Femtocell deployment slows temporarily, but large-scale use expected
Deployment of femtocell by mobile operators has been slow to develop due to market conditions, but researchers see unit shipments rising to more than 1 million units by 2010.
By Gail Flower, Contributing Editor -- EDN, March 20, 2009
Large-scale femtocell deployment by major mobile operators has slowed down in reaction to the global recession, according to ABI Research. However, the market research company reported that the sluggish market is expected to be a temporary condition.
“Femtocell rollouts to date have been limited, controlled ones,” said Aditya Kaul, an ABI Research senior analyst. “Shipments at the end of 2008 were in the few hundred thousands, and at the end of 2009 should climb towards a million but will fall short.”
ABI Research expects that 2010 will see shipments climbing well above a million units. Indeed, vendors are gearing up for a big push, Kaul said. One of the industry’s main silicon suppliers, picoChip recently announced a multi-million dollar injection of funding. Kaul said he expects that the funding will “probably be geared toward a ramp-up and that there is "a lot of similar activity behind the scenes, and new partnerships which point to preparation for a major market expansion.”
In telecommunications, femtocells -- small cellular base stations designed for use in residential or small business environments -- has attracted ongoing interest. In February, Nigel Toon, newly appointed president and CEO at picoChip, identified the emerging femtocell market as an important focus for future high-volume support. TI also showed interest in the technology when it joined the Femto Forum in December, making it one of the few chip companies in the standardization group.
Late in 2009 or early in 2010, ABI said it expects an announcement of a multi-city commercial femtocell deployment by one of the major mobile operators, which may encourage other operators to follow suite.
Priced at close to $150 to $180 at present, the high cost of femtocells has been a major market deterrent.*
“Even at $100 cost point, femtocells would very likely be subsidized,” said Kaul.
For the femtocell to reach mass-market scale like WiFi access points, the $50 cost point would need to be reached. This is long way off and usually depending on multi-million unit volumes.
