Mobile Backhaul Trends

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Mobile Backhaul Trends NetEvents, Malta,
September 28, 2007
Moderated by
Michael Howard Principal Analyst
Co-Founder Infonetics Research
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New Options for Mobile Backhaul

• Trends
• Growing numbers users, cell sites, bandwidth
• What operators are saying -- from mobile/wireless
  study
• The promise of new technologies data from mobile
  backhaul market report
• QA

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Mobile Backhaul Trends

• March of 2G, 2.5G, 2.75G, 3G, 3.5G, 4G
• Over 2.5 billion mobile phone users in 2006,
  growing to 3.6 billion in 2010
• Growing dependence on mobile connection
• Data mobility for all
• Data, video applications growing
• Data grows exponentially, ARPU/revenue does not
• Carrier Ethernet for backhaulhybrid approach
• Ethernet microwave
• Wireline Ethernet copper/fiber, DSL, PON

Source Infonetics Research, 2006
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20022009 Worldwide Cell Site Connections

• Installed WW connections
• 2006 2.3 million
• 2010 3.6 million
• Microwave 1
• Ethernet fastest growing through 2010
• Mobile operators pay incremental charges for 2x
  to 10x bandwidth
• New options solve major problem for operators

Source Infonetics Research Mobile Backhaul
Equipment, Installed Base Services, March 2007
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Operator Drivers for New Backhaul Technologies

• 1 reduce operations costs in the face of rising
  bandwidth
• March 2007 study
• 20 worldwide providers that offer next gen mobile
  or wireless broadband services
• Business challenges
• Competition
• Customer retention
• Operations costs
• Revenue

Source Infonetics Service Provider Plans for
Next Gen Mobile and Wireless Broadband North
America, Europe, and Asia Pacific 2007
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New Options Solve Backhaul Cost Problem

• PDH (T1/E1 etc.) costs climb directly with
  bandwidth
• Ethernet wireline costs grow gently with large
  bandwidth increases (Eth, DSL, PON, cable)
• New IP/Ethernet wireline options to meet the the
  1 driver operational cost savings

Source Infonetics Research Mobile Backhaul
Equipment, Installed Base, and Services, March,
2007
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Mobile Backhaul Equipment Market Opportunity

• Microwave is king
• Ethernet fastest growing (wireline microwave)
• Equipment revenue
• 2006 3.9B
• 2010 6.0B

Ethernet
Microwave
Source Infonetics Research Mobile Backhaul
Equipment, Installed Base Services, March 2007
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Conclusions

• Trends growing subscribers, bandwidth, backhaul
  costs
• Challenges
• Backhaul costs escalating
• 2G, 2.5G, 3G, 3.5G, 4G must be backhauled
• Many technologies to evaluate/consider
• Carrier Ethernet for data backhaul in hybrid
  configuration
• New IP/Ethernet options solve backhaul operations
  costs

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Thank You
Questions?