Nimble Small Cell Vendors Find Another Market to Exploit

Danny Dicks
Heavy Lifting Analyst Notes
Danny Dicks
4/26/2018



The history of small cell vendors is an exciting one, though nerve-wracking. Companies making WiFi access points and routers have had a long-lasting and stable market to sell into. In recent years, however, those that have sold micro, pico and femtocells to operators that need to densify their networks and boost capacity in hotspots have found the competition from the big network equipment providers (NEPs) becoming increasingly difficult to live with. The small cell portfolios of companies like Nokia, Huawei and Ericsson are now extremely comprehensive, and they have the strategic commercial relationships with operators.

There have been successes, of course, notable examples being SpiderCloud's supply deals with Verizon Wireless, Telcel and Vodafone a few years back, and more recently Airspan's very big contracts with Sprint and Reliance Jio. But while the ability of the small cell specialists to scale so they can compete with the big boys is an open question, one area that some have had more reliable long-term success with (though with lower volumes) is direct (and channel) sales to enterprise customers for private networks -- both indoors and outdoors, including in hazardous environments like factories, mines and quarries. These have often been based on variants of WiFi, or proprietary technologies, and vendors have had to be nimble -- developing ways to quickly adapt their radio frequency (RF) and software stacks to address specific sectoral and customer requirements.

Now those same enterprises -- and many more beside -- are looking with great interest at Long Term Evolution (LTE) for two reasons: LTE is an increasingly capable technology that can deliver some of the mission-critical communications features some private networks require; and one way or another enterprises can get their hands on LTE spectrum they can use for themselves -- something that's been pretty hard to do in the past. The citizens broadband radio service (CBRS) approach to spectrum sharing at 3.5GHz in the US is being closely watched by regulators around the world, and MulteFire (which could use globally available bands, such as 5GHz) is starting to build some momentum. CBRS is moving very fast, and in April 2018, specifications for deployment and coexistence of LTE in multiple use cases were published by the CBRS Alliance.

If small cell vendors can rapidly deliver equipment for CBRS and MulteFire networks, they may steal a march on their bigger competitors -- and it's easier than ever for them to offer an end-to-end LTE-based solution now there are many vendors of virtualized evolved packet core (EPC) and IP multimedia subsystem (IMS) networks to choose from. Of course, they must be able to demonstrate value when looked at from a total cost of ownership perspective. In addition, they need to develop an effective channel strategy -- they are unlikely to take the lead in delivering a complete private network. They also need to demonstrate their long-term stability: many private networks will be owned outright by the customer and viewed as a long-term asset. Having a credible 5G roadmap wouldn't hurt either.

The Heavy Reading report LTE & 5G for Private Networks looks at the use cases for private LTE and future 5G networks, examining why LTE and 5G are better able than public cellular technologies of the past to meet the needs of enterprises and other organizations with specific requirements. Further, this report looks at the models for deployment and integration with network operators' public services, describes the market supply-side and profiles 12 leading vendors.

— Danny Dicks, Contributing Analyst, Heavy Reading

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