Wednesday, March 02, 2016

Fiber versus Wireless Debate

Today on the FISPA member listserv there is a debate going on about the viability of fixed wireless, spurred on by my sharing the article: Cable MSOs beware: Wireless broadband is a growing threat. And this one: Google Fiber: Fixed Wireless for Last Mile May be in Play.

Fixed wireless is a viable option. Many companies make money from it. Yet far more make money from residential via wireless than B2B. There are notable B2B plays in fixed wireless like BOB that Windstream bought; Telepacific has fixed wireless; and Airband that UNSI bought before being bought by GTT. Even XO tried it a few times (and VZ just leased that LLDS spectrum).

From my perspective, I see fixed wireless as something a company cannot dabble in. You need an RF Engineer. You need experience to not only get it working but to keep it working. And as JAB Wireless (now Rise Broadband) proved, a roll-up is expensive and challenging. The equipment has an end of life. There are numerous factors that effect service delivery, including line of sight and noise floor. It isn't for the timid.

ISPs and CLECs have a resale mentality. They didn't really build network or own network. They rented network and built up a customer list to be sold. Think about the whole debate about Special Access. If CLECs owned their own network (and destiny) this would be a non-starter. It wouldn't matter. But 20 years and $1.7 Trillion later, resale still matters. To be fair, it matters to everyone, including cablecos.

Facilities based CLECs have a different mentality. They are building for the long-term. The exit strategy may be a sale, but it is a Built to Last mentality. That is why they seem to lean towards fiber. Fiber is more easily understood. There are numerous business models for fiber - from Cogent to Ideatek to Zayo to Level3. It is what the ILECs are doing in-region, although they do it to escape regulation and the copper plant. Who would say that fiber is a bad plan?

Due to the noise of Google Fiber and Verizon FiOS, even customers don't want anything but fiber (despite the build-out expense of time and money). I have two mid-market clients now complaining about copper to the building. Can you imagine if it was fixed wireless how freaked out they would be? Why?

Telecom is low on the priority list of most businesses. Just above a root canal I imagine. They just want this stuff to work. Period. They hear that subliminal messaging of fiber -- even from the cable companies. Fiber, fiber, fiber. How could they buy anything else? Think about a business associate using a Blackberry or Windows smartphone. What would you think? Yeah.

There are so many flavors of wireless too. Cellular, LTE, LTE-U, licensed, unlicensed, P2P, P2MtP. With fiber, there is fiber. And wireless suffers from cellular being called wireless. All those dropped calls, no bars, and other service issues paint the whole industry with a wide brush.

With copper there is the problem with service delivery that is effected by copper quality, distance from CO, number of pair available and gear used in the central office (CO). ADSL, ADSL2+, VDSL2, G.SHDSL and soon G.Fast are more like wireless where you have to keep upgrading gear to deliver service to the ever-increasing bandwidth consuming customer.

And I have to note that the B2B CLECs have not had great success selling fixed wireless, but use it for faster deployment and redundancy options. Even the CLECs who have acquired B2B Wireless entities have not showcased that talent. There are numerous factors involved - low hanging fruit, core competencies, sales ability, etc.

It might also be valuation. Building fiber networks is as hot as selling data centers right now. If you have investors, they are going to want the CLEC to own fiber. Fiber equals pay day in many people's heads.

That's just some of the thinking in the great wireless debate.

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