Small Networks and Digital Oxygen, Big Enterprise Services Future for Mobile Operators
What a difference a couple of years can make. We’re in the midst of a mobile industry in transformation – the most rapid change we have seen from the RAN equipment and services players since the move to CDMA/WCDMA over a decade ago. With the inclusion of Wi-Fi as part of outdoor macro networks and coffee and retail shops and Femto cells as a useful stand-alone access point for residential and small businesses, “small” is here to stay. Small, as in small cells, which embed 3G, Wi-Fi and LTE access functionalities into a small cell form factor as part of the overall macro network, lovingly referred to as HetNet (Heterogeneous Networks), is growing in importance as Small Cells are in strong consideration as infill networks for dense metropolitan areas where they complement the bigger Macro network. Since Mobile World Congress 2011, Deutsche Bank Securities has called for an answer to the “densification problem.” And we are “getting there” as an industry.
As we look to 2020 and ignore some of the ‘noise’ in between now and then, the pragmatic view is mobile networks will become more capable and agile with the use of Macro and Small Cell networks to better handle capacity requirements from consumers and enterprises. Since we will likely not see a 3GPP ‘5G’ term, we’re talking about a common service network infrastructure where Macro/Micro/Small Cells work in close tandem with intelligent physical and virtual routing of access and services. In simple terms, vendors will help operators make better use of what they have, to deliver more capacity, when and where it’s needed.
Goldman Sachs expects small cells to drive 18% of RAN investment by 2016. The profound statement here is that the 18% may be able to handle as much as 80% of all the traffic. For proper context, keep in mind that indoor/outdoor multi-mode Wi-Fi/3G/LTE is part of this equation.
Scalable small cell systems are in the early days of making a bigger impact in metropolitan public access markets, and evolving to include all access technologies in various form factors. The next battleground is for sustainable ARPU and the enterprise markets.
Multi-Mode, Multi-Access Small Cells that can Scale to Demands of the Enterprise
Mobile operators want to acquire and retain valuable enterprise customers. For the next few years, ARPU growth for Western and USA operators will come from the medium to large enterprise segments. In many countries, ARPU for enterprise subscribers is twice as much as the ARPU for consumers. Employees of mid-to-large sized enterprises constitute 15% of subscribers at major mobile operators like Vodafone, and contribute as much as 30% of their revenue. These enterprise customers are not only the most loyal and profitable customers that mobile operators have, but also the most demanding. They expect the mobile operator to deliver seamless wireless coverage in their facilities, to stay ahead of the rapidly growing demand for wireless capacity, and to offer innovative ways to solve business problems.
Often, enterprise subscribers are willing to purchase new services from operators, ranging from international roaming plans to mobile device management. However, to win these customers, mobile operators must provide high-capacity networks where business customers spend more than 80% of their working hours – indoors.
Enterprise small cells have emerged as the most promising technology to deliver high-capacity and 3G coverage inside offices. Analyst firms such as Infonetics, ABI Research, and Informa expect enterprise small cells to be the fastest growing segment of the small cell market. Infonetics Research expects enterprise small cells to grow fastest, contributing to over 50% of small cell investment by 2016. http://tinyurl.com/6ngeo83
ABI predicts small cells for enterprise deployments will catch up with DAS by the 2016 timeframe – reaching the $2 billion mark by 2016. (August 24, 2012: http://tinyurl.com/9o8gktv). The inside enterprise opportunity with a lower cost and more flexible system that can be deployed by-enterprise, by-floor, in days and not 9+ months, also means that operators are making better use of licensed spectrum indoors which have a positive impact on resources used by the outside macro. Our findings show that as many as 90% of medium to large enterprises in a metro area have cellular indoor coverage and capacity problems – which currently cannot be addressed cost effectively by mobile operators.
When properly accessed with a lower cost and scalable small cell solution, the amounts of pockets of un-used licensed spectrum inside metropolitan and campus office buildings in New York, San Francisco, London, Beijing, Singapore, Paris and Barcelona alone…could mirror the importance of discovering and utilizing the world’s largest crude oil deposits in Ghawar (Saudi Arabia) in 1948. Mobility spectrum (licensed) is the digital oxygen, and our industry’s equivalent to crude oil deposits.
But, scalable enterprise small cells cannot fulfill their potential without a deployment architecture that meets the performance expectations of enterprises and the business requirements of mobile operators. Enterprises expect small cell systems to provide seamless voice coverage, LAN-comparable mobile data throughput, and integration with local applications. Mobile operators need a solution that can be rapidly deployed, minimizes operating costs, is easy to manage, and scales – from small offices to huge multi-story buildings.
SpiderCloud’s small cell architecture, called E-RAN (Enterprise Radio Access Network), is designed from the ground up to meet the performance expectations of enterprises and larger venues (V-RAN) and the business requirements of mobile operators.
What makes a scalable small cell RAN different?
- Seamless voice coverage, with make before break handovers
- Consistently high data throughput, by managing inter-small cell interference
- Policy-based integration with Enterprise Intranet and voice applications
- Rapid deployment, with self organizing and self-optimizing algorithms
- Enterprise-centered management
- Lower operating costs through efficient use of backhaul
- Scalability – from small enterprises to very large
SpiderCloud Wireless E-RAN systems are deployed in commercial networks. With 65 Radio Nodes and one Services Node deployed using SON over 16 floors in one green building in the heart of London, SpiderCloud is proud to lay claim to the world’s largest (consecutive and SON connected Radio Nodes) and most capable in-building small cell network for voice and data services, where the foundation for services is already in place. The world of mobile is indeed turning itself inside out and Digital Oxygen may be as valuable as crude oil by 2020. ?
Stay tuned, as we share more progress and adoption of the SpiderCloud Wireless small cell systems for scalable deployments inside enterprises and large venues. You can request a meeting with us at any of these upcoming industry events.
You can also follow our progress at twitter spidercloud_inc and haraldsvik.