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T-Mobile eyes hotspots and Sprint femtocells

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The need for new tariff structures and better indoor penetration to support quad play applications is driving the current intense interest in femtocells (miniaturized indoor base stations about the size and range of a Wi-Fi access point, but integrated with the carrier network and under the carrier's control).

Majors like Ericsson are starting to enter the fray, indicating that the tier one carriers are also starting to show a real commercial interest. Wi-Fi/cellular integration using techniques like UMA (Unlicensed Mobile Access) has dominated indoor/outdoor convergence efforts in the past two years, and will remain popular with operators like T-Mobile that have heavy investment in Wi-Fi. But the superior control that operators gain from femtocells is now attracting many big names towards trials, especially as this approach promises better evolution to IMS and all-IP, plus the usual benefits of indoor penetration and offloading of traffic from the main network. Telefónica O2 will be among the pioneers, but as so often, the industry, particularly its CDMA and WiMAX portions, is looking to Sprint Nextel for a lead in a new technology.

Sprint recently issued a request for proposals for 'low cost internet base stations', which fleshes out its earlier general comments about using picocells to improve coverage in office buildings and other complexes. It is essential, if Sprint Nextel's WiMAX-based services are really to be clearly differentiated from those on 3G, that they support strong indoor penetration, and therefore genuine convergence between mobile and home services, going well beyond the cellphone to embrace delivery to set-top boxes and future devices. To achieve this, the operator would need to make a significant investment in microcells and femtocells to make this convergence into a consumer play across its whole proposed coverage area, rather than just a method to improve quality within large buildings such as malls.

It is not clear whether these miniature stations would be specific to the proposed WiMAX network or would also support the CDMA EV-DO system. In the latter case, companies with a CDMA heritage would be hopeful of making the shortlist - Airwalk and Airvana spring to mind among the specialists, and could net a partnership with a larger Sprint supplier without its own femtocell offering. Among the equipment makers currently supporting Sprint's WiMAX and EV-DO build-outs, Nokia plans to use RadioFrame's UMTS product but has not indicated plans for WiMAX femtocells; Alcatel Lucent has been working with ip.access; Nortel has not shown its hand; Motorola has its own product in the shape of the AXPT and is likely to adapt current products for 802.16.

The most hopeful of the majors currently must be Samsung, which recently unveiled its Ubicell in CDMA and UMTS variants, and is said to be working on a WiMAX implementation. Samsung says Sprint is currently trialing UbiCell on its EV-DO network, which could be a blow to RadioFrame, which is an incumbent supplier of indoor/outdoor iDEN base station units at Nextel.

Although its recent expansion into femtocells has focused on GSM, it is also promising a WiMAX product, and will hope to build on its existing contacts within Sprint Nextel. Radioframe talks up several claims that will be relevant to Sprint - the prospect of a $100 price tag, bringing femtocells into line with Wi-Fi access points, and a highly scalable 'collapsed base station architecture' that could potentially support millions of femtocells. This architecture collapses the functions of much of the radio management into RadioFrame's picocell and femtocell base stations at the edge of the network allowing a virtually unlimited number of stations to connect to the core. This is also a concept in advanced development at Alcatel Lucent with their Base Station Router platform, already adopted by Japan's Softbank, which can work with third party femtocells such as those from ip.access.

The prospect of tier one carrier contracts for hundreds of thousands of femtocells in the 2008-2010 period will also lure new chipmakers into the sector. The UK's PicoChip is currently the strongest contender, powering many of the early products, (and with CDMA capability through an alliance with Global Wireless Technologies of New Jersey, but the big names will soon start piling in too.

A possible Sprint deal will pique Qualcomm's interest, especially if it decides on a major CDMA component - the giant has already hinted at plans for a femtocell for CDMA2000 and for multiple radios. RadioFrame is developing its own architecture, OmniFrame, and Texas Instruments' plans are also being closely watched.

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