AT&T Leans on Femto-cells to Support iPhone Coverage

I’ll admit that I get jazzed when I read a news item in the mainstream media that has some Microwave technology playing a leading or supporting role. So I was pleased when I read this story appearing in the New York Times on Wednesday that discussed how AT&T was addressing spotty iPhone service that occurs in locations where there are a shortage of cellphone towers. The solution, “a miniature cell tower in your living room” was described as a mini-tower, the size of a couple of decks of cards that looked like the Wi-Fi hot spots at cafes and could redirect calls from congested cell towers to home Web connections. Hhhmmmm, sounds like a femtocell to me.

The Times reported the story of Christina Zachariades, 28, a Manhattan resident who already pays $130 a month for iPhone service but cannot receive or make calls in her fifth-floor apartment on the Upper East Side. Despite the additional cost to consumers, the technology is poised for big sales, thanks to price drops but also because of the entrance into the market by AT&T. Other companies — Verizon, for example — have already marketed their mini-towers for niche use to customers in places with limited cellphone signals, like basements or homes with particularly thick walls.

The article went on to describe how industry analysts stated that "mini-towers, known as femtocells, are poised for spectacular growth. Shipments should grow from 571,000 this year, to 1.9 million next year, to 40 million by 2013, according to iSuppli, a market research firm. Falling prices are helping propel sales. Two years ago, for example, consumers would have paid $500 or more. "

Cisco, Samsung and Netgear are among the companies that make the towers; Qualcomm and Texas Instruments, which make chips for phones, have also developed products. Francis Sideco, an analyst at iSuppli, said there were still bugs to be worked out before femtocells become a mass-market product like wireless routers or storage devices, which were once hard to market.

Over the long term, basic economics favors mini-towers in homes over big towers, said Pasquale Romano, chief executive of 2Wire Inc., a company in San Jose, Calif., that is developing one of the devices. Ramano claimed that it didn't make sense for carriers to spend money building large towers in residential areas because most people are not home during the day; as it is, AT&T already plans to spend $8 billion this year on improving its wireless coverage, including on big towers, according to public filings.

The price for the AT&T device could fall to $49 if consumers buy a broadband or in-home calling plan, and could be free to customers who buy both. Still, marketing mini-towers has its risks for AT&T. Even though it expects the towers to improve signal quality and take pressure off its network, they could displace landline telephones because wireless consumers will not need a second phone number.

At Microwave Journal, we’ve been following the Pico- and Femto-cell markets for a number of years now with news, articles and application notes from a variety of sources. Earlier this month we reported on the completion of the Femto Forum’s first Femtocell plugfest (Femto Forum Completes First Femtocell Plugfest ). GaAs power amplifier supplier, Anadigics has been targeting this market since 2008 (ANADIGICS Enters Femtocell Market ) and provided us with a white paper that same year

Last May we reported that femtocells, which were virtually non-existent in 2006, and deployed by one operator in 2007, would make up 61 percent of small cellular base station revenue by 2013, according to reports In-Stat.

Highlight's from last year’s In-Stat report included:

• Femtocells, picocells and microcells are expected to surpass 15 million units by 2013.
• Worldwide annual femtocell semiconductor revenue will approach $400 M by 2013.
• Sprint was the first to market with a femtocell-based service in 2007, while others entered the market in 2008.
• In mid-2009, Airwalk introduced a new enterprise femtocell. These products have the capacity of a traditional picocell and the ease-of-use of a femtocell.