Femtocell Market to Reach $630M in 2010

(Business News & Technology News, 17 Dec 2007)

Worldwide sales of GSM/GPRS and 3G femtocell access points will heat up quickly once femtocell services become more widely available, with unit shipments expected to grow 10-fold from 2007 to 2008, and revenue reaching more than $630 million in 2010, according to Infonetics Research.

Femtocells are small, low-power, indoor cellular base stations that can achieve higher-quality local-area coverage and allow mobile operators to extend their cellular footprint in the home and office environment. Infonetics' latest report, "Femtocell Access Points Market Outlook," explains that the femtocell concept can be applied to a variety of wireless technologies, such as GSM, W­CDMA (including HSPA), CDMA2000 (including EV-DO), 4G LTE, WiMAX, and WiBro, but not all of these applications will be necessarily commercially justified.

The greatest opportunity will be presented by 3G femtocells that are deployed in households, where they can be used to provide consistent high-speed coverage as well as improved home-zone type tariffs and services for customers. 3G femtocells offer a practical and potentially much less expensive alternative to enhancing coverage by further investing in denser 3G macrocell networks. In addition, as femtocells are backhauled over an Internet connection, such as a consumer's DSL line, the mobile operator could make operational expenditure savings on macrocellular backhaul.

According to Richard Webb, wireless analyst for Infonetics Research, femtocells could allow mobile operators to make a significant shift away from just relying on traditional cellular network architecture. He said that the prospect of capex and opex savings combined with new personal broadband service opportunities is generating intense interest from operators in femtocells, and more vendors are developing products. If the hype translates into deployment, femtocells could radically transform the economics of mobile data and content-based services.

Other highlights from the report include:
- In 2010, GSM/GPRS femtocells will account for 6 percent of worldwide femtocell access point revenue, W-CDMA femtocells will account for 59 percent, CDMA2000 femtocells 35 percent

- The strongest early markets for femtocells are in developed countries; it is likely that the large potential of Asia Pacific, and EMEA will drive femtocell subscriber and equipment revenue growth in the long term

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