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16 September 2009

Three or four networks per operator, in small cells: the face of 4G?

This week sees the 4G World event taking place in Chicago, and we can expect some of the same divergence of themes that have been seen at other big wireless occasions this year ‘ anticipation of LTE coupled with a strong focus on technologies that can be deployed now (HSPA+ or WiMAX). Most operators will be looking to mix and match different technologies to achieve the ‘4G effect’ ‘ true broadband over wireless, huge ranges of web apps and content, flat rate pricing and multi-device access.

Australia, though hardly a typical market, may provide the template for how 4G services are achieved ‘ with incumbent Telstra combining aggressive upgrades of its existing network with a cautious, hotzone approach to LTE, while media giants and disruptive start-ups (Seven and Unwired) join forces to shift the goal posts using WiMAX, which also gains a role for rural access. This pattern is repeated in most developed economies (think AT&T’s HSPA, Verizon’s LTE in spot cities, and the WiMAX activities of Clearwire/Sprint/cablecos, and also by rural access providers).

Telstra has firmly established its credentials as the world’s most aggressive deployer of HSPA – it is currently in the process of moving to HSPA+, with peak download rates of 21Mbps, and is promising to implement the 42Mbps iteration (via multicarrier systems) from next year. But it is more cautious about LTE, and expects to deploy it only in selected ‘hotzones’ for many years ‘ a pattern likely to be emulated by a large number of 3G cellcos worldwide.

Mike Wright, executive director of wireless engineering and operations at Telstra, told the Broadband World Forum conference in Paris that the carrier is not planning nationwide deployment of LTE, though it does believe that the technology will help to lower costs in areas where true mobile broadband is required. But where there are small numbers of users, or high capacity services are not needed, Telstra will stick with HSPA for the foreseeable future.

CTO Hugh Bradlow added: ‘We will deploy LTE in an evolutionary fashion as required’ ‘ mainly in some urban areas in 2.6GHz, and in future, to fill in some rural broadband gaps using 700MHz. However, neither of these bands has been auctioned yet.

Wright said Telstra ‘does not need LTE tomorrow’ and added ‘I don’t think I could afford’ to overlay the whole HSPA network with the new technology. Predictably, the main markets to see LTE from 2011 or later, will be major cities. Australia may be an extreme case for hotzones, with its huge concentration of population in a few metro areas, but Telstra’s position will be adopted by most HSPA carriers, research indicates. 4G, whether WiMAX or LTE, will remain a metrozone technology, geared to areas of high demand and high value customer bases, for some time, handing off to 3G or 2G for wide area coverage.

Then there is Wi-Fi. Carrier WLans may have been somewhat discredited by the bursting of the largely US-driven municipal metrozone bubble, but Wi-Fi ‘ attached to a serious business model, and with the network carefully planned and targeted ‘ is gaining an increasing important role in operator strategies, especially in the US. This is true of the cablecos and their would-be quad plays, as Cablevision demonstrates, and of the incumbents ‘ AT&T’s purchase of Wayport.

This is because, for all the ambitious business models that are talked about for next generation networks, the most urgent objectives when building new systems ‘ whatever the technology – are to offload traffic from the overstretched cellular networks, boosting total capacity (for wireless carriers); or to add wireless to a service that lacks it, at relatively low cost (for the cablecos and others). Wi-Fi is important to these goals, as is WiMAX ‘ even if not built out by the major carriers themselves, many will see the 802.16 networks of partners as a strong route to expanding capacity.

So we can expect 4G World to focus on the optimal ways to combine different technologies, according to business model and available spectrum, not on religious wars between platforms. Another theme that is sure to gain prominence is one of the few things on which all the next generation wireless players tend to agree ‘ the need for small cells.

These may, themselves, be based on outdoor Wi-Fi access points, probably in a self-organizing mesh to balance loads and be efficient on backhaul. Steve Rayment, CTO of carrier Wi-Fi vendor BelAir Networks, speaking at last week’s LTE Focus conference in Amsterdam, reinforced the theme that carriers need to offload a great deal of traffic from a cellular macro network that will always be limited in capacity, even with LTE, at least if operators do not secure large swathes of spectrum. Currently, BelAir offers a Wi-Fi based offload option and has a 52% share of the installed base of carrier-controlled WLans, including the Wayport/AT&T network, and Cablevision’s huge network of Wi-Fi access points around its New York/Long Island/Connecticut territory (which has reduced its cable churn by 9% and, Rayment claims, carries more data than Verizon Wireless’ entire national network).

The interest in ‘complementary’ Wi-Fi or WiMAX networks among 3G operators is not just because of the economics of high capacity technologies running in low cost or free spectrum, but also the ability to target bandwidth where demand lies, as Cablevision has done. And positioning capacity where the customers are, and beyond that, targeting specific QoS levels or services at individual cells, are among the clear benefits of small cells.

Wi-Fi has blazed a trail, but the up-and-coming technology to create small cells, allowing for targeted coverage and applications, is the femtocell. This can also, of course, offload traffic from the macro network to the user’s private network, or to an outdoor hotzone. Rayment fully recognizes the potential of the latter and expects Wi-Fi access points to be replaced, in some situations, by LTE femtocells in future. ‘Smart carriers realize Wi-Fi can be a land grab for LTE femtocells and picocells,’ he said. ‘An operator controlled Wi-Fi AP can be swapped for a femtocell and the carrier already has the PoP and site.’

Looking forward to the LTE femtocell is picoChip, the main supplier of femto silicon, which announced a hardware/software development platform for ‘small cell LTE base stations’, which it said would be optimized for a metrozone approach. The PC9608/9 integrates baseband, software stack and RF, seeking to cut time to market for vendors creating an LTE femto. It is based on picoChip’s PC203 picoArray silicon, supporting various frequencies and TDD or FDD modes, and incorporated into a compact MicroTCA chassis.

Demand for improved 3G reception for residential mobile voice and broadband use will be principal driving forces behind the growth of femtocells in the next few years, with subscribers exceeding 15m globally during 2012, according to a new study by Juniper Research.

However, some operators are less interested in indoor coverage, especially if their 3G networks are in low frequencies. Telstra said it was interested in femtocells, though with its HSPA+ network running in 850MHz, it does not need the indoor access points to improve in-home coverage, often the first benefit that carriers will market when they launch femtos (as Vodafone UK already has). That means that Telstra will not be in the first wave of femto roll-outs, Bradlow told Total Telecom. He is far more interested in the application layer than in capacity and coverage benefits. ‘When they’ve got the applications, we’ll be right in there,’ he added. According to Juniper, the top three regions for femtocell subscribers in 2014 will be western Europe, north America and the Far East/China.

Small cells to offload from the overstretched macro network as it approaches the limits of Shannon’s Law; new-breed core networks that can support huge traffic volumes and vast arrays of personalized services; a patchwork of frequencies geared to different business priorities ‘ these will be the keynotes of ‘4G’, and most carriers will be working with a variety of technologies, whether owned by themselves or by partners. ‘In five to 10 years, we’ll be in a place where there are lots of overlapping 3G networks, 2G networks, femtocells, Wi-Fi, then throw in a bunch of 4G networks as well,’ said Peter Jarich, research director of Current Analysis, in a recent interview. ‘The question is how do you manage to connect on a user-by-user basis to make sure you maximize the experience for everyone?’