Date: 23/01/2012

Femtocell market 2012: Revenues to double

Market researcher Infonetics has reported worldwide revenue from 2G and 3G femtocells (also called small cell or picocell base station) used in consumer, enterprise and public spaces grew 9% sequentially in the third quarter of 2011, with 2G femtocell revenue declining and 3G femtocell revenue ramping.

The other finding shared by Infonetics includes:
1. Year over year (3Q10 to 3Q11), global femtocell revenue is up 37%.
2. W-CDMA/HSPA femtocells accounted for 72% of all femtocells shipped in 3Q11.
3. 4G LTE femtocells are expected to start shipping in late 2012.
4. Femtocell market leader Airvana is the first to break through the US$25 million quarterly revenue threshold, expanding its revenue market share lead significantly.
5. The Cisco/ip.access partnership maintains its lead in terms of femtocell unit share, and increased its quarterly femtocell revenue to its second-highest level to date, but did not gain revenue market share as other players also posted notable gains, including Huawei and NEC/Ubiquisys.
6. A growing number of operators are offering free femtocells to their consumer subscribers, including SFR France, Softbank in Japan, and Cosmote in Greece.

Infonetics also shared the below highlights from its market survey on Femtocell market:

1. 83% of mobile operators interviewed by Infonetics have already deployed small cells (predominantly microcells and picocells), and the remaining will deploy them by the end of 2012, a qualification for participating in the survey.

2. In-building coverage and data optimization are the top-rated drivers for operators deploying femtocells/small cells, followed by the non-expandability of the macro network due to the increasing difficulty of adding new cell sites.

3. Although 61% of the operators see potential interferences with the macrocell network as the top technical challenge when deploying small cells, only 50% rate it a strong barrier to adopting small cells.

4. The percentage of mobile operators deploying public space femtocells (also called "metro femtocells") is growing from 28% in late 2011 to 44% in 2012 to improve mobile coverage and capacity in large areas of high footfall, such as retail malls, airports, and public buildings.

5. The rise of carrier-WiFi (SIM-based WiFi access points that enable seamless handover between WiFi and cellular networks) could inhibit the opportunity for public space femtocells for offloading data from the macro network.

"This year the femtocell market will scale up significantly and break out into clearer market segments: consumer, enterprise, and rural and metro public space femtocells. As price points continue to come down, we expect to see global femtocell revenue nearly double this year while unit shipments grow at nearly 140% compared to 2011," predicts Richard Webb, directing analyst for microwave, mobile offload and mobile broadband devices at Infonetics Research.