Small cells shaping a new order for future wireless networks

Two thirds of operators claim 2014 will be "year of deployment", but important issues are yet to be resolved, meaning that it will be at least 2015 before we see mass deployment.

By Frank Rayal, Xona Partners and Elias Aravantinos, ExelixisNet

Small cells are deemed indispensible for mobile network operators who are facing unrelenting pressure to increase capacity in response to the insatiable demand for data services.

As a case in point, AT&T announced that it will aggressively push to deploy 40,000 small cells by the end of 2015 under its Project Velocity IP (VIP).

Yet, outdoor small cells remain an object of great debate with promises of deployments deferred into the future.

This perplexing situation gives rise to a number of questions such as: What do operators see as the challenges holding up small cell deployments? What are their key requirements for small cell deployments? And, when can we expect small cell deployments to happen?

A new primary research report entitled “Small Cells New Order – a global status report” by ExelixisNet and Xona Partners answers these and other critical questions based on the input of leading multinational and regional operators who answered probing questions on their outdoor small cell deployment plans.

Still plenty to do, as operators build confidence
Operators are bullish on small cells: about two third of those surveyed say 2014 is the year of deployment. But further probing reveals that important elements to the deployment of small cells are yet to be implemented.

Over half of the operators who want to deploy in 2014 have not yet completed their financial assessment on the value proposition of small cells and about a third are yet to determine whether small cells will be deployed in the same spectrum as macro cells or in dedicated spectrum.

This leads us to conclude that 2014 will be the year of sporadic deployments used by operators to gain confidence in the small cell value proposition and continue to assess the impact on network performance.

It will be at least by 2015 that operators will be ready for mass deployment, armed with confidence in small cell enabling technologies and toolbox of solutions to the backhaul conundrum.

This timeline matches the evolving LTE roadmap, specifically the introduction of interference management techniques targeted at enhancing small cell performance in LTE-Advanced (3GPP Release 10 and later) and widening scope of self-organizing network techniques (SON) critical to lowering the operating cost of heterogeneous networks which ranks atop the concerns operators have on small cell deployments.

A backhaul surprise
The cost challenge is mirrored by an equal concern for backhaul. Backhaul presents a techno-economic challenge and contributes significantly to the total cost of small cell deployments. Operators overwhelmingly prefer to use fibre over any other backhaul technology. Yet, for two thirds of surveyed operators the probability of fibre availability at the small cell location is under 25%.

As a substitute, over half the operators surveyed are considering NLOS in unlicensed band, leading over any other type of backhaul. This is a striking surprise which could be explained by the availability of high-capacity affordable equipment that does not require licensed spectrum. Just as importantly, it demonstrates that operators are pragmatic in the face of the backhaul challenge.

With 2013 being a year of trials, operators gave E-Band solutions a good test drive: these are the most trialled solutions for small cell backhaul followed by point-to-multipoint microwave, millimeter-wave and sub 6-GHz non-line-of-sight technologies (licensed and unlicensed bands).

In effect, operators acknowledged the need of a technology toolbox of different backhaul solutions, and are still active in their evaluation ahead of mainstream deployments.

Despite the anticipated delay in small cell deployments, we are at the cusp of a new order for wireless network architecture where the prerequisites for small cells such as interference management technologies, SON and backhaul technologies are firmly put in place.

Small cells are just an aspect of this evolution which has the potential to shake up the industry with new technologies, business models and a supporting ecosystem of vendors.