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Fixed Wireless Economics
Duncan M. Davidson
[email protected]
Personal Background:
SkyPilot – outdoor WiFi mesh
Covad – DSL / VoIP
Genuity – nationwide IP access
Hughes – satellite data
ATT/Intel – future RBOC network
Selected VPVP Investments:
Metricom – Ricochet Network
DSL.Net – DSL / VoIP
Aerie – nationwide IP access
Broadstorm – OFDM FWB
CBeyond – VoIP for SME
The Promise: Wireless is *Much* Cheaper
Nationwide Buildout Cost
(Order of Magnitude)
Fiber to home
$200billion
($1,256/home)
FTTN / All IP Cable
$ 20 billion
($200/home)
$ 2 billion
($20K/sq mile)
$ 0.2 billion
($2/home)
WiMAX/WiFi Cloud
Customer Mesh
Operator Economics
Five Drivers
network
new subs
sites
subs
services
VoIP
Spectrum
VoIP is a cheap
revenue kicker!
Data
B/S
Mktg
Field
Rent
BH
CPE
T3
Cust
Care
Nothing special here
Site costs grow by ^2
POP
No CPE is the new goal
Amortized over lifetime (1/churn
rate)
Depreciated over useful life
Equipment getting cheap
Sites & spectrum pricey
Metricom
2 Radio Poletop
Technology:
2.4 GHz mesh backhaul
900 MHz fronthaul
28.8 kbps  128 kbps
Proprietary CPE
Economics:
¼ mile radius
7  16 sq mi
$33k /sq mi + CPE
Metro WiFi
1 Radio Poletop
Technology:
2.4  5.8 GHz mesh backhaul
2.4 GHz fronthaul
CPE required for 75% of users
330 Kbps / user
Economics:
< ¼ mile radius
Cheaper radio BUT smaller radius
16  25 /sq mi
$20k  $30K/sq mi + 75% CPE
3G WiFi
Star Grid
Technology:
2.4 GHz mesh backhaul
2.4 GHz fronthaul
330 kbps / user
No CPE required
Economics:
Engineer for
85%+ coverage
Multi-radio units with
directional antennas
25  40 /sq mi
$50K  $200K /sq mi
WiMAX
Cellular
Technology:
5.8 GHz backhaul
2.5/3.5/5.8 GHz fronthaul
¼ Mile:
No CPE
384 Kbps /user
Mixed CPE model
½ Mile:
Inside CPE*
Economics:
1 Mile:
Mounted CPE
Multi-radio B/S with cheap CPE
½ to 1 B/S / sq mi
$125K /sq mi + 80% CPE
* Source: joint Intel / ArrayComm analysis
of interference-limited 802.16 networks
Source: WiMAX Forum. Note that
B/S cost include backhaul, site planning
and other network gear, and doubles for SME
WiMAX Mesh
(or mutant WIFi MAC)
Sectorized Mesh
Technology:
5.8 GHz (WiMAX*) mesh backhaul
2.4 GHz (WiFi) fronthaul
1  3 Mbps /user
Timed CPE Model
(as mesh builds, CPE goes away)
Economics:
Grows organically
to 100% coverage
Start thin, grow to no CPE
5  25 /sq mi
$10K + CPE  $20K /sq mi
* Or Mutant WiFi MAC
Customer Mesh
Sectorized Mesh
Technology:
5.8 GHz (WiMAX*) mesh backhaul
2.4 GHz (WiFi) fronthaul
1  3 Mbps /user
Timed CPE Model
(as mesh builds, CPE goes away)
Customers are
the infrastructure
Economics:
Start thin, grow to no CPE
5  25 /sq mi
$5K  $2K /sq mi
* Or Mutant WiFi MAC