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Outlook for Mobile Network Small Cells Deployment

As more mobile service providers plan to increase their 4G mobile network coverage, the small-cell phenomenon is gaining momentum. According to the latest market study by Informa Telecoms & Media, an important new milestone has been reached -- the global number of small cells now exceeds the total number of traditional mobile base stations.

Their latest market study shows that between October and November 2012, the number of small cells has surpassed 6 million (6,069,224) with macrocells worldwide totaling 5,925,974.

Although the bulk of these numbers (over 80 percent) are made up of residential femtocells, which will alone overtake the total number of macrocells early next year, they also include enterprise and public-access small cells.

There are now 45 small-cell network deployments -- including nine of the top 10 mobile network operators (ranked by revenue) globally.

This milestone was made possible as mature femtocell deployments start to scale and was best illustrated by Sprint which has now deployed one million femtocells -- that's up from 250,000 in 2011.

Informa also highlights how new femtocell deployments from Telefónica O2, Orange UK, and Bouygues Telecom over the summer of 2012 mean that the UK and France have become the first countries globally where all major operators have deployed the technology.

Telefónica O2 has made significant public-access progress with the world’s densest femtocell deployment in east London for the Olympics, as well as the launch of public Wi-Fi in central London which will be upgraded imminently to support licensed small cells.

Their report also acknowledged the emergence of the Small Cell as a Service (SCaaS) model which allows third parties to roll out a small-cell network and then rent it to several mobile network operators -- thereby lowering the barrier to entry for deployment and total costs.

In this space over the past quarter, Virgin Media announced it is trialing LTE small cells in the UK ahead of launching its SCaaS offering and Colt Telecom announced it is already in trials with a major European operator.

Furthermore, two new companies -- Cloudberry Mobile and ClearSky -- have launched their own offerings in Europe and the U.S. market, respectively, targeting smaller mobile network operators.

"There are now more small cells than macrocells worldwide. The industry has passed a very important milestone and in the process changed the future direction of mobile networks. The days of small numbers of expensive cell towers have given way to the era of high numbers of low cost mini access points. Without this change, the mobile network simply could not sustain the continued growth in data usage," said Dimitris Mavrakis, principal analyst at Informa Telecoms & Media.

Such a dramatic network transformation opens up interesting new business models, and over the past quarter the SCaaS idea has been gaining traction. It allows third parties to build networks that several mobile operators can use, thereby reducing costs and time to market.

At the moment, this new model is being targeted at major mobile network operators that are looking for a simple route to establishing a small-cell network in urban areas, as well as smaller players that have found the barriers to entry too high to date.

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