PicoChip Unveils Low-Cost Femto Chip
Heavy Reading's Brown reckons picoChip’s new generation of femtocell chips will be best suited for femtocell modules that are integrated into home gateways, because that's the most cost-effective option for operators in the long run. (See Femto Players Gun for Gateways, Netgear Gateway Goes Femto, Netgear, Ubiquisys Team, Thomson, IP.access Team, and Thomson, NSN Team.)
“The femto itself as a standalone device is OK for an early launch, but it won’t really be cost effective enough for a mass market,” says Brown.
Integrating a femtocell module into home networking gear helps drive down the price of the devices because there are several shared components. Heavy Reading estimates that the bill of materials for a femtocell module (before software costs) is expected to come down to about $50 towards the second half of 2009.
“To get to that price point, you need more integrated silicon,” says Brown. “And that’s really the application that picoChip is targeting with this new product. It will make the modules cheaper.”
PicoChip's new product will be available in volume early next year, says Baines.
“When volumes start going into tens of millions of units, which is what the industry is talking about now for WCDMA, you need a very aggressive cost-reduction program,” says the marketing man. “People like AT&T Inc. (NYSE: T) are talking about 7 million units, and Vodafone is talking about similar units. You need lower-cost silicon to support those numbers.” (See Is AT&T Putting Out Femto Feelers?, Cisco, ip.access Prep Femto Combo, and Vodafone Picks Femto Vendors.)
Market potential still a topic for debate
But it’s still early days for femtocells. Nokia Networks head of radio access, Marc Rouanne, told Unstrung at a recent press event that “the femtocell market has not decided if it’s going to be big or not.”
Getting the price of the devices down is critical to the fate of femtocells. The market seems to be in a chicken-and-egg situation, where operators say they need cheaper femtos before they can commit to volume orders, but volume orders are needed to drive down the price of the devices. PicoChip’s new generation of integrated femtocell chips at least goes a way toward bringing costs down.
— Michelle Donegan, European Editor, Unstrung
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