A compression/decompression method for backhaul communication of a complex-valued radio signal between base stations and the network processing unit, such as a Central Processor of a Coordinated MultiPoint (CoMP) system, significantly reduces backhaul bandwidth. The spatial and temporal correlations of the wireless IQ signal are exploited in order to remove redundancy and substantially reduce signal bandwidth. Feature component signals of significance are extracted through linear transformation to form the radio signal, and are individually quantized, possibly at different bit rates in accordance with their relative importance. The transformation can either be pre-determined or computed in real-time based on the spatial and temporal statistics of the radio signal. In the latter case, the transformation matrix or matrices are also sent over the backhaul in order to allow the radio signal to be reconstructed at the receiving end. Different methods of generating the transformation matrices are proposed.