Opinions about Femtocell Business Case

500% market penetration for mobile devices requires a network with femtocells

Ivan Seidenberg Verizon CEOIvan Seidenberg, CEO of Verizon Wireless set a BHAG (Big Hairy Audacious Goal) of 500% market penetration for mobile devices at his speech at CTIA this month. Is this realistic or feasible? Will this encourage femtocells to make it happen?

We’ve already exceeded 100% penetration in many countries

Many countries have already exceeded 100% mobile phone saturation. This means the number of mobile phone subscriptions (not necessarily the same as number of mobile phones) exceeds the population. You can see the evidence for this backed up by many businesspeople who have separate devices for voicecalls (a small phone handset), email (Blackberry or similar) and a USB data dongle – each has its own SIM card and associated subscription. Both prepaid and postpaid accounts are included in these totals, although short term SIM cards sold to tourists and visitors may not.

500% means many more machine to machine applications

The premise of future growth is based more around machine-to-machine applications – everything from automobiles to smart health monitors could include an embedded mobile network connection. With the cost of a basic GSM device chipset under $2 today, the incremental cost of this connectivity for many consumer electronics devices isn’t unreasonable. It could be subsidized by potential revenues of services from the manufacturer’s website – printing your photos, scheduling your auto maintenance or even your health checkups.

We’ll insist on always on, available everywhere connectivity

Mobile phone networks have the advantage of being available everywhere, not just at home, work or other hotspots. I’ve found that Wi-Fi hotspots can be great where they’re available, but see them as a bonus rather than wanting to depend on them solely for connectivity. Mobile network operators have the opportunity to cash in on this potential enormous growth in number of devices if they can make it easy to subscribe through their networks. By that, I mean being very cost effective (to match usage) and offering bundles of multiple data SIM cards within a single account, easy signup/registration and excellent performance.

Operators are investing in their own innovation centers

Also mentioned in this speech, Verizon will be setting up its LTE Innovation Center to incubate and encourage development of new applications for its LTE network. This will focus on working with consumer electronics, telematics and machine-to-machine products for health care, security and utility metering. Many other network operators also have their own innovation centers and 3rd party developer programs.

This huge number of mobile devices will need a different network topology

I’ve said before that the predicted heavy growth in data volume on mobile networks creates a strong case for data offload through femtocells. It’s not just the data traffic itself, but also managing always on connections to huge numbers of devices that strains the traditional mobile network – especially the radio interface.

If we all have 5 mobile devices (on average), then the signaling and data traffic from them will certainly need a radical rethink. Machine to machine types of communications can be deferred to offpeak times of the day, unless there is a particular need for more urgent updating. This could allow some devices to wait until you get home or overnight offpeak periods where larger data uploads occur.

Hits : 5027

Comments   

#1 Ken Figueredo said: 
The industry certainly is picking up on 'embedded mobility' the next phase of growth in mobile. Beyond the issue of femtocells, the implementation and operational issues are complex (but solvable) touching topics of business model change and greater outreach from the mobile eco-system to non-mobile device and service providers. More insight can be found in a market development study conducted by the GSMA in collaboration with a group of international mobile operators.

http://www.gsmworld.com/Embedded_Mobile_Final_Report_PRJ-0263-STR-PSD-1B_November_2008_-_FINAL.pdf
0 Quote 2009-04-08 13:12
 
#2 ThinkFemtocell said: 
Ken

Thanks for pointing out the report - this contains several good charts/figures/ projections and some useful segmentation of likely M2M (Machine to Machine) applications.
0 Quote 2009-04-08 20:14
 
  • 4

    more

    Residential

    Residential

    A significant number of users continue to report poor mobile coverage in their homes. There will always be areas which are uneconomic for mobile operator to reach. They range from rural areas

    ...
  • 4

    more

    Enterprise

    Enterprise

    The term Enterprise addresses any non-residential in-building including hotels, convention centres, transport hubs, offices, hospitals and retail outlets. It's not just intended for businesses to

    ...
  • 4

    more

    Urban

    Urban

    Urban small cells (sometimes also named metrocells) are compact and discrete mobile phone basestations, unobstrusively located in urban areas. They can be mounted on lampposts, positioned on the

    ...
  • 4

    more

    Rural

    Rural

    A rural small cell is a low power mobile phone base station designed to bring mobile phone service to small pockets of population in remote rural areas. These could be hamlets, small villages or

    ...
Categories
Backhaul Timing and Sync Chipsets Wi-Fi LTE TDD Regional

Popular Categories

Follow us on...

footer-logo

Search