Meeting the 3G/4G Challenge: Maintaining Profitability in the Mobile Backhaul Through Ethernet
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1 White Paper Meeting the 3G/4G Challenge: Maintaining Profitability in the Mobile Backhaul Through Ethernet This document makes the case that replacing TDM networks with Ethernet in the mobile backhaul enables service providers to keep up with the increasing demand for network bandwidth while maintaining profitability. May 2011
2 Keeping up with the increasing demand for network bandwidth has been an ever-present challenge for equipment manufacturers, network operators, and service providers since the first network was powered on. Traditionally, this challenge has taken the form of providing sufficient bandwidth with enough performance and at a reasonable cost. Today, however, engineers face the difficulty of providing cost-effective solutions much more quickly than has been required in the past. The ubiquitous connectivity enabled by mobile devices has resulted in an exponential growth in traffic. Smartphone shipments alone are expected to surpass total PC shipments in 2012, and live content streaming (YouTube, Hulu, etc.) and processing-on-demand applications (Facebook and LinkedIn, for example) are being used by nearly every consumer and professional. In addition, with more and more consumer electronics devices being able to connect to the Internet via a wireless link, users have more opportunities to consume content, further increasing their bandwidth consumption. The combined result of such fast adoption, anytime access, and a growing selection of multimedia services is that the ramp-up of subscribers from the first launch of mobile services has dwarfed the adoption rate of desktop Internet (see Figure 1). For example, 20 quarters after the Internet was available to desktops, 20 million subscribers were active. It took only five quarters for the number of mobile subscribers to exceed 20 million, and after only 13 quarters, there are more than 120 million subscribers. Figure 1: The rate of adoption for mobile services dwarfs the rate at which consumers took to the Internet over their desktop computers. In just 13 quarters after launch, there are more than 120 million mobile subscribers driving traffic over the mobile backhaul. MBTE-WP100-R Page 2
3 The impact on bandwidth demand in the mobile backhaul is tremendous (see Figure 2). In 2010, mobile traffic was approximately 240,000 terabytes/month. With the transition to 4G, this figure is expected to increase to 6.3 million terabytes/month by To put the problem in perspective, consider that all of the mobile traffic carried in 2010 will be carried within the first seven weeks of The only way for service providers to meet this demand is to transform their traditional networks. For that, service providers will need to turn to Ethernet. Figure 2: The impact of wireless anytime, anywhere access on bandwidth is tremendous. Between 2010 and 2015, monthly demand is expected to grow 92% CAGR, from 0.24 EB to more than 6.3 EB (an exabyte [EB] is 1 million terabytes). The only way to meet this demand is to move to Ethernet within the mobile backhaul. MBTE-WP100-R Page 3
4 The Obsolescence of TDM Meeting mobile bandwidth demands is proving difficult for the existing TDM-based infrastructure. As a technology, TDM does not scale well with bandwidth to double bandwidth, the size of the network must double as well. This means that as traffic volume increases, the cost to transport that traffic rises at a similar rate. Unfortunately, the market expects the cost for services to decline even as these services consume more bandwidth (see Figure 3a). Consider the initial cost of a dial connection as it matured into a DSL link and then to broadband service. While the bandwidth provided has increased by orders of magnitude, consumers have paid a relatively equivalent price at each stage. At this point, it costs more to build out TDM infrastructure than the network can hope to generate in subscriber revenue. As a technology, TDM has become too slow and costprohibitive. It has clearly run its course. Ethernet offers a proven means for addressing the performance and economic challenges brought on by the explosive growth of mobile traffic. Ethernet technology provides cost-effective connectivity that scales to rising bandwidth demand (i.e., 10/100/1G/10G). Advances in Ethernet technology enable Ethernet-based equipment to provide up to 1000 the bandwidth of a TDM-based connection at significantly lesser expense. As a result, manufacturers are able to drive equipment costs down even as bandwidth throughput increases. Likewise, service providers are able to operate networks at a level that yields consistent profit margins (see Figure 3b). Figure 3a Figure 3b Figure 3: TDM-based networks (a) do not scale well with bandwidth: to double bandwidth, the size of the network doubles as well. As the price consumers are willing to pay for services declines, however, these services will cost more than the service providers can hope to generate in subscriber revenue. TDM has become too slow and costly to serve as the foundation of the mobile backhaul. Ethernet scales cost-effectively to rising bandwidth demand (b), enabling service providers to operate their networks at a level that yields consistent profit margins. MBTE-WP100-R Page 4
5 Because of its high value-proposition and ability to scale, Ethernet is well-suited to take the mobile backhaul over from TDM to manage the bandwidth needs of consumers as the transition to 4G progresses (see Figure 4). In terms of market share, Infonetics predicts that by 2014, the $8 billion expected to be spent on new network equipment in this space will be entirely Ethernet-based. Ethernet will also bring substantial annual OPEX savings to service providers of up to 75% compared to T1 leased line costs. Figure 4: The attractive economics and ability to scale make Ethernet well-suited to take the mobile backhaul over from TDM to manage the transition to 4G. Infonetics predicts that the amount spent on new network equipment in this space will reach $8 billion by With substantial annual OPEX savings to service providers of up to 75% compared to T1 leased line costs, new equipment is expected to be entirely Ethernet-based. MBTE-WP100-R Page 5
6 This shift should not be surprising, given the consistent history of Ethernet replacing existing infrastructure as bandwidth needs increase. Ethernet quickly replaced the T1/E1 infrastructure for home services such as dialup and DSL. It also replaced ATM in access concentrators, as well as SONET/SDH in the aggregation network. It is now time for the same changes to take place in the mobile backhaul (see Figure 5). Figure 5: Over the past decade, Ethernet has consistently replaced existing infrastructure throughout the network. It is now time for this same migration to take place in the mobile backhaul. The Ethernet Solution Broadcom has led the convergence to Ethernet since 1999 when it provided the fundamental technology to extend Ethernet into the Enterprise, and soon after that into the data center. With over 20 lines of business enabling growth in wired and wireless convergence and the industry's broadest portfolio of products, Broadcom has developed a powerful synergy with service providers to ensure high performance interoperability while driving down Ethernet economics. Broadcom has proven experience with real-world deployed networks backed by its strong investment in Ethernet technology and, as a company, it stands as the consistent leader in the Ethernet switch market, having shipped over 2 billion Ethernet switch ports around the world since MBTE-WP100-R Page 6
7 To enable high bandwidth in the mobile backhaul, Broadcom has introduced the new BCM56440 Ethernet switch. The BCM56440 is seventh-generation technology based on Broadcom's award-winning StrataXGS series, the foundation for the broadest and most complete portfolio of Ethernet switches on the market. In addition to eliminating the need for expensive, power-hungry NPUs and FPGAs, the BCM56440 delivers CAPEX savings of up to 50% while significantly reducing time-to-market. The BCM56440 has a nonblocking switch fabric with up to twenty-four 1 GbE ports, four 10 GbE ports, and sixteen T1/E1 ports for legacy connections (see Figure 6). With a diversity of configurations, it provides the complete solution for all areas of the mobile backhaul network, from small to very large port counts (see Table 1 on page 8). The extensive capabilities of the BCM56440 include: Bandwidth: Programmable approaches suffer from degraded performance as they perform more processing on each packet (see Table 7 on page 8). The proven XGS forwarding architecture guarantees 100% line rate performance even while providing full packet processing, hierarchical quality of service (QoS) for prioritized traffic scheduling, and deep packet buffering. Advanced Packet Processing: In addition to advanced features such as VPLS, VPWS, MPLS-TP, PBB, and PBB-TE tunneling, the BCM56440 supports the latest carrier Ethernet services in hardware, including OAM and BFD, to support complete host CPU offload for these functions. Integration: Offering the industry's highest integration in its class, the BCM56440 is a full cell site routeron-a-chip, combining the functionality of up to seven ASSPs onto a single, power-efficient 40 nm device. Seamless Transition from Legacy Networks: Carrier-grade capabilities and hardware-based Circuit Emulation Services (CES) including gateway, framer, and buffer enable seamless delivery of legacy TDM, so service providers can preserve their existing network investment. Figure 6: The BCM56440 has a nonblocking switch fabric with up to twenty-four 1 GbE ports, four 10 GbE ports, and sixteen T1/E1 ports (for legacy connections) to provide the complete solution for all areas of the mobile backhaul network. MBTE-WP100-R Page 7
8 Table 1: Broadcom offers a complete selection of Ethernet "cell-site-on-a-chip" switches to support applications from small to very large port counts. The new BCM56440 guarantees wire-rate performance under all loads, advanced packet processing, the industry's highest integration, and hardware-based Circuit Emulation Services (CES) to enable a seamless transition from legacy networks. Part Number Front Panel Ports XAUI/HiGig2 Ports BCM GbE 4 BCM GbE/2.5 GbE 2 BCM56445 a 24 1 GbE 4 BCM MbE 4 1 GbE/2.5 GbE a. Pin-compatible with BCM56334; no DDR3 interfaces. Figure 7: With programmable approaches, performance degrades as new features are enabled. The proven XGS forwarding architecture of the BCM56440 guarantees 100% line rate performance even when providing full packet processing, hierarchical quality of service (QoS) for prioritized traffic scheduling, and deep packet buffering. MBTE-WP100-R Page 8
9 The time to transition to Ethernet in the mobile backhaul is now, and with the unparalleled integration of the BCM56440 based on technology that has been deployed and proven in real-world networks, developers have everything they need to provide the high bandwidth required to support 3G and 4G mobile backhaul transport while preserving their existing legacy network investment. Switches based on the BCM56440 will be able to deliver up to 1000 more bandwidth than legacy TDM-based networks while offering carriers a seamless migration path to Ethernet-class performance and advanced services in the mobile backhaul network at wire rate. Finally, manufacturers and service providers will be able to leverage the tremendous cost economies of Ethernet with up to 50% CAPEX and 75% annual OPEX savings to offer their customers the most advanced features, performance, and reliability while increasing profitability. MBTE-WP100-R Page 9
10 Broadcom Corporation reserves the right to make changes without further notice to any products or data herein to improve reliability, function, or design. Information furnished by Broadcom Corporation is believed to be accurate and reliable. However, Broadcom Corporation does not assume any liability arising out of the application or use of this information, nor the application or use of any product or circuit described herein, neither does it convey any license under its patent rights nor the rights of others. BROADCOM CORPORATION 5300 California Avenue Irvine, CA by BROADCOM CORPORATION. All rights reserved. MBTE-WP100-R May 2011 Phone: Fax: Web:
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