50% of Mobile Subscribers Interested in Femtocells
Femtocells, the mini-base stations intended to improve poor cellular coverage and capacity indoors, have been getting something of a bad rap lately. Although Sprint, Verizon, and AT&T have femtocell services on offer, none have put their weight behind marketing femtocells aggressively.
However the results of a recent online survey of 1000 consumers in the United States suggest that operators are losing out on a significant portion of the market due to their lack of initiative in marketing femtocells or educating consumers on a mass-market scale.
“Close to 25% of respondents to our survey were ‘very’ or ‘extremely’ interested in using a femtocell,” reports principal analyst Aditya Kaul. “Consistent with last year’s survey results, this shows that interest remains high. A further 31% were ‘somewhat’ interested. So even in the absence of real marketing by carriers, more than 50% of respondents seem interested in the idea. This significant finding shows that more aggressive marketing and consumer education campaigns by carriers should be able to produce positive outcomes for the market.”
However some operators are already experimenting with bundled packages that could alleviate consumers’ price concerns.
The survey’s results also suggest that attitudes to femtocells are to some degree related to age, with younger respondents more open to the idea of femtocells than older ones. Says Kaul: “The age bias, with younger consumers more enthusiastic about femtocells, underscores the fact that carriers need to focus on the younger demographic when selling femtocell services.” [ABI Research]
All Hype and No Action on Femtocells
By Lynnette Luna
The hype surrounding femtocells reached a fever pitch in 2008, but with little in terms of market rollouts. Those router-sized mobile home base stations were billed at the "next big thing" in fixed-mobile convergence, promising to solve the many shortcomings faced by existing WiFi/cellular FMC services and enable operators to offer consumers high-speed data, VoIP and conventional voice services in the home with reduced infrastructure costs and cheaper prices for the consumer.
Sprint has been the only operator to roll out femtocells in the U.S. In July, the operator expanded its Airave femtocell offering to all customers nationwide and retooled its price plans for the in-home wireless technology. We have yet to hear about any milestones Sprint has made with the product.
In April, Verizon Wireless CTO Tony Melone said at the CTIA Wireless 2008 trade show the carrier would begin offering femtocell products and service plans sometime this year. Then in October, AT&T and Verizon announced plans to move ahead with femtocells. AT&T has indicated it will begin trialling femtocells later this year and into 2009. Verizon Wireless said it may introduce its first femtocell product next year.
The bottom line: An unclear business case will likely lead to a slower rollout in 2009 as operators grapple with how to convey the value of femtocells to their customers. The good news is that the Third Generation Partnership Project (3GPP) has now finalized specs for femtocells. [FierceBroadbandWireless]
Picocells’ Future Linked to Femtocells and the SMB Market
Much attention has been devoted to femtocells’ potential to improve indoor cellular coverage. But an older technology, the picocell, has existed for about a decade. Picocells provide larger coverage and capacity than femtocells, which should make them well suited to small and medium businesses. Yet global shipments of picocells will total only about 18,000 this year. Why haven’t picocells gained greater market share, and what can vendors do about it?
According to ABI Research senior analyst Aditya Kaul, “One major reason for picocells’ low penetration has been their high total cost of ownership. Picocells are mostly operated and maintained by mobile operators, and every installation and service call costs them money. Many operators underestimated these costs when they initially opted for picocells.”
The market has also focused on femtocells, with their minimal ownership costs. Operators have avoided picocells because they’ve been waiting for femtocells to be thoroughly tested and trialed, and for standards to be established.
What can the leading picocell vendors such as RadioFrame Networks and ip.access do? “An important step will be the introduction of an innovative 3G picocell,” says Kaul. “Today there are only a few 3G picocells in the market but they still have high ownership costs. 3G’s architecture should permit integration of the controller with the base station, reducing cost and allowing picocells to more closely approach femtocells’ ‘plug-and-play’ ease of use.”
There is, says Kaul, a time-limited chance for picocells to secure a larger market. “There is a gap between the small capacity provided by femtocells and that required by SMEs. Picocells can fill that gap, but only if the next generation has drastically reduced ownership costs. ‘Super femtos,’ which are essentially femtocells with picocell capacities are also being prepared for this market, and home-grade femtos could see some use in the SMB market, once interference and handover issues are resolved. Therefore picocells have a limited window of opportunity.” [ABI Research]
New Femtocell Designs 'Sniff' Out Networks
By Paul Rasmussen
The arrival of self-organising wireless networks has taken a step forward following the announcement from picoChip that its new software reference designs provide the first integrated network listening (or sniff) capabilities for femtocells. The company claims its three designs will enable femtocells to detect WCDMA, GSM and TD-SCDMA networks.
According to Doug Pulley, CTO and co-founder at picoChip, the three new software designs target the company's single-chip femtocell device by automatically performing cell search and decode to enable self-configuration. In an all-3G context, they should permit handover between a femtocell and adjacent cells, and manage the handoff between a 3G femtocell and adjacent GSM base stations as users move in and out of range in a mixed 2G/3G network.
Separately the company's CEO, Guillaume d'Eyssautier, confirmed that it was about to close a fifth round of financing, having already raised US$71 million in four previous rounds from venture capitalists and other investors including AT&T, Intel and Samsung. d'Eyssautier did not reveal the size of the new investment, or whether the money was for a specific purpose. [FierceBroadbandWirelee]
Japan's SoftBank to Launch 3G Femtocells in January
By Peggy Albright
The wireless industry, expecting femtocells to usher in another market for products and services and eager to get that ball rolling, now knows where to look for the next femtocell deployment: Japan.
Japanese operator SoftBank Mobile announced it is on track to commercially deploy a 3G femtocell service in January 2009. The deployment will be of particular interest not only because it will be early to market but because the SoftBank product will connect to an IP Multimedia Subsystem core network.
SoftBank will introduce the service with Ubiquisys ZoneGate femtocells. NEC will supply the overall femtocell system, which includes the IMS core and Femto Gateways. The femtocells will be targeted to the residential market for use in the home, and will typically connect to the consumer's fixed Internet connection.
Sprint, in the U.S., does get to claim first-mover status in the femtocell service business. The operator introduced the Airave femtocell program in two markets in September 2007 and took the product nationwide this past summer. However, that service is promoted primarily as a voice product; it does not support Sprint's EVDO data speeds.
Vendor NEC, in addition to the SoftBank deal, announced it has made a strategic investment in the U.S. FMC solutions company, Kineto Wireless. Kineto, which helped pioneer UMA-based dual-mode devices and other innovations, is naturally pursuing femtocells as well. Kineto indicated the funding will be applied to femtocell development.[FierceBroadbandWireless]
Sprint’s Femtocell Goes Nationwide
Steven Hartley, senior analyst at Ovum
US Mobile Operator Sprint is to Launch its Airave Femtocell Nationwide on 17 August 2008. The device will cost $99.99 plus $4.99 per month for device rental. Unlimited calling plans are available for an additional $10 or $20 per month, depending on the number of lines needed. This is another step in the seemingly inexorable rise of femtocells, but also highlights how much work is needed if femtocells are to become viable consumer propositions.
Little to differentiate from T-Mobile@Home
“Sprint’s position in the US market means it needs to be disruptive, but it has launched its femtocell before the technology is sufficiently matured to bring anything unique to the market.”
“The announcement comes a month after T-Mobile’s @Home went nationwide (see Straight Talk Telecoms, 27 June 2008), but differs little. T-Mobile may use WiFi and Sprint a femtocell, but to a consumer they are essentially the same. Both divert fixed line minutes to the mobile operator by routing calls via a box.”
“Also, Sprint’s focus on voice suggests it might be missing a differentiation trick. The Samsung device can only handle 1XRTT data. EV-DO traffic uses the macro network, which is downgraded to 1XRTT if coverage is unavailable. According to Sprint, data is in the pipeline (probably through WiMAX), but we would have expected more emphasis on data from the outset.”
Pricing could hamper uptake
“The charging model is Airave’s greatest weakness. $99.99 and $4.99 per month buys only ‘enhanced coverage’. Usage comes from a user’s existing mobile plan. Therefore, users pay $160 in the first year just for the box – which provides coverage that many will feel Sprint should provide in the first place. This is in addition to broadband access, required for backhaul, and well above the much-touted $100 femtocell price threshold.”
“The unlimited calling plans can be added only in addition to a mobile plan. Therefore, users pay Sprint once to subscribe to Sprint’s mobile service, again to improve indoor coverage and a third time to benefit from Sprint’s backhaul cost savings. This is far from compelling and suggests to customers that Sprint’s indoor coverage must be very weak if it expects customers to pay extra.”
“Then again it is possible to avoid paying $160 altogether. The device provides unsecured access by default. With most people likely to use default settings initially and with a range of 5,000 square feet, someone in a neighbouring apartment could benefit from improved coverage. To be fair, it can be easily secured for up to 50 numbers, but only by the account holder contacting customer services. Only allowing registered users access will mean visitors are unable to benefit; a mechanism allowing for a simple trigger SMS from the account holder containing a password and number requiring access would have been a good move.”
Handover not ideal
“If a user does take a supplementary Airave calling plan, calls initiated on the femtocell are charged at the discounted rate even if the user roams on to the macro network. Sprint told us that it saw little revenue leakage during trials and wanted to prevent bill shock. This is reasonable; however, potential for abuse remains.”
“Conversely, there is no handover to the femtocell for a call initiated on the macro network. This is unhelpful to a user if they paid extra for an Airave calling plan, or bought the femtocell for improved indoor coverage. The call must be completed outside and restarted on the femtocell to benefit.”
GPS undermines plug ‘n’ play
“GPS is included in the device to meet FCC emergency call location stipulations and is required for the Airave to function. However, this additional technical complexity makes set-up that bit more complicated. Given Sprint’s poor customer service reputation, this is a big risk.”
“Firstly the Airave must be sited near a window to get a GPS signal, limiting potential sites. Additionally, the device can take up to an hour to locate a satellite – hardly plug ‘n’ play! An external GPS aerial with a 30-foot cable can be used if problems remain, but this creates another peripheral to site. Ironically, users are warned not to rely on Airave for emergencies in case of power cuts.” /PR
Sprint Rolls Out Femtocell
By Brad Smith
The battle for the home has started. After 9 months of testing a femtocell built by Samsung, Sprint has decided the technology and service are ready for nationwide prime time.
Sprint is going to start selling its Airave femtocell nationally starting Aug. 17 at a price of $99.99 for the Samsung device plus $4.99 a month for the service. Sprint is the first U.S. carrier to use femtocells.
Airave essentially is a mini-base station that users plug into their existing broadband access, such as DSL. Samsung said the device is plug-and-play and will provide coverage over a 5,000-square foot area, or roughly the size of a typical home lot. Users can have up to 3 Sprint CDMA phones programmed to use the femtocell. It works with any Sprint phone except those using the Nextel network. If someone is using a phone on a call connected through the femtocell and roams outside the coverage area, the call will roam to a regular base station.
The Airave has been in use in three trial markets since last fall – Denver, Indianapolis and Nashville, Tenn..
A spokeswoman for Sprint said the operator’s customers are using their phones more than ever in their homes and with Airave will get enhanced coverage plus the option of unlimited calling from home.
Some people have compared Sprint’s femtocell to T-Mobile USA’s HotSpot@Home service, but the two are basically different. T-Mobile USA uses a dual-mode phone with Wi-Fi to connect to an access point, with the in-home connection using Unlicensed Mobile Access technology. Airave doesn’t require a dual-mode phone.
ABI Research has forecast there will be 70 million femtocells globally by 2012. In-Stat has forecast 40.6 million femtocells by 2011. The main interest for femtocells is expected to be in North America and Western Europe. [WirelessWeek]
European Operators Delay Femtocell Deployments
By Paul Rasmussen
While the enthusiasm for femtocells continues unabated, several of the mobile operators that have lead the charge are having second thoughts due to unresolved technical issues and unclear business cases.
These concerns came to the surface during the Femtocell Europe 2008 conference when SFR said it had delayed selecting a femtocell supplier because of undefined industry standards. The company said that the expected deployment of the technology now would not commence until sometime next year.
SFR, of which Vodafone Group owns 44 percent, participated in Vodafone's group-level request for proposals for femtocells last year, but it also issued its own RFQ separately. "We're assessing another technology in parallel," said Thierry Berthouloux, network solutions director at SFR. "However, we have decided to extend that assessment period and have put this process on hold to give equipment suppliers time to consolidate roadmaps. There's no point making a decision today."
According to those close to the situation, the issue for the major operators in agreeing to a standard is the need for clarity on 3GPP status and the lack of resource being provided by the larger femtocell vendors to achieve this. [FierceBroadbandWireless]
Comcast Will Use WiMAX Femtocells
By Sue Marek
At a conference in London, Comcast's senior vice president of wireless and technology Dave Williams revealed that part of the cable company's deal with Clearwire calls for 5 MHz of spectrum across the U.S. to be set aside solely for WiMAX femtocells. Williams said that Comcast would have liked to have more spectrum for femtocells but that this was the best deal it could negotiate.
The femtocell spectrum will be available for any of the new Clearwire partners to use, but Williams said that the cable companies will have the most incentive to use it because it allows them to cost-effectively deliver wireless to the home.
Cable companies Comcast, Time Warner Cable, Bright House Networks were part of the consortium (which includes Google and Intel) that invested $3.2 billion in the new Clearwire. The cable companies plan to wholesale WiMAX services via Clearwire to their customers. [FierceBroadbandWireless]
Comcast Will Use WiMAX Femtocells
By Sue Marek
At a conference in London, Comcast's senior vice president of wireless and technology Dave Williams revealed that part of the cable company's deal with Clearwire calls for 5 MHz of spectrum across the U.S. to be set aside solely for WiMAX femtocells. Williams said that Comcast would have liked to have more spectrum for femtocells but that this was the best deal it could negotiate.
The femtocell spectrum will be available for any of the new Clearwire partners to use, but Williams said that the cable companies will have the most incentive to use it because it allows them to cost-effectively deliver wireless to the home.
Cable companies Comcast, Time Warner Cable, Bright House Networks were part of the consortium (which includes Google and Intel) that invested $3.2 billion in the new Clearwire. The cable companies plan to wholesale WiMAX services via Clearwire to their customers. [FierceWireless]
Asia-Pacific Femtocell Revenue “Modest”, Enterprise In-Building Wireless Systems to Blossom in Next Five Years
A new study from ABI Research indicates that femtocells will generate revenue of nearly $5 million in 2008 from device shipments in the Asia-Pacific region.
According to research director Stuart Carlaw, “While $5 million is a relatively modest sum in global terms, it is important to remember that it is generated from a market that barely exists yet, and as such it represents quite satisfactory early growth.”
Regulatory complications may play a roll in femtocells’ regional rollouts too. “Softbank still needs to get regulatory approval before it can roll out femtocell service commercially. Hence, its timeline for mid-2008 may slip,” notes research analyst, Hwai Lin Khor.
The South Korean government has yet to finalize its fixed-mobile convergence policy, and ABI Research believes commercial femtocell services will not be introduced in the country until 2009. Femtocell prospects in India and China are heavily dependent on those countries’ 3G license developments.
Hwai Lin Khor continues, “In-building wireless for enterprise markets in the Asia-Pacific region was approximately a $1.5 billion industry in 2007, with the majority of the earnings coming from Distributed Antenna System (DAS) deployments.” Currently, most IBW deployments in the region are of passive DAS and repeater-based solutions due to their lower cost.
However, ABI Research expects more fiber optic-based active DAS deployments in the next five years, due to migration of customers to 3G technologies on 2100 MHz spectrum and an increase in the number of buildings larger than 100,000 square feet. [ABI Research]
Motorola, Netgear Announce Femtocell Products
A host of femtocell-related news has come out before this week's 3GSM World Congress in Barcelona. Motorola introduced its first 3G femtocell customer premise equipment (CPE) and announced it will release two commercial devices in the second half of the year. Motorola's 8000 Series Femtocell Ethernet Gateway features a four-point Ethernet gateway, VoIP port, USB connections and a WiFi router.
Netgear announced its new Femtocell Voice Gateway that will become available in the first half of this year. Netgear's box includes a residential gateway with integrated ADSL2+ modem, router, 10/100 wired LAN switch, wireless access point, VoIP, firewall and 3G femto technology from Ubiquisys.
Meanwhile, after the Femto Forum announced plans to help harmonize the integration of femtocells into mobile core networks, NEC and Kineto Wireless announced a standards proposal based on the existing 3GPP Generic Access Network (GAN) model. The two companies said a formal standard will help the market achieve mass market success.
Femtocells are mobile access points that connect to a mobile operator's network using residential DSL or cable broadband connections. They have been developed to work with a range of different standards including CDMA, GSM and UMTS.
Femtocells have the potential to make Wi-Fi networks redundant because they use less power and have a longer range. The downside is that such technology will only be available from mobile network operators as they own the licences covering the frequencies that 3G operates in. [FierceBroadbandWireless]
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