Light Reading

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
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. 
Flash Poll
From The Founder
Networks of the future will rely on "white box" switches and servers rather than proprietary hardware and that's going to alter the shape of the communications industry. Who says so? John Chambers.
LRTV Documentaries
In Ericsson's 5G Lab

4|2|15   |   06:29   |   (0) comments


Light Reading CEO Steve Saunders visits Ericsson's labs in Stockholm to find out about the vendor's 5G device prototype from the leader of the vendor's 5G product strategy, Håkan Andersson.
LRTV Huawei Video Resource Center
Huawei's Power Play With GrupoGiro

4|1|15   |   2:51   |   (0) comments


Daniel Heredia, CEO of Energiro, the power management services part of Spain's Grupo Giro, explains why his company has just struck a partnership with Huawei for uninterruptible power supply products and how he hopes it can take the partnership into other markets.
LRTV Huawei Video Resource Center
Huawei Intros Smart Device for eLTE

3|30|15   |   05:25   |   (0) comments


Huawei has developed a secure, location-aware multimedia smartphone for its eLTE trunked radio solution, says Huawei's Norman Frisch.
LRTV Huawei Video Resource Center
Win Video, Win All

3|30|15   |   06:44   |   (0) comments


Video is going to be the next main source of revenue for operators. Operators have big opportunities and advantages to monetize video services. Globally, Huawei has helped more than 70 operators achieve over 30 million video subscribers. Watch this video for more.
LRTV Custom TV
The Benefits of HyperScale Clouds for NFV

3|27|15   |   01:50   |   (0) comments


Hyperscale cloud has been developed by the Internet giants to support the creation and delivery of software-based services at blistering speeds, and at the lowest possible cost. The original ETSI NFV vision was to adopt hyperscale cloud architecture and practices. This vision has become somewhat obscured along the way, due to misunderstandings about the hyperscale ...
LRTV Huawei Video Resource Center
eLTE Rapid Meets the Need for Speed

3|26|15   |   4:45   |   (0) comments


Designed especially for emergency and dedicated ad hoc local mobile communications coverage, Huawei's eLTE Rapid solution can deliver trunked voice, video and data coverage for multiple users over a 6km range and be set up in just 15 minutes, explains Huawei's Norman Frisch.
LRTV Huawei Video Resource Center
On Videos: Challenges & Opportunities

3|26|15   |   5:56   |   (0) comments


Most everything is now connected. And along with 4K and 4G technologies, everyone could be creating and broadcasting video contents. Users are expecting better video experience with any screen, anywhere and anytime. Operators will meet new challenges, but also see some big opportunities.
LRTV Custom TV
JDSU: Delivering Dynamic Networks for a Personalized Experience

3|26|15   |   5:59   |   (0) comments


Light Reading speaks to JDSU at Mobile World Congress 2015 about new solutions in the areas of HetNets, VoLTE, backhaul, virtualization, big data analytics, and real-time intelligence.
LRTV Custom TV
Smarter Service Chaining & New Ways to Benefit From Qosmos Technology

3|25|15   |   03:11   |   (0) comments


David Le Goff, director of strategic and product marketing at Qosmos, explains how the company has added application awareness to subscriber information to make service chaining more efficient and reduce costs for networking and infrastructure. In addition, Qosmos technology, which has been delivered as C libraries, is now also available as a virtual machine, ...
Between the CEOs
Qosmos CEO: The Changing Face of DPI

3|24|15   |   13:53   |   (0) comments


LR CEO and Founder Steve Saunders sits down with the head of Qosmos to talk about the changing state of the art in deep packet inspection technology, including its role in SDN and NFV architectures. Also, how the comms market is becoming more like the automotive industry.
LRTV Huawei Video Resource Center
FC Schalke Scores With Its Agile Stadium

3|24|15   |   6:23   |   (0) comments


Top German soccer club FC Schalke 04 has deployed a new, agile WiFi network from Huawei in its Veltins-Arena stadium and is reaping the benefits in terms of customer satisfaction and business opportunities, explains marketing chief Alexander Jobst.
LRTV Huawei Video Resource Center
Huawei’s Insights on Mobile Video

3|24|15   |   7:51   |   (0) comments


More people than ever are now watching videos on smartphones. Seventy percent of mobile traffic will be video traffic until 2018. In this video, Huawei's exports give their insights on mobile video in terms of business model, network planning and 4G network construction.
Upcoming Live Events
April 14, 2015, The Westin Times Square, New York City, NY
May 5, 2015, Hyatt McCormick Place, Chicago, IL
May 6, 2015, Georgia World Congress, Atlanta, GA
May 12, 2015, Grand Hyatt, Denver, CO
May 13-14, 2015, The Westin Peachtree, Atlanta, GA
June 8, 2015, Chicago, IL
June 9-10, 2015, Chicago, IL
June 9, 2015, Chicago, IL
June 10, 2015, Chicago, IL
September 29-30, 2015, The Westin Grand Müchen, Munich, Germany
November 11-12, 2015, The Westin Peachtree Plaza, Atlanta, GA
All Upcoming Live Events
Infographics
More and more traffic is traveling within data centers, and operators need new networking approaches to manage this growth. Pica8's infographic shows how operators can confidently and painlessly deploy white box switches into existing networks today and leverage the benefits of SDN.
Hot Topics
AT&T Woos SMBs With Small-Scale WiFi
Sarah Thomas, Editorial Operations Director, 3/26/2015
Just Don't Say IBM Is 'Relaunching' Networking Business
Mitch Wagner, West Coast Bureau Chief, Light Reading, 3/26/2015
TV Everywhere Nears Mainstream Adoption
Mari Silbey, Independent Technology Editor, 3/27/2015
Carriers Are Bright Spot in BlackBerry Q4
Sarah Thomas, Editorial Operations Director, 3/27/2015
Comcast Says TWC Deal Will Close Later
Mari Silbey, Independent Technology Editor, 3/26/2015
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
LR CEO and Founder Steve Saunders sits down with the head of Qosmos to talk about the changing state of the art in deep packet inspection technology, including its role in SDN and NFV architectures.
Chattanooga’s EPB publicly owned utility comms company has become a poster child for how to enable a local economy using next-gen networking technology. Steve Saunders, Founder of Light Reading, sits down with Harold DePriest, president and CEO of EPB, to learn how EPB is bringing big time tech to small town America.