Reality Check: LTE-Advanced Business Impacts
The Small Cell concept is quite a hot potato. Vendors are naturally trumpeting the concept – selling more boxes fits their agenda very well. Refreshingly we also have some new challengers e.g. Airspan in the market putting pressure for the big ones E///, HWI, NSN, ALU and the like.
But in my view this not just fancy marketing. Operators can really improve business with Small Cells, provided that planning and decision making processes are intact.
If you already didn’t know, Small Cells are low-power base stations with limited radio footprint of few tens of meters. They can be used to improve overall network quality and to fill coverage holes in macro layer in a rather efficient fashion.
Small cell deployment approach can be pinpoint or clustered, indoor or outdoor, or fill a coverage hole in a macro layers. It’s a very versatile concept facilitating quite ingenious network solutions.
If more capacity – and new cells – is anyway needed, why not put the cells exactly where the people are? That’s the fundamental philosophy of Small Cells.
Small Cells increase network capacity and offload macro traffic, thus improve overall network quality and performance. Small Cells offer several benefits compared to macro base stations:
The concept of Small Cells has been around since GSM, but now with LTE-A it seems to start picking up real moment.
LTE-A eases the management burden related to operation of Small Cells (micro, pico, femto cells) alongside the macro layers. It facilitates quick deployment of improved coverage and capacity. This can be achieved by
With LTE-Advanced, Small Cells can be operated as independent base stations or managed by a centralised macro base station responsible for radio resource management. Latter option allows for exploiting important LTE-A functionalities such as Interference Management and Carrier Aggregation.
LTE-A and Small Cells also allow for exploiting several new features such as Cell Range Expansion (CRE), Interference Coordination (eICIC), Carrier Aggregation (CA), and Coordinated Multipoint (CoMP). All of these features are fully applicable in Small Cell context.
SON (Self-Organising Networks) features have also evolved significantly. SON eases the operation and management burden of small cell architectures down to tolerable levels.
If you are interested to learn more about the LTE-A specifics, you could google for a couple of more abbreviations: CSG, HeNB, RN, HetNet, TDD, X2, ABS, feICIC, 256QAM.
You don’t need to know all of these gimmicks in and out, but it’s good to know that the Small Cell concept is well tackled with LTE-Advanced.
New sites cost. Transmission costs. O&M costs. It can be difficult to make the equation work if planning is not thorough enough. Increased site count also results in increased OpEx. Warning, Business Case challenges ahead!
Deployment location defines needed small cell type, site acquisition, site works, backhaul, options, transport solution, deployment method and costs. Needless to say, finding the optimum solutions is complex and the appropriate solution will vary per location.
Deployment environment defines the selected topology and transmission type for wireless backhaul. Topology can be point-to-point (P2P), point-to-multipoint (P2MP) or multi-hop and. Radio type can be NLOS, nLOS, LOS. All having their own pros and cons in terms of propagation, capacity and cost.
When deploying Small Cells, it’s better to evaluate all possible solutions. Some of them typically result in better business results than others.
Just as a side note, easy deployment has one minor disadvantage too. It’s rather easy to deploy Small Cells in excessive numbers and eventually kill the business case with complexity.
In my experience, cost-efficient small cell deployment eventually boils down to selecting the optimum locations. That’s the very decision point which basically defines pretty much the profitability.
The locations need to be defined based on traffic levels, growth predictions, existing coverage, available capacity and desired service level targets – and of course business objectives. Deployment location defines the deployment cost, transmission cost, revenue base and thus the whole business case.
To finally justify the Small Cell investment, the number of served subscribers needs to be sufficiently high. This can be ensured only by carefully selecting the deployment locations taking into account the revenue potential and churn potential. In Omnitele we talk about Value Based Network Expansions – a service concept we deliver with our Data Analytics.
Eventually, my main message for operators considering Small Cell deployments is:
So nothing new compared to traditional network deployment strategy. Better to keep the basics intact, that’s always a good strategy!
My two cents of Small Cells and LTE-Advanced,