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Mobile Capacity Crunch Looms for O2

Michelle Donegan
LR Mobile News Analysis
Michelle Donegan
6/27/2012

LONDON – Small Cells World Summit -- Telefónica UK Ltd. 's mobile operator O2 said that some parts of its network could run out of capacity as soon as 2014 or 2015 if mobile data usage continues to surge, and it is looking to small cells to avoid such a crisis.

"In 2014 or 2015, we think we will have exhausted the macro cell grid in certain areas of the network -- that's assuming 160 Mbits per loaded macro cell," said Robert Joyce, chief radio engineer at Telefónica in the U.K. "We need to do something different and that's small cells."

That stark projection holds up even after factoring in any new spectrum that O2 might acquire from the upcoming LTE auction in the U.K. "Even if we put in LTE, we will only get eight to ten times more capacity on a macro cell," he said.

The operator has already taken measures to add capacity to its network, such as doubling the number of base station sectors to six in London macro cells, as well as rolling out 3G in refarmed 900MHz spectrum, which was previously only used for GSM services. (See O2 Boosts Capacity for Smartphone Surge and 02 Felt iPhone Crunch Too.)

But according to Joyce, the operator needs to do more than that and that's why it is pursuing small cells -- both unlicensed Wi-Fi as well as licensed cellular access points.

"Small cells are firmly on our roadmap," said Joyce.

For the cellular variety, O2 is looking for enterprise femtocells that can support open access, 64 users and up to 42Mbit/s downlink speeds. And for small cells that can be deployed outdoor on third-party poles or street signs, for example, Joyce said the power output requirement for those devices will be at least 2 watts, but possibly even 5W or 10W.

Joyce said that O2 is working with Alcatel-Lucent (NYSE: ALU) on the development of such products. (See Euronews: AlcaLu, Telefónica Are Femto Friends and Who's Big in Small Cells?.)

Wi-Fi leads the way
O2's latest Wi-Fi rollout in London marked its first foray into rolling out small cells in an outdoor public setup (as opposed to deploying inside popular venues and locations, which it also does). In preparation for the Olympics, O2 bid for and acquired the rights to use certain street assets, like lampposts, in the London districts of Westminster and Chelsea and has deployed more than 100 Wi-Fi access points from Ruckus Wireless Inc. across the U.K. capital. The network was switched on last week. (See Small Cell Spotting in London.)

That Wi-Fi deployment has not only given O2 important sites in key locations that can be used again for other small cells, such as 3G or LTE varieties, but it also provided insight into the headaches of network planning and the challenges of working with local authorities when it comes to getting permission to install equipment. (See Small Cell Network Planning Poses Problems.)

For example, after O2 had won the tender and paid the local councils for the use of those street assets, the operator then had to approach the council's planning departments to get permission to install anything on each and every lamppost. Joyce said that his team of radio engineers had to file some 400 separate planning applications, as well as pay more fees.

In one part of the London Wi-Fi network on Exhibition Road, O2 installed an access point on every fourth lamppost, each one providing 15 Mbit of data capacity.

But O2's capacity target in high-traffic areas is to be able to provide 1 Gbit per square kilometer. "That's where we'll need to be to cope with the traffic demand by 2015," said Joyce.

— Michelle Donegan, European Editor, Light Reading Mobile

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Anne Morris
Anne Morris
12/5/2012 | 5:29:04 PM
re: Mobile Capacity Crunch Looms for O2


Reading stories about O2 always makes me feel exhausted; they always seem to be running just slightly ahead of the next crunch. Hope small cells does it for them, and the right backhaul set-up...


Like the metro cells on the street lights - very dinky.

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