I have just released a new research report on the progress of small cell deployments in collaboration with ExelixistNet: “Small Cell Ecosystem: Challenges and Opportunities.” The report examines mobile operators’ plans and deployment strategies of small cells and backhaul solutions along with vendor and technology preferences. The research is based on experience gathered by operators from market trials of small cells and wireless backhaul solutions conducted to evaluate the ecosystem deployment readiness and impact of small cell roll-out on operator financials and network performance.
In the past three years in particular, market forecasts of outdoor small cells have been high – just look at the many press releases and news bits released from analysts covering this space. Yet, to date, only a fraction of the forecasted numbers has materialized. The common questions now are: what is the hold up? and, when small cells will be deployed? This is expected given the large investment that went into this market with very little results to date. OEMs and investors alike are getting nervous.
The fundamental problem is that forecasts often fall short of considering all the important factors that impact deployment. This is compounded by errors in applying the right weight to the factors that are included. There are several reasons which include complex technology tradeoffs, limited knowledge of operator evaluation and deployment processes, and lack of visibility on true vendor product roadmap and availability, and strategic and financial implications that operators face. In our report, we take a discerning look at small cells from multiple angles to identify the challenges that have forestalled deployments and the opportunities available to the wireless ecosystem to capitalize on critical gaps that must be addressed in order to realize scalable small cell deployments. Some highlights:
- Over 50% of the surveyed operators say they expressed the need to start deploying outdoor small cells in 2014 while our analysis of readiness points to longer timeline.
- Fiber remains the operator’s first choice for backhaul. However, operators are actively investigating alternative solutions where the cost/performance equation is better optimized for small cell deployments.
- Traditional wireless backhaul vendors are dominating the high-frequency space while new entrants are protagonists in the low-frequencies.
- Operators are overwhelmingly asking for multimode LTE, 3G, and Wi-Fi outdoor small cells. This puts tremendous pressure on the backhaul network capacity requirements that certain technologies would fall short of meeting.
The report runs for over 50 pages and answers fundamental questions to small cell deployments such as:
- Are the operators ready for small cell deployments which require radical change of current operational processes?
- How close are we to realizing large scale small cell deployments?
- What operators see as their primary small cell backhaul technology and how they rank the different solutions?
- Which vendors are operators considering for each type of backhaul technology?
- Will operators deploy small cells in the same spectrum used for macro cells, or in a separate dedicated spectrum band?
- What are the key issues that are holding up small cell deployments and what are the potential avenues available to resolving these challenges and jump start the small cell market?
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