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Femtocell Market Status Issue. 9 December 2011
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029 Informa Femtocell Market Status 2011Q4

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Page 1: 029 Informa Femtocell Market Status 2011Q4

 

   

 

Femtocell    Market    Status      Issue.  9  December  2011  

 

 

 

 

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© 2011 Informa Telecoms & Media, Femtocell Market Status page 2  

Purpose  of  this  Document  The  market   status   report   provides   regular   updates   on   the   status   of   femtocell   market   development   as   it  

pertains   to   service   providers   and   femtocell   ecosystem   manufacturers,   and   also   covers   standards   and  

regulatory  aspects.    

Informa  Telecoms  &  Media  is  researching  and  producing  this  report  on  behalf  of  the  Femto  Forum.  The  news  

and  analysis  is  based  largely  on  news  items  submitted  through  the  Forum  by  members  and  analyst  houses,  

supplemented  by  research  we  have  conducted  through  publicly  available  websites  and  sources.        

Editorial  control  remains  with  Informa  Telecoms  &  Media  (see  also  copyright  and  acknowledgement  sections  

at  the  end  of  the  newsletter).  Suggestions  for  contributions  may  be  submitted  to  the  contact  details  at  the  

end  of  this  report.  

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© 2011 Informa Telecoms & Media, Femtocell Market Status page 3  

Latest  Market  Developments  • Having  experienced  healthy  growth  during  2011,  the  femtocell  market  is  now  demonstrating  it  can  scale  

with   multiple   deployments   that   reach   well   into   100s   of   thousand   units,   including   Vodafone,   Sprint,  

AT&T,  Softbank  and  SFR.  

• The  majority  of  Tier-­‐1  mobile  operators  worldwide  have  expressed  interest  in  small  cells,  particularly  for  

capacity  driven  networks  including  LTE.  

• 8   of   the   top   10   mobile   operator   groups   (by   revenue)   now   offer   femtocell   services,   including   AT&T,  

France  Telecom/Orange,  Telefonica,  T-­‐Mobile/Deutsche  Telecom  and  Vodafone  amongst  others.  

• As   of   December   2011,   there   are   37   commercial   services   (from   31   in   June   2011)   and   a   total   of   46  

deployment  commitments  (compared  to  43  in  June  2011).  As  of  December  2011,  there  have  been  7  new  

operator  deployments  since  June  2011.  

• According  to  an  Informa  survey  that  took  place  during  Q2  2011,  60%  of  operators  believe  that  small  cells  

will  be  more  important  than  macrocells  for  an  effective  LTE  deployment  strategy.  

• The  Femto  Forum  has  grown  to  include  66  mobile  operators  representing  1.99  billion  mobile  subscribers  

worldwide,   across  multiple  wireless   technologies   (WiMAX,  UMTS   and   CDMA)   and   account   for   34%   of  

total   mobile   subscribers   worldwide   plus   70   vendors,   illustrating   that   the   femtocell   ecosystem   is  

experiencing  healthy  growth.    

• The  CDMA  femtocell  market  is  also  growing  with  Verizon  Wireless  and  Sprint  having  launched  enterprise  

femtocells  during  Q4  2011  and  the  Femto  Forum  publishing  a  best  practice  guide  for  deploying  CDMA  

femtocells  in  cooperation  with  3GPP2.  

• Important   progress   has   been   made   in   the   evolution   of   femtocell   chipsets   with   new   launches   from  

Cavium,  Freescale,  Qualcomm  and  Texas   Instruments.  These  join  existing  chipset  vendors  –  Broadcom,  

DesignArt,  Picochip  and  Mindspeed.  

• Femtocell-­‐specific  3GPP,  3GPP2  and  WiMAX  standards  have  been  completed,   signalling   that   femtocell  

technology  has  been  ratified  by  the  highest  profile  standardisation  bodies  worldwide.  

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© 2011 Informa Telecoms & Media, Femtocell Market Status page 4  

Operator  Aspect  The   femtocell  market   continues   to  experience  a   flurry  of  activity,   including   further  operator   launches  and  

commitments  and  major  milestones,  including  SFR’s  free  femtocell  offering.  Femtocell  interest  in  the  mobile  

operator  community  continues  to  grow,  while  deployments   increased  to  37   in  24  countries  (from  36   in  24  

countries)   during  Q4  2011.   Several   operators   have  now   reported  deployments  with   100s   of   thousands   of  

femtocells  including:  

• Sprint  (US)  has  reported  more  than  500K  units  

• Both  Softbank  and  SFR  have  reported  more  than  100K  units  

• Vodafone  having  reported  femtocell  registered  users  in  the  “hundreds  of  thousands”  in  the  UK  

• Although   AT&T   has   not   reported   their   numbers   directly,   analyst   estimates   also   put   this   at   over   500K  units  

Femto   Forum   operator   members   currently   represent   more   than   2   billion   mobile   subscribers   worldwide,  

across   multiple   wireless   technologies   (WiMAX,   UMTS   and   CDMA)   and   account   for   34%   of   total   mobile  

subscribers  worldwide.  

Figure  1   illustrates  operator  members   in   the  Femto  Forum.  For  updated   information  on   the  Femto  Forum  

members  and  their  activities,  please  see  http://www.femtoforum.org/femto/membership.  

Figure  1:  Femto  Forum  mobile  operator  members  

 

Source:  Femto  Forum  

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Femtocell  Service  Commercial  Deployments  and  Announcements  

As   the  number  of   femtocell   deployments   continues   to   increase,   several  operators  have  now   launched   for  

both  consumers  and  enterprise  markets,  while  some  are  deploying  femtocells  in  public  places  for  coverage  

and   capacity   enhancement.   Several   markets   are   now   subject   to   competition,   where   operators   have  

identified  femtocells  as  a  competitive  advantage  and  their  competitors  are  launching  femtocells  to  address  

consumer  demand.  

As  of  October  2011,  eight  of  the  top  10  mobile  operator  groups  (by  revenue)  now  offer  femtocell  services,  

including   AT&T,   France   Telecom/Orange,   Telefonica,   T-­‐Mobile/Deutsche   Telecom   and   Vodafone   amongst  

others.   Femto  Forum  memberships   include  both  Tier-­‐1  and  Tier-­‐2  operators,   illustrating   that   the  business  

case  for  femtocells  are  not  unique  to  the  larger  operators.    

The  total  number  of  operator  members  of  the  Femto  Forum  is  66.  

Table  1  below  illustrates  commercial  femtocell  services  as  of  June  2011.  

Table  1:  Femtocell  commercial  deployments  as  of  Q4  2011  (36  in  23  countries)  

      Offering   Example  Pricing   Capabilities   Launch  date  

1    USA  

Consumer  and  Enterprise:  Airave  

$4.99  per  month  ($10  for  unlimited  calling,  $20  for  family  plans)  

Up  to  6  3G  users   September  2007  

http://bit.ly/sprint_us  

2    

Singapore  

Consumer:  Home  Zone  (UMTS)  

$32.1  per  month   Up  to  4  3G  (postpaid)  users   November  2008  

http://bit.ly/starhub_singapore  

3    USA

Consumer  and  Enteprise:  Network  Extender    

$249.99   Up  to  3  2G  1xRTT  users   January  2009  

http://bit.ly/verizon_us  

4    UK  

Consumer:  Sure  Signal  (UMTS/HSPA)  

Various  options  £50  upfront  Free  for  >£45  contracts  

Up  to  4  3G  users    

July  2009  (Access  Gateway)  Rebranded  January  2010  

http://bit.ly/vodafone_us  

5    

USA

Consumer:  3G  MicroCell  

$159   Up  to  4  3G  users   September  2009  

http://bit.ly/ATT_us  

6    France  

Consumer:  Home  3G  (UMTS/HSPA)  

€199  upfront   Up  to  4  3G  users   November  2009  

http://bit.ly/sfr_france  

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7    

Japan  

Consumer:  My  Area  (UMTS/HSPA)  

$10  per  month   Up  to  4  3G  users   November  2009  

http://bit.ly/docomo_japan  

8    

China  (Northern  Provinces)

Consumer:  3G  Inn  (UMTS/HSPA)  

FAP  cost:  CNY  1,200  Monthly  fee:  CNY  10  

Up  to  4  3G  users   November  2009  

http://bit.ly/china_mobile  

9    

 Portugal  

Consumer:  Sinal  On  (UMTS)  

€99.99  upfront  €7,8  monthly    

Up  to  4  3G  users   December  2009  

http://bit.ly/optimus_portugal  

10    Singapore  

Consumer:  CallZone  (WCDMA)  

Access  point:  SING$323  Monthly  charge:  SING$53.50  

Up  to  4  3G  users   January  2010  

http://bit.ly/singtel_singapore  

11    Spain  

Consumer:  Voz  y  Datos  Premium  Oficina    (WCDMA)  

€15  per  month   Up  to  4  3G  users   June  2010  

http://bit.ly/vodafone_spain  

12    

Japan  

Consumer:  Femtocell  service  (WCDMA)  

Free  of  charge   Up  to  4  3G  users   June  2010  

http://bit.ly/softbank_japan  

13    Qatar  

Public:    Femtocell  service  in  public  areas    (WCDMA)  

Metro  coverage   Up  to  4  3G  users   Announced  June  2010  

http://bit.ly/vodafone_qatar  

14  

Japan  

Consumer:  au  Femtocell  (CDMA2000  EV-­‐DO)  

Free  of  charge  (in  coverage  deadspots)   Up  to  4  3G  users   July  2010  

http://bit.ly/KDDI_japan  

15    Greece  

Consumer:  Vodafone  Access  Gateway  

Free  of  charge  (>€40  monthly  contract.  €75  (<40  monthly)  €150  retail  price  

Up  to  4  3G  users   July  2010  

http://bit.ly/vodafone_greece  

16    Spain  

Consumer:  Mi  Cobertura  Movil  

€9/month  service  charge    Requires  3MB  DSL  service  from  Movistar  

Up  to  4  3G  users   August  2010  

http://bit.ly/movistar_spain  

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17    

United  Kingdom  

Enterprise:  Femtocell  services  for  business  customers  

October  2010  

http://bit.ly/t-­‐mobile_UK  

18  

 

Moldova  

Consumer:  Femtocell  Unite  

Femtocell  tariff  addons:  Unilimited  3G  voice,  network,  Internet.  

Up  to  4  3G  users   November  2010  

http://bit.ly/moldtelecom    

19    South  Korea  

Public:  Femtocells  for  data  offload  

Deployed  in  public  areas   Up  to  4  3G  users   December  2010  

http://bit.ly/sktelecom_kr  

20    New  Zealand  

Consumer  and  Enterprise:    Sure  Signal  

Home  AP  cost:  NZ$349  Enterprise  AP  cost:  NZ$1033.85  

Home:  Up  to  4  3G  users  Enterprise:  Up  to  16  3G  users  

January  2011  

http://bit.ly/vodafone_nz  

21    Ireland  

Consumer:  Sure  Signal  

€49  for  Vodafone  DSL  customers  €99  for  rest  

Up  to  4  3G  users   February  2011  

http://bit.ly/vodafone_ireland  

22    

Norway  

Enterprise:  Full  Dekning  

NOK  99   Up  to  4  3G  users   February  2011  

http://bit.ly/network_norway  

23   Thailand

Public:  Disaster  areas:  2G  femtocells  deployed  in  disaster  areas  

March  2011  

http://bit.ly/tot_thailand  

24   Australia  

Consumer:  Homezone  

Monthly  fee  of  AU$5-­‐10  (includes  free  calls)   Up  to  4  users   April  2011  

http://bit.ly/optus_au  

25    Australia  

Enterprise:    Vodafone  Expand  

Unknown  Two  models:    Small:  Up  to  4  users  Large:  Up  to  16  users  

May  2011  

http://bit.ly/vodafone_au  

26  

Russia  

Consumer:  Minicells  

Free   Up  to  4  users   May  2011  

http://bit.ly/megafon_ru  

27   Italy  

Consumer  and  Enteprise:  Booster  Privati  Booster  

Consumer:  $240  Enterprise:  $780  

Consumer/Enterprise:  Up  to  4/8  users   May  2011  

http://bit.ly/vodafone_it  

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28   Hungary  

Consumer  and  Enterprise:    Mini  Bázis  

Consumer:  $165  Enterprise:  $640  

Consumer/Enterprise:  Up  to  4/8  users   May  2011  

http://bit.ly/vodafone_hg  

29   France  

Enterprise:    Couverture  Site  Confort  

Upfront  fee:  €1,400  Monthly  fee:  €70  Multi  FAP  plans  available  

Up  to  4  users   May  2011  

http://bit.ly/orange_fr  

30   Romania  

Enterprise:    Extra  Signal  

Upfront  fee:  €500   Up  to  16  users   May  2011  

http://bit.ly/orange_ro  

31   Russia  

Consumer:  Reliable  Access  

Unknown   Up  to  4  users   May  2011  

http://bit.ly/mts_ru  

32   Czech  Republic  

Consumer:  Private  3G  Zone  

Upfront  fee:  CZK  3377   Up  to  4  users   July  2011  

http://bit.ly/vodafone_cz  

33   Russia  

Enterprise   Unknown   Up  to  8  users   August  2011  

http://bit.ly/beeline_ru  

34   Netherlands  

Enterprise:  Sinaal  Plus  

Unknown   Up  to  4  users   October  2011  

http://bit.ly/vodafone_nl  

35  

Greece  

Consumer:  Perfect  Signal  

Upfront  cost:  €90  Discounts  for  postpaid  subscribers  

Up  to  4  users   October  2011  

http://bit.ly/cosmote_gr  

36   Romania  

Unknown   Unknown   Unknown   Unknown  

Presented  by  Vodafone  during  Base  Station  Conference,  September  2011  

37    United  States  

Consumer:  Homecell  

$9.95  per  month    2  year  contract  -­‐  $49.95  equipment  fee    1  year  contract  -­‐  equipment  fee  $99.95    Month  to  Month  service  –  equipment  fee  $199.95    

Up  to  4  users   December  2011  

http://bit.ly/mosaic_us  

Source:  Informa  Telecoms  &  Media  

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There  are  several  other  operators  that  have  expressed  interest  in  past  femtocell  trials  and  have  announced  

their   plans   to   launch   femtocell   services   in   the   future,   including   Free   in   France   who   aims   to   introduce  

femtocells   in   a   home   gateway   product   during   2012.   Mosaic   Telecom’s   and   Celcom’s   commitments   are  

significant   in   being   the   first   instances   of   smaller   operators   committing   to   femtocells,   showing   that   the  

femtocell   business   case   also   benefits   smaller   operators.   Following   after   these   two   regional   operators,  

Moldtelecom   is   the   latest   operator   to   offer   femtocells,   confirming   that   the   business   case   for   smaller  

operators   is   positive.   Bouygues   Telecom   has   also   expressed   that   femtocells   will   help   to   expand   indoor  

coverage  with  LTE  networks.  

Table  2  below  presents  a  summary  of  deployment  commitments  expressed  publicly.  

Table  2:  Femtocell  deployment  commitments  

Operator   Details  

 France  

Expects  to  include  femtocells  in  home  gateway  during  2012  

 United  States  

Intention  to  deploy  an  IMS-­‐based  femtocell  network  

United  Arab  Emirates

Intention  to  deploy  a  femtocell  to  improve  coverage  and  capacity.    

Taiwan  

Intention  to  deploy  femtocells  after  regulatory  approval.  All  three  

operators  in  Taiwan  report  that  they  will  offer  femtocell  services  with  

subsidies.  

Taiwan  

Taiwan  

Turkey

Intention  to  deploy  an  Iu-­‐h  femtocells,  pending  regulatory  approval.  

United  Arab  Emirates

Intention  to  deploy  femtocells  during  2011  to  bridge  fixed  and  mobile  services  

 USA  

Intention  to  deploy  femtocell  services.  

United  Kingdom

Intention  to  deploy  femtocells  for  consumer  services.  Femtocell  service  ”BoostBox”  for  residential  and  enterprise  now  listed  on  website  as  “pre-­‐launch”.  Link  

Kuwait

Intention  to  deploy  femtocell  services  for  consumer  and  enterprise  customers.  

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Israel

Intention  to  deploy  femtocells.  

France

Bouygues  CEO  has  claimed  that  femtocells  will  help  the  operator  to  improve  indoor  coverage  for  LTE  networks  

United  States  -­‐  Alaska

Intention  to  deploy  femtocells  for  the  consumer  market.  

South  Korea

Intention  to  deploy  LTE  femtocells  –  world’s  first  during  2011.  

Source: Informa Telecoms & Media

The  following  chart   illustrates  a  historical  representation  of  deployments  and  commitments,  both  of  which  

have   increased   more   than   200%   within   a   year,   while   there   have   been   6   operator   deployment  

announcements  in  the  last  half-­‐year  alone  and  18  similar  announcements  in  2011  so  far.  

Figure  2:  Historical  femtocell  service  deployments  and  commitments  

 

Source:  Informa  Telecoms  &  Media  

Operators  continue  to  identify  a  number  of  major  user  segments  for  femtocell  and  exciting  service  scenarios.    

All  femtocell  deployments  had  previously  been  focused  on  consumer  deployment,  so  it  is  significant  to  see  

that  several  operators  have  now  commercialised  a  femtocell  service  specific  to  enterprises.  Enterprise  only  

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femtocell   deployments   are   starting   to   accelerate   compared   with   previous   quarters.   Beeline   (Russia)   and  

Vodafone  (Netherlands)  have  launched  enterprise  only  femtocell  services  during  Q3  2011.  

 Additional   segmentation   is   being   considered,   including   open   access,   metro   and   rural   applications.   The  

following  table  summarizes  femtocell  offerings  segmented  according  to  target  group.  

Table  3:  Femtocell  deployment  segmentation  according  to  target  group  

Target  group Number  of  deployments Examples Consumer 20   Vodafone  UK,  AT&T,  Cosmote    Enterprise 6   T-­‐Mobile  UK,  Network  Norway,  Orange  France  Consumer  and  Enterprise   6   Vodafone  NZ,  Verizon  Wireless,  Sprint  Public 3   Vodafone  Qatar,  SK  Telecom,  TOT  Thailand  Rural   1   Softbank  (using  satellite  backhaul)    

Source:  Informa  Telecoms  &  Media  

From  a  regional  perspective,  the  distribution  of  femtocell  service  deployments  is  expanding  year  on  year  in  

all  regions.    As  of  Q3  2011,  no  next-­‐generation  (WiMAX  or  LTE)  femtocell  services  have  been  deployed,  but  

Tier-­‐1  mobile  operators  have  expressed   the  view   that   LTE  and  subsequent  high-­‐capacity  air   interfaces  are  

most   likely  to  be  deployed  through  hierarchical  cell  structures,   including  femtocells.  The  publication  of  the  

3GPP   and   WiMAX   Forum   standards   for   LTE   and   WiMAX   femtocells   respectively   is   a   key-­‐enabling   factor  

towards  this.  

Table  4:  Commercial  service  launches  by  Geography  and  Technology  

Regional  view   UMTS  femtocell  launches CDMA  femtocell  launches APAC 8   1  EMEA 24   -­‐  Americas 1   2  

Source:  Informa  Telecoms  &  Media  

Pricing  models  

As  the  femtocell  market  evolves,  a  variety  of  pricing  models  have  surfaced,  illustrating  that  mobile  operators  

are   active   in   assessing   the   business   case   of   femtocells   and   applying   it   to   their   regional   environment.   The  

following  table  illustrates  a  selection  of  pricing  models  tied  to  femtocells,  for  both  consumer  and  enterprise  

markets.  

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Table  5:  Selection  of  pricing  models  for  femtocell  services  

Market   Pricing  model   Deployment  examples  

Consumer  

Addons  for  unlimited  calling   MoldTelecom,  Sprint,  Optus  Free  femtocell   Softbank,  Vodafone  (GR),  SFR  Low  upfront  fee   Vodafone  (UK)  High  upfront  fee   Vodafone  (IT,  HU),  Verizon  Monthly  fee   Sprint,  Movistar,  NTT  DoCoMo  

Enterprise   High  upfront  fee   All  operators  

Source:  Informa  Telecoms  &  Media  

The   majority   of   consumer   femtocell   services   rely   on   a   low   upfront   fee.   On   the   other   hand,   enterprise  

deployments   are   subject   to   high   costs   (e.g.   Orange   France   charges   an   upfront   fee   of   €1100   and   €70   per  

month  for  an  enterprise  femtocell)  but  these  costs  are  justifiable  since  femtocells  are  operator  installed  and  

technicians   perform   on   site   visits   and   surveys   to   select   the   best   location   for   installing   the   femtocells.   In  

addition,   enterprise   femtocells   are  bigger  units   compared   to   consumer  units  which  may  also   increase   the  

cost  considerably.  

Notable  examples  are  Optus,  Mold  Telecom  and  Sprint,  who  are  offering  bundles  that  can  be  applied  to  their  

femtocell  services  to  offer  unlimited  voice,  data  or  messaging  in  return  for  a  monthly  fee.    

A  major  trend  is  now  free  femtocells  with  Softbank,  Vodafone  and  Cosmote  in  Greece  and  SFR  now  offering  

the  FAPs  for  free.  SFR’s  example  is  notable,  which  does  not  require  customers  to  fulfill  ARPU  requirements  

to  qualify  for  a  free  femtocell.  

Trial  Status  

Trial  activity  has  been  very  healthy  during  2009  and  2010  and  has  created  a  good  pipeline  for  deployments  

during   2010   and   2011.     Although   the   majority   of   trials   remain   behind   closed   doors   and   no   public  

announcements  are  made,  the  increase  in  announcements  shows  a  healthy  growth  in  the  femtocell  market.  

According  to  Informa’s  calculations,  the  number  of  trials  that  are  taking  place  during  Q3  2011  are  more  than  

50.    

Competitive  landscape  

Several  markets  across   the  globe  are  now  subject   to   femtocell   competition,  where  more   than  one  mobile  

operator   have   launched   femtocells   to   address   competition.   The   following  map   illustrates   the   state   of   the  

femtocell  market  in  the  global  landscape.  

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Figure  3:  Femtocell  competitive  markets  

 

Source:  Informa  Telecoms  &  Media  

Ecosystem  –  Industry  Support  The  Femtocell  ecosystem  continues  to  grow  in  both  breadth  and  depth  as  the  femtocell  market  transitions  

from  early  adopter  phase  to  early  market  growth.  At  a  high  level  the  femtocell  ecosystem  can  be  segmented  

by    

• End-­‐to-­‐End  solution  providers:  These  vendors  provide  a  complete  femtocell  solution  which  includes  

Femtocell  Access  Points  (FAP),  femto  gateways,  necessary  middleware  and  other  parts  that  

complete  a  large  scale  femtocell  deployment.  This  segment  includes  NSN,  ip.access,  Ericsson,  

Huawei,  Cisco  and  Alcatel-­‐Lucent.  

• Femtocell  Access  Point  (FAP)  providers:  Vendors  who  offer  FAPs  directly  to  operators  or  through  

other  partners,  including  Ubiquisys,  ip.access,  Airvana  and  Netgear.  

• Femtocell  Core  Network  providers:  Vendors  that  focus  on  provisioning  femtocells  in  the  mobile  core  

network,  including  Kineto  Wireless  and  Spidercloud.  

• Software  and  Component  providers:  Vendors  who  focus  on  specific  parts  of  the  femtocell  software  

stack  or  provide  the  necessary  silicon  to  power  FAPs.  Vendors  include  Picochip,  Percello,  Continuous  

Computing,  Texas  Instruments  and  Qualcomm.  

• Others,  including  test  and  certification  houses,  research  institutes  and  other  enablers  that  may  focus  

indirectly  on  femtocells  operation.  

It   is   common   for  vendors   to   focus   in  more   than  a   single  market   segment,  especially  end   to  end  providers  

that  may  offer  specific  parts  of  a  femtocell  deployment  standalone.    

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There  are  68  vendors  in  this  ecosystem  today  focusing  on  products  and  services  in  the  emerging  femtocell  

marketplace.   There   are   currently   8   providers   of   End-­‐to-­‐End   and   System   Integration  worldwide   and  more  

than   23   FAP   providers   covering   most   licensed   spectrum   types;   their   number   is   increasing   rapidly   as  

component  manufacturers  are   introducing   flexible   reference  platforms   for   femtocell   access  points.     There  

are   more   than   23   equipment   providers   providing   core   network   components   that   can   support   femtocell  

services   and   in   excess   of   17   component,   software   and   tools   vendors   providing   a   health   supply   to   various  

parts  of  the  solution  space.  

All  major  infrastructure  vendors  have  now  joined  the  Femto  Forum  and  there  are  several  smaller  companies  

targeting   smaller,   specialist   segments,   including   test   and   certification,   femtocell   specific   silicon   and   core  

network  components.  

Figure  4:  Femtocell  ecosystem  

End$to$end$$system$providers$

Network$$Elements$

Components$and$So6ware$

Other$enablers$

Products$

 

Source:  Femto  Forum  

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Figure  5:  Segmentation  of  vendors  in  femtocell  ecosystem  

8"

17"

23" 23"

11"

0"

5"

10"

15"

20"

25"

End"to"End"solu.ons"

Components"and"So5ware"

Femto"Access"Points"

Networking"elements"

Other"enablers"

 

Source:  Femto  Forum  

End  to  End  Solution  Providers  &  System  Integrators  

At  present  there  are  8  providers  of  end-­‐to-­‐end  femtocell  systems  worldwide.    Solution  providers  made  good  

progress  throughout  2009  to  early  2011  assembling  trial  and  initial  market  solutions.    All  solution  providers  

have  committed  to  supporting  open  standards,  especially  the  3GPP  Iu-­‐h  interface  standard  that  was  ratified  

during   2009.   Several   Tier-­‐1   vendors   are   in   this   segment,   including   NSN,   Alcatel-­‐Lucent,   Huawei,   ZTE   and  

Cisco.  The  presence  of  all  Tier-­‐1  vendors  is  evidence  of  the  perceived  potential  of  the  market.  

Femto  Access  Point  

There   are   currently   23   femtocell   CPE   vendors   and   between   them   they   have   more   than   50   available   or  

announced   product   offerings.     The   breadth   of   CPE   solutions   varies   in   both   technology   and   integration   of  

other  broadband  access  technologies.  Standalone  and  integrated  CPE  have  already  entered  the  market.  FAP  

vendors   have   provided   a   variety   of   intelligent   algorithms   for   interference  mitigation   and   this   is   a   critical  

turning  point  for  mobile  operator  acceptance.  These  vendors  are  also  starting  to  expand  their  product  lines  

to  enterprise  and   larger  area   femtocells,   representing  a  healthy  competitive  development   in  a  key  part  of  

the  ecosystem.  

Femto  Core  Network  

20  vendors  now  provide  core  network  components   for   femtocells  with  several  solutions  covering  security,  

provisioning  and   integration  of   the   femtocell   services   into   the  existing  mobile  operator  core  network.  The  

categories   included   in   this  section  are  security  gateways,   femto  gateways   (FNG  or  HNB-­‐GW),  Convergence  

Servers  (e.g.  MFIF)  and  HNB  management.  

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Components,  Tools  and  Software  

An   important   factor   contributing   to   rapid   market   development   is   a   healthy   ecosystem   of   component  

vendors,  development  and  test  tool  as  well  as  protocol/system  software.  Silicon  providers  are  continuously  

evolving  hardware  platforms  to  enable  FAP  vendors  to  offer  femtocell  access  points  that  are  more  efficient  

and  capable  of  higher  capacity.    

Market  Forecasts  Informa  Telecoms  &  Media  expects  the  femtocell  market  to  experience  significant  growth  over  the  next  few  

years,  reaching  just  under  48  million  femtocell  access  points  (FAP)  in  the  market  by  2014.  The  following  chart  

illustrates  Informa’s  forecasts  (June  2011)  for  femtocell  access  point  shipments.  

Figure  6:  Femtocell  access  point  forecasts  

!"!!!!

!10!!

!20!!

!30!!

!40!!

!50!!

!60!!

2009! 2010! 2011! 2012! 2013! 2014!

Femtocell(access(points(in(market((millions)(

 

Source:  Informa  Telecoms  &  Media  

In  addition,  many  industry  analysts  who  cover  a  number  of  aspects  of  the  femtocell  ecosystem  have  begun  

to   track   and   forecast   the   progress   of   the   femtocell   market.     The   following   table   provides   a   summary   of  

publicly   announced   statements,   sorted   by   reverse   chronological   order.   The   table   is   followed   by   more  

information  regarding  each  statement:    

• Mobile  Experts  published  a  report  on  small  cell  backhaul,  claiming  that  more  than  1.8  million  small  cell  

wireless  backhaul  unit  shipments  during  2016.  (Mobile  Experts  –  October  2011)  

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• IDate   estimates   that   worldwide   femtocell   access   point   market   will   reach   a   cumulative   total   of   39.4  

million  deployed  units  by  2015,  representing  a  compound  annual  growth  rate  (CAGR)  of  71%  between  

2011  and  2015.  (IDate  –  September  2011)  

• Infonetics  anticipates  that  femtocells  will  gain  mass-­‐scale  traction  in  2012,  at  which  point  the  year-­‐over-­‐

year   unit   growth   rate  will   jump   to  over   100%,   and  will   stay   at   triple-­‐digit   levels   in   2013.   (Infonetics   –  

September  2011)  

• ABI   Research   estimates   that   Enterprise   femtocells   are   to   make   up   36%   of   shipments   by   2016   which  

relates  to  50%  of  security  gateway  revenues  (ABI  Research  –  August  2011)  

• Infonetics  estimates   that   total  global   revenue   from  femtocells  used   in  consumer,  enterprise,   rural  and  

public  spaces  grew  45%  during  the  past  4  quarters.  (Infonetics  –  June  2011).    

• Visiongain  expects  femtocell  revenues  will  reach  US  $27  Billion  in  2016  and  that  femtocells  have  entered  

into  the  growth  stage  of  their  lifecycle  during  2011  (Visiongain  –  May  2011).  

• Juniper   Research  predicts   that  Wi-­‐Fi   and   femtocell   networks  will   play   a   significant   role   in   easing   data  

traffic  by  carrying  63  percent  of  data  traffic,  or  almost  9,000  petabytes  by  2015  (Juniper  Research  –  April  

2011).  

• Infonetics   Research   predicts   that   rapid   acceleration   in   the   market   will   happen   during   2012,   when  

femtocell  shipments  should  exceed  5  million  worldwide,  driven  by  a  diversification  from  the  consumer  

and  enterprise  segments  to  rural  and  public  spaces.  (Infonetics  Research  –  March  2011).  

• Cisco  expects  that  by  2015,  over  800  million  terabytes  of  mobile  data  traffic  will  be  offloaded  to  the  fixed  

network  by  means  of  dual-­‐mode  devices   and   femtocells.  Without   dual-­‐mode   and   femtocell   offload  of  

smartphone   and   tablet   traffic,   total  mobile   data   traffic  would   reach   7.1   exabytes   per  month   in   2015,  

growing  at  a  CAGR  of  95  percent.  (Cisco  –  February  2011)  

• Maravedis   expects   the  price  of   femtocell   access   points   to   fall   to   as   low  as  US$70-­‐80   in   2011   from   its  

$100  price  during  end-­‐2019.  Maravedids  also  expects  the  demand  for  femtocells  will  be  highest  in  2012,  

when  upfront  payment  is  expected  to  be  below  $50.  (Maravedis  –  January  2011).  

Standards  Development  The  majority   of   industry   standards   have   ratified   femtocells   in   their   activities,   including   3GPP,   3GPP2   and  

WiMAX.  Ongoing  standardisation  activities  are  taking  place  to  enhance  the  operation  of  femtocells  in  these  

networks.  

3GPP  Femtocell  Standardisation  

3GPP  Release  9  was  functionally  frozen  during  December  2009  and  extends  significantly  by  fully  supporting  

LTE  femtocells  for  the  first  time  thereby  allowing  upcoming  rollouts  to  incorporate  the  technology  from  the  

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outset.   It   also   supports   a   greater   number   of   simultaneous   users,   emergency   warning   systems   and   both  

private  and  public  usage  models.    

Release  9  provides  end-­‐to-­‐end  support  for  LTE  femtocells,  including  all  radio  and  OAM  aspects,  enabling  the  

development  of   the   first   standardised  devices.   It  also  supports  hybrid  access   so   femtocells   can  be  used   in  

retail   environments   to   provide   open   access   to   customers   yet   also   provide   prioritised   usage   for   a   closed  

group  such  as  staff.  WCDMA  uplink  bandwidth  requirements  have  been  revised  allowing  a  major  increase  in  

the  amount  of  calls  that  can  be  simultaneously  supported.  Finally,  the  standard  also  supports  public  warning  

services  so  that  areas  without  macro  coverage  can  receive  emergency  messages  such  as  Tsunami  warnings.    

3GPP  Release  10  has  been  frozen  in  March  2010  and  protocols  were  made  stable  during  June  2011.  Release  

10  has  introduced  support  for  mobility  enhancements  for  Home  eNodeBs.  The  Stage  2  architecture  for  the  

enhancements  was   ratified   in   the   RAN  Plenary   in  December   2010,  which   introduces   a   new   Iurh   interface  

between   the   femtocell   access   points   and   supports   soft   and   hard   handover   between   femtocells.   Other  

important   additions   to   Release   10   include   Self   Optimizing   Networks   (SON),   Selective   IP   Traffic   Offload  

(SIPTO)  and  Local  IP  Access  (LIPA).  

Proposals  to  consider  new  functionality,  including  support  of  Cell_FACH  for  HNBs  and  inter-­‐CSG  handover  for  

HeNBs  were  removed  from  the  Release  10  work  item,  and  are  now  likely  to  be  considered  during  Release  11.  

Broadband  Forum  Standardisation  

The  Femto  Forum  has  worked  with   the  Broadband  Forum   to   to   standardize   the   inclusion  of   the  ability   to  

manage   Femtocell   based   services.     The   Femto   Forum   announced   the   activity   in   this   area  this   past  March  

with  the  publication  of  the  Femtocell  Services  Release  1  API  (press  release)  

The   Femto   Forum   guideline  WT-­‐262   is   going   to   be   issued   as   TR-­‐262   from   the   Broadband   Forum,  making  

femtocell  integration  simpler  in  broadband  networks.  

• Broadband  Forum  TR-­‐196  “Femto  Access  Point  Service  Data  Model”  was  published  in  April  2009.    

• A  new  update  to  TR-­‐196  to  include  enhancements  for  LTE  and  CDMA2000  networks  is  expected  during  

Q1  2011.  

3GPP2  Femtocell  Standardisation  

The  3GPP2  formal  publication  of  femtocell  specifications  was  published  during  March  2010.    The  following  

list  describes  the  technical  specifications  of  the  new  standard:  

• SIP/IMS   is  used   in   the   core  network   to   integrate   femtocell   services,   allowing  a   variety  of   components  

from  different  vendors  to  interoperate.  

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• Enhanced   System   Selection   is   supported   for   improved   handset   battery   life,   faster   femtocell   and  

macrocell   system   acquisition,   improved   handoff   between   femtocell   and   macrocell   and   femtozone  

awareness.  

• Local   and   Remote   IP   Access   is   supported,   allowing   packet   data   traffic   to   be   directly   offloaded   from  

femtocells   to   customers’  home  networks,   corporate   intranets,  or   to   the  public   Internet.  When  mobile  

devices   are   operating   outside   of   the   femtocell   subsystem,   the   3GPP2   specifications   also   include   a  

remote   access   capability   to   allow   mobile   devices   to   connect   to   the   user’s   IP   network   at   home   and  

exchange  IP  data  with  their  home  network  via  a  secure  remote  tunnel  

The   3GPP2   specifications   provide   a   complete   security   architecture   that   allows   CDMA2000   femtocell  

networks   to   support   large   numbers   of   femtocells   via   standard   commercial   IPsec/IKEv2-­‐based   security  

gateways.    The  3GPP2  security  architecture  and  protocols  are  compatible  with  the  security  architecture  for  

3GPP  radio  technology-­‐based  femtocell  devices.  This  architecture  not  only  protects  system  operators’  core  

networks,  but  also  provides   for  highly   secure  authentication  of   FAP  devices  using   secure   certificate-­‐based  

mechanisms  and  protocols   that  are  widely  deployed  and  validated  for  security,   robustness,  manageability,  

and  scalability.  

WiMAX  Forum  Femtocell  Standardisation  

The WiMAX Forum and the Femto Forum announced the publication of the first WiMAX™ femtocell standard

during June 2010 (http://www.femtoforum.org/femto/pressreleases.php?id=139).

The  specifications  incorporate  a  security  framework  that  allows  WiMAX  networks  to  support  a  large  number  

of   access   points   via   standard   commercial   IPSec   based   security   gateways.   This   phase   of   specifications   also  

contains   simple   Self   Organizing   Network   (SON)   capabilities   to   allow   automatic   configuration   of   large  

numbers  of  femtocells.  Future  revisions  will  further  enhance  the  SON  capabilities  to  standardize  automatic  

interference  management  between  femtocells  and  macro  base  stations.  

The  standard  also   incorporates  support   for   three  usage  models   to  support  different  deployment  scenarios  

such  as  residential,  enterprise  and  outdoor  environments.  The  ‘Open  Model’  allows  the  femtocell  to  operate  

like   a   normal  WiMAX  base   station  by   allowing   anyone   to  use   the   service;   ‘Closed   Subscriber  Group   (CSG)  

Closed’   allows   a   limited  number   of   pre-­‐allocated   subscribers   to   use   the   femtocell.   The   ‘Closed   Subscriber  

Group  (CSG)  Open’  extends  the  previous  model  to  allow  the  subscriber  to  add  users  themselves.      

Regulatory  Developments  In  April  2011  the  Femto  Forum  issued  two  regulatory  updates:  

1.  Regulatory  considerations  for  LTE  deployments  

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The  Forum  issued  a  short  statement  for  the  benefit  of  regulators  who  may  be  considering  specific  regulatory  

requirements  for  femtocells  using  LTE  technologies.  It  emphasised  that  femtocells  are  fully  encompassed  in  

the   3GPP’s   LTE   standard   and,   as   is   the   case  with   existing   3G   femtocells,   are   fully  managed   by   a   licenced  

mobile  operator  via  secure  connections  and  management  systems,  allowing  them  to  comply  with  relevant  

licencing  conditions   in   the  same   fashion.   It  also  highlighted   the   regulatory  benefits  of   femtocells   including  

improved  access  to  mobile  services  and  improved  spectrum  efficiency  thereby  making  the  technology  a  key  

part  of  LTE  rollouts.  A  full  paper  of  femtocell  regulatory  considerations  is  available  on  the  Forum’s  website  

here:  http://www.femtoforum.org/femto/Files/File/regulatory_support_for_lte_femtocells_6apr11.pdf  

2.  Cellular  interference  –  distinguishing  between  types  of  cellular  boosters  and  femtocells  

The  second  update  focused  on  the  controversy  surrounding  the   issue  of   interference  caused  by  the  use  of  

cellular  signal  boosters  in  the  United  States.  It  highlighted  that  certain  specially  designed  signal  boosters  can  

be  deployed  without  causing  interference  issues,  the  controversy  therefore  surrounds  the  use  of  improperly  

designed   signal   boosters.   However,   it   also   highlighted   the   distinction   between   boosters   and   femtocells  

which  provide  the  virtues  of  specially  designed  signal  boosters  but  with  the  added  advantage  that  they  also  

significantly   improve  network  capacity.  As  such   femtocells  can  provide  mobile  services   in  areas  where  cell  

capacity   is   under  major   strain   –   a   situation  which   cell   boosting   technology   is   fundamentally   incapable   of  

addressing.  

In  addition,  several  national  and  international  regulatory  bodies  have  taken  specific  steps  to  clarify  issues  of  

policy  and  regulation  relating  to  femtocells.  

• The  FCC   is  organizing  a   forum   focusing  on   indoor  deployments  of   small   cells   to   take  place  during  28th  

October  to  discuss  technologies  available,  potential  business  models  and  economic  impart  of  small  cell  

deployments.  

• In  March  2011  UK  regulator  Ofcom  published  its  consultation  on  the  award  of  the  800  MHz  and  2.6  GHz  

spectrum,  expected  to  take  place  in  the  first  half  of  2012.  This  includes  an  option  for  a  portion  of  the  2.6  

GHz  band,  potentially  up  to  2  x  20  MHz,  to  be  awarded  specifically  for  low-­‐power  use.  This  portion  of  the  

band  could  be  shared  by  as  many  as  ten  operators  concurrently,  with  technical  measures  and  a  potential  

code  of  practice  amongst  operators  to  limit  potential  interference.  This  consultation  represents  perhaps  

the  first  example  of  a  spectrum  award  being  explicitly  designed  to  take  account  of  the  technical    

Femto  Forum  provides  specific  information  for  regulators  at  http://www.femtoforum.org/femto/regulatory.  

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Latest  News  from  Femto  Forum  3GPP2  and  Femto  Forum  Publish  Best  Practice  Guide  for  cdma2000  Femtocell  Deployments    

3GPP2  and  the  Femto  Forum  announced  the  publication  of  an  operator  guide  for  cdma2000  femtocell  and  

small   cell   deployments.   It   provides  an  overview  of   cdma2000   standardized  architecture  and   interfaces,   as  

well  as  deployment  best  practices.  These   include  rollout  models,   frequency  planning,  provisioning  options,  

radio  parameters,  interference  mitigation  techniques,  security  and  handoff.    

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Contact  Information  Femto  Forum  would  be  pleased  to  respond  to  further  queries  on  femtocell  deployment.  

Contact  details:       Email:  [email protected]           Web:  www.femtoforum.org  Postal:       The  Femto  Forum  

P  O  Box  23  Dursley  GL11  5WA  UK    

Suggestions  for  additional  content  –  particularly  analyst  forecasts  –  may  be  submitted  to    

[email protected]  

 

Informa  Telecoms  &  Media  Editor  –  Dimitris  Mavrakis,  Principal  Analyst    

Contact  details:       Email:  [email protected]           Web:  www.informatandm.com  Postal:       Informa  Telecoms  &  Media  

37-­‐41  Mortimer  Street  London    W1T  3JH  UK  

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Acknowledgment  

Informa  Telecoms  &  Media  acknowledges  with  thanks  the  news  items  and  contributions  submitted  by  Femto  Forum  members  and  Analyst  Houses  

through  the  intermediary  of  the  Femto  Forum.