PMP in the metro market
Meeting the challenges
By Gideon Ben-Efraim
CEO of San Jose, Calif.-based Netro Corp.
Today's telecommunications marketplace will
soon begin a transformation through the
application of a revolutionary, wireless
broadband access technology.
Point-to-multipoint (PMP) wireless broadband
access will enable service providers to own the
customer relationship by economically building
and growing integrated local loop network
infrastructures in pace with market needs.
Competitive local exchange carriers (CLECs)
face several choices in entering a market.
Resale, or line leasing, is the quickest mode of
market entry for CLECs. Accordingly, many
have entered the market with this option.
Lease-line resale allows a cost-reduction for
small to midsize businesses (or small medium
enterprises [SMEs]). These businesses account
for 80% of all employees in any given
metropolitan location.
The second interconnection option, rebundling/
unbundled network element platform (UNEP), is
a form of resale with different pricing
configurations based on incumbent local
exchange carrier (ILEC) truncation of seven
elements in its network for individual sale to
market competitors, including the customer
service components. This "virtual resale" has the
potential to translate into discounts at 50% to
60% below retail for the business customer.
More progressive CLECs are entering through a
switch-based or facility-based strategy.
Switched-based resale eliminates access charges
for any carrier using its own switch.
The convergence of voice and data requires an
access technology with flexible bandwidth
capabilities. Network structures, historically
designed for consistent voice traffic, are not
equipped to manage the ‘bursty' traffic driven by
the Internet and other data applications. The best
example of ‘burstiness' is Web surfing. One
mouse click transmits a large amount of data to
the surfer; two to three minutes afterward,
nothing happens. With this kind of traffic, there
is no need to provide the service on an average
data rate standpoint Rather, service should be
provided on a peak rate standpoint — bandwidth
on demand — to better accommodate the bursts.
Of equal challenge to CLECs in the metropolitan
access market is reliable service integration with
voice, Internet Protocol (IP) and frame relay.
Today's network backbones are becoming
increasingly packet switched (asynchronous
transfer mode [ATM]), as circuit switching does
not accommodate IP and frame relay traffic
efficiently. Packet switching utilizes ATM
because it is the only way to manage delay in a
broadband wireless network. This pushes
integration closer to the SME's front door, so
CLECs, in turn, must integrate to remain
competitive in the market.
Furthermore, telecom and datacom service
standards differ. Telecom's service standard is
about 99.99%. When CLECs enter the market
with mixed voice and data offerings, they must
match this. Here is where ATM Quality of
Service (QoS) guarantees are essential,
especially for voice services.
Another challenge facing CLECs is coverage
economics: getting into and covering the market
quickly for a high return on investment. This
approach creates first-mover advantages,
allowing CLECs to leverage early successes and
own the customer relationship. In addition, it's
the CLEC's goal to grow with incremental
investments and show a sound return on the
dollar. This deployment strategy is contrary to
historical network deployments, which had to be
laid out in advance. Through the back door,
cost-effective churn management is essential for
a healthy balance sheet.
Additionally, CLECs focus on the ability to
provide more value-added services to customers.
CLECs thus create a competitive advantage and
differentiate themselves from ILECs and reseller
CLECs. This level of service can only be
provided through a sophisticated, self-owned
network.
Delivering on market challenges requires
resources. It is here that the CLECs, most of
whom are start-ups, face difficulties in deploying
large, new networks. Acquiring resources is why
the last-mile solution for the metropolitan access
market will involve strong relationships between
CLECs, systems integrators (such as Lucent
[Murray Hill, N.J.] and Siemens [Boca Raton,
Fla.]) and equipment manufacturers to enable
end-to-end network solutions. Systems
integrators provide CLECs with the financing
and management components; however, CLECs
will face increased reliance on independent
equipment developers to supply the
technological innovation to satisfy market needs.
At the end of the day, CLECs want to hold down
capital expenditures while developing their
markets. This strategy requires fast-to-deploy
intelligent networks that are cost-effective and
that optimize capacity in a bursty-traffic world,
while providing the flexibility to meet future
market changes.
Different Broadband Technologies
Fiber optic backbone provides high-speed,
reliable, integrated transport, but it is connected
to less than 3% of businesses in the U.S. market
today.
At a deployment cost of $200,000 to $300,000
per mile, fiber is approaching its saturation point
due to this fixed deployment cost.
On the opposite end of the scale, digital
subscriber line (xDSL) as an integrated service
solution is well suited for businesses in the
SOHO and small business sector. While ADSL
standards allow for bit rates of up to 8 Mbps,
typical service deployments are at 768 kbps and
below. The advantages of xDSL include fast and
inexpensive deployment, scalability and minimal
outside plant infrastructure. However, xDSL's
availability is distance sensitive and highly
dependent on the condition of the ILEC copper
plant. With xDSL, CLECs cannot completely
own the SME relationship because the customer
premises equipment (CPE) is engineered for
single plain old telephone service (POTS).
Cable modems and hybrid fiber coax (HFC)
technology provide faster speeds than analog
modems and ISDN, with a high degree of
reliability. One difficulty with this solution lies
in the lack of uniform cable modem standards.
Third-generation (3G) wireless has the promise
to provide high-speed access and mobility for
users, but the technology is not proven and the
standards have yet to be defined. Commercial
launch is several years away and the speed will
be capped at 2 Mbps.
These technologies have significant
shortcomings in meeting the three critical
criteria for the metropolitan access market:
bandwidth flexibility; service integration; and
coverage economics. Nevertheless, the
technologies can satisfy the needs of the larger
SMEs, which have higher bandwidth
requirements.
Wireless Broadband Access
Broadband wireless PMP technology enables
CLECs to men access market by using radio
microwave transmission to reach hundreds of
subscribers through the air. Installing PMP is
time and cost efficient. PMP has a high degree of
reliability and scalability, along with minimal
infrastructure and real estate requirements, while
providing faster speeds than cable modems and
xDSL technologies. It is also the closest a new
market entrant can get to a self-owned network.
PMP broadband wireless technology is optimized
for business customers requiring capacities
within the two to eight T1 range.
In the U.S., there are three licensed frequency
ranges: 24 GHz; 28 GHz (better known as local
multipoint distribution service [LMDS]); and 39
GHz. A single carrier, Teligent (Nynäshamn,
Sweden), exclusively owns the 24-GHz range.
The 39-GHz range was licensed in 1997 to
Advanced Radio Telecom (Bellevue, Wash.),
WinStar (New York) and AT&T Local Services
(formerly Teleport Communications Group), but
more will be auctioned later this year.
The Design
PMP wireless broadband access systems vary in
their design. All PMP systems work by dividing
the air surrounding a hub/base-station into
multiple sectors (up to 90). The range of a PMP
system is a 3- to 7-km radius, depending on
licensed frequencies and weather conditions. The
base station is connected to the central office by
fiber or point-to-point radio connections.
For example, Netro Corp.'s (San Jose, Calif.)
AirStarT system transmits voice, IP and frame
relay traffic from the base station to multiple
downstream customers. Each transmission is
divided into time slots that are dynamically
allocated based on user traffic requirements and
preassigned prioritization.
Customers also dynamically share upstream
bandwidth. At a customer facility, the PMP
system allows connection with several T1 ports,
as well as Ethernet and frame relay ports. The
subscriber access system transforms information
to radio frequency and sends it up to a rooftop
radio unit. Information is then transmitted to the
base station radio. In turn, a modem at the base
station demodulates the signal into digital stream
and multiplexes it through the base station onto
the ATM network.
Throughout, the system grants permission to
subscribers to ‘burst,' and thus enables dynamic
bandwidth allocation. The subscriber radio unit
is shoebox size and can be conveniently mounted
on a building or behind glass. Quickly mounted,
the subscriber radio is ready to go in less than an
hour.
Technological Advantages
A PMP broadband access solution is a viable
option for CLECs to open the last-mile
bottleneck in the metropolitan access market. In
order to satisfy future market demands, a system
must be designed with attention to spectral
efficiency by conserving spectrum to save on
capital costs, dynamic bandwidth allocation and
scalability through modularity. Two predominate
design approaches exist in this arena: frequency
division multiple access (FDMA) and time
division multiple access (TDMA) — the optimal
choice in terms of spectral efficiencies and
capital costs.
With FDMA, the spectrum is divided into
separate smaller bands and each user is granted a
band, or pipe, with which to access the network.
TDMA users access the network on a
time-shared basis; each time slot is allocated a
fixed subscriber. FDMA and TDMA are not
capable of allocating capacity between users
individually, so subscribers have access to a
prefixed peak rate, which cannot increase for
bursty Internet data.
ATM has become a key focus in the industry
because it is the only proven way to manage the
delay in a broadband wireless network. ATM has
high-speed transport and switching, statistical
multiplexing, a long architecture life cycle and it
simplifies network management. The
introduction of ATM also enables carriers to
guarantee QoS.
The Difference
The advantages of PMP wireless broadband are
clear: reduce time and cost of going to market,
improve network efficiencies and facilitate
economic growth. PMP technology reduces the
time and cost of going to market because it is
easily deployed and the cost of a centrally
located base station and sector modem/radio is
spread over hundreds of customers. One
challenge with PMP is securing roof and building
rights, but once this is done a radio can be
installed within hours. This technology's
capacity is the closest to fiber that we have seen,
but its cost benefits are obvious compared with
the time and expense of laying fiber. PMP also
eliminates the risk of depending on ILEC
infrastructures that is inherent with xDSL, while
promoting a facility-based deployment strategy.
A comprehensive PMP wireless broadband
system also greatly improves a CLEC's network
efficiencies by integrating voice, IP and frame
relay through a single channel to the SME's
building. Bandwidth on demand, the greatest
technical challenge, is simplified with the
appropriate wireless TDMA and ATM
architecture.
Growth economies are another benefit of a PMP
deployment. Subscriber additions require an
incremental investment of $5,000 to $7,000,
spreading fixed base station costs over hundreds
of users. Since the system is designed to manage
thousands of subscribers, adding a new business
customer is easy and cost effective when
compared with competing technologies. This
enables CLECs to own more of the customer
relationship. Additionally, a minimally equipped
hub can be deployed, so that costs coincide with
market demand. A PMP broadband solution is
deployable over an entire metropolitan area;
moreover, it's not dependent on antiquated ILEC
infrastructure for a growth strategy.
This brave new world of broadband access is not
without its own deployment challenges.
Broadband wireless requires line-of-sight
transmission. This requires site and network
planning in advance. Although the market is
clearly emerging, the technology is just
beginning to prove its viability. Equipment
providers with a solid track record of commercial
deployment will minimize this issue. The key
success criteria for CLECs are solid business
planning and well-defined market entry strategy.
No matter how innovative the technology, it
cannot solve the issues associated with age-old
business planning fundamentals.
et the challenges of the
metropolita
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