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Small Cells: The Next Sure Thing

Dan O'Shea
Heavy Lifting Analyst Notes
Dan O'Shea, Analyst, Heavyreading.com

Small cells have had an interesting market trajectory -- and by "interesting," I mean "confounding." Having once been the new, hot thing, they then turned into the next over-hyped thing, before starting to look again like the next big thing, and the advent of the cloud RAN made us briefly wonder, wait, are they still a thing? But in 2016, it looks like we can finally say that small cells are the next sure thing.

There we go with the hype again, right? Somehow the arrow always has been pointing upward for small cells, even when there was little happening in the market to warrant it. At times, our belief that small cells were a great technology idea obscured our inability to figure out why, how, where and when they should be deployed in the market. (Wow, I think I just described the history of a lot of other technologies that never panned out.)

Why are things different this time around? There appear to be real reasons to be excited about small cell technology, and how it will come to be used very soon in the networks of both service providers and enterprises. Verizon, AT&T, Sprint and other carriers are at the stage of testing small cells with an eye toward how they fit into 5G network upgrades, and how they can help address massive expected growth for new Internet of Things connections in those existing networks, as well as ongoing explosive demand for existing devices to always be connected and always drawing on network capacity, even heavy usages areas.

Those same operators are getting their backhaul plans in order, too, in expectation of broad-scale small cell deployment. Witness Verizon's recent move to acquire XO Communications, a deal that has applicability in multiple market segments, but perhaps most notably, the potential to provide Verizon with more of its own backhaul facilities outside of its tradition wireline markets as the wireless side of the house rapidly densifies its network with small cells.

Meanwhile, there's also great potential in the enterprise small cell market. The Small Cell Forum issued a report late last year suggesting that enterprise small cell deployment is about to explode as enterprises and operator partners look to address the long-standing need for indoor coverage, as well as developing applications like business M2M.

Having said that, there still might be some important enterprise questions to be resolved. The "why" of deploying small cells in the enterprise is clear, but consensus on the "how" is not. The technology options are not the issue -- there are plenty of different options. The remaining questions instead are: Will enterprise solutions be affordable for the enterprise market at large (and not just the largest enterprises)? What role will multi-operator small cells play, and how will they be deployed? Are operator technician staffs sufficient in knowledge and in numbers to meet enterprise deployment demand?

Will 2016 will be the Year of the Small Cell? Yes, and the issues around enterprise deployment can be figured out, but that doesn't mean we have all the answers just yet.

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This blog is sponsored by Huawei.

— Dan O'Shea, Analyst, Network Transformation, Heavy Reading

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3/17/2016 | 12:07:51 PM
But why, again?
The article makes this comment:  "The "why" of deploying small cells in the enterprise is clear..."

Is it?  I think everyone can understand why mobile operators want to deploy small cells into the enterprise.  But that's not the question.  The question is, why does an enterprise user need access to a small cell?  There are at least 2 options:

(1) Better data coverage/performance.  Well, the vast majority of enterprise users will have smart phones with Wi-Fi, and the vast majority of enterprises will have Wi-Fi networks.  So users can already get excellent data access on their mobile devices using the Wi-Fi network.

(2) Better voice coverage.  Voice has always been the area where small cell proponents have retreated in order to explain why users can't get by with Wi-Fi.  But that's over now, right?  At least in the US every one of the big 4 mobile operators provides Wi-Fi calling.  Maybe not on every handset yet, but it's vastly easier to push the functionality to new handsets than to deploy millions of small cells in enterprises.

So what is so clear about "why"?  It's not data.  It's not voice.  What is it?
3/7/2016 | 9:44:40 AM
Re: E-911
I think its pretty certain at this point to say its a matter of when and not if, and even the when is fairly soon. All the factors are pretty close, although I have a funny feeling that real small cell deployments won't be until 4.5/5G, which is a bit ironic as it was envisioned as a solution for 3G.
3/7/2016 | 9:37:40 AM
Re: E-911
It's still a gamble for whether it's a sure thing or not I would guess. While "Verizon, AT&T, Sprint and other carriers are at the stage of testing," it's still depending on lots of variables not the least is the speed of IoT development scaling up.
2/25/2016 | 6:02:56 PM
This also coincides with the new FCC mandates for improved indoor E-911location accuracy.
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