June 27, 2017 —
An analysis of the small cell market conducted by Mobile Experts concludes that the market is evolving rapidly. Kyung Mun, a senior analyst, said small cells will become an integral part of mobile networks as operators make the move toward hyperdense networks with 5G services.
Technology choices range from frequency-division duplex/time=division Long Term Evolution (FDD/TD-LTE) modulation, unlicensed and licensed-assisted access LTE (LTE-U/LAA), LTE and wireless local area network aggregation (LWA), Citizens Broadband Radio Service (CBRS), and even carrier Wi-Fi (self-organizing and self-optimizing Wi-Fi). The study found that although major mobile infrastructure suppliers, including Ericsson, Huawei and Nokia, take larger shares of the carrier outdoor segment through macro-parity small cells that take advantage of macro footprints, smaller companies, such as Spidercloud and Airspan, are finding success in enterprise and indoor segments at several Tier 1 mobile operator accounts.
By 2022, Mobile Experts predicts small cells’ revenue to triple, reaching more than $4.5 billion over the forecast period. Mun said that although the overall market includes residential femtocells, the growth for nonresidential small cells is more dramatic.
“We expect carrier and enterprise segments to grow at more than a 30 percent compound annual growth rate from 2016 to 2022,” he said.
DAS and Wi-Fi
The long-suffering mobile network and Wi-Fi service at the Las Vegas Convention Center now works well, thanks to an $18 million upgrade by Cox Business and InSite Wireless Group.
Hugh Sinnock, vice president of customer experience for the venue operator, the Las Vegas Convention and Visitors Authority, said the indoor DAS and Wi-Fi system boasts more than 2,200 access points and a capacity equal to 14 cell towers. During the International Wireless Communications Expo (IWCE) conducted in March, Sinnock spoke about the installation.
September 19, 2014 — Recent estimates of 1 percent cell site growth in a CTIA survey may seem underwhelming, but to understand the health of the tower industry you should look at the revenue per cell site, which is going up at a muscular pace with both amendments and collocations increasing, according to Jennifer Fritzsche, managing director in the Equity Research department at Wells Fargo Securities.
Fritzsche gave the track chair address at the Tower and Small Cell Summit last week in Las Vegas, where she drilled down and shared her analysis of wireless infrastructure deployment activity at all four major carriers.
“While small cells will show a higher growth rate, we believe macrocells will continue to increase in absolute numbers,” Fritzsche said. “AT&T, when it announced Project Velocity IP in 2012, said it would add 10,000 macrocells. While Verizon has not confirmed it, it will have as much growth or more. It is the consistent spender in the industry.”
Verizon Wireless is well into its 4G network deployment with 308 million LTE POPs in the 700 MHz band, more than 500 markets with LTE coverage, and 76 percent of total data traffic on its 4G LTE network. But it’s not done yet.
“The Verizon Wireless CFO says don’t expect wireless capex to come down anytime soon, even though they are — quote-unquote — done with the LTE build out,” Fritzsche said.
“Verizon is known for the quality of its network,” Fritzsche said. “It has been very aggressive with its backhaul. Sources say they are aggressively deploying dark fiber to the cell sites, which gives them more control and they can light them up as they see the demand.”
Their future network plans are definitely focused on network densification, investing in small cells, DAS and in-building coverage. They plan to deploy LTE on 1700-MHz and 2100-MHz AWS spectrum, and their stated goal is to deploy VoLTE by the end of the year.
“Even Verizon’s LTE network covers more than 308 million LTE POPs [U.S. population equals 310 million], the Verizon CFO says the wireless capex will not come down any time soon, even though the LTE build out is completed. It speaks loudly to the densification that has yet to occur,” Fritzsche said.
AT&T has LTE coverage of 300 million in population on 700-MHz spectrum and more than 600 markets with 4G LTE coverage. Two-thirds of its postpaid smartphones are LTE-capable devices, and 84 percent of postpaid subs use a 4G-capable device.
In the future, the carrier plans to deploy LTE on Advanced Wireless Services and Wireless Communications Service (2.3 GHz) spectrum. It has already begun refarming the 1900-MHz Personal Communications Service spectrum. Additionally, it will begin rolling out LTE Advanced carrier aggregation technology later in 2014.
“There have been a lot of questions about the stops and starts of capital spending at AT&T,” Fritzsche said. “I think we have to look at the fact that they spent more than what was expected in the first half of this year. The guidance is for $21 billion in capex in 2014. To state the obvious, that is a huge number. I don’t see AT&T backing away from its investment in wireless or their commitment to their network.”
Sprint is catching up with the other carriers, with coverage of 255 million LTE POPs in 500 markets. A key part of its strategy is the deployment of Spark in major markets, using the old Clearwire spectrum at 2.5 GHz. The company has set its guidance for 100,000 POPs of 2.5-GHz Spark coverage by the end of 2014. It should complete to rollout LTE on 800-MHz spectrum by year-end 2015 and on 2.5 GHz over next 3 years.
“Sprint is my wild card company,” Fritzsche said. “The Network Vision deployment has been a hard slog for Sprint, but hopefully we are seeing the light at the end of the tunnel.”
The iPhone 6, which was announced during Super Mobility Week, is the first Apple handset to operate on 2.5 GHz and holds the key to unleashing the power of Network Vision, according to Fritzsche.
“With 2.5 GHz being the cornerstone of Sprint’s strategy, this phone is a really big deal. Essentially, Sprint can now move iPhone users from a 5×5 channel for LTE to multiple 20×20 channels. This is a game changer for Sprint,” she said.
Sprint also launched an unlimited data plan with no throttling for $50 a month and a leasing arrangement for $20 a month. The question is when there will be a network to back up that subscriber plan. Fritzsche called the plan “transformational.”
T-Mobile has 233 million LTE POPs on AWS spectrum, 325 markets with 4G LTE coverage and nationwide VoLTE coverage over 200 million POPs.
“You have to give T-Mobile credit, a lot of credit. I have learned that it is a mistake to bet against Neville Ray [T-Mobile CTO],” Fritzsche said. “Since the breakup of the AT&T merger and with rumors of a merger with Sprint flying back and forth, T-Mobile has quietly built a very good network. The MetroPCS merger has proven to be a very logical move.”
Future network plans for T-Mobile include covering 250 million LTE POPs by year-end 2014 and more than 280 million POPs by mid-2015. It has begun the 700-MHz A block rollout, and 60 percent of its MetroPCS spectrum needs to be re-farmed and integrated. Additionally, wideband LTE is being deployed on 15×15 and 20×20 channels.
“I don’t expect most of this deployment to be done until the end of next year, so maybe the iPhone 7 will be able to operate on T-Mobile’s spectrum in the 700-MHz A block,” Fritzsche said. “T-Mobile has the easiest spectrum position footprint, because it is not bringing in a really high band spectrum.”
In addition to completing Network Vision, which is set for mid-2014, Sprint has commenced deploying LTE technology on its 800-MHz spectrum and has set out a plan to deploy LTE on some of its Clearwire sites and to decommission others, according to the annual SEC filing, dated Feb. 16, of the carrier.
At the time of the Sprint acquisition, Clearwire had WiMAX technology deployed on 17,000 cell towers and was in the process of deploying LTE technology on 5,000 of these sites, which has been completed. Sprint plans to expand LTE deployment to 5,000 more Clearwire sites and to decommission 6,000 redundant sites.
“We expect to decommission and terminate the underlying leases. We expect lease exit costs recorded in future periods associated with these sites to range between $50 million to $100 million on a net present value basis,” Sprint wrote. The WiMAX system will be turned off by the end of 2015.
The majority of the LTE roll out in the 800-MHz and 2.5-GHz spectrum bands is to be completed by the end of 2015. Sprint will introduce its Spark Tri-band (800 MHz, 1.9 GHz and 2.5 GHz) phone to correspond with the multi-band LTE roll out. The overall network modernization effort consolidates and optimizes all of Sprint’s spectrum into each base station. The Network Vision project commenced in late 2011 and includes the deployment of enhanced 3G and 4G LTE technology at the carrier’s 38,000 sites.
“The cost to complete these initiatives to modernize our network will be significant. We expect capital expenditures of approximately $8 billion in 2014,” the carrier wrote.
Additionally, Sprint is modifying its existing backhaul architecture to increase the capacity and lower the cost by using Ethernet as opposed to our existing time division multiplexing (TDM) technology.
“We expect to incur termination costs associated with our TDM contractual commitments with third-party vendors ranging between $175 million to $225 million, the majority of which we expect to record through the first quarter of 2016,” the carrier wrote.
By Morgan Kurk…
As 2014 rolls in, the continued implementation of LTE and the ongoing data boom mean that for most wireless operators, modernizing and enhancing the capacity of their networks with the most efficient architectures and equipment possible will be a major focus. Increasing network capacity intensifies the focus on metrocells and indoor coverage. With this in mind, let’s take a look at what will be the biggest and most important wireless infrastructure trends of the next 12 months.
The newest focus in the wireless industry globally is LTE. GSMA Intelligence expects the number of LTE connections worldwide to pass one billion by 2017. As the world’s population begins to access the Internet at the speeds available on LTE, there will be no turning back. Operators will be forced to quickly update and fortify their networks. Operators must ensure that their network evolution is well architected and accurately implemented to provide the exceptional experience that is 4G LTE to their customers.
Prior generation systems such as GSM were designed in a voice-only era and have aged as much as 20 years. As such they are not very efficient when delivering data. Forward-looking operators who are not deploying LTE yet will use 2014 to update their network equipment and architecture, preparing their networks for the arrival of 4G. Central to this preparation will be shifting to a remote radio architecture that will put much of the radio function on the top of the tower. This design replaces traditional coaxial runs with hybrid fiber optic and power cable, which is used to connect the remote radio heads at the tower top to the baseband units that remain at ground level. Advanced multiband and multi-technology capable antennas will be connected to the radio heads, improving performance and increasing power efficiency while servicing 2G, 3G and 4G simultaneously.
Implementing such technologies to modernize the wireless network is a sound investment for improving operating expense in all of its forms, from energy efficiency to maintenance, while improving reliability and preparing for an LTE rollout.
Bigger focus on small cells
Wireless operators will continue to increase their focus on “small cells” in 2014. This term is defined as everything that is not the macro cell. We further break it down into the metro (or micro) and indoor layers of the network. These layers are designed to significantly increase capacity by moving closer to the mobile device, working in conjunction with rather than in competition to sector splitting on the macro layer. The indoor layer of small cells may include pico and femto radios, distributed antenna systems and low power remote radio heads, while the metro layer is made up of microcells and medium power remote radio heads. Operators will place more focus in 2014 on how to most efficiently deploy and integrate small cells in more buildings and urban centers where increased use is dramatically slowing the network. With the proliferation of data intensive devices like smartphones and tablets, focusing on how to offload traffic from the macro site will become increasingly important in 2014.
Inside becomes the new outside
The increased focus on indoor coverage may ultimately compel operators to trial a whole new approach to their network, which I call the “inside-out approach.” Historically, operators deployed wide area macro sites and eventually worked their way indoors on an ad-hoc basis, starting with the most heavily used areas such as airports and arenas. With the recognition that more than 70 percent of mobile sessions occur indoors, operators will take a fresh look at how best to architect their networks. The inside-out approach will likely start in the heavy traffic areas indoors, where the exception rather than the rule is being on the macro network. The first trials of using indoor sites to cover outdoor areas as part of an inside-out architecture could occur in a large city in 2014.
Morgan Kurk is senior vice president, Wireless, CommScope.
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