Published: 2 August, 2012
Mindspeed and Cavium, two chip firms looking for a goldmine in small cells, are racing to be the first to announce commercial LTE wins.
On its fiscal Q3 earnings call last week, Mindspeed's CEO Raouf Halim said: "In a strong confirmation of our leadership position in small cell wireless base stations, we are pleased to report that we have production orders on backlog for our 4G LTE Transcede products and the first wave of Korean deployments for this coming calendar fourth quarter."
Just over a week later, Cavium has announced it is "first with production orders for LTE small cells". Both suppliers' chips seem to be going into 4G small cells for the two big Korean operators, SKT and Korea Telecom, which have both talked up ambitious plans to instal indoor femtocells and outdoor metrocells as part of their fourth quarter roll-outs.
Cavium said its Octeon Fusion platform will provide the 'base station on a chip' to power a deployment at SKT. And KT has selected the same silicon for the first stage of its own LTE small cell roll-out.
"The Fusion processor platform offers a complete carrier grade LTE small cell solution with proven hardware and software supporting a large number of users and the demanding application requirements for multiuser small cells," said KT senior manager.Jean Choi in a statement.
While the Korean cellcos can usually be relied upon to move very quickly into new technologies, they will soon be followed by other carriers which are poised to add small cells to their LTE networks, to add capacity and coverage, and support new services. Sprint, which recently said it had 950,000 femtocells (mainly indoor) on its CDMA system, is particularly committed.
Rupert Baines, VP of strategic marketing at Mindspeed, said: "Beyond Korean carriers, AT&T and Verizon in North America, we're also seeing that Sprint, Telefonica, Vodafone are clearly developing and finalizing their plans for LTE and dual-mode small cell roll-outs."
The competing announcements highlight an important aspect of the small cell trend - that many networks will be composed of access points and chips from a mixture of suppliers. Many operators see the development as a way to reduce their reliance on major incumbent OEMs, and to be able to mix and match base stations, boosting price competition in their supply chains. They will also have the option to purchase from ODMs and low cost manufacturers, of the kind which could previously only address domestic equipment.
This could change the cost structure of 4G, though only if interoperability standards for multivendor small cells are sufficiently functional, and universally supported. The Small Cell Forum recently set up a taskgroup to examine the additional capabilities needed to make the 3GPP's X2 standard fit for purpose. This interface supports communication between base stations to support various functions such as handover and load balancing, but it is inadequate for complex networks of many cells, raising the risk that vendors will step in with proprietary alternatives.