Femtocells halted by business complications

SINGAPORE--The business issues posed by femtocells are a big barrier against mass adoption of the devices, said telco voices.

Speaking at a panel discussion at the 5th annual Mobile Network Evolution conference here Tuesday, Jaikishan Rajaraman, senior director of services at the GSM Association (GSMA), said femtocells deployed in homes and offices are maintained by users, and as such are out of telcos' control.

This makes them unreliable bets for telcos, said Rajaraman. Users who may be benefiting from a neighbor's femtocell may find that their cell service has deteriorated if the neighbor takes the device down, but the onus of keeping cell coverage quality falls entirely on telco's shoulders, Rajaraman explained.

Femtocells are small devices installed within the user's premises, and are meant to augment cell signals to handsets by riding on fixed broadband lines.

The technology have been touted as a way to help telcos offload mobile traffic onto fixed broadband infrastructure, ensuring service qualities stay up while keeping the costs of mobile data down for operators.

Femtocells networks are also expected to have a user base of about 70 million by 2014, according to an analyst report released August last year, although the same report noted that femtocell adoption remained stagnant because consumers are unwilling to fork out for the devices.

It turns out operators are unwilling to invest in them as well, said Yoshihiro Obata, CTO of Japanese carrier, Emobile.

During the panel discussion, Obata noted that operators looking to install the devices in buildings located in dense cities--where the technology offers a more cost-effective way of reaching more users, compared to erecting cell towers--have to pay building operators "rent" for the space to house femtocells, turning them off the idea altogether.

One telco, however, has explored femtocells as an option.

Ong Boon Teong, StarHub's network architecture strategy and research services senior engineer, said the Singapore telco has been weighing it against other backhaul offloading technologies.

Ong noted, however, that femtocells have yet to take off in a big way because the ecosystem needs telco participation on a global scale, to drive prices down and spur vendors to introduce more models.

StarHub began customer trials of femtocells in May 2008, and launched a commercial service in November the same year.

According to Bjorn Amundsen, Telenor Norway's vice president and head of mobile network coverage, indoor coverage has become an increasing concern for telcos as upgrades to LTE infrastructure get underway.

Telcos upgrading their networks will have to balance the investment in new LTE base stations with older hardware to support existing 3G and 2G devices, said Amundsen.

This includes ensuring coverage stays reliable by maintaining sufficient cell sites, he explained.

In five to six years' time, he mused that architects may build base stations into their building plans, making cell connectivity a necessity equal to power and water plumbing. This will allow telcos to offload mobile coverage onto networks that they can control, he said.