Small cells: the only way to 5G

Telecoms.com periodically invites expert third-party contributors to submit analysis on a key topic affecting the telco industry. In this piece Bernhard Pussel, Director of Operator Channel, Colt Technology Services, argues that with ever increasing demand for capacity, small cells are key in the future of 5G.

It’s been estimated that the volume of global monthly mobile data traffic will exceed 15 exabytes by 2018. LTE is already proving to be a major bandwidth hog. While 4G represents only a fraction of mobile connections today, it accounts for at least 30% of mobile data traffic, thanks to a surge in high-bandwidth content such as video calling and music streaming.

Yet, the growth in bandwidth demand is not only about smartphones, tablets and other mobile computing gadgets. The sales of these devices are set to reach 2.4 billion units this year, but other types of connected ‘things’ will require their share of the already stretched networks too. Industry analysts have estimated that the number of wireless connected things will exceed 16 billion in 2014, up 20% from the year before. This growth is set to continue as the Internet of Things gathers pace, with more than double the number of connected devices – 40.9 billion – forecasted for 2020.

As existing 3G and 4G networks struggle to cope with the influx in data traffic, mobile operators are looking at solutions to offload traffic from their current base station networks. Small cells will be their solution of choice – so the number of small cells networks deployed across Europe is going to increase dramatically over the next few years. Small cells that are connected to city-wide superfast fibre networks will be the most economic and scalable way of ensuring that the needs of mobile users for more and more bandwidth are met in the future. Small cells will also be an enabler for the Internet of Things, paving the way for more connections than ever before.

Shortcomings of rooftop base stations

Today’s badly congested 3G and 4G networks rely on rooftop base stations. Many operators have been scrambling to acquire enough rooftop space for LTE, but still 4G networks don’t often meet their bandwidth hungry customers’ expectations, especially in dense urban areas such as pedestrian zones. While filling rooftops with base stations might have been a good solution for 3G, in the LTE era, the cells are becoming smaller, and mobile operators need ten times more base stations to cover the same footprint of a city.

Imagine a situation today where you have five people waiting for a bus, all with a brand new 150 mbps iPhone 6. The existing rooftop base station infrastructure is not able to cope with the sudden surge in bandwidth demand, as all five try to read the news, order groceries or download a restaurant menu, at the same time.

Recognising the need for faster evolution of mobile networks, the European Commission has committed to investing up to €700 million for the developments of ‘ubiquitous 5G communication systems’. This funding is part of a joint public and private sector initiative that aims to overcome today’s data traffic challenges. The ambitious goals of this 5G initiative include increasing wireless area capacity by a factor of 1,000 compared to 2010, creating a high-bandwidth network with 0% downtime, and enabling the roll-out of very dense wireless networks that are able to connect over 7 trillion devices amongst 7 billion people.

Getting ready for the future

As mobile operators gear themselves up for 5G, many of them realise that they can no longer rely on rooftop base stations. Why would a customer splurge on a 5G contract and a 5G-ready smartphone, if they aren’t able to get superfast download speeds? Instead, they will go to an operator that is able to give them the capacity they crave.

To eliminate the well-known capacity problems with rooftop base stations, future proof their networks and stay competitive, more and more European mobile operators are starting to tap into small cells. They are realising only small cells connected to fibre can bring mobile users the great user experience they expect on their LTE-enabled superfast mobile devices – down at street level where it really matters. When connected to fibre networks, these small cells can collectively deliver up to Gigabytes per second of capacity, making entire cities 5G ready in a cost effective way.

The mobile operator community has been talking about the potential of small cells for a couple of years, but up until recently, the size of the boxes prevented their widespread use. All leading networking vendors have invested in the development of more suitable equipment, so the technology is now ready to allow mobile operators to start planning their roll-outs in earnest.

To be able to roll out faster than their rivals, many European mobile operators are now starting to buy space on lampposts, billboards, bus stops or even public toilets, and equip them with  small cells.

Small cells – the only way to 5G

Still in recovery from the substantial investment needed for 4G, some cost-conscious mobile operators might be tempted to tighten the purse strings with small cells to protect their margins.

Yet, they really don’t have a choice but to invest. If they don’t, they will lose customers. It’s as simple as that. Why would a user buy a top of the range LTE-enabled smartphone or smartwatch, if they aren’t able to make the most of its superfast download speeds – unless they are standing on a rooftop? Instead, they will get their device from an operator that is able to give them the capacity they crave.

Other small cells-ready players aren’t the only competitive threat for mobile operators. Street furniture providers might eat into the profits of those mobile operators who drag their heels over small cells too. Through city-wide wifi schemes, street furniture companies are eliminating completely the need for mobile users to use their operator for data in some cases. Why would a mobile user pay a premium for patchy 5G connectivity, if they can get better speeds and coverage with free wifi?

In any way you look at it, 5G will only materialise with small cells connected to existing superfast fibre networks. And all European mobile operators’ competitiveness – and survival – will rely on 5G.

 Bernhard Pussel works as Channel Director for the Operators at Colt’s Communication    Services unit. Prior to joining Colt in March 2007, Bernhard held several management,      senior sales and senior service management roles both in the Telecommunications and  IT industries. Bernhard also serves as Executive Chairman at the “Digital Hub  FrankfurtRheinMain e.V”.