Femto Chips Too Costly

11:40 AM -- While much of the mobile industry goes ga-ga for femtocells, Ericsson AB (Nasdaq: ERIC) is sticking by its plans to introduce a 3G home base station some time in 2009, but not before. The world's dominant WCDMA vendor says that chips needed to make femotcells are just too expensive to make a product that's affordable for consumers. (See Ericsson Stalls on 3G Femtos and Vodafone CEO Seeks Cheap Femtos.)

"The chips today are too expensive for us… It is too expensive to implement the radio technology into a small box," says Jennette Fridberg, director of product marketing for radio access networks at Ericsson. "You need a consumer price on a [femtocell] solution. That's one of the problems we're fighting with, and I think the rest of the industry is, too."

Fridberg also pointed to interference and standardization issues that needed to be sorted out with 3G femtocells. (See Femto Firms Counter Interference Flak.)

Ericsson has a GSM femtocell that is part of a home gateway that includes a WiFi access point, a home router, and a DSL modem. Just one European operator is using the GSM femto in a friendly user trial.

"You need [a femtocell solution] when you have a high volume of users, as you do with GSM," says Fridberg.

— Michelle Donegan, European Editor, Unstrung

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