2009 Year in Review: Femtocells: A year of unfulfilled promise

Despite the gloomy start to 2009, femtocells were being positioned as a particularly bright hope for the year as the technology matured into near-commercial reality and operators began meaningful trials across Europe.

Various analyst studies added fuel to this viewpoint claiming that the majority of 3G operators in Europe were trialling femtocells and were planning commercial launches in late 2009 or for next year. One reports stated that nearly 12 million femtocells would be in use in Europe by 2014.

As the year progressed the picture remained largely the same--more trials or pilot deployments––but with no visibility as to when a major European operator would be the first to make the move.

However, hopes were given a severe dent when one analyst firm cut its femtocell shipment forecasts cut by 55 per cent for 2009 claiming that less than 350,000 would ship this year as against a previous estimate of nearly 800,000. The firm blamed operators for being slow to adopt the technology.

However, the year ended on a more positive note when SFR followed Vodafone by offering commercial femtocells to their subscribers.

Unanswered questions
While pointing the finger at operators for the poor femtocell shipment numbers is easy, other market researchers blamed the high cost of femtocells together with doubts over interoperability as the real reasons behind slow market uptake.

Existing femtocells use a chipset estimated to cost around €50. The commonly held viewpoint is that this needs to fall to €10 or below before the femtocell can be priced at an attractive level for consumers. Taiwanese vendors are thought to be targeting an end user price point of US$100 by the second half of 2010 that should trigger interest.

Interoperability still remains an issue with the Femto Forum and now T-Mobile Germany about to enter extended testing starting Q1/2010. This will be watched with keen interest by vendors and operators alike.

Related stories:
Femtocells: T-Mobile and Orange remain sceptical
Femtocells to fall below US$100 next year, claim insiders
Femtocells: Vodafone sets the pace with European launch
3G coverage requirement pushes femtocell market

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