Femtocell success reliant on handset innovations

• In dense deployments of femtocells, handsets can spend too much time and power attempting to connect at locations that are not their own “home zone.”
• The new 3GPP Release 8 specifications contain various modifications to enable handsets to work better with femtocells, but the first R8-compliant phones will likely be shipped at the end of 2010.
• The usage of handsets on femtocells may identify unexpected side-effects, relating to faster/cheaper data connections. This may impact elements of design such as memory allocation and power management.
• Various suggestions have been made for ‘femto-zone’ services–but there is no standardised way for handset applications to know they are attached to a femtocell.

By looking at the above issues it may not sound very well in favour of femtocell deployment and commercialisation. However operators are always looking for new means and ideas for the generation of new revenue streams. Femtocell is definitely on of those new means and a possible opportunity for the operators to generate more revenue. Revenue can be generated by the operators from advertisers and other third parties by enabling the provision of ‘at home’ services via femtocells.

Research and Market claimed that there could be a demand for at least 48 million femto-aware handsets to be sold to femtocell owners in 2013. However, with more optimistic forecasts, and especially if shared femtocell models become popular, there could potentially be a demand for up to 300 million femto-aware handsets per year in 2013.

Although the above figures look very encouraging, femtocell industry is still very cautious in terms of their approach towards massive investment. Femtocell industry is currently focusing on the short term, getting initial trials in place, developing standards, and securing commitments for early commercial deployment. These initial efforts are very critical for the femtocell industry so that they can validate the market, raise the profile of the femtocells concept. If the industry can do that then it will stimulate finance and investment in the femtocells.

One of the propositions by central marketing is that femtocells can work with normal 3G handsets. If this is true then subscriber can get the service from femtocells without needing to go for expensive upgrades to their existing phones.

But while focus is good and the industry does not want unnecessary distractions there is a risk of medium term failure if certain future problems are not addressed early enough, even if this muddies the waters of the short term marketing message. Already, femtocells proponents are talking up mass market business models that go beyond simple indoor coverage and macro-network offload. They are talking about 10’s of millions of subscribers, and new “in-home” services for users, that exploit fast and cheap local mobile connectivity.

It is at that stage that the issue of right handsets for the femtocells industry comes into picture once again. The handset innovations become even more important for important for the industry. As I have mentioned above, the handsets design should be able to differentiate between femtocells and real cell environment. In part, this relates to complexities in managing the radio environment and mobility between femtocell and macrocell networks. This is easy said then done and hence various optimisations are desirable, especially when dense deployments of femtos occur. These drive changes in areas such as the way the phone “selects” cells on which to register. There may also need to be ways to offer provisioning and “guest access” on femtocells, from the handset UI. But this cannot be considered as a solution as users will definitely consider this as an unnecessary exercise for them. In my view the medium term hopes of the industry also reflect the notion that people will use their cellphones differently when in range of femtos. The problem for the femtocells industry doesn’t end with solving the problem of registering to the right cell. There will be different applications and behavioural patterns when people are at home, perhaps content backups, podcasts or even advertiser sponsored TV programming. The mobile phone may need to linked to TV, PC, HiFi or other items of domestic technology. This shows the road ahead is really tough and it again highlights the degree of innovations that will be required for the handsets design in order to work precisely in the femtocell environment.

Some reports suggest that standard phones can work with femtocells, but they are not optimised. Certain applications may only work when the phone is within femto range but they need to know when that is. Yes, some services can be notified by the core network that the user is “at home”, but that approach doesn’t scale to a wide base of operators, application developers and handset/OS vendors. The phone needs to be “aware” of the femtocell, ideally both in the radio and the application platform.