Femtocells Move Front and Center as Prices Decline

Carl Weinschenk

The world of convergence took a small step forward last week as Sprint Nextel rolled out Airwave, a femtocell-based service, in parts of Denver and Indianapolis. The femtocell concept has been around for a long time, but increased competition and shrinking costs from deeper chip integration are heating up the market.


There is no doubt that service providers welcome what femtocells do -- act as tiny in-premise base stations. In addition to improving weak cell coverage inside structures, the devices can switch calls between the cellular and broadband networks.


The second of the two uses will make femtocells thrive. It is cheaper to move bits over the Internet than on licensed cellular frequencies. In the case of Airwave, Sprint is offering unlimited calling for $15 a month for individuals and $30 for families. The payback for subscribers is that such calls don't cut minutes off their plans.


In late August, Cambridge Consultants claimed it cut costs of picoChip-based femtocells by using a less expensive base station radio, according to PC World. The femtocell will support higher-speed 3G service.


America's Network also looks at the increasing focus on femtocells, with a particular interest in the international market. In Japan, Softbank began a six-month demonstration in June and NTT DoCoMo plans to deploy units for both residential and consumer customers. In Europe, Vodaphone has issued a large request for proposals focusing on Wi-Fi and HSPDA.


Indeed, femtocells could find use even beyond people seeking better coverage or to save a few bucks on their residential service. This blog posting by wireless analyst Craig Mathias at Unstrung says the technology could help mobile WiMax providers. In this scenario, Mathias says, by using femtocells, carriers could avoid building "great big expensive cell sites." He says that hybrid WiMax/Wi-Fi femtocells would make a lot of sense. A long Unstrung report on femtocells is available here.


This WirelessWeek story mentions a number of big and small companies interested in femtocells. These include Google -- the article speculates that the interest comes from a desire to improve broadband data rates for its services -- Alcatel-Lucent, Ericsson, Huawei, Motorola (through its purchase of Netopia), Nokia Siemens, Samsung, ip.access, Ubiquisys, 3Way Networks, AirWalk Communications and RadioFrame Networks. It has been reported that Samsung is supplying the Sprint Nextel service.


This is all good news. Femtocells can either work alone or in tandem with other technologies to bridge the wireless and cellular worlds. That flexibility -- combined with the competition that will still exist between the two broad networking families -- will lead to lower prices and better services.

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