Point to Multi-Point microwave backhaul in Next Generation mobile backhaul networks TNMO London May 2010

The Company Headquarters in Cambridge UK Market-driven, world class technology Research and product design in Cambridge Manufacture by Benchmark Largest carrier-class PMP vendor, four-fold increase in sales 2007 to 2009 More than 50 customers in 35 countries First Backhaul vendor sponsor to join NGMN Alliance

Agenda Evaluating last-mile backhaul alternatives for European Operators What are the cost implications PMP Backhaul Considerations for next generation networks Conclusions

Next Generation Mobile Broadband networks also need to make money The backhaul crunch Backhaul Crunch Speed is key: Coverage ubiquitous Unlimited Data Plans New app’s fuelled by multiple open operating systems Smartphone ownership growing rapidly Next Generation Mobile Broadband networks also need to make money

The wall of mobile data Smartphones and Dongles are just the beginning 2010: 4.6 Billion Mobile Subscribers 2015: 7 Billion Mobile Subscribers 2020: 50 Billion mobile connections Smartphones and Dongles are just the beginning Machine-to-machine communications will change dynamics of mobile Source: Nokia

Key Factors in Backhaul Deployment Equipment plus Installation must meet market targets Equipment needs to provide services in a few hour, not weeks or months – with minimal planning and licensing Drive down ever increasing antenna lease and spectrum costs along with radio equipment site costs Must be enough for Backhaul Requirements of today and tomorrow – with an established capacity roadmap System Capacity System Operational Cost System Capital Cost Speed to Deploy

Evaluating last mile backhaul for European Operators What are the options?

Last Mile Backhaul Options Western European Operators – Grading Of Principle Backhaul Options Grading 1-5 where 1 is very poor and 5 is excellent Source: Informa Telecoms & Media

Cost comparison: various backhaul technologies Source: Informa Telecoms & Media Forecast cost to transport data traffic: as traffic increases, the need to build or upgrade backhaul increases Voice traffic is assumed to be carried on E1 Cost increases towards the end of the forecast period due to volume of traffic Deployed Fibre is second most expensive but is a long term option for some operators Microwave technologies are the most cost efficient

A balanced backhaul solution PMP has the lowest microwave OPEX PMP has the lowest CAPEX Make sure the source of this analysis is clear. This is an independent research report from Informa Telecoms Informa Telecoms and Media: “Last Mile Backhaul Options for West European Mobile Operators”

What are the cost implications? Evaluating last mile backhaul for European Operators What are the cost implications?

Mobile operators want backhaul solutions that cost less, deliver higher performance and reduce the complexity of their networks

Cost comparison: Tier-1 UK Operator Cost comparison (Europe) between PMP and the other two prominent technologies, PTP and hybrid fibre (leasing) Although both leasing fibre and hybrid backhaul technologies are considered cost-efficient, analysis shows that PMP can provide better cost savings in backhaul, even compared to the widely established PTP microwave in Western Europe. The analysis presented has been undertaken for an international Tier-1 operator running a mobile broadband network in the UK. Calculations are for a 5-year period. Cost savings of PMP compared with TDM/fibre leasing for the total cost to transfer traffic amounts to US$497 million per year during 2010, increasing to US$2.8 billion per year for 2014 PMP is expected to offer cost savings of US$26 million during 2010 and this will increase to US$248 million during 2014 compared to PTP microwave. Source: Informa Telecoms & Media

PMP Microwave Backhaul Is there a another way?

PMP Microwave Architecture Point-to-point Point-to-MultiPoint Single Hop = predictable latency Access point PtP uses 1 frequency, 2 radios and requires 2 installations per link PMP uses 1 frequency per sector. To backhaul 9 cell sites, VectaStar uses 8 fewer radios:10 vs. 18 This is the best place to make the point that VectaStar is spectrum efficient. Make sure you make the point that each point to point link needs separate planning, spectrum license, two installations, separate frequency (within reuse guidelines), etc.

Multi-sector Gigabit Ethernet Hub Backhaul on Demand GE Outdoor Indoor GE Step 1: Single PtP link Step 2: Zero footprint sector Step 3: Multi-sector Gigabit Ethernet Hub GE Site a PMP Ethernet Hub where there is a need to provide or upgrade backhaul coverage Add sectors as demand increases Hub economics enable variable sector sizes/capacities Radio Controller available to aggregate multiple sectors and provide hybrid support New sites require one radio – deployment time halved PMP system architecture enables a paradigm shift in microwave backhaul network design

Stat-Mux and Aggregation Point-to-Point backhaul planners have to provision for peaks, i.e. 30Mb/s per NodeB: Traffic measurements from 4 HSPA Node Bs in a VectaStar network sector Total provisioning: 4 x 30Mbps = 120 Mbps PTP: Bandwidth not used is wasted! 150 Mbps Sector th’put VectaStar aggregates cellsite traffic in sector Built-in optimisation and statistical multiplexing reduces peak backhaul requirement to 40 Mbps 30Mbps 120 Mbps Vectastar: Unused bandwidth is available for other cellsites in the sector 40Mbps 40Mbps

Case Study: LTE Network London LTE PMP Backhaul solution for London: 145 Cell sites 8 Hub sites 150Mb/s Peak 30Mb/s Mean Utilises overlapping sectors to increase capacity in dense, high traffic areas Comparison showed that at 100Mbps, PtP exhausts available spectrum. VectaStar used less than half the spectrum needed for PtP

VectaStar Cost to Deploy Compared to Point-to-Point London LTE network business case VectaStar CAPEX advantage compared to Implemented PtP from 2 links: Point to Point is 40% more expensive at 5 links Point to Point is 80% more expensive at 15 links VectaStar Cost to Deploy Compared to Point-to-Point CAPEX Broader London Case Study of Savings over 5 year Business Case - With 360 BTS and 13 Hubs – Net Present Value: Point to Point is 44% more expensive in CAPEX (First Year) Point to Point is 38% more expensive in OPEX (All Years) VectaStar used Half the Spectrum of the PtP solution This economic analysis from the last case study shows how VectaStar has much better financial performance than PtP when comparing the same number of connections coming back to a single aggregation point. The analysis is shown on two levels – the top of the page looks at the capex and opex at the time of installation – year one The bottom half of the page looks at the same network over a 5 year period using NPV calculations Either way – VectaStar outperforms the alternatives. Deploy PMP Access Point Network for Lower Capex than PtP - AND save on OPEX

Next generation backhaul PMP Microwave Backhaul Next generation backhaul

Key LTE Backhaul Requirements HSPA 1.8  168 Single or Multi carrier (Multi carrier for Max Rates) Peak Download: 168Mb/s for multiple 5MHz carrier Standard final: 2004+, First Deploy: 2005-2007 + Commercial: Now (except highest options: 2012(e)) 1. Capacity BTS Backhaul must be more than 30-50Mb/s average & 150Mb/s peak; >300Mb/s peak by 2014 Synchronization Backhaul must be synchronous with & transparent to several schemes being considered/used. X2 Switching and Flat Networks Ability to turn traffic at Hub (not in core) and support simplest flat network hierarchy 4. Low Latency Backhaul last link latency must be a fraction of total latency requirement of ~10ms end-end LTE 1x2 SIMO Variable Carriers: 1.25, 5, 10, 20MHz Peak Download: 100Mb/s for 20MHz carrier Standard final: 2009, First Deploy: 2010, Commercial: 2011-2012+ LTE 2x2 MIMO Variable Carriers: 1.25, 5, 10, 20MHz Peak Download: 173 Mb/s for 20MHz carrier Standard final: 2009, First Deploy: 2010, Commercial: 2012-2014+ LTE 4X4 MIMO Variable Carriers: 1.25, 5, 10, 20MHz Peak Download: 326 Mb/s for 20MHz carrier Standard final: 2009, First Deploy: 2013(e), Commercial: 2014-2015+

Extremely simple, cost effective microwave backhaul platform What makes VectaStar different Extremely simple, cost effective microwave backhaul platform Gigabit Ethernet ODU Outdoor Indoor -48V DC Supply IP/Ethernet Network IP/Ethernet Network Gigabit Ethernet Sector Outdoor Indoor -48V DC Supply Unique 26 & 28 GHz Radios: Highest spectral efficiency 5 bits/s/Hz net throughput (data) All outdoor zero footprint design Powerful integrated processor Hitless Dynamic Adaptive Modulation 7 states: QPSK to 256QAM Supports PtP & PMP architectures Single platform addresses entire network VectaStar Terminal 150Mb/s Ethernet throughput Gigabit interface Hybrid support via 8xE1 IDU Typical latency <600 µs LTE Ready VectaStar Hub Gigabit Ethernet Hybrid and Optimisation support via radio controller Deploy as PtP or PMP LTE Ready

Buy it now: quadruple capacity tomorrow IP Optimisation 200% increase in IP throughput (traffic dependant) Software Upgrade for VectaStar Complements existing TDM optimisation feature 2+0 resiliency Enables 300Mbps total sector capacity (2 x 28MHz channels @256QAM) Software upgrade for 1+1 redundant AP configurations If AP1 fails, all AP1’s,Terminals failover to AP2 until AP1 restored. 2+0 sector in normal operation Sector operation if an Access Point fails AP1 AP2

Point-to-Multipoint microwave backhaul costs less high performance reduces complexity LTE ready    

Thank You! VectaStar No other microwave Solution does this

Lance Hiley, VP Marketing LHiley@cbnl.com www.cbnl.com