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Wholesale Wireline Providers and Wireless Backhaul - Challenges to the Revenue Opportunity
Frost & Sullivan, Dec 2005
This Frost & Sullivan research titled 'Wholesale Wireline Providers and Wireless Backhaul - Challenges to the Revenue Opportunity' discusses the crucial issues concerning the wholesale wireline providers and the revenue opportunities for them in the wireless backhaul service market. It offers an insight into the following sub-topics - data service growth and migration to 3G, current typical and alternative backhaul scenarios, and an outlook for the wholesale wireline providers. The study also looks into the prevailing market trends and the corresponding end-user expectations, before giving strategic recommendations to overcome the market restraints and industry challenges.
Migration to 3G Technologies Drives the Demand for Wireless Backhaul Services
Flourishing subscription growth and deployments in areas such as third generation (3G), data, mobile Internet access, and streaming video are increasing the requirements for wireless backhaul services among the wireless operators. These developments necessitate an increase in the number of base stations by four or five times, as 3G technology requires higher base station-to-handset frequencies, which ultimately calls for more backhaul links.
Having relied on a few leased lines per cell site in the past to backhaul their voice traffic, these operators now seek a greater number of leased lines for their new networks, a trend which is likely to continue in the future. 'The leased line businesses - predominantly digital signal level one (DS-1s), followed by DS-3s and synchronous optical network (SONET) - especially for the wholesale local carriers are currently witnessing a boom and are enjoying a healthy position,' emphasizes the analyst of this research service. 'This situation could be under threat as wireless operators intend to move their traffic from the expensive leased lines to other viable technologies to curtail their operational expenditure.'
Wholesale Service Providers Can Offer Novel Services Along With Conventional Ones to Boost Revenues
In order to get higher revenues, wholesale service providers must offer new bundled services, along with network construction and network management solutions. For instance, leased line services can be clubbed with other wireline services such as billing features, back-up services for portions of the wireless operator's network that are not leased, and the network management of these parts. Further, these wholesale operators can promote their expertise in supporting legacy applications as well as support extensive use of service level agreements (SLAs) and the future migration to secure multiprotocol label switching (MPLS) networks, in the process of capitalizing on their strong scalable infrastructure.
'Wireless operators, though inclined toward building their own backhaul networks and investing in network equipment, are less interested in managing and operating their own backhaul networks,' points out the analyst. 'Wireline operators can cater to these needs, subsequently building and managing the optical and broadband wireless networks of the wireless carriers.'
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