As more and more video is posted and shared on the Internet, and more mobile users access the Web, industry insiders say consumers will feel increasingly frustrated when their cell phones – which can still put a call through with a weak signal – start processing data very slowly.

 

Officials with Scottsdale, Arizona-based In-Stat, a market research firm, say that higher frequencies, which most wireless broadband providers use, don’t penetrate buildings as well as the lower frequencies.

 

“With a wireless data connection, a weak or noisy signal results in a slower data connection,” In-Stat Principal Analyst Allen Nogee writes. “As long as a voice call stays connected, the voice user feels like he or she is getter their money’s worth, but the data user who is getting a 50 Kbps data rate instead of the advertised 1.5 Mbps may not be very happy, and his impression will be that his service is not living up to that advertised.”

 

Though operators are aware of the problem, according to Nogee, it’s difficult to produce a strong wireless signal everywhere.

 

One option that wireless providers have is femtocells, he says.

 

Originally known as an Access Point (News - Alert) Base Station, a femtocell is a small cellular bas station, typically designed for use in residential or small business environments, that connects to the service provider’s network through broadband. Generally speaking, a femtocell allows service providers to extend service coverage indoors.

 

According to Nogee, femotcells usually can support 3 or 4 simultaneous subscribers while the subscriber foots most of the backhaul costs – “an operator’s dream,” he says.

 

“Femtocells remain expensive and supporting a consumer installed device could be costly for operators,” Nogee writes. “Then there can be the problem of convincing the subscriber to effectively pay for coverage by purchasing a femtocell.”

 

Industry insiders say femtocells are vying strongly, with technologies such as WiFi, to solve the battle for fixed-mobile convergence.

 

TMC (News - Alert) President and Group Editor-In-Chief Rich Tehrani recently wrote about one resounding victory for femtocells, when Airvana (News - Alert) just signed an OEM agreement with Motorola to provide CDMA femtocells to the wireless equipment company.

 

“This news is huge for Airvana and one assumes that Motorola (News - Alert) will leverage its myriad relationships with wireless carriers to get these devices installed as widely as possible,” Tehrani writes. “It will be very interesting to see how this market evolves and what sort of consumer and in-building calling plans these devices allow carriers to come up with.”

For Tehrani, the femtocell market is bustling with excitement because it is relatively new and allows cellular coverage to be improved at the last mile without the need for new base stations.

“In a sense, femtocells are the disruptive equivalent of RAID hard drives as they are low cost and, when aggregated, give carriers tremendous connectivity potential,” Tehrani said.

 

Meanwhile, operators are trying to figure out how to solve the problem of providing strong enough signals for data transfer.

 

According to Nogee, Micro and picocell base stations can get the signal closer to users and will be used more in the future, but while the base stations themselves are much cheaper than a macro base station, their capacity and coverage is much less.  

 

“Still, operators may not have a choice once wireless data use becomes much more widespread,” Nogee says.