Femtocells can provide coverage and capacity for 4G LTE networks by functioning as very small cells deployed in large numbers. A case study of deploying femtocells in New York City found they could reduce total capital expenditures by 63% and network operating expenses by 45%, lowering the total cost of ownership by 58% over 10 years compared to a network using just macrocells and microcells. While femtocells provide significant cost savings, deploying the hundreds of thousands needed requires addressing challenges around network management and consumer adoption.

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The Economic
Impact of
Femtocells
on the
4G LTE Business Case
By Haig Sarkissian
March 4, 2014
Barcelona

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› How can Femtocells add coverage and capacity?
› Very small cells in very large numbers
› Building an effective business case for HetNets
› Assumptions
› Impact on 4G Business Case
› Sensitivity Analysis
› Opportunities for Mobile and who are also Cable
operators
2
… Agenda…2

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Hideo
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Femtocells for coverage and capacity

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Critical Questions
› Can Femto Cells be used to provide meaningful
coverage and capacity
› What do Femto cells cost?
› Who pays for Femto equipment?
› Who pays for Femto installation and backhaul?
› How many Femtos are needed per square km?
› Can you deploy Femtos without SON?
› Can Femtos form a primary network?
› Business Case Impact of Femto?
7 … Why Femtos?

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Proposed Answers
› Can Femto Cells be used to provide meaningful
coverage and capacity? Perhaps!
› What do Femto cells cost? US$30 – US$100
› Who pays for Femto equipment? MNO
› Who pays for Femto installation and backhaul?
Consumers
› How many Femtos are needed per square km?
Many!
› Can you deploy Femtos without SON? No!
› Can Femto form the primary network? No!
› Business Case Impact of Femto?
8 … Why Femtos?

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Femto Case Study
9

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Introduction to WiROI™
› 4G Operator Business Case Tool
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› 10 Year Business Case
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Analysis and “What If” Scenarios
› Build a comprehensive business model
… WiROI…

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WiROI™ Research Analysis
Case Study – NYC Femto Analysis
12

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Baseline: NYC – Dense Urban Case Study
13
New York City
8.1 million Population
LTE using AWS (1700MHz)
10+10MHz Channel
Coverage 789 sq km
3.8 Million 4G subscribers
376 Coverage Sites
6,327 Capacity Sites
Cumulative CAPEX $1.6B
Cumulative OPEX $2.7B
TCO $4.3B
› Assumption: LTE
deployment in Urban,
NYC market, USA
› Activity: Simulate TCO
impact of implementing
Femto Technology
› Identify: The scenario for
optimal financial return
› Analyze: Understand
main drivers of the
results
… NYC Case Study …

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… LTE Coverage & Capacity
Cells – Microcells…

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… LTE Coverage & Capacity
with Femto …

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Femto ECONOMICS
18

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Cum CapEx baseline

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Cum CapEx with
Femto…

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Network OpEx baseline

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Network OpEx with
Femto…

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TCO baseline

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… TCO with Femto …

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Summary and Conclusions
25 … Why Femto?

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LTE Baseline
With Femto
Deployment
Delta % / $
Total CAPEX $1,616m $597m 63.1% / $1019m
Network OPEX $683m $373m 45.4% / $310m
Network TCO $2,299m $970m 57.80% / $1,329m
… NYC Market Results …
› To provide coverage and capacity using LTE Micro Cells
› 376 Small Cells for Coverage and for Capacity in year one
› By year Ten, 6,327 Small Cells are needed for Capacity
› If Femtos were deployed – we would need 1,725 Small Cells by year 10
› We would also need ~200,000 Femto cells (6% penetration) of 3.3m subs
›
› Network OpEx savings of 45%
› Value derived per Femto = $6,645 of Cumulative Savings over 10 year
› 200,000/789sq.km=250 per sq.km.

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Pros and Cons of Femtocells
Pros
› Huge capacity per
square meter
› Very low site rental,
power and
backhaul expenses
› Scales with time
27 … Why Femto?
Cons
› Large numbers
needed for
meaningful
coverage
› Lack of control by
MNO
› Serious SON needed
to make them scale

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WiROI™ GUI Demo
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