Informa &Infonetics: Femtocell market gaining critical mass; # of Small Cells surpass Macro Cells

Image Courtesy of Infonetics

The telecom industry has talked about residential femtocells for years, but the market has not gained traction until recently. One key reason is that many felt WiFi home networks were sufficient for 3G/4G mobile devices. Here’s an article I wrote on this topic over 3 1/2 years ago:

For several years, AT&T has been giving away femtocell equipment to folks buying iPhones in rural areas (like my cabin in Blue Lake Springs, CA where AT&T doesn’t provide cellular service of any kind). The company is said to have almost 1M femtocells deployed in the U.S.

This week, Informa Telecoms & Media issued its latest quarterly small-cell market status report noting that the global number of small cells (nano base stations and femtocells) now exceeds the total number of traditional mobile base stations. This milestone was made possible as mature femtocell deployments start to scale and was best illustrated by Sprint which has now deployed one million femtocells – up from 250,000 in 2011. The report also highlights how new femtocell deployments from Telefónica O2, Orange UK, and Bouygues Telecom over the Summer mean that the UK and France have become the first countries globally where all major operators have deployed the technology. Telefónica O2 has made significant public-access progress with the world’s densest femtocell deployment in east London for the Olympics, as well as the launch of public Wi-Fi in central London which will be upgraded imminently to support licensed small cells.

Dimitris Mavrakis, principal analyst at Informa Telecoms & Media wrote:

“The days of small numbers of expensive cell towers have given way to the era of high numbers of low cost mini access points. Without this change, the mobile network simply could not sustain the continued growth in data usage.

Such a dramatic network transformation opens up interesting new models and over the past quarter the Small Cell as a Service idea has been gaining traction. It allows third parties to build networks that several mobile operators can use, thereby reducing costs and time to market. At the moment, this is being targeted at major operators that are looking for a simple route to establishing a small-cell network as well as smaller players that have found the barriers to entry too high to date.”

For more information on Informa’s findings, please see:  (log-in required)

Also this week, Infonetics Research released its Residential Femtocell Service Strategies: Global Service Provider Survey which is based on interviews with more than 25% of the network operators in the world that have already launched or plan to launch femtocell services by 2013.

The Infonetics report assesses operator needs and analyzes trends in the femtocell market.  Excerpts from that report, follow.


  • The top drivers for offering residential femtocell services are improving mobile broadband and voice within the home, and offloading data traffic from macro networks
  • 29% of operators surveyed plan to offer FD-LTE femtocell services by 2013
  • WiFi, long seen as a competitor to the growth of femtocells in the home, is increasingly being viewed as complimentary by carriers.
  • Service provider respondents project they will have, on average, 211,000 femtocell subscribers by 2013


For its 27-page Residential Femtocell Service Strategies survey, Infonetics asked purchase-decision makers at service providers in North America, Europe/The Middle East/Africa, Asia Pacific, and Latin America about their plans for delivering femtocell services through 2013. Survey participants were asked about current and future femtocell service launches, adoption drivers and challenges, femtocell technologies, service features, add-on services, marketing, advertising, sales strategies, CPE features, form factors, expected service revenue, ARPU, and subscribers.

“Operators are still very much focused on using femtocells to deliver better voice coverage, but our 2012 residential femtocell survey identifies a shift toward a more strategic utilization of femtocells for enhancing the mobile broadband experience and as a means for delivering value-added services like virtual home phone numbers and media file sharing,” explains Richard Webb, directing analyst for microwave, mobile offload, and mobile broadband devices at Infonetics.

Mr. Webb adds, “The business model for more sophisticated femtocell services remains a big question mark. For the market to evolve, vendors need to help operators on pricing and service models so they can drive volumes and enable new service revenue. If it adds up, there’s a real opportunity to leverage the femtocell to put the mobile network at the heart of the home network-something that’s traditionally been beyond the reach of the mobile operator.”

To buy the survey, contact Infonetics:

From a report released last month, Infonetics 2nd quarter (2Q12) Femtocell Equipment market share and forecast report


  • Global 2G and 3G femtocell revenue is up 12% in 2Q12 over 1Q12, and is up 43% from the year-ago second quarter
  • Every segment of the femtocell market—consumer, enterprise, and public access—grew by double digits in 2Q12, with consumer femtocells accounting for more than 1/2 of 2Q12 revenue
  • In 2Q12, Alcatel-Lucent holds on to the #1 spot it nabbed last quarter in the tight race for W-CDMA/HSPA femtocell revenue, with Cisco/ip.access a close 2nd
  • W-CDMA/HSPA 3G femtocell revenue is growing at an 84% 5-year compound annual growth rate (2011 to 2016) and is expected to make up 95% of the 3G femtocell market by 2016
  • Airvana continues to lead the higher-priced CDMA2000/EV-DO femtocell segment, with Samsung easily maintaining the #2 spot

“Double-digit revenue growth returned to the femtocell market in the 2nd quarter following a minor seasonal dip the previous quarter,” notes Richard Webb, directing analyst for microwave, mobile offload, and mobile broadband devices at Infonetics Research. “The combination of attractive product feature sets and price points, wider service availability, a growing customer base, and rising shipment volumes is proof positive that the femtocell market has long-term viability.”

To purchase this or other Infonetics reports, contact Infonetics sales:

Clarifications and Closing Comments:

  • A key distinction between femtocells and small cells  is that the latter includes nano-base stations as well as residential/ enterprise femtocells and even femtocells deployed as hotspots (if any).  Femtocell work is now done in the Small Cell Forum.
  • Residential femtocells use the wired broadband connection in the home (e.g. Comcast/Xfinitiy cable modem, VZ FiOS  or AT&T U-Verse residential gateway).  In many cases, the residential wireline broadband provider is NOT the same as the cellular provider that’s sells or gives away the residential femtocell.  For example, AT&T gives away femtocells in rural areas in CA where Comcast offers high speed, cable based Internet access.   In that case the broadband provider will carry more and more cellular broadband traffic without being compensated for it.  Surprising the MSOs haven’t complained about this yet to the FCC.
  • One huge problem with deploying nano-base stations is they all need backhaul- perhaps to an aggregation node that’s fiber connected to the ISP/service provider PoP.
  • Here’s the report of the Oct 2012 IEEE ComSocSCV meeting on Mobile Backhaul:

ComSocSCV Oct meeting on Mobile Backhaul: Significance of LTE, Small Cells, Macro Cells and Market Forecasts!

0 thoughts on “Informa &Infonetics: Femtocell market gaining critical mass; # of Small Cells surpass Macro Cells

  1. Thanks Alan for posting this article.

    Reading this reminded me of the outdoor WiFi hotspots that Comcast are placing on their outside cable plant. While providing increased utility to their broadband package, this could conceivably serve the needs of nomadic people quite well and with VoIP apps could eliminate the need for a wireless plan altogether for that group (e.g. Outdoor WiFi hot spots near bus stops, parks & schools could serve probably 95% of a students’ broadband needs – I know I am thinking of this as a phone alternative for my kids).

    It also makes me wonder if, as part of their partnership with Verizon Wireless, the large cable operators will begin deploying Femtocells – either outdoor or indoor – as part of an off-load strategy.

    1. Ken, Thanks for your comment. Haven’t read or heard anything about cablecos/MSOs deploying femtocells. Probably cause they do NOT operate their own cellular network, so no need to “offload traffic.”

      However, there’s a cable Wi-Fi roaming agreement between Comcast, Time Warner, Cable Vision, Bright House, and Cox called “CableWiFi.” With CableWiFi, high speed Internet subscribers (i.e.cable modem based) to any of those five cable operators will be able to access the Wi-Fi hotspots of the other operators when they are outside their home network city. This allows each cable operator to effectively expand the number of Wi-Fi hotspots available to their subscribers, while limiting the number of sites they have to actually build and manage on their own.

      I would expect any cellular carrier offering 3G+/4G to face capacity constraints and offer both “carrier WiFi” hot spots as well as residential femtocells.

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