Because the small cell market is immature and its market definition can vary, Cisco has at times had difficulty being recognized for its contribution to this space. Cisco’s lack of a macrocell offering, the traditional backbone of the radio access network (RAN) market, also hurts its public perception in this area.
However, Cisco’s accomplishments – over 12 million carrier-grade Wi-Fi access points and approximately 800,000 femtocells deployed – make the vendor hard to ignore in the RAN space. Its packet core solutions also play an important role in helping to tie small cells into the larger macrocell network.
While Cisco does not compete across the entire spectrum of small cells, it is strong with residential and enterprise users. Cisco has a small cell story to tell, even if it lacks solutions for all the areas that fall under the small cell umbrella.
It often amazes me how a seemingly simple term can be so hard to define. “Small cells” is a great example. Despite countless research reports, industry shows, and white papers, there is still no common definition of what a small cell is. One challenge is that the small cell market isn’t a singular thing, but really a collection of different types of small base stations, both licensed and unlicensed, designed to address a range of end-user and operator needs.
When thinking of base station vendors the name Cisco usually doesn’t come up first. In fact it might not come up at all. There is a good reason for this. Historically base stations meant macro base stations, an area in which Cisco doesn’t compete. But the base station market is changing, and small cells are becoming a bigger factor. In small cells, Cisco is very much an important vendor.
While heterogeneous networks with pico and microcells have dominated much of the recent small cell news, Wi-Fi and femtocells fit under the overall small cell umbrella as well. When looking at the broader definition of base station, it quickly becomes clear that Cisco is a major player in this space. (For more on Ovum’s definitions of small cells, see Mobile Small Cell Taxonomy, February 2012.)
Cisco tackles small cells from the inside
Cisco’s small cell strategy tends to focus on opportunities that are enclosed, such as a house, office, stadium, or retail environment. A notable exception is its carrier Wi-Fi access solutions that have been deployed in outdoor metro environments. Cisco, so far, has shown little interest in pushing its licensed small cell solutions into the broader outdoors. The company currently appears comfortable ceding this space to the traditional macro base station vendors, but that certainly could change as the metro space becomes more mature.
Focusing on the inside makes sense for Cisco. This is an area of strength for the vendor, especially with enterprise users. The company can leverage its expertise in enterprise data communications to integrate enterprise femtocells and Wi-Fi into their overall local area networks. Cisco can also provide enterprise-specific managed services over these small cells. An example would be the vendor’s Connected Stadium Wi-Fi solution. And yes, stadiums are a type of industry vertical.
However, Cisco isn’t just relying on its enterprise expertise to push its small cell strategy. The vendor has strong relationships with operators as well. Around a third of its revenues come from service providers. The company is a major mobile packet core vendor, allowing it to help service providers integrate small cells into the overall macro network. This is important when it comes to providing a better end-user experience when moving between the small cell and macrocell environments.
Small cell messaging is a problem for both Cisco and the industry as a whole. The term “small cell” often has a different meaning depending upon the vendor. What is and isn’t included in a small cell discussion can often change.
When Cisco talks about small cells it is using the term in its broadest definition to include Wi-Fi, femtocells, picocells, and microcells. Even there the lines between different categories within small cells can blur, such as high-end enterprise femtocells and low-end picocells. The challenge here for Cisco is that its messaging, while not wrong, doesn’t always line up with what other vendors in the space are saying when those vendors talk about small cells. But this is really more of a reflection of the small cell space than Cisco.
Not every vendor plays in every part of the small cell space. What a vendor includes in its small cell discussions is often driven by what the vendor is selling. Vendors with stronger backgrounds in licensed spectrum radios, for example, at times play down the role of Wi-Fi with small cells. Vendors only focused on pico and microcells often leave out femtocells in their small cell discussions.
The fact is small cells are not a singular thing, but really a grouping of different types of base stations. This is quite the opposite of macrocells, which are a much more singular thing. So with much of the small cell market currently focused on pico and microcells, Cisco can at times get overlooked in the small cell space. That, however, is a function of the market and not the fault of the vendor.
Daryl Schoolar is a principal analyst for network infrastructure telecoms at Ovum. For more information, visit www.ovum.com/