On the face of it, the merger between US firm Fastback Networks and UK outfit Sub10 Systems might come as a surprise. Yes, both are wireless backhaul solution providers, but Fastback has pioneered solutions in the 5GHz unlicensed band, while Sub10 has developed products in the millimetre wave V and E bands.
But it is exactly this combination of wireless expertise that will provide the merged entities with a more powerful offering to the market. Speaking to Wireless on the day the merger was announced (17 March 2015) – see news story here - Kevin J. Duffy, CEO of Fastback and Stuart Broome, who becomes chief sales and marketing officer in the new company, explain the commonality behind their approach to solving the wireless backhaul challenge.
‘Fastback set out in 2011 to solve the problem of the any line of sight (ALOS) backhaul challenge and broke new ground by doing so. We put together the highest speed, lowest latency software defined radio available today,’ says Duffy (pictured below). ‘We’ve had customer wins with Tier 1 and 2 operators and developed an OEM sales channel and a distribution channel; and we’ve also raised $41m in funding.’
Broome (pictured below) says: ‘Like Kevin and the Fastback team, we saw a market demand and opportunity to provide backhaul solutions for dense urban environments. We approached the challenge from a millimetre wave angle, but we had the same philosophy for clients by looking for ways to help them densify their macro networks and provide them with the high speeds and low latency solutions they need to enable deployment of LTE small cell networks.
‘The whole ethos of both companies was to build very effective, viable, low latency devices using available spectrum and the different strengths of those spectrums. So, we had the same customer approach with different, but complementary solutions; hence the decision to merge the two companies,’ explains Broome.
‘That’s the baseline,’ adds Duffy, ‘and we are both prospering and thriving as companies. We both have great financial backing, so it makes sense to put the two together.’
The motivation for the merger comes from looking at the future of the industry and what its market drivers are. As everyone knows, demand for cellular services is rising and will only continue to do so with the proliferation of LTE technology and the higher capacity applications it can support, such as high definition video streaming.
The problem is cellular demand is outstripping backhaul capacity. ABI Research is predicting that by 2016-17 wireless demand will be growing at 37%, but backhaul capacity by only 25%.
‘There is going to be insufficient backhaul capacity and the situation is getting worse,’ argues Duffy, ‘so we need to move to utilising high capacity microwave backhaul solutions. Sub-6GHz and millimetre wave backhaul are the best available solutions to meet the demands of dense LTE networks and to handle applications such as HD CCTV.’
In the view of Fastback and Sub10, the only spectrum below the roof and treeline level that really works is V-Band (60GHz) and sub-6GHz and that is why backhaul solutions using those spectrum bands are going to grow. ‘So, if you look at what we have done separately and then put us together, we have a powerhouse offering,’ says Duffy.
He goes on to say: ‘Densification of the network requires a bottom up, street level approach, rather than the traditional macro network top down, rooftop approach – this is the future. We think we are the only company in the world that can address that bottom up approach.’
Broome points out that legacy wireless backhaul solutions using the classic microwave (6-38GHz) products are really about providing coverage. ‘What we are looking at is densification in urban areas. Operators need to boost their macro sites and then introduce small cells at lower levels. Our new approach is to start where the network will be in the future and that means communicating from street level to rooftops and vice versa,’ he says.
‘There are considerable RF challenges to overcome in doing this,’ continues Broome. ‘How do you provide freedom of location? You have to put the base station where you need it to be, not just where you happen to be able to get access. You want the connectivity where the customers are, not where the fibre dictates; i.e. you site your cells where the demand is greatest.
‘By bringing Fastback and Sub10 together we offer a great combination of ALOS and LOS solutions to address the backhaul of small cells in any configuration. We can link seven different combinations of Fastback and Sub10 products together and we will still provide lower latency than any of our competitors. What we provide is the backhaul solutions for next generation networks: LTE, LTE-A, and later 5G,’ says Broome.
He notes that Fastback has been phenomenal in supplying backhaul for macro sites –a market that most people didn’t think would exist, but which has come into being as mobile network operators (MNOs) upgrade their existing macro networks.
‘But it’s the ability to provide such low latency that is remarkable,’ says Broome, ‘and that is what is needed to connect LTE eNodeBs together and later 5G, which will have even higher latency demands (sub-1millisecond is being proposed). The new Fastback portfolio is about deploying solutions today that are future network ready.’
As far as Sub10 is concerned, Broome points out that the company is on its third or fourth generation of millimetre wave products, while Fastback has the best backhaul product in unlicensed spectrum on the market. ‘The cross fertilisation that will take place in our engineering teams will provide us with a unique combination that will keep us ahead of the competition,’ he asserts.
‘5G will require a knowledge of how millimetre waves behave and because 5G will require thousands of antennas and radios to be deployed they will need stringent interference mitigation. Fastback has that expertise, as it had to develop that to handle all the interference in the 5GHz band.’
Broome also points out the both companies have software defined networking(SDN) and low latency expertise in common, so that gives them a unique combination of experience and tools.
‘Sub10 has the millimetre wave expertise in-house and Fastback has the interference mitigation expertise in 5GHz. So that gives us a huge advantage going forward. We’ve both done it all and that will really put us ahead of the competition,’ believes Broome.
Duffy adds that the companies will complement each other in terms of regional focus, as Fastback has a strong presence in the North American market and Sub10 in Europe. Both sets of customers can now benefit from Fastback’s widened product portfolio. ‘With Stuart taking on the chief sales and marketing role, he will spearhead how we broaden our attack and become the dominant player in the wireless backhaul market.’
Broome says: ‘We will combine the names under the Fastback brand, but we will keep both for a while - that’s more to do with order fulfilment. We will continue to use the likes of Ericsson as a go to market channel, as MNOs have strong relationships with Tier 1 OEMs and are comfortable with Ericsson recommending them the right solutions, which can include Fastback/Sub10 products.’
He adds that providing backhaul for macro sites is the first step and a lot of the growth has been driven by macro site upgrades. After that, it will be network infilling and densification of the network. The key task is to maintain R&D and product evolution to stay ahead of the competition.
‘As far as infill and network densification is going, we are getting beyond trials and that trend will continue,’ observes Broome. ‘Even in UK, where the MNOs are still rolling out their macro 4G networks, the activity is starting to pick up. As an MNO, when you invest in an LTE network you need to justify and fulfil customer demand and the quality of experience you have promised them. We are starting to see the beginning of these deployments.’
Duffy concludes: ‘We have an amazing syndicate of investors behind us; we have the products and expertise, and we’ve got staying power and strength.’