HomeNewsCompetition holding back backhaul revenue, claims new research

    Competition holding back backhaul revenue, claims new research


    Competition is hampering sales growth in the backhaul equipment market, new research has claimed, with microwave continuing to dominate the sector.

    A report from IHS said the global backhaul equipment market was worth $8.4 billion last year, up five percent from the previous 12 months.

    Despite the price pressures, growth was driven by LTE deployments, continued 3G network expansions and a desire by operators to expand their backhaul capacity.

    Microwave equipment remains the biggest player in the backhaul market, with a 44 percent share.

    However, its share will come under pressure from fibre and wireline Ethernet backhaul products in the short-term. Towards 2020, microwave growth will be reignited by deployments of LTE-Advanced Pro and early stage 5G networks.

    Elsewhere, the report claimed ethernet access devices and IP edge routers collectively accounted for 45 percent of global macrocell backhaul revenue last year.

    LTE and LTE-Advanced deployments have been predicted to fuel the ethernet macrocell market, which will be dominated by ethernet over fibre or microwave.

    Richard Webb, research director for mobile backhaul and small cells at IHS, said: “Although the exact long-term 5G picture for backhaul is unclear at present in terms of form factor, in the long run there must be fibre or other high-speed solutions available out at the network edge, locally, close to cells, due to the very high-capacity spectrum used for high-capacity service delivery with low-latency requirements. This means there will always be backhaul, even if it eventually looks different in form to what we know today.”

    Between 2015 and 2020, operators will spend $51 billion on mobile backhaul as they focus on expanding LTE-Advanced networks and prepare for 5G.