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Fixed Wireless Economics

Fixed Wireless Economics. Personal Background: SkyPilot – outdoor WiFi mesh Covad – DSL / VoIP Genuity – nationwide IP access Hughes – satellite data ATT/Intel – future RBOC network. Duncan M. Davidson dd@vpvp.com.

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Fixed Wireless Economics

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  1. Fixed Wireless Economics Personal Background:SkyPilot – outdoor WiFi meshCovad – DSL / VoIP Genuity – nationwide IP access Hughes – satellite dataATT/Intel – future RBOC network Duncan M. Davidsondd@vpvp.com Selected VPVP Investments:Metricom – Ricochet NetworkDSL.Net – DSL / VoIP Aerie – nationwide IP accessBroadstorm – OFDM FWBCBeyond – VoIP for SME

  2. The Promise: Wireless is *Much* Cheaper Nationwide Buildout Cost (Order of Magnitude)

  3. Operator Economics Five Drivers network new subs sites subs services VoIP Spectrum VoIP is a cheap revenue kicker! Data B/S Mktg Field Rent Cust Care BH CPE Nothing special here T3 Site costs grow by ^2 POP No CPE is the new goal Amortized over lifetime (1/churn rate) Equipment getting cheapSites & spectrum pricey Depreciated over useful life

  4. Metricom 2 Radio Poletop Technology: • 2.4 GHz mesh backhaul • 900 MHz fronthaul • 28.8 kbps  128 kbps • Proprietary CPE Economics: • 7  16 sq mi • $33k /sq mi + CPE ¼ mile radius

  5. 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: • Cheaper radio BUT smaller radius • 16  25 /sq mi • $20k  $30K/sq mi + 75% CPE < ¼ mile radius

  6. 3G WiFi Star Grid Technology: • 2.4 GHz mesh backhaul • 2.4 GHz fronthaul • 330 kbps / user • No CPE required Economics: • Multi-radio units with directional antennas • 25  40 /sq mi • $50K  $200K /sq mi Engineer for 85%+ coverage

  7. ¼ Mile: No CPE ½ Mile: Inside CPE* 1 Mile: Mounted CPE WiMAX Cellular Technology: • 5.8 GHz backhaul • 2.5/3.5/5.8 GHz fronthaul • 384 Kbps /user • Mixed CPE model Economics: • 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

  8. 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: • Start thin, grow to no CPE • 5  25 /sq mi • $10K + CPE  $20K /sq mi Grows organically to 100% coverage * Or Mutant WiFi MAC

  9. 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) Economics: • Start thin, grow to no CPE • 5  25 /sq mi • $5K  $2K /sq mi Customers arethe infrastructure * Or Mutant WiFi MAC

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