Femtocell technology is on the move, driven by new product introductions, several successful field trials, a host of industry collaborations, and the availability of high-performance design tools and ICs. Originally known as access-point (AP) basestations, these personal basestations are making progress in home and office deployment.

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With femtocells, service providers can extend coverage indoors, especially where access would be otherwise limited or unavailable, enabling improvements in both coverage and capacity. Femtocells connect to the service provider’s network via broadband routers, typically cable modems and digital subscriber lines (DSLs). Signals are routed from the home or office from a user’s cell phone over the Internet and to the provider’s basestation (Fig. 1).

Femtocells incorporate the functionality of a typical basestation but extend it for simpler and self-contained deployment. They’re compatible with international communication standards like Wi-Fi, WiMAX, Global System for Mobile Communication or GSM (originally Groupe Spécial Mobile), Code Division Multiple Access2000 (cdma2000), WCDMA/HSDPA/HSUPA, and time-division synchronous CDMA (TD-SCDMA).

The Pros and Cons

Femtocells promise unparalleled in-home and in-office cellular coverage (i.e., more bars) using dedicated high-speed 3G and 4G cell-phone data service (Fig. 2). They’re also presenting opportunities for new services and reduced cost by allowing existing networks to handle more providers.

By leveraging existing mobile core network equipment, standards, and capabilities, they can deliver service faster with minimal added-equipment costs. Aggressive bundled tariff packages can allow for flat-fee rates for unlimited voice and data services.

Cellular service providers can benefit from reduced capital expenditures and operating expenses associated with putting up large towers where opposition by municipal governments and residents over tower locations can also be difficult to overcome. The providers’ already heavily loaded backhaul channels can thus be unburdened.

Femtocell technology is still in its infancy, so there are technical and business model hurdles to overcome. These include RF interference within the wider network it works in, lingering fears about harmful effects on individuals from microwave emissions, and the deployment of equipment that meets strict licensing spectrum allocation requirements. Other challenges include achieving satisfactory quality of service (QoS) levels, network integration, and access control that prevents the unauthorized use of a mobile appliance via a neighbor’s femtocell.

Nevertheless, some standardization on femtocell network architectures is being achieved. The 3^rd Generation Partnership Project (3GPP) completed a feasibility study on femtocell network architectures, including a cellular basestation (picocell), a collapsed stack (base-station router), and the UMA/GAN (Unlicensed Mobile Access/Generic Access Network) topologies for a 3G femtocell, known as a Home Node B (HNB). As the 3GPP completes the formal standard by the end of this year, it is migrating toward a reference architecture that builds on elements of both the collapsed stack and UMA/GAN approaches.

The market outlook is rosy. According to ABI Research Inc., some 50,000 femtocell units were shipped in 2007 with 1 million expected for this year. By 2012, there could be 70 million femtocells installed in homes around the world serving more than 150 million users. ABI says the market is primed to grow from just under $72 million this year to over $1.8 billion by 2013 for a compound annual growth rate (CAGR) of more than 300%.

Market research firm Forward Concepts foresees a lucrative femtocell market opportunity for semiconductor IC vendors, predicting it will reach $1.5 billion by 2012 for a CAGR of 138%. Forward Concepts also believes that femtocells will capture the dominant fixed mobile convergence (FMC) market share by 2010.