Femtocells – tiny indoor base station for extending coverage of outdoor networks such as 3G and WiMAX – have attracted high levels of interest in the past year, but have remained the preserve mainly of the start-ups and the pilot projects. Now they are gaining commercial momentum, first with O2’s plans to use the technology in new UK spectrum, and now with a major deal from new Japanese mobile player Softbank. The company is an enthusiastic adopter of emerging technologies in its bid to bridge the gap between its service, acquired from Vodafone, and leaders DoCoMo and KDDI. It is piloting WiMAX systems from Motorola and has now turned to Alcatel-Lucent for a 3G network upgrade that relies heavily on enhancing indoor coverage through femtocells.
A major factor in Alcatel-Lucent’s win seems to have been its Base Station Router (a Lucent product), which is one of the most advanced flat IP mobile networks ready for commercial deployment, and so is well adapted to support femtocell structures – although it is not clear whether the mini stations themselves will come from Alcatel or a third party.
Lucent, along with Nokia, Ericsson and others, has been aggressive about the flat network as a technology to help cellcos move towards all-IP, while making their current systems more cost effective to run, and also enabling new architectures including femtocell meshes. In its vision, the Base Station Router (BSR) combines the various elements in the network hierarchy into one product that can also support distributed base station architectures, with end-to-end quality of service and enhanced support for IP services such as VoIP, while interworking is simplified because done at the IP level. Although its development has been on UMTS, the design is air interface independent and a CDMA EV-DO variant has also been created.
Such a design supports increased automation of the base stations, which – rather like Wi-Fi mesh – can be randomly positioned and configure themselves based on local rules, by communicating directly and automatically with other neighboring stations, via the BSR. This also allows for reconfiguration if one station fails.
When Femtocells first came upon the scene they were seen as an opportunity to let the DSL fixed line in most home be used to backhaul their traffic back to the cellular gateway, and reduce the burden of building out in rural areas. Today they are seen as being an easy deployment option to give strong signals in the home, that can be backhauled trough nearby base stations, through data pipes, and eventually will be part of the cellular hierarchy to replace DSL connections with wireless.
Such contracts will lure major vendors into the market to join the pioneers, such as Ubiquisys, RadioFrame, Airvana and ip.access. Motorola already has products in this area and Cisco is said to be poised for an acquisition, while in the chip world, Qualcomm is manoeuvring for position alongside start-ups like PicoChip (which has spearheaded the development of femtocells for WiMAX as well as 3G, not to mention coining the name in the first place).
Interest in femtocells is being driven primarily by the weakness of 3G indoors. By installing tiny base stations in an office or home, cellcos can offer an alternative to Wi-Fi access points, which they still control, and which hands off to the main cellular network outdoors without the need for an expensive dual-mode handset. This, in turn, should enable cellcos to capture wireline voice minutes rather than losing out to wireline carriers’ convergence approaches, which tend to rely on Wi-Fi and dual-mode (like BT Fusion).