Press release: Mobile operators could save USD45 per customer per year
by deploying femtocells
March 2007: Indoor base stations (often referred to as femtocells) could
substantially improve indoor 3G coverage and avoid the need for further
investment in macrocellular networks by mobile operators, according to a new
report, Picocells and Femtocells: will indoor base stations transform the
telecoms industry?, published by Analysys.
"3G network in-building coverage is significantly worse than that of 2G for most
mobile operators worldwide," according to report co-author Dr Alastair Brydon.
"As the number of mobile users that make calls within their homes increases,
operators could be forced to make substantial further investment in their
macrocell networks to improve 3G coverage. However, deployment of millions of
femtocells could provide a much less expensive alternative."
Key findings of the report include:
- Operators may have to increase the number of outdoor base stations in their
networks dramatically - by a factor of two or more, in some cases - as demand
for in-building coverage increases. For example, operators in Japan launched 3G
services early, but are still making substantial further investments in coverage
enhancement.
- Widespread 3G femtocell deployment could avoid the need for substantial numbers
of additional macrocells, by providing a targeted means of enhancing in-building
coverage for customers that need or want it. An operator with 5 million
customers could save an average of about USD45 per customer per year by 2012 by
deploying 3G femtocells in 60% of customer households.
- Mobile operators that decide to deploy indoor base stations must adopt a
large-scale approach. If most of their customers do not take up femtocells,
mobile operators will still need to invest heavily in their macrocell networks.
Operators with 5 million customers would save only about USD20 per customer per
year by 2012 by deploying 3G femtocells in 20% of households.
"Cost savings represent only one part of a compelling business case for the
widespread deployment of femtocells," according to Dr Mark Heath, co-author of
the report. "3G femtocells improve opportunities to generate additional voice
revenue from fixed-mobile substitution, group tariffs, mobile data services and
DSL."
This new report describes how indoor base stations may be used across different
wireless technologies, assesses the business case for their application and
identifies the issues that need to be resolved to enable widespread deployment.
It also assesses the strategic impact of home base stations on the telecoms
industry, including fundamental changes to network evolution. The report draws
on interviews from a range of indoor base station experts and vendors in Europe
and the USA.