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Summary:

Picochip today said it has released a chip that will enable mobile operators to place small base stations known as femtocells anywhere, bringing them out of the home environment and into public areas. This is good for carriers, but it may be bad news for consumers.

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Picochip today said it has released a chip that will enable mobile operators to place small base stations known as femtocells anywhere, bringing them out of the home environment and into public areas like parking garages surrounding a busy shopping area or on an enterprise campus. Femtocells help ensure better cell phone coverage in hard-to-cover areas, such as indoors or in hilly or urban terrain, so they could mean a better iPhone connection, but they may also mean that the era of widespread Wi-Fi supplied by carriers could end.

We at GigaOM have long argued that femtocells, which act as a mini cell tower and connect through a home’s existing broadband connection, are expensive for the carrier to deploy and currently expensive for consumers to pay for in their homes. With more phones coming with Wi-Fi, which many homes already have, femtocells won’t improve mobile Internet access, but could improve voice calls. However, femtocells are compelling, because they could help carriers serve more mobile phones in an area without needing more spectrum. From an earlier story I wrote on these chips:

However, if Picochip’s beefed-up chips can help femtocells support more users, they could become an attractive solution for larger campuses, and perhaps public places such as Times Square or a train station. They might also help improve the overall network for operators by taking signaling traffic off congested towers in urban areas. Chetan Sharma, a wireless analyst, issued a report this week noting that network congestion is generally caused by two big issues: (1) signaling traffic caused by smartphones and superphones and (2) peak data traffic caused by data cards and embedded laptops. He writes that signaling traffic is growing faster than raw data traffic because smartphones are not very efficient with applications.

The danger here is that with more capable femtocells, and an ability to reuse their spectrum in congested areas, carriers lose their incentive for deploying Wi-Fi networks to offload data and will shunt customers back over to 3G networks (right now, these Picochip radios are for HSPA networks, not the coming Long Term Evolution networks), which generate more money and provide carriers with more control over the applications that run over the network. For users, it would mean higher data costs and, depending on how the net neutrality debate pans out, a different version of the Internet.

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  1. this finally is something that makes sense. consumers are expecting a future where they completely replace their wired internet connections with wireless ones. people do not want to have to do things like configure their own router.

    these tiny cell towers belong out on the street managed by the carriers. this is what will give the capacity to cellular that makes wired and eventually wifi(at least for internet connectivity as opposed to ad hoc interconnections to printers and other devices) irrelevant.

  2. If we could implement handoff protocols between access points we wouldn’t need cell networks at all. Cell networks simply provide access to the same backbone wifi dumps into.

  3. Only just noticed this article – I agree that femto is fast becoming the standard unit for small cells, characterised by cell intelligence, with the miniaturisation a mere stepping stone.

    Another intelligence-generated development is femto self-organising networks, where femtos autonomously form a grid of coverage.

    These are currently being trialled with enterprises in Europe.

    I’d be interested to hear comments about this development. More on our blog http://ubiquisys.com/femtocell-blog/what-is-an-enterprise-femtocell-2/

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