IHS: Asia Pacific fueled 26% growth in small cells in 2016

small cells
IHS predicts the small cell market will reach $2.2 billion by 2021.

Asia Pacific helped fuel a small cell market that grew 26% year over year in 2016, reaching $1.5 billion, according to fresh data from IHS.

A total of 1.7 million small cell units shipped last year, marking 43% year-over-year growth, and Asia Pacific claimed 59% of all shipments. North America was the No. 2 market for small cells, followed in order by Europe, the Middle East and Africa, and the Caribbean and Latin America.

Indoor unit shipments outpaced outdoor shipments last year, IHS said, as operators focused on enterprise and public venue deployments to deliver consistent network performance of voice and data.

“Much of the growth was driven by an increase in rural and remote deployments – as well as strong indoor small cell activity from the enterprise and urban segments, which are seeing an increase in public venue deployments,” IHS said in a press release. “For the first time ever, the volume of indoor units surpassed those of outdoor in 2016.”

IHS predicted the global small cell market will grow at a compound annual growth rate (CAGR) of 8.4% from 2016 to 2021, reaching $2.2 billion. But while shipments of outdoor small cells will be “much smaller” than those of indoor cells, the outdoor market will generate more revenue because they are more expensive per unit.

While the segment has generated a significant amount of hype, small cell deployments have been slowed by a lack of uniform processes, haphazard deployments and a wide variety of citing and zoning issues at the local level, including complex rights-of-way headaches. CTIA earlier this month urged the FCC to adopt policies that make it easier for carriers and their partners to deploy small cells in municipalities across the country, and at least one research firm believes the agency is likely to lend a hand.

Carriers are increasingly looking to small cells to densify their networks and fill in coverage gaps, particularly in urban areas. That dependence is likely to grow as they begin to roll out 5G technologies and services to meet soaring demand for mobile data.