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As super-fast, Long Term Evolution wireless networks are deployed, some are questioning whether carriers even need 4G femtocells to boost coverage in the home. A post this week over at Unstrung adds fuel to the debate by pointing out that with femtocells, bandwidth speeds are only as fast as their slowest link, which means the wired connection to the home in many places will likely be slower than the speeds offered via LTE wireless networks. In other words, the speeds offered by an LTE femtocell, which uses the wired broadband as its connection back to the Internet, could be throttled by the wired connection.
The median download speed in the U.S. is currently less than 3 Mbps, whereas industry experts expect LTE speeds to offer about 20 Mbps down. As carriers look to deploy LTE networks beginning in 2010, however, the case for 4G femtocells is murky. Major carriers in the U.S. have already started offering 3G femtocells to boost coverage in the home, but consumer adoption of femotcells remains unproven. Carriers are still trying to educate customers and figure out the right business models, and analysts are calling for femtocells and their subscription plans to be cheaper.
There’s also a question as to whether carriers — notably AT&T (s T) and Verizon (s VZ), both of which have spectrum in the 700 MHz band — will even need 4G femtocells, given how well that spectrum penetrates buildings. On the speed side, even though ISPs are deploying fiber or wideband cable through DOCSIS 3.0, both of which offer speeds in excess of 50 Mbps, not every consumer will have access to such technology. If the spectrum over which LTE is deployed is robust enough to offer good coverage inside buildings, and the wired broadband slows network speeds, then a 4G femto doesn’t make sense.
That’s bad news for startups such as ip.access and Ubiquisys, which are banking on femtocells. The biggest driver for 4G femtocells may have to do with ensuring voice quality over an all-IP network. If that’s the case, then a 4G femtocell would have to be cheap for consumers, but a potentially pokey wired connection wouldn’t really matter.