Femto cells to be big?

Ubiquisys has just raised $11m as they expect the Femto cell market to explode.

Why is everyone so surprised? Femto cells in the home using the customer's broadband connection makes sense for the Mobile Network Operators (MNOs) as they remove some of the backhaul requirements which is an incredibly expensive operational cost.

As new data services are launched like HSPDA+ which offer 20Mb/s or so download speeds and eventually LTE (or even WiMAX) the backhaul requirements just get worse.

Currently the MNOs restrict the in-premise cells to just a few users, but in the future it's likely the femto cells will be given away for free, the customer gets "free" or greatly reduced call charges and free or cheap data. However at some point the MNOs will allow 3rd party users on to the cells for calls and data. They can then use in-home cells for micro fill and offloading traffic from the main cell sites.

This only is really practical for 3G femto cells as they will co-operate with neighbouring cells and not interfere on the radio side of things. Unfortunately 2G femto cells still need to be frequency planned which causes a nightmare if they are randomly deployed (unless they have their own spectrum to sit in, which is available in the old GSM Guard Bands - but of the MNOs only O2 has a low power guard band license).

Vodafone have taken the initiative in the UK and it's surely only a matter of time before the other operators follow suit with their own femto cell rollouts.