Upstream Bandwidth Surge in Offing As Femtocells Link Mobile to Fixed

Ralph de la Vega, president & CEO, AT&T Mobility & Consumer Devices

Ralph de la Vega, president & CEO, AT&T Mobility & Consumer Devices

March 26, 2010 – Broadband service providers have a new issue to worry about when it comes to accommodating user demand for scarce upstream resources – mobile data.

What’s in store came into clearer focus this month with AT&T’s announcement that it has launched a femtocell connectivity service for use by its 3G mobile customers nationwide. This follows earlier launches of femtocell strategies by Sprint Nextel, the first to do so in August 2008, and Verizon Wireless, which started offering a femtocell service in January 2009.

But the AT&T move marks a departure from the steps taken by Verizon and Sprint, where the femtocell product they use, the Samsung UbiCell, supports voice and very low-speed (CDMA 1X) data rates. The AT&T unit, supplied by Cisco Systems, operates at full 3G data rates with the capacity to support four online connections at one time.

In all these cases the voice and data communications from a mobile handset in the home links via Wi-Fi to the femtocell and from there to the users’ broadband connection irrespective of who the provider is. And the data rates will be increasing on the Sprint and Verizon femtocells with Samsung’s release of a UbiCell that operates at EVDO data rates (2 1/2G) by midyear.

As previously reported (November, p. 1), femtocells are also an important part of Clearwire’s bandwidth efficiency strategy. And Clearwire’s MSO partners are looking at femtocells as well. The venture has set aside 5 MHz of spectrum to accommodate the fixed usage model, which eliminates the need for dual-mode Wi-Fi/WiMAX handsets. (Dual mode 3G/Wi-Fi is intrinsic to most smartphones.)

Adding to the emphasis on how important femtocells will be as the industry moves to 4G and ever higher levels of data usage were declarations from carrier executives at the CTIA Wireless convention that the ability to offload mobile traffic to fixed Wi-Fi and broadband networks was essential to avoiding cataclysmic congestion on 3G and 4G networks. Despite FCC plans to allocate an additional 300 MHz of spectrum to commercial wireless operations plus another 200 MHz for public safety applications and despite the greater spectral efficiencies promised by 4G, they said the pace of data-driven bandwidth consumption will overwhelm mobile network capacity in a few short years without the fixed offload and other remedies.

“Expansion to 4G is not enough to keep pace with consumer demand,” said Ralph de la Vega, president and CEO of AT%26T Mobility and Consumer Devices, in a keynote address in Las Vegas. “We need to take advantage of Wi-Fi and femtocells. These technologies redirect network demand and they help the industry to enhance its footprint.”

Said Tony Melone, CTO of Verizon Wireless: “It seems like a waste to deploy resources in a mobile network and not take advantage of mobility. If there’s another alternative, that’s what [users] should be doing.”

“Mobility tends to reduce throughput in the network,” echoed Madan Jagernauth, vice president of wireless marketing and product management at Huawei Technologies. “Stationary users have a better experience. Looking at heterogeneous networks is really important. People in stationary positions will be able to off load from the mobility network.”

AT%26T, in announcing its 3G MicroCell service plans, emphasized the enhanced footprint benefits of the femtocell as opposed to the off-load advantages by positioning the device as a solution for households where thick walls and roofs or obstructions from hilly terrain and other outdoor factors “consistently interrupt wireless spectrum.” But the company’s steep $100 rebate on the $149.99 cost of the Cisco Systems-supplied unit, slated for availability by mid April, together with an incentive service rate suggested the offload-to-broadband option was positioned for wide-scale adoption. For $19.99 per month individual or Family Talk customers can make unlimited calls through a 3G MicroCell without using minutes in their monthly wireless voice plan, AT%26T said.
In a recent report on the pace of femtocell rollouts as part of the overall fixed-mobile convergence (FMC) market, Infonetics Research projected that the number of 2G and 3G femtocells sold for use in mobile networks would increase five-fold worldwide from 2009 to 2010 and that sales of security gateways enabling femtocells and dual-mode handsets would rise to over $1 billion in 2013. “We expect at least a dozen major operators to launch [femtocells] in 2010, giving this market a kick-start,” said Richard Webb, directing analyst for WiMAX, microwave, and mobile devices at Infonetics.
Most fixed network engineers have given little thought to the implications of all this as they weigh the impact of market trends on future upstream capacity requirements. Until now the assumption has been that mobile users’ impact through femtocells will be negligible given the low data rates of voice and early generation data traffic.

But the impact of usage could be far greater in light of the surge in data usage and the expanding throughputs enabled by 3.5G and 4G technologies. Already, according to Morgan Stanley’s latest Mobile Internet Report, Web browsing is consuming 32 percent of mobile users’ time and 69 percent of the available bandwidth. The proportions of iPhone and other smartphone users who are accessing music, games, social networking, search, news and video compared to the averages for other users are higher by margins of 4 to 1 or better.

According to a March report by analyst Chetan Sharma, a member of the GigaOM Pro Analyst Network, U.S. data traffic exceeded voice traffic by almost 400,000 gigabytes in 2009, and that ratio is expected to double this year. “Mobile data has definitely become a mainstream phenomenon as subscribers are increasingly relying on their mobile connection to do the things their home PC can,” said David Caputo, president and CEO of Sandvine, the provider of technology supporting network usage monitoring and management.

Citing Sandvine’s new report on Mobile Internet usage from Sandvine, Caputo said, “We observed that mobile users were running similar applications as on fixed networks, including real-time communications such as IM and Skype. With the emergence of more powerful mobile devices, like the iPad, and the ready availability of laptop dongles, more and more users on the go will be foregoing traditional voice in favor of data-centric, bandwidth-intensive applications.”

Sandvine is already getting requests from network operators for measurements of how much mobile traffic is going over their fixed networks, Caputo said. “We can identify when mobile subscribers are using the upstream on a fixed broadband connection,” he noted. “It’s something people are going to want to know.”

Under the existing rules of the game, blocking unwanted traffic is not an option. All the broadband providers can do is adjust bandwidth expansion strategies to ensure this looming surge from mobile data users doesn’t cause disruptive congestion in the years ahead. But, as Caputo noted, at least monitoring the trend lines will provide them some idea of where things are going and what they must do to avoid unwelcome consequences.