T-Mobile's top networking executive said the operator's interest in adding small cells to its network has "certainly softened" following the close of its merger with Sprint. He said that T-Mobile plans to add capacity to its network by deploying Sprint's 2.5GHz spectrum onto macro cell towers instead of adding more small cells.
Neville Ray, T-Mobile's president of technology, explained that adding network capacity through the installation of additional small cells is time consuming and expensive due to the need to obtain construction permits and equipment for the devices.
"The small cell progress has been meaningful but it's still a battleground with the various jurisdictions. So if you're staring down the barrel of, 'I gotta build a couple hundred thousand of these things,' that's a nightmarish scenario," Ray said Thursday during the Wells Fargo Virtual 5G Forum. "For us, I'm not going to say it's less of a focus on small cells, but it's certainly softened. The major driver on small cell builds for us was capacity. Now, with all of our [Sprint] spectrum, we really have to go and build less than targeted with T-Mobile standalone [the company prior to its merger with Sprint]. And we're in no huge rush to go do that."
T-Mobile said it owned 26,000 small cell and Distributed Antenna System (DAS) sites at the end of the first quarter of this year. Ray said that figure would eventually double to around 40,000 to 50,000 as T-Mobile works to build its 5G network following the close of its merger with Sprint. He explained that much of the initial $40 billion in network spending T-Mobile has earmarked for the next three years would go toward building 15,000 new macro cell towers in order to raise T-Mobile's total number of macro towers to 85,000 sites.
"At this point in time we can deliver so much capacity into this network with our midband [2.5GHz] spectrum on our macro [tower] grid. Every engineer worth their salt is going to tell you that's the cheapest, most cost effective, most meaningful way to roll out and build this network," he said. "And that work itself is in many ways less complex than what you have to do with millimeter wave [small cells]. We're adding radios and antennas to existing sites in many cases out of 100. I'm not trying to navigate small cells being constructed or installed in suburban or urban areas."
Ray added that T-Mobile is working with Crown Castle – a cell tower company that has invested heavily in small cells – to add small cells to its network.
T-Mobile's position on small cells is directly opposite that of Verizon's. Verizon said earlier this year it expects to build five times more small cell sites in 2020 than it did last year. However, Verizon did not provide a specific number for its small cell ambitions.
Verizon's interest in small cells is directly tied to its use of millimeter wave (mmWave) spectrum for 5G. Transmissions in mmWave spectrum can only travel a few thousand feet, making small cells an ideal way to broadcast signals in such spectrum. T-Mobile, meanwhile, is deploying 5G primarily in its lowband 600MHz and midband 2.5GHz spectrum bands. Transmissions in this kind of spectrum can travel several miles at least, making standard macro cell towers – as long as they're in the right places – ideal for such broadcasts.
Small cells have been a hot topic in the wireless industry for years. The gadgets can be attached to rooftops, light poles and other so-called "street furniture," and can add more capacity to a network. Trade group CTIA forecasts that the total number of small cells in the US will grow from around 86,000 in 2018 to over 800,000 by 2026.
However, the space has proved challenging as installation projects run up against city regulations and residents' concerns. The FCC in 2018 stepped into the issue with rules designed to speed up the installation of small cells, but top small cell vendors like Crown Castle have said it still can take more than two years to receive local approval to activate a small cell. Indeed, AT&T at one point had hoped to deploy 40,000 small cells in its network by the end of 2015, but subsequently dropped those plans. Executives from the operator have not offered any firm numbers around the carrier's small cells efforts since then.