Mobile Operators Think Small to Get Bigger Profits

Mobility, outsourcingSmall cells that is. Whether you’re a mobile virtual network operator (MVNO) deploying services in urban or rural areas, a city official modernizing your infrastructure to attract and retain citizens, or a high tech start-up looking to join the ecosystem of suppliers emerging to address the ever growing data traffic demands, a small cell solution should be part of your plan. Or maybe you’re a mobile operator with one of the 184 LTE networks already in service as of the end of July or leading the planning or deployment of another 159 networks during 2013 . No matter what stage of deployment you’re in, a new hosted model, Small Cells as a Service (SCaaS) is worth exploring.

Smart Cities + Small Cells=New Opportunities

Over the past couple of years, I took a closer look at “smart cities” that were deploying high speed fixed broadband to deliver innovative services to citizens and businesses as a way of reinventing their city and improving the way of life. What I found was amazing! Cities like Chattanooga, TN transformed light poles into multipurpose, high technology devices housing sensors for lighting, rain gauges, sniffers for chemical spills or terror attacks, and cameras for crime. This simple transformation of existing infrastructure had a significant impact on the city. Citizens felt safer walking to downtown offices or attending riverside festivals. City officials monitored rainfall to avoid flooding in flood-prone zones. And police now had a new weapon to help reduce crime.

As more cities become wired to handle citizens need to stay connected 24×7, existing networks are pushed to the limit. 3G and 4G networks are important steps in addressing data demands but small cells are an important part of the mix. Small cells allow an additional layer in the mobile access network to handle growth in mobile capacity where it’s needed most – close to the citizens needing the coverage.

Innovative Business Models Emerging

But like any investment, the key question to answer with LTE/4G is; how can the costs be made affordable for all ecosystem players to justify the investment? One business model emerging that helps justify LTE investments including small cells is a hosted model, Small Cells as a Service (SCaaS). Several European operators are actively trialing and testing this option.

COLT telecom, a European network operator with fiber in many European urban areas, has been offering to install and connect small cells for mobile networks. They’ve discussed several commercial arrangements, which include a fully managed service where they own the equipment and lease it at a monthly fee. Mobile operators would simply request installation of a new small cell at a specific location, and it would be connected on demand. All traffic would be consolidated and sent through dedicated broadband connections to the operator’s small cell gateway.

Virgin, a UK cable broadband network, already supplies high capacity Ethernet backhaul for mobile operator’s macrocells. They offer a hosting option where they install metrocells or small cells for the last few hundred meters. Site acquisition, power, fiber backhaul from a nearby hub and on-site field staff for installation and maintenance are all included. They have completed successful trials in two UK cities.
And trials are starting in the US. Clearsky/NEC and Public Wireless offer similar services. In March of this year, they offered a Femtco as a Service (FaaS) to fill coverage service gaps.

Trials are also proving that the addition of small cells works, serving to “supercharge” access points where they need it most. A study from Real Wireless showed if the small cells were deployed at the cell edges of the existing macro cells, they would have the potential to double the throughput that was possible in those locations.

What’s Next

With the growing interest by the US government to ignite another internet revolution to help the fuel economic growth, Small Cells as a Service may just be poised to take off. Driven by the thriving ecosystem, one researcher is projecting small cells and carrier WiFi deployments to account for nearly $352 Billion in mobile data service revenues by the end of 2020.

So why not explore how your business can benefit from smalls cells? Ecosystem players will be key in serving up solutions to cities, businesses and citizens. Collaboration between mobile operators, MVNOs, city leaders, utilities, cable operators and specialized providers can make all the difference in building smarter cities and delivering on citizen’s insatiable need to stay connected.

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