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The ability to support the deployment of indoor customer-installable end-user terminals can provide operators with significant cost savings that can greatly enhance the business case for a WiMAX fixed broadband wireless network. For the same operational performance, indoor terminals will be less expensive since they do not need to be hardened to deal with the more stringent requirements of out-door environments. Also, they can be designed as a single-box solution, thus eliminating extensive cabling and the need for multiple packages. More important, indoor units do not require professional rooftop installation. The net savings in customer premise equipment (CPE) costs for the operator can amount to several hundred dollars per customer. This CPE cost savings, however, does not come without other offsetting infrastructure costs that must be considered when making network deployment decisions. Consequently, various trade-offs need to be considered to help assure a winning business case when planning and deploying a WiMAX fixed wireless network with indoor self-installable customer terminals.

Recognizing the need for low-cost residential customer terminals, WiMAX vendors are aggressively pursuing designs and manufacturing approaches that are intended to drive down prices. Since WiMAX solutions are based on the worldwide IEEE 802.16 standard, ASICs and other critical components will be available at costs that will quickly decline with increasing volume. For the purpose of this discussion, outdoor terminal prices are assumed to be about $350 and indoor terminals about 30% less. With growing volumes and increased manufacturing efficiencies, these prices are projected to decline about 20% per year and 30% per year, respectively.

Installation costs for operator-installed outdoor terminals requiring a truck-roll can vary considerably from region to region depending on local labor rates, installation complexities, and roundtrip travel times. Figure 1 provides a forward-looking summary of projected average selling prices (ASPs) for residential WiMAX terminals and projected cost savings for self-installed indoor terminals. It assumes an installation cost differential of $150 in 2005 growing at 5% per year in future years. The net cost differential of approximately $250, as opposed to the absolute terminal pricing is the key variable in quantifying the trade-offs between the various deployment options.

From the end-customer's perspective, the functionality of indoor and outdoor terminals will be the same. However, due to reduced system gain and increased path losses the range capability of indoor terminals will always be less than the range capability for outdoor terminals. Professionally installed outdoor terminals will be mounted on a rooftop or under the eaves. These units will have a high gain, narrow beamwidth antenna and when mounted, will be strategically located on the customer premises and carefully aligned so as to maximize received signal strength and minimize the effects of interference.

Indoor residential terminals on the other hand will be subject to the following limitations:

• Indoor units will have lower antenna gain (wider beamwidth) to reduce the size of the unit and to facilitate self-installation. This results in a reduced system gain of approximately 6 dB.

• Signals will have to pass through one or more walls or windows. Signal loss through walls and windows is caused by a combination of signal reflections and signal attenuation as it passes through the medium and is more significant at shorter wavelengths. At frequencies in the 2.5 GHz to 5.8 GHz range these losses can be significant.

• Self-installable indoor terminals are subject to customer-by-customer installation variations that will not always be optimal. With some installations, for example, the height of the terminal relative to the height of the base station antenna will result in an installation that is off bore-sight to the base station antenna in the elevation plane.

Based on the current WiMAX channel model and terrain type; a 6 dB reduction in system gain and the anticipated excess path losses for indoor units will result in a range reduction compared to installation with outdoor units of 65% to 75%. As a result, in both capacity-limited and range-limited deployments, the use of indoor terminals will require additional base-station infrastructure to make up for the reduced channel capacity and/or range. The cost of this additional network infrastructure must be taken into consideration when making deployment decisions.

The operator has the following deployment alternatives from which to choose:

• Deploy base-station infrastructure to support 100% outdoor residential terminals only.

• Deploy base-station infrastructure to support 100% indoor residential terminals only.

• Deploy base-station infrastructure assuming a mix of indoor and outdoor terminals.

To quantitatively evaluate the relative trade-offs between the three deployment options it is necessary to understand the relationship between downlink (DL) channel capacity of a WiMAX base station and the coverage area or range over which the base station is expected to operate. Since fixed WiMAX deployments use adaptive modulation and adaptive coding, the effective DL channel capacity is dependent on the mix of modulations and the distribution of active users over the coverage area. For the purpose of this discussion a WiMAX-compliant solution with the characteristics summarized in Table 1 will be assumed. The most important parameters, system gain and BW efficiency, are consistent with the mid-performance WiMAX-compliant solutions, based on IEEE 802.162004, that are expected to be available in the near future.

Based on these characteristics, and assuming a uniform distribution of active non-line-of-sight users over the coverage area, it is possible to determine the effective base-station downlink channel capacity for the three CPE deployment options: all outdoor, all indoor and mixed indoor and outdoor. This is shown in Figure 2 with range projections based on a typical urban environment (terrain category “A”). The range notations used in Figure 2 are described in Table 2.

Converting the downlink channel capacity to the number of potential customers that can be supported provides additional insight as to the infrastructure cost implications. For a residential-only customer base using the service characterization summarized in Table 2, the channel capacity can be expressed in terms of the number of supportable customers per channel as shown in Figure 3 for ranges, “a,” “b,” “c,” and “d,” “d” denoting maximum range.

The service definitions in Table 3 convert to an average data rate of 35 kbps per residential customer or approximately 28 residential broadband customers per megabit of channel capacity. When deploying with indoor CPEs, Figure 3 suggests that a mixed deployment of indoor and outdoor CPEs, at ranges “b” or “c” will provide greater revenue potential per channel or alternatively, a lower base-station infrastructure cost per subscriber.

Limiting the base-station range in order to support lower-cost indoor self-installable customer terminals necessitates a higher investment for base-station infrastructure, but the terminal savings more than offsets these costs in a majority of deployment scenarios. In areas with high subscriber densities, generally encountered in urban and many suburban environments, a cost-effective deployment can support 100% indoor CPEs with a significant net savings in capital expenditure (CAPEX) per subscriber. In less populated areas with lower subscriber densities, limiting the range sufficiently to support a high percentage of indoor CPEs will not always be the most cost-effective approach.

If capacity-dependent or variable base-station costs dominate the infrastructure cost, a deployment that supports 100% indoor CPEs will often be the more cost-effective deployment alternative. However, if fixed base-station costs dominate, a mixed indoor/outdoor deployment may prove to be the more cost-effective approach.

Doug Gray works as a telecommunications consultant focusing on strategic planning and business development in the area of broadband wireless networks. He is currently working on various assignments on behalf of the WiMAX Forum with primary emphasis on business case studies. Gray holds an MSEE degree from Stanford University and a BSEE from the Polytechnic Institute of New York.