Is Gigabit wireless a thing yet?

Fact: the FWA industry is mature, with roots in serving rural communities where the economics of full fibre don't work. But FWA technology has come on in recent years, and then some. Gigabit wireless products are now available in the market, and are attracting lots of interest in non-rural areas. Why? Because FWA can be commercially attractive and offer some of the benefits of private 5G - namely coverage and service where wanted, to local terms and local needs. But is the technology reliable, sustainable, and in any way a substitute for FTTP? Do read on...

From a terminology standpoint, it is important to note that the ‘wireless’ industry includes ‘mobile’ (or cellular) networks, WiFi, public and private 4G and 5G systems, and much more.

There is more to ‘wireless’ than ‘mobile’, although often, the terms are used interchangeably, incorrectly. Further, 5G technology is not only for smartphones. ?

Whereas the FWA industry is well-established, especially with products supporting operation in the 5GHz radio band targeted towards providing connectivity for more rural areas, there have been some key developments of late.

Gigabit and multi-gigabit capable radios are now commercially available, supporting a range of radio bands from sub-6GHz, to the EHF 26-28GHz and 60GHz bands. ?

In some respects, these solutions can offer broadband service performance levels similar to those with full fibre. But it is wrong to equate wireless systems to fibre without careful qualification, as cost structures and engineering details can vary widely.?

Cost structure with gigabit capable FWA can be superior to that for full fibre networks across a range of deployment scenarios …

With equipment using the sub-6GHz radio bands, gigabit connectivity is possible with wireless links with range up to around 10km, with high gain directional antennas and high order modulation radios.

Key advantages with FWA networks over cellular systems include the ability to deploy high gain antennas to reach specific areas, and much simpler core network technology – as mobility management is not required. These factors improve cost structure significantly, and when coupled with use of lightly licensed shared access radio spectrum – available at nominal costs, allow compelling investment cases in some situations.

Capital cost per connected premises (CPCP) with gigabit capable FWA designs can be around ￡350 or less at the access network level (including mesh and PtMP designs), significantly less than with full fibre network designs.

Given this attractive cost structure, and with cost-efficient cloud-native core network designs,

EBITDA margins in excess of 50% are possible with FWA networks, along with healthy valuation multiples – supported by fast network roll-out times.

New commercial models are becoming important for non-rural areas…

In non-rural areas, interest is growing strongly in the deployment of FWA systems operating in the millimetre wave (extra high frequency, EHF) bands such as 26-28GHz and 60GHz, as these can offer multi-gigabit performance (as an alternative to full fibre), and address demand cases (e.g. nomadic connectivity, holiday parks, coverage at event spaces) which cannot be served using fibre.

This market is likely to offer good potential in the near future, including in the UK – with Ofcom expected to offer licensing for outdoor wireless systems in the lower 26GHz band during 2022.

Wireless mesh networks using the EHF bands can provide highly resilient multi-gigabit connectivity with node to node link ranges of hundreds of metres.

Radio meshing is an important technology for non-rural areas, as multi-gigabit capacities can be provided, and network capital costs are significantly lower than with full fibre. ?

In meshed FWA network designs, CPCP is around ￡100 with current deployments, and costs are expected to reduce further as this market continues to develop. Meshing provides good cost efficiencies with backhaul circuits and network resilience benefits across the whole access network. Meshing also enables flexible capacity development as markets develop.??

Wireless solutions need not contribute more risk than with full fibre, and investment models can be very appealing…

From an investor perspective, higher risk per se with FWA systems over full fibre deployments is not evident (as is often the perception without a level of analysis), but neither are the two technologies directly comparable.

With well-engineered designs, FWA networks can provide resilient connectivity levels. As with many technologies, there are pros and cons with both.

FWA solutions, with attractive cost structure and time to market, become particularly compelling with the advent of gigabit capability.

FWA solutions are attractive in various cases including in:

·????????rural areas,

·????????cases where semi-mobile, vehicular, or portable connectivity is required, and

·????????non-rural areas to support smart city and transport opportunities.??

Gigabit capable wireless networks now provide an important complement to FTTX networks, enabling pervasive connectivity, new services, and valuable consumer benefits.

Increased roll-out of FTTX networks will enable greater deployment of FWA ‘last mile’ solutions. This is an important development, where gigabit and multi-gigabit wireless access networks will provide valuable new solutions supporting a range of new market needs such as nomadic and semi-portable access.

Increased market access and competition, with regional shared spectrum access, will provide important consumer benefits and remove innovation log-jams.

FWA and FTTX together will support the development of pervasive gigabit connectivity for the whole of the UK.?

It is unlikely that the window of opportunity for wireless solutions will close as full fibre develops, but there is a shifting of markets and technology supply chains – presenting new opportunities for those able to leverage key developments (i.e. changing social behaviours, new regulations, limitations with cellular mobile systems, and unique capabilities of new gigabit wireless systems).

Looking to the future, a key issue, facilitated by effective regulation, will be increased access to radio spectrum on a regional basis (spectrum sharing), at cost levels that do not present excessively high barriers to entry – as has been the case with national licensing for spectrum in the mobile bands. Key issues include maintenance of alignment between radio spectrum regulation and equipment suppliers, and international harmonisation, so that network equipment can be made available to the market in a timely way, and with economies of scale supporting efficient pricing levels.

Wireless systems are expected to evolve with particular technologies suited to selected market needs, as it is not economically efficient to design one network which meets all demands. As full fibre continues to be rolled out,

one can expect that winners in the market will capitalise on the unique advantages that wireless connectivity brings, with new commercial models and services such as: neutral host networks, gigabit capable portable services, joint investments, and carrier-neutral segment-focused datacentres.

Taking into account attractiveness of scalable opportunities,

smart cities and solutions for portable and vehicular needs can be seen as particularly notable areas for development.?