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Infrastructure Sharing and Outsourcing to Characterise Mobile Backhaul Strategies in Sub-Saharan Africa

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Mobile network backhaul infrastructure plays a key role in the delivery of services to end users and is likely to be an important spend area for network upgrades during the medium and long terms. Operators will be upgrading backhaul to match the capacity of core and access networks that have been receiving constant attention. Infrastructure sharing will increasingly be used by operators to reduce capital expenditure (CAPEX) and operating expenditure (OPEX) on backhauls. These trends will create growth opportunities in the Sub Saharan African mobile network backhaul infrastructure market.

New analysis from Frost & Sullivan finds that the backhaul infrastructure markets in Angola, Gabon, Ghana and Kenya spent $355 million in 2009 and estimates this to reach $1.45 billion in 2015.

"Escalating demand for data services is driving the need for upgrading mobile network backhaul infrastructure," notes Frost & Sullivan ICT Senior Research Analyst Vitalis G. Ozianyi. "Operators need to share costs and invest in network technologies that support transmission of large quantities of data such as optical fibre."

Landing of undersea cables on various African countries' coasts and deployment of enhanced 3G (3G+) and 4G technologies will amplify the increasing demand for data services. Microwave-based backhaul is likely to remain dominant for rural coverage; however, operators are likely to adopt resource sharing to provide higher-capacity backhaul for areas with sustainable high demand.

A key challenge will be the high CAPEX required for new technologies.

"The high CAPEX and OPEX associated with deploying and maintaining backhaul infrastructure will influence investment into higher capacity technologies," remarks Ozianyi. "Furthermore, the inadequacy of other supporting infrastructure, like reliable power supply, will slow the deployment of new technologies."

Sharing infrastructure will enable operators to cost effectively deploy backhaul networks that meet the increasing demand for data services. Outsourcing of backhaul services can also be used to reduce OPEX in areas with limited demand.

Mobile operators need to ensure that their backhaul networks are upgraded to avoid creating a bottleneck between access and core portions. Backhaul networks should be upgraded in response to increasing network traffic.

"Since upgrades can be expensive, operators need to segment their markets," advises Ozianyi. "They can deploy high capacity fibre technologies in high demand areas while wireless backhaul technologies can still be used in low demand rural areas."

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Tags: backhaul  Angola  Gabon  Ghana  Kenya