20 January 2016

Kenya: Point-to-Multipoint Last-Mile Solutions Can Reduce Backhaul Total Cost of Ownership, Study Reveals

The latest point-to-multipoint (PMP) last-mile solutions can reduce backhaul total cost of ownership (TCO) by as much as 50% and generate 1.8x higher return on investment (ROI) for enterprise access. These are some of the findings from the new Real Wireless report into the cost and time to breakeven of last mile data transport in multiple deployment scenarios.

The study, carried out by independent wireless experts Real Wireless, looks at the TCO of installing and running backhaul networks based on a range of wired and wireless technologies. Analysis found that site-related costs dominate TCO, accounting for around half of a five year TCO. The report revealed PMP solutions offered up to 50% TCO savings over point-to-point (PTP) and managed fibre, largely due the aggregation of multiple links to a single hub site.

For the study, Real Wireless modeled a case study of an ISP, building out a network to supply carrier-grade connectivity to enterprises. It found that PMP microwave and sub-6 GHz resulted in the fastest time to break even, potentially enabling an ISP to connect 67% more customers and generate 1.8x higher ROI compared to PTP equivalents. The report also highlighted the increased revenue possible with PMP at licensed microwave frequencies; this can generate a further 30% higher ROI than PMP in sub-6GHz bands. The increased revenue of PMP microwave was due to its ability to offer both higher capacities and a superior grade of service than its unlicensed equivalent. The ISP model can equally apply to a mobile operator's network division, where the higher ROI equates to greater financial efficiency and more ability to invest in network footprint.

"The new report highlights the variety of last mile technologies available and how the right choice can almost halve a network's TCO." said Oliver Bosshard, Managing Consultant, Real Wireless. "It's clear from the report that MNOs and ISPs should carefully consider the knock-on impact their choice of technology will have for their future revenues and growth. Particularly in enterprise deployments, operators and ISPs should look carefully at the latest available transport options to determine what will deliver the best business case."

Managed fibre networks, albeit scalable to higher capacities, were found to have a significantly higher TCO when compared to wireless approaches. PMP solutions were also shown to offer a much quicker ROI versus PTP solutions, because PMP lends itself to the sharing of hub sites and bandwidth between customer terminals. However, PTP links were found to more suitable for longer links and lower site densities.

Real Wireless considered a range of transport options for the study, including managed fibre, V-band and E-band PTP, microwave PTP and PMP and sub-6 GHz unlicensed PTP and PMP. The model includes not only the initial outlay for equipment but also the more significant aspects of installing and running it over time.

The full report is available to download for free from the Real Wireless website.

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