Study: Small cell market to hit $2B by 2016, driven by capacity needs

Operators looking to improve mobile broadband coverage and capacity will drive the small cell market in the years ahead, with three million small cells being shipped by 2016, valuing the market at $2.1 billion (€1.58 billion), according to a new year-long study conducted by Infonetics Research.

Alcatel-Lucent's 9363 Urban Metro Cell at the Gare du Nord train station in Paris.

"Mobile broadband is shifting the game to capacity upgrades," Stéphane Téral, principal analyst for mobile infrastructure and carrier economics at Infonetics. Téral notes that the major objective for operators is to complement and enhance the macrocell layer from a capacity standpoint with a new breed of low-power nodes like public space femtocells and Wi-Fi hotspots.

The report looked at microcells, picocells, and public space femtocells made by infrastructure vendors Alcatel-Lucent, Ericsson, Huawei, Nokia Siemens Networks and ZTE as well as small cell specialists, including ip.access, Contela, Juni, Minieum Networks, Ubiquisys and others.

"But dividing the macro layers into smaller cells remains challenging due to inter-cell interference and backhaul issues. The question is: how small can the cell be? Because the smaller the cell, the higher the number of units required to cover an area, and that will determine the true size of the small cell market," he said in a statement.

The study, which Infonetics stressed is "not a pie-in-the-sky, new-technology-honeymoon forecast," and was developed after a year of research by Infonetics. Infonetics maintains that early femtocell adopters such as AT&T, Softbank, and Vodafone and macro network density will decide which regions represent the largest small cell opportunities. Asia Pacific is expected to lead the small cell market with 44 per cent of all units shipped in 2012, followed by EMEA with 32 per cent.

Other highlights of the report include:

  • For the next three years or so, most operators are planning small cells only in the urban core.
  • Infonetics expects public space femtocells to make up more than 50 per cent of all small cells shipped in 2012.
  • In 2013, Infonetics expects 3G small cells to make up 63 per cent of global small cell shipments, with LTE small cells kicking off and ramping up rapidly to make up 37 per cent.
  • LTE small cell shipments will overtake 3G small cells by 2015.

For more:
- see this Infonetics Research release

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Small cells eclipse interest in macrocell offerings - Mobile World Congress 2012 Scorecard
Study: Adoption of small cells and public space femtocells gathers pace
FT Orange readies launch of Hotspot 2.0 services
Telefónica's O2 hits back with free Wi-Fi calls
European operators embrace Wi-Fi offloading with a hint of caution
Picochip argues London LTE coverage needs 70,000 small cells

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