Adoption of wireless data services is today’s growth engine for wireless network operators. We have a “perfect data storm” in the making, fueled by a young Internet-savvy generation that wants immediate access to information anytime, anywhere. Mobile data users want instant access, from downloading the latest video on YouTube to updating their Facebook profiles with their latest pictures and videos. To meet this demand, wireless network operators have to find cost-effective ways to augment capacity in their networks.
To add capacity, wireless operators rely on Increase spectral efficiency and Cell splitting (Adding more cell sites and reducing subscriber density in a given cell site, thereby adding more capacity in the network).
The reality is that the rate of growth of consumer data demand far outstrips the rate of spectral efficiency improvement. It took more than a decade for 3G WCDMA UMTS networks to be adopted, yet today mobile broadband traffic is growing by almost 400% every year.
To keep up with the growing demand, wireless network operators have to increase capacity through the construction of additional macro cell sites; that is, through cell splitting. This strategy is becoming much less attractive, however. Site acquisition costs are exorbitant and continue to rise as space on viable towers and buildings fills up, landlords exact high rent, and regulators impose onerous permitting requirements. Furthermore, public opposition to the building of large-scale base stations is increasingly common. Acquiring a site is only half the battle, though; sophisticated base station equipment must then be purchased, installed, insured, operated, and maintained.
The 3G femtocell solution creates a new location for wireless base stations in consumers’ homes or offices. Femtocells provide a compelling solution to network operators for augmenting capacity in their networks in a cost-effective manner. In essence, a small space on a bookshelf or desktop in a consumer’s home becomes a cell site and thus there are no site acquisition costs involved. The customer pays for the femtocell backhaul by using an existing broadband line (e.g., cable or DSL) that is typically charged at a flat rate, and hence there are no incremental costs to the femtocell subscriber. Electricity bills, which constitute a large operational expense item for macrocell sites, are paid for by the consumer as well.
Femtocells allow carriers to offload their existing macrocell networks because in-home wireless traffic is routed through broadband connections rather than through the operators’ NodeB leased lines. Macro cellular network resources that were formerly charged with handling indoor users’ mobile calls, text messages, and so on, are now freed up as that traffic is instead offloaded to femtocells and consumers’ broadband connection.
The three Cs of wireless—coverage, churn, and capacity—are stifling 3G adoption. 3G wireless networks suffer from inadequate indoor signal penetration, leading to poor coverage in the indoor environment where consumers spend on average two thirds of their time. From an RF propagation perspective, buildings and walls have never been friends to a radio signal. Physical structures cause RF signal attenuation because of reflection, diffraction, scattering, and multipath signal fading, all resulting in poor radio signal reception in an indoor environment. In some cases, virtual dead spots can occur inside buildings even though there is great coverage outside; indeed, walls can attenuate RF signals by 10 to 20 dB depending on the type of construction.
The indoor coverage problem is amplified even more in 3G WCDMA UMTS networks when compared to their predecessor 2G Global Systems for Mobile Communications (GSM) networks. In most parts of the world, 3G UMTS networks are deployed in the 2.1 GHz spectrum range as opposed to 900 MHz or 1.8 GHz for GSM. As wireless networks are deployed in higher frequency bands (i.e., 2.1 GHz > 1800 MHz > 900 MHz), indoor signal penetration becomes worse because higher frequencies suffer higher levels of attenuation.
Poor coverage diminishes the quality of voice and video applications and slows down high-speed data services. Dropped calls and time-consuming downloads can lead to churn as high-value 3G customers, who expect a high quality of service, choose to pick up their landline phones or switch to other mobile carriers in search of uninterrupted voice calls, clear video images, and faster downloads. Churn is intricately linked to coverage and capacity and is a double-edged sword, costing carriers both in lost revenue—about $100 per month average revenue per user (ARPU)—and in new customer acquisition costs, about $400 per customer. As small wireless home base stations, femtocells transmit at very low power yet create almost ideal indoor radio conditions. The very walls that are radio signals’ foes actually become their friends as they attenuate RF signal propagation out of the home and thereby minimize radio interference with the existing macro cellular network or other nearby femtocells. Last but not least, one femtocell can support four to six simultaneous voice calls, which means that each member of a family of four can talk simultaneously on a femtocell.
