Copper – the Traditional MediaCopper is used for voice and data-capable T1/E1 and DS3 lines and is the most common media for access and backhaul in North America. It’s typically leased on a monthly basis.

• Leased T1/E1 lines provide 1.544/2.048 Mbps in each direction, with typical prices ranging from $150 to $750 per month, depending upon location, and with set-up charges averaging $625 per T1.

• The North American average price per T1 is $337 per month, and price increases linearly with capacity – so there are no volume cost savings when leasing multiple T1/E1 lines.

• The price per megabit per second of throughput is the same at 1 Mbps as it is at 10 Mbps and, because T1/E1 leased line prices can be a function of distance, too, using copper for backhaul quickly becomes cost-prohibitive.

Fiber – the Gold StandardFiber offers far higher capacities than copper, and fiber is the gold standard when it comes to capacity and speed. But leasing fiber lines can be prohibitively expensive. That’s why those with high capacity demands – such as mobile operators and large enterprises – often invest in their own dedicated fiber rather than lease lines.

Typical lease rates for an OC-3 with a capacity of 155 megabits-per-second (Mbps) are $4,000 to $7,500 per month. There’s also a one-time set-up charge for each leased line averaging $7,300 per OC-3. (Of course, this price assumes fiber is available, and that’s the case only in an estimated 13% of U.S. office buildings holding twenty or more employees.)

The alternative to leasing – owning your own fiber – is practical only when capacity r equirements warrant such a sizeable investment or when the fiber will be shared by multiple

parties. Fiber installation costs continue to skyrocket, ranging from $40,000 to more than $250,000 per mile, depending upon geography, rights of way, traffic control and the costs of the transmission equipment itself. That’s why new fiber only makes sense when the distance to the nearest fiber ring is short – typically, less than 2 miles.

And, of course, new fiber takes months to deploy.

Microwave – the 21st Century AlternativeMicrowave is the cost-effective alternative to both copper and fiber. More often than not, it makes better financial sense to buy than to rent. This is as true for communications transmission equipment as it is for houses and automobiles. In the case of microwave backhaul systems, typical microwave payback vs. leased lines is less than a year for all but the lowest throughput requirements and shortest distances.

When it comes to purchasing fiber, no one doubts that for the highest capacity transmission requirements, it is the gold standard. But for distances greater than 2 mi / 3 km (typical) and for the majority of applications –10s or 100s of megabits per second – microwave is simply more cost effective – and far faster to deploy. And in addition to the economic benefits

MIDDLE MILE AND LAST-MILE BACKHAUL:What’s Your Best Investment?When it comes to network backhaul, you have three choices: fiber, copper and microwave. But what are the costs involved, and how do they compare? Let’s examine each.

Microwave is the

cost-effective alternative

to both copper and fiber.

What’s Your Best Investment? (cont’d)

of ownership, those who own their microwave backhaul systems gain the security, stability and freedom associated with full control over their network. Let’s look at the costs of a microwave backhaul system:

Low Capital Costs for Microwave (and you own your backhaul)

• Microwave backhaul systems range from less than $5,000 per link to $50,000 or more for ultra-high capacity, redundant installations.

• Antennas, cables and power costs range from $3,500 to $9,000 per link depending upon antenna size, radio configuration, tower height and other site characteristics.

Lower Installation Costs and Faster Deployment• The installation costs for a microwave backhaul system, cabling and ancillary equipment ranges from $3,000 to $8,000. (Tower

installations generally cost more than rooftop installations.)When it comes to time-to-deploy, microwave can’t be beat, with deployment times as short as a few hours.

Minimal Recurring Costs for Microwave

• For microwave backhaul systems configured for a licensed frequency band, the FCC (or other regulatory agency) changes a one-time cost for the license and frequency coordination, typically ranging from $1,500 to $3,000 for a ten-year license (FCC).

• Annual maintenance costs run from 5%-10% of the equipment cost and include both spares and an annual site visit;

• Depending upon the installation locations, there may be a monthly cost to lease space for the antennas, ranging from zero in the case of systems deployed on-premises to about $700 per month for larger antennas at the most expensive third-party tower sites.

About ExaltExalt Communications provides next generation microwave backhaul systems to service providers, government organizations and enterprises worldwide. Exalt products are designed to solve the network bottlenecks associated with the growing demand for IP- based voice, data and video applications and the resulting migration from TDM to IP-based networks. With a flexible architecture and universal product platform covering multiple market segments, Exalt provides a full range of carrier-class microwave radio systems that meet the demand for cost-effective and flexible alternatives to fiber and leased lines.

Exalt Communications, Inc.

580 Division Street

Campbell, CA 95008

Produced in the United States of America.

©2010 Exalt Communications, Inc.

All rights reserved.

More details on Exalt point-to-point microwave backhaul systems may be found at:

www.exaltcom.com

Exalt and the Exalt logo are trademarks of Exalt Communications, Inc. Other company and product names may be trademarks of others. Information contained in this document may be subject to change without notice. 2/2010