Local switching could cut cost on satellite backhaul

Telecom Asia Staff
16 Mar 2009

With backhaul still one of the most formidable barriers faced by cellcos in emerging markets wanting to extend coverage to rural villages, satellite has been touted for some time as the most efficient way to connect remote base stations to the PSTN. One problem: space segment links are costly, and even with costs coming down in certain regions, a 2-Mbps satellite link still costs as much as $10,000 a month.

Irish tech company Altobridge aims to blow the economics out of the water with a managed services solution that lets cellcos outsource their remote base station connectivity far more cheaply. Altobridge isn't the first vendor to think of this - Hughes Communications, for example, has been doing it for some time now - but Altobridge's secret weapon could be its in-house technology: a split-BSC architecture combined with local switching capability.

Altobridge's split-BSC architecture effectively makes it easier to integrate on-demand VSAT capability into a BTS. Ericsson licenses the technology, and it's also been deployed in Blue Ocean Wireless' maritime GSM service and the in-flight mobile service offered by ARINC/Telenor-owned Aeromobile.

Altobridge has been pitching its technology as a rural BTS solution for years, but it's recently added something potentially more compelling: local switching technology that allows a rural base station to switch local calls in the same cell site without sending them across the backhaul network. Combined with split-BSC, which connects with the satellite only when it needs a link, rather than 24/7, the Altobridge proposition can save cellcos thousands of dollars in backhaul costs, says Janne Hazell, Altobridge's general manager of wireless solutions.

'Rural coverage is often too low on an operator's priority list because of the economics,' Hazell told Telecom Asia. 'There has to be an economic incentive with low effort for the operator to be interested enough.'

Case studies

That's also why Altobridge is offering cellcos an outsourcing option to design, build and operate GSM/VSAT base stations with managed services ranging from dimensioning and capacity analysis to 24/7 monitoring, fault management and network/cell KPIs, Hazell adds. 'Outsourcing means they don't have to divert resources from other projects, and the set-up time is faster. What usually takes six to 12 months to put in place can be set up in a month.'

At last month's Mobile World Congress, Altobridge offered some extra metrics to make its case via case studies from its two most recent cellular customers: Malaysia's Maxis Communications and Mongolia's Mobicom, which spent four months each trialing the managed BTS service in locations eight hours from the nearest town (including a one-hour canoe trip in one case) with access dependent on favorable weather conditions.

One site, which primarily served a remote enterprise customer, served over 440 subscribers with zero marketing and generated $25.86 in ARPU a month. The second site - a government-sponsored remote community - served 50 subscribers with ARPUs of $19.60 a month.

Altobridge didn't disclose which site belonged to which cellco for NDA reasons, but Hazell said the ARPUs were double what the operators see on their macro networks, even though rural service was offered for the same package price plans as in the cities. Hazell also noted one other interesting metric from the trial: remote coverage means churning subscribers to your network.

'We saw a number of instances where users on competing networks came to the location, found another network providing coverage, then changed network providers before their next trip,' Hazell said. 'So there's definitely a first-mover advantage opportunity here.'

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