& cplSiteName &

Urban Jungle Is Still Too Wild for Small Cells

Michelle Donegan
News Analysis
Michelle Donegan
6/11/2014
50%
50%

LONDON -- Small Cells World Summit 2014 -- As the Small Cell Forum's new urban rollout guidelines were still steaming off the press on Tuesday, five European operator CTOs started the small cell industry's annual gathering by sounding off on the challenges that hold back public access deployments. (See Small Cell Forum Tackles Urban, Virtualization.)

"The ecosystem is complex -- from local councils, to street furniture owners, to transmission vendors, and the small cell vendors," said Bryn Jones, CTO at UK operator 3 . "Trying to get all those suppliers to create one solution that's cheap and simple to operate in a cost-effective way is a challenge. The operational part is absolutely key."

Jones called on the industry to step up and work with other stakeholders to improve the situation. "Everyone in this room needs to work together on how we get that end-to-end operational experience," he said.

Small Cells, Big Cheeses
From left to right: Dave Salam, director for network strategy and core network infrastructure; Adrian di Meo, CTO of Telefonica UK; Frode Stoldal, CTO of Telenor; Manuel Rosa da Silva, CTIO of Portugal Telecom; Bryn Jones, CTO of 3 UK.
From left to right: Dave Salam, director for network strategy and core network infrastructure; Adrian di Meo, CTO of Telefonica UK; Frode Stoldal, CTO of Telenor; Manuel Rosa da Silva, CTIO of Portugal Telecom; Bryn Jones, CTO of 3 UK.

3 UK has rolled out more than 100,000 residential femtocells and is currently working on enterprise femtocells. Once the operator has rolled out its LTE network, Jones said 4G small cells could be used to fill in capacity and add coverage. But the big challenge with LTE small cells is getting enough backhaul capacity to each site. "How to get 60 Mbit/s to 100 Mbit/s cost-effectively to each small cell is the challenge."

Dave Salam, director for network strategy and core network infrastructure at the UK's largest mobile operator, EE , said that small cells were the right solution to provide capacity in dense urban areas in the operator's 4G network. The operator already uses LTE femtocells in some of its retail stores to demonstrate the 4G experience.

But, like 3 UK's Jones, he warned that "the fragmentation of the ecosystem, especially in the outdoor case, is working against it and will make it very difficult. The cooperation needed to come through that isn't there yet."

Telefónica UK Ltd. CTO Adrian Di Meo was more concerned about the cost of renting sites in an outdoor environment, and noted that form factors are being addressed but still need work. "The size and weight of the technology is getting there," he said.

For Norwegian operator Telenor ASA (Nasdaq: TELN), the problem with small cells is not so much the operational issues, but the business case itself: "If there's money in small cells, we'll invest, but if there's not, we won't invest," said Frode Støldal, the operator's CTO.

Portugal Telecom SGPS SA (NYSE: PT) CTIO Manuel Rosa da Silva added to the financial debate, noting that that the fundamental challenges go deeper than just outdoor deployment issues. "Anything that's HetNet naturally means cost," he said.

Ideally, da Silva wants the small cell business model to be more like the WiFi model, whereby the customer pays for the equipment. "With our managed WiFi and revenue model, we have indoor coverage. It works and our customers finance that," he said. "Monetizing data is very difficult. Our 4G network is running at 20% capacity. Until we see a model that is close to managed WiFi, then we won't get there."

The concerns raised by these European operators won't necessarily be fatal for the outdoor, urban small cell business case. According to Gordon Mansfield, Small Cell Forum chairman and AVP of small cell solutions at AT&T Inc. (NYSE: T), public access LTE small cell trials are well underway at several operators in more advanced LTE markets, namely Japan, South Korea and the US. While Mansfield did not reveal any details about specific trials, he said that AT&T was one of those operators.

But the candid comments from the CTOs echo the Small Cell Forum's own findings about the drivers and barriers for urban small cell deployments. The biggest drivers, according to a Maravedis-Rethink survey of 40 operators commissioned by the Forum, are: improving overall capacity; generating revenue from new applications; filling in capacity holes; reducing the cost of delivering data; and improving coverage.

On the flipside, operators surveyed said the biggest barriers were: backhaul availability and cost; securing optimal sites; monetization; and network provisioning and management.

With such challenges remaining, it seems that small cells aren't quite ready to survive and thrive on a mass scale in the urban jungle.

The challenges of small cell deployments will be analyzed during a panel session at the Big Telecom Event (BTE) on Tuesday June 17. See the BTE agenda for more details.

And for all the latest on the key small cell sector developments, check out Light Reading's Small Cells content track.

— Michelle Donegan, contributing editor, special to Light Reading

(6)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
Mitch Wagner
50%
50%
Mitch Wagner,
User Rank: Lightning
6/11/2014 | 8:16:48 PM
UK more conducive
My impression of the UK is that the populated parts are densely populated indeed, making small cell deployments more practical from a physical standpoint. Is that correct?
AJ Allred
50%
50%
AJ Allred,
User Rank: Light Beer
6/11/2014 | 5:08:35 PM
City fathers owe something
Using the term 'urban jungle' helps point out how regulations at the municipal level seem to be viewed as unavoidable bumps in the road.  We look for technology work-arounds instead, as if city fathers were another form of hopeless rain fade.    

We need a set of arguments that push urban leaders to view commercial wireless as a vital community insfrastructure, like water, streets, and sewer.  We should not accept that wireless furniture gets regulated by how it looks, instead of how it works.  
MordyK
50%
50%
MordyK,
User Rank: Light Sabre
6/11/2014 | 2:33:14 PM
Re: Biggest challenge in monetization
It was easy for carrier's to stand on a high horse when it was all theory, but as they face the reality of complex and the diverse multitude of deployment scenarios in the coming years, they'll need to embrance previously avoided models such as network sharing and SC's as a Service among others.
Carol Wilson
50%
50%
Carol Wilson,
User Rank: Blogger
6/11/2014 | 2:19:28 PM
Re: Biggest challenge in monetization
MordyK,

You present an interesting and very reasonable scenario.

I totally agree that there needs to be more creativity brought to this process. I also think that's why anyone planning to deploy small cells needs to be looking at all the options. Earlier this week, AT&T said it's even looking at the cable industry's small cell as a service options, something it wasn't so high on in the past. 
MordyK
50%
50%
MordyK,
User Rank: Light Sabre
6/11/2014 | 1:56:22 PM
Re: Biggest challenge in monetization
I agree Carol, but financing is only one part of the monetization play. Carrier's need to think beyond their current business models for ways to monetize and ease operational issues.

I'll provide an example in retail but this applies to any sector if modified.

When a carrier approaches a retailer or facility owner and pitches them on a coverage solution such as DAS or small cells, a carrier ends up with a big chunk of the cost depending on the facility and teh agreement. If however the carrier provided the facility with analytics or interactive abilities with the clients derived fro the deployment, a retailer/facility would be more than happy to take on additional parts of the deployment and/or maintenance burden.
Carol Wilson
100%
0%
Carol Wilson,
User Rank: Blogger
6/11/2014 | 10:29:04 AM
Biggest challenge in monetization
I think the two gentlemen who discussed financing all this small cell stuff hit the nail on the head. Using small cells for coverage makes a ton of sense but if you can't monetize it -- or get the customers to pay for it, as with WiFi -- then the cost of the build-out and operation of those small cells looms large as a major problem. 

If there's money to be made there, the other issues can be resolved. 
Educational Resources
sponsor supplied content
Educational Resources Archive
From The Founder
The independent evaluation of Nokia's key virtual network functions (VNFs) was a defining moment for the Finnish giant.
Flash Poll
Live Streaming Video
Charting the CSP’s Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it’s going from two industry veterans.
LRTV Custom TV
Cisco's Innovations in Cable

5|26|16   |   03:18   |   (0) comments


Marc Aldrich from Cisco discusses the latest in security, the evolution and momentum for CCAP and what the industry will be seeing next from Cisco.
LRTV Documentaries
Leading Lights 2016 Highlights

5|25|16   |   02:26   |   (1) comment


Some of the high points from this year's Leading Lights awards dinner at the Hotel Ella in Austin, Texas.
LRTV Documentaries
Light Reading Hall of Fame 2016

5|23|16   |   05:43   |   (0) comments


Find out who has been welcomed into Light Reading's Hall of Fame this year.
LRTV Custom TV
ZTE TM Forum Highlights

5|23|16   |     |   (0) comments


ZTE showcased its new ICT solutions at TM Forum in Nice.
LRTV Interviews
Gamma's MD on the Emergence of UC2

5|20|16   |     |   (0) comments


Gamma Communications Managing Director David Macfarlane believes the unified communications (UC) market has reached a tipping point.
LRTV Custom TV
The Ultimate 5-Minute Guide to Digital Customer Engagement

5|20|16   |     |   (0) comments


In this short video, you will hear all about how Digital Customer Engagement is the key to meeting customer expectations, keeping them happy, and maximizing revenue. VP Product & Marketing at Pontis, Ofer Razon, breaks down for us the five essential capabilities for successful Digital Customer Engagement. Don’t miss!
LRTV Custom TV
NFV in 2016: Part 1 – NFV Use Cases Get Real

5|19|16   |   05:57   |   (0) comments


Consensus is building around the key use cases for NFV, including managed IP services at the network edge and on customer premises, which can generate new revenues from enterprises/SMBs and consumers; Evolved Packet Core to support LTE migration; and adjacent technologies, such as TAS and IMS, to support VoLTE and next-generation charging and policy control ...
LRTV Custom TV
Nokia's Steve Vogelsang on NFV – Part 3

5|19|16   |     |   (0) comments


Steve Vogelsang discusses the challenges of operational transformation and how Nokia helps its customers. Join Steve at the Big Communications Event in Austin the morning of May 24, on his keynote and optical networking panel.
LRTV Interviews
Level 3: Why UC Is In Demand

5|17|16   |   04:12   |   (1) comment


Andrew Edison, Level 3's senior VP of sales, EMEA region, talks about the drivers of growth in the unified communications services market.
LRTV Custom TV
ARM's OPNFV Action

5|17|16   |     |   (0) comments


At the ARM booth at MWC 2016, Joe Kidder and Bob Monkman speak to Light Reading about OPNFV and their upcoming action.
LRTV Custom TV
Nokia's Steve Vogelsang on NFV – Part 2

5|16|16   |     |   (0) comments


Steve Vogelsang gives advice to service providers on how to move to NFV. Join Steve at the Big Communications Event in Austin the morning of May 24, on his keynote and optical networking panel.
LRTV Interviews
Interoute CTO on NFV's Maturity

5|13|16   |   06:46   |   (1) comment


Matt Finnie, CTO at international operator Interoute, explains how NFV has made life easier in terms of logistics and how Interoute can now enable a 'software-defined moment' for its customers.
Upcoming Live Events
September 13-14, 2016, The Curtis Hotel, Denver, CO
December 6-8, 2016,
June 16-18, 2017, Austin Convention Center, Austin, TX
All Upcoming Live Events
Infographics
A new survey conducted by Heavy Reading and TM Forum shows that CSPs around the world see the move to digital operations as a necessary part of their overall virtualization strategies.
Hot Topics
DT: Telcos Must Escape Vendor Prison
Iain Morris, News Editor, 5/24/2016
AT&T to Start 5G 'Friendly' Trial by 2016 End
Dan Jones, Mobile Editor, 5/24/2016
Cisco's Patel Hails 'Microculture' Successes
Iain Morris, News Editor, 5/26/2016
Cable Is Eyeing Its Retail Options
Mari Silbey, Senior Editor, Cable/Video, 5/25/2016
AT&T's Margaret Chiosi Retires
Ray Le Maistre, Editor-in-chief, 5/25/2016
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
In this latest installment of the CEO Chat series, Craig Labovitz, co-founder and CEO of Deepfield, sits down with Light Reading's Steve Saunders in Light Reading's New York City office to discuss how Deepfield fits in with the big data trend and more.
Grant van Rooyen, president and CEO of Cologix, sits down with Steve Saunders, founder and CEO of Light Reading, in the vendor's New Jersey facility to offer an inside look at the company's success story and discuss the importance of security in the telecom industry.
Animals with Phones
Live Digital Audio

Our world has evolved through innovation from the Industrial Revolution of the 1740s to the information age, and it is now entering the Fourth Industrial Revolution, driven by technology. Technology is driving a paradigm shift in the way digital solutions deliver a connected world, changing the way we live, communicate and provide solutions. It can have a powerful impact on how we tackle some of the world’s most pressing problems. In this radio show, Caroline Dowling, President of Communications Infrastructure & Enterprise Computing at Flex, will join Women in Comms Director Sarah Thomas to discuss the impact technology has on society and how it can be a game-changer across the globe; improving lives and creating a smarter world. Dowling, a Cork, Ireland, native and graduate of Harvard Business School's Advanced Management Program, will also discuss her experience managing an international team focused on innovation in an age of high-speed change.