Radio backhaul hasn’t made too many in-roads in the US compared to Europe. With the exception of Clearwire (NASDAQ:CLWR), carriers tend to use radio links to connect cell sites as a last resort, but a new IP radio company Siklu hopes to change US operators’ minds. It may not be able to convince them milimeter radio technologies are technically superior to wireline ones, but it can offer them those radios for dirt cheap.
Rather than build its millimeter wave technology on an existing platform, Siklu has developed it from scratch, cutting down costs by integrating the front-end and baseband components into silicon and designing its own antennas. As a result of those efforts, according to Shahar Peleg, Siklu’s director of product management, Siklu can not only undercut the prices of larger competitors like Aviat (NASDAQ:AVNW), Ericsson (NASDAQ:ERIC) and Dragonwave (NASDAQ:DRWI), it can decimate them.
Siklu is selling its millimeter radio, supporting up to 1 Gb/s of capacity, for less than $3000, which is $2000 less than its competitors’ cheapest microwave radio and $12,000 less than the closest millimeter wave solution, Peleg said. If that price is extrapolated across a 10,000 link radio backhaul network, along with the licensing and opex costs, Siklu’s network costs only $35 million to build and maintain over 5 years compared to between $175 million to $225 million for a microwave network (which supports two-thirds less capacity) and between $155 million to $255 million for another vendor’s millimeter network, Peleg said.
With 4G coming fast in the US, backhaul needs will be enormous, but operators can’t get fiber to every cell site, Peleg said. Therefore Siklu hopes to convince operators of using its technology as, at least, a temporary solution for hard-to-reach sites, Peleg said, and once the platform proves itself, to perhaps change their minds about the viability of radio backhaul entirely.