May 22, 2012

Small Cells Become a Big Deal

This article originally appeared in the May 2012 issue of Next Gen Mobility magazine.

Forecasts Indicate They Will Outnumber Macro Basestations by 2012

Small cells have been garnering big attention lately, as many wireless service providers embrace them in an effort to add capacity and fill in coverage. So popular are the different iterations of this kind of gear that the number of small cells is expected to outnumber that of macro base stations by 2014, according to Rethink Research.  

“Small cells are set to drastically reshape mobile networks over the next few years as they become comfortably the most common form of base station worldwide,” says Dimitris Mavrakis, principal analyst at Informa Telecoms & Media. “Over the past few months alone we’ve seen a host of new operators make small cell announcements including major players like Telenor and Telefónica O2, as well as smaller providers like 3UK and Free in France whose free femtocell offer looks set to be highly disruptive. Unsurprisingly this sea change in mobile networks is impacting M&A activity with Mindspeed acquiring small cell chipset frontrunner Picochip while Ericsson provided further proof of the importance of Wi-Fi in small cells by picking up BelAir Networks.”

Informa Telecoms & Media forecasts that small cells will grow from 3.2 million this year to 62.4 million by 2016 – a 2000 percent increase. Femtocells (News - Alert) will play a leading role in the small cell expansion, with expected growth from 2.5 million in 2012 to 59 million in 2016, according to Informa. Public access small cells, including microcells and metrocells, most of which are for outdoor installation, are forecast to increase from 595,000 this year to 2.9 million in 2016. Enterprise and public area picocells are positioned to rise from 140,000 this year to 540,000 in 2016, Informa Telecoms & Media estimates.

Meanwhile, Infonetics Research (News - Alert) expects public space femtocells to make up more than 50 percent of all small cells shipped this year, and says that most operators are planning small cells only in the urban core for the next three years or so. Infonetics forecasts the global small cell market will grow rapidly, with about 3 million small cells shipping and the market worth about $2.1 billion in 2016.

"While small cells, including microcells and picocells, have been used for the past two decades to improve voice coverage, now mobile broadband is shifting the game to capacity upgrades," notes Stéphane Téral, principal analyst for mobile infrastructure and carrier economics at Infonetics Research. "Therefore, the chief objective is to complement and enhance the macrocell layer from a capacity standpoint with a new breed of low-power nodes like public space femtocells and WiFi.”

However, he adds, small cells do have their challenges in terms of inter-cell interference and backhaul issues.

“The question is,” says Teral, “how small can the cell be? Because the smaller the cell, the higher the number of units required to cover an area, and that will determine the true size of the small cell market."

Whatever the true size of the small cell market, many infrastructure vendors – be they big names like Alcatel-Lucent, Ericsson, Huawei (News - Alert), NSN or ZTE, or smaller outfits like Contela, ip.access, Juni, Minieum Networks, Ubiquisys, and others – clearly want to grab their slice of what looks to be a sizable pie.

Alcatel Lucent earlier this year at Mobile World Congress (News - Alert) in Barcelona was pushing its new metrocells (what some might call picocells) and the fact that they were in trials by three customers. The metrocells are based on the company’s lightRadio technology, which uses beam forming that makes amplifiers on the radio towers more energy efficient, have an extremely small footprint, and lower the cost per bit for carriers, explains Thomas R. Gruba, senior director of 3GPP product marketing. Etilsat in the United Arab Emirates is among the service providers that have been testing the lightRadio Metro Radio Outdoor product.

Ericsson, meanwhile, is addressing the small cell opportunity through both new product introduction and via acquisition. The company earlier this unveiled a new pico base station. The multi-standard RBS with integrated Wi-Fi access is part of Ericsson’s RBS 6000 portfolio, which includes products ranging from pico to macro.

The purchase of BelAir also will let Ericsson’s service provider customers more easily integrate Wi-Fi and their cellular services, says Mikael Back, Ericsson AB vice president. BelAir has indoor and outdoor Wi-Fi systems that are in use by such service providers as AT&T and Comcast (News - Alert).

And Nokia Siemens Networks plans to make its Flexi Zone small cell solution, which it has had in trials in Chicago running on its own spectrum, generally available at the end of the year. The product targets-high density applications, including business campuses, shopping centers, and sports arenas. The Flexi Zone architecture can aggregate and do traffic management for up to 100 small cells and present that information to the network as if it’s just one cell. The solution includes Wi-Fi backhaul, network discovery, and is non-line-of-sight.

NSN also offers Flexi Compact, which is targeted at GSM rural deployments. The company calls it “the industry’s smallest macro base station for three-sector sites combining baseband, radio and integrated transport in a single enclosure.”

Coming at small cells from the specialized camp is ip.access, which offers 3G and 4G solutions on this front. The company has installed more than 500,000 3G public and private small cells in more than 60 networks to date.

Zain Bahrain of the Middle East, and multiple European networks under the Telenor Group umbrella, have signed on to deploy 3G small cell solutions from ip.access. And the equipment company unveiled an LTE small cell solution, called the E-100, earlier this year; it is slated for general availability in early 2013.

Edited by Stefania Viscusi

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