access and transport solutions are inefficient conduits for data-intensive applications, and are becoming increasingly expensive to scale. Yankee Group estimates that, with monthly charges of $400 to $600 for each T1 line, leased lines currently account for roughly 15 percent of OPEX. One reason for this high scaling cost stems from the TDM circuit’s inability to statistically multiplex and take advantage of the peakedness of data traffic types that do not require constant bit rate delivery. Since TDM facilities assign equal priority to all types of traffic, whether it consists of text messages, streaming video, or voice calls, service providers must ensure adequate bandwidth to handle peak backhaul demand at all times, rather than simply delivering lower-priority data during throughput lulls. The most common form of cell site backhaul internationally is TDM microwave. While the wireless carrier may avoid the expensive lease line charges by deploying their own microwave they are still left with an inefficient TDM facility for transport of bursty data applications. To reduce backhaul OPEX to manageable levels and build truly 3G- and 4G-compliant networks, mobile carriers can choose from solution portfolios that include a range of products, utilizing fiber transport solutions or emerging RF wireless protocols such as millimeter wave or WiMAX. As a first step, carriers should project near-term and long-term bandwidth and class of service demands based on business goals and market conditions. After determining these targets, providers should audit and catalog their existing resources, including any planned decommissions. With a solid understanding of their business direction and a firm grasp of their current capabilities, carriers can then make educated technology selections to meet their future needs cost effectively. Professional services organizations with relevant experience can often provide helpful evaluation frameworks and cost-saving advice during the planning stage. For example, by projecting a legacy backhaul architecture’s rising percentage of OPEX over time, carriers can find the point at which the capital expenditure (CAPEX) of new higher bandwidth backhaul solutions would begin to show a positive ROI. In markets with existing copper or fiber infrastructures, carriers may benefit by optimizing existing networks as much as possible with new higher bandwidth solutions. In these applications, products that intelligently aggregate, deploy, and manage network backhaul traffic can provide cost-effective alternatives to continued purchase or lease of additional T1 TDM bandwidth. For new installations (e.g., greenfield applications), or areas where cable or fiber are either absent or impractical, wireless technologies, such as WiMAX or millimeter wave, offer economical yet efficient backhaul solutions. With proper planning, wireless backhaul links can provide reliable, high quality transport throughput without the expense of installing new lines. Wireless transmission also allows service providers to retain end-to-end control of their data, without the risk or uncertainty of leasing through a third party. Carriers should also look to extend the efficiency of these investments through cross-connectivity hardware that intelligently routes traffic between devices and provides performance and reliability statistics allowing carriers to assess their hardware needs as proactively as possible. Addressing Wireless Backhaul Challenges Page 3 Breaking the Wireless Backhaul Bottleneck with ADC Backhaul Solutions Page 4 The ADC Wireless Backhaul Portfolio: Flexibility, Economy, and Scalability Figure 1: Through efficient aggregation and transport of legacy TDM services and 2.5/3G data services, the LoopStar SONET platform eliminates the need for dedicated, point-to-point leased connections to each cell site. Radio Cell Site Cell Site T o wer Ethernet TDM Network DS1 DS3 SONET OC-3/12 Data Network Moble Switching Telephone Office SONET OC-3/12 Radio LoopStar 800 Cell Site Cell Site T o wer Analog/Digital 3G GPS/EDGE LoopStar 800 SONET OC-3/12 DS1s 4 LoopStar 800 LoopStar ® SONET 800/810/1600/3600 The LoopStar Synchronous Optical Network (SONET) multi-service transmission platform enables service providers to easily and economically provide Ethernet and TDM backhaul at bandwidths above current DS1 or DS3 speeds (OC3 through OC192). The platform optimizes fiber infrastructures for backhaul transport, allowing carriers to aggregate, deploy, and manage 2.5G/3G services and legacy TDM services at a substantial cost savings. One major carrier realized 30 percent first cost savings by implementing LoopStar 800 and 1600 series units at a new MSC (Mobile Switching Center) in the southeastern U.S. Because the LoopStar 800 family features compact form factors and low power consumption, it occupies little real estate in already crowded cell sites or remote cabinet environments. Easily scalable, the LoopStar 800 family can be supplemented by additional units over time as carriers need additional backhaul capacity. Solutions Overview Serving customers in more than 130 countries worldwide, ADC offers an industry-leading portfolio of network infrastructure solutions and services to ensure a smooth transition as carriers transform traditional TDM circuit switched voice networks to competitive broadband, video and IP networks and create the backhaul systems needed to support these services effectively. By implementing a comprehensive product plan, optimizing existing backhaul traffic, and building out copper-free transport, carriers can reduce their dependence on third parties and build a reliable, expandable, cost-effective backhaul solution designed for the future. Breaking the Wireless Backhaul Bottleneck with ADC Backhaul Solutions Page 5 LoopStar ® 700 Since a service provider’s biggest asset is its existing network, it makes economic sense to optimize that network to the extent practicable. The LoopStar 700 product family is a next generation Ethernet Acccess and Transport Solution optimized for converged packet access at the edge over any type of available facility. The LoopStar 700 family provides T1/E1 circuit emulation functionality that can operate with a mix of fiber, cable, radio or NxT1 systems. Ethernet packet access for 3G/4G cellular services can be easily and cost effectively added over N T1/E1 copper facilities using MLPPP with the LoopStar 714/718. Where fiber exists or access to Ethernet leased lines or WIMAX facilities are available, the LoopStar 780/722 can cost effectively provide converged access for T1/E1 TDM via circuit emulation and Ethernet over the same facility. The LoopStar 700 provides bandwidth efficiency to minimize transport costs and Ethernet layer 2 quality of service functionality to meet service providers’ requirements for class-of-service SLA flexibility. The LoopStar 700 family enables wireless carriers to migrate toward an all Ethernet/IP transport network. Mobile Switching Office Cell Site 1 2G/2.5G BTS MSC RNC 3G BTS 100/100TX/GigE 100/100TX/GigE 100/100TX/GigE Ethernet TDM (4) 10/100 or 100FX LS 780 Ethernet Backahaul Cell Site 2 2G/2.5G BTS 3G BTS LS 780 Cell Site 3-N 2G/2.5G BTS 3G BTS LS 780 Figure 2: Illustrates cell site backhaul using the LoopStar 780 to provide T1 TDM and Ethernet packet access over the same Ethernet transport facility. The LoopStar SONET platform comes in four form factors, each tailored to a specific infrastructure need. For instance, the 800/810 series offers capabilities for smaller applications, while the 1600 and 3600 series provide robust functionality for high density applications or metro rings, such as the application being implemented by Open Access, a metropolitan area network provider in the Long Island and New York City area. The company is utilizing LoopStar 1600 and 810 devices in a network overlay design for wireless backhaul. Says Robert Mavretich, president and co-founder of Open Access, “We selected ADC’s LoopStar platform for our optical network because it is a cost-effective and scalable TDM delivery solution that best fits…the needs of our business customers.” 4 Breaking the Wireless Backhaul Bottleneck with ADC Backhaul Solutions Page 6 FlexWave ™ Millimeter Wave (MMW) A point-to-point millimeter wave transmission system, FlexWave Millimeter Wave (MMW) provides fast, reliable line-of-sight (LOS) backhaul communications without the complications and expense of running fiber. FlexWave provides secure, native Ethernet connections and fiber-quality speeds with 99.999% reliability over short (e.g., 1 – 10 mile) distances. FlexWave MMW is an ideal solution for new cell tower construction and an excellent supplement to existing fiber or copper solutions for carriers seeking greater control of their backhaul network. University Hospital Office Building Financial Institution Hotel Bank Multiple Dwelling Unit Metro Fiber Ring MMW Link ISP - Network Point of Presence FlexWave ™ WMX WiMAX Another RF wireless solution, FlexWave WMX WiMax enables next generation, all IP wireless backhaul capabilities. Using the 802.16 WiMAX standard, ADC’s WMX product family offers high capacity, point-to- multipoint transmission operating in the 1.7GHz to 6GHz range. Quick to install, FlexWave WMX WiMax ensures carrier-grade reliability at low cost for backhaul over short distances. WMX is suitable for greenfield applications, especially in developing countries where wired infrastructure may be cost-prohibitive. Internet PSTN Network Operation and Switching Centers WiMAX Network SS Cell Site Cell Site SS Cellphones Cellphones MS Figure 3: WiMAX provides low-cost, quick-to-install, robust backhaul capabilities over short, 1-10 mile distances. Breaking the Wireless Backhaul Bottleneck with ADC Backhaul Solutions Page 7 Connectivity Solutions for Wireless Networks The reality of today’s marketplace dictates that service provider networks change to remain competitive. New modulation techniques, faster metro optical fiber rings, voice, high-speed data and multimedia services are deployed closer than ever to the edge of the network. These changes are largely upgrades and reconfigurations designed to improve reliability, availability, accuracy and breadth of services. Establishing a solid network foundation rooted in connectivity has already proven successful as networks transitioned from analog to digital and from copper to fiber, and as service providers joined networks together through collocation and consolidation. As service providers approach the convergence of voice, data and video with IP-based services, a foundation of connectivity remains just as essential. Moving to more complex network models incorporating a connectivity foundation delivers multiple proven benefits: • Minimizeoperationalcosts. The capital allocated to purchase new electronics, software and connectivity pales in comparison to the multi-year, ongoing cost of labor to manage and maintain the network. With a connectivity foundation, labor costs for everything from initial installation, to provisioning, to upgrades and reconfigurations, to maintenance is reduced. Minimizing operational costs contributes to the bottom line just as strongly as new revenue sources. • Increasenetworkreliability. More and more, 99.99% availability pertains to more than just voice services. With ILECs, MSOs, wireless service providers and others vying for the same customers, quality of service measures and service level agreements will soon pertain to voice, data and video services. Connectivity delivers reliability by providing termination, test access, and cable management strategies that ensure maximum service availability. • Maximizerevenue. The competition is positioning to earn new revenues from broadband services and take away annuity business from others in the marketplace. A solid connectivity foundation speeds service provisioning while, at the same time, lowers the cost of provisioning. With faster turn-up of services—and associated acceleration of revenue—service providers wield an attractive weapon in competing for customers. ADC offers an unrivaled breadth of low- to high-density solutions that offer superior cable management and modular, flexible platforms. These solutions reduce maintenance cost and ensure network reliability. This family of field-proven products augments the connection into the Loopstar solution, integrating seamlessly with the current infrastructure and setting the stage for next generation network plans. These innovative solutions include: • DigitalCross-ConnectProducts(DSX-1andDSX-3) Proven performers that have set the industry standard, providing a centralized point for cross-connecting digital signals. The digital cross-connect panels provide efficient connectivity to migrate service and traffic to the Next Generation Network. • EthernetPatchCords– Category5e,Category6and10Gigabit Patch cord plugs are designed with integrated strain relievers and exceed all performance requirements. • FiberOpticPanels Provide fiber termination, splice and/or slack storage and excellent cable management in a high-density, discrete panel solution. ADC is the market leader in the deployment of connectivity solutions for copper, fiber and wireless networks around the world. With hundreds of millions of ports in service worldwide, over 600 patents, and connectivity solutions that touch the majority of worldwide voice, video, and data communications traffic, ADC has the products, services, and experience to make the inevitable work of network transitions cost effective and profitable for service providers. Professional Services Poor planning bears as much responsibility for current backhaul bottlenecks as technology limitations. Every technology choice has benefits, drawbacks, and costs. Before beginning any network buildout, service providers should understand the root causes of their current problems and create scalable solutions that will remain viable in the face of future challenges. Every successful project needs an accurate inventory and audit of available assets, an honest assessment of business needs, and a properly structured development plan. Deployment is every bit as important as planning. To complete functional services on time and under budget, carriers must be able to address multiple issues simultaneously, including project management, equipment installation and integration, material services, power services, and decommissioning and removal of legacy equipment. After deployment, service providers must continue to maintain their network. Preventive and routine maintenance, emergency maintenance and replacement procedures, scheduled decommissioning and gradual upgrade paths all contribute to optimal performance and ROI. WHITE PAPER Through its Professional Services unit, ADC helps plan, deploy and maintain telecommunications networks throughout the United States and Europe. Unique experience in multi-vendor, multi- technology, multi-service solutions makes ADC the ideal choice for projects that require an in-depth, hands-on understanding of simple to complex network environments. Conclusion As increasing numbers of cellular users demand access to more bandwidth-intensive content, existing backhaul infrastructures require new solutions. To remain competitive as 3G and 4G applications arrive, carriers should optimize their existing networks and begin to migrate toward alternative backhaul strategies capable of handling tomorrow’s higher-volume IP-based traffic while maintaining their current TDM investments. Trusted partners, such as ADC with its comprehensive product portfolio and global experience in multi-vendor, multi-technology, multi-service networks, can help carriers identify and implement cost-effective, quick-to-market wireless backhaul solutions. References: 1 Buckley, Sean. April 30, 2007. Wireless Backhaul’s New Savior: Ethernet. http://www.telecommagazine.com/search/article.asp?HH_ID=AR_3138 (accessed May 23, 2007). 2 Marshall, Phil. October 1, 2005. Bringing Brains to Wireless Backhaul. http://www.telecommagazine.com/search/article.asp?Id=AR_1179 (accessed May 23, 2007). 3 ADC Telecommunications, Inc. September, 2006. LoopStar® SONET Access System: Cell Site Backhaul Aggregation and Transport. 4 Open Access Deploys ADC LoopStar Systems to Deliver TDM Services to Mobile Carriers in Long Island and New York City; LoopStar 1600 and 810 Systems Provide Cost-Effective and Scalable Solution. www.adc.com/investorrelations/newsandcommunications/newsreleases/show.jsp?RELEASEID=193122 (accessed May 25, 2007). WHITE PAPER Website: www.adc.com From North America, Call Toll Free: 1-800-366-3891 • Outside of North America: +1-952-938-8080 Fax: +1-952-917-3237 • For a listing of ADC’s global sales office locations, please refer to our website. ADC Telecommunications, Inc., P.O. Box 1101, Minneapolis, Minnesota USA 55440-1101 Specifications published here are current as of the date of publication of this document. Because we are continuously improving our products, ADC reserves the right to change specifications without prior notice. At any time, you may verify product specifications by contacting our headquarters office in Minneapolis. ADC Telecommunications, Inc. views its patent portfolio as an important corporate asset and vigorously enforces its patents. Products or features contained herein may be covered by one or more U.S. or foreign patents. An Equal Opportunity Employer 105034E9/07Original©2007ADCTelecommunications,Inc.AllRightsReserved . WHITE PAPER ADC Backhaul Solutions Breaking the Wireless Backhaul Bottleneck Breaking the Wireless Backhaul Bottleneck with ADC Backhaul Solutions Executive. Addressing Wireless Backhaul Challenges Page 3 Breaking the Wireless Backhaul Bottleneck with ADC Backhaul Solutions Page 4 The ADC Wireless Backhaul Portfolio: