Small cell networks for hire

Businesses and properties across a wide range of markets are crying out for multi-operator small cells. Tower companies are perfectly placed to provide a small cell network to multiple operators because they have relationships with MNOs, private and State landlords, and understand how to operate and commercialise networks. In this interview, Nick Johnson, Co-Founder and CTO of ip.access and Chairman of the multi-operator working group at the Small Cell Forum, describes how the small cell ecosystem is moving toward a multi operator model, and the opportunities therein for independent infrastructure specialists.

TowerXchange: Please introduce yourself and ip.access to our readers – where do you fit in the telecom infrastructure ecosystem?

I’m one of the founders of ip.access. The company started right at the end of 1999, just when the telecoms winter was about to set in! We started life as a spin out of TTPCom, a company which provided systems designs for GSM handsets. I saw how we could use the same handset technology and apply it to develop small base stations.

Since then, the company has grown fairly steadily, and now have about 160 people working for the company. In terms of geographical presence, we have three separate sites – a development site in Pune, India; our headquarters in Cambridge, UK; and a support lab in the North West of America where we provide support to T-Mobile and AT&T.

When we started out we had a vague intent to focus on all kinds of access networks. But in the end we decided to focus on licensed spectrum and serving MNOs; we’ve done GSM, 3G and LTE.

Over the last couple of years, we’ve noticed that things have changed and mobile operators have started to struggle with their own sense of identity. Many MNOs are not sure whether they are service providers, access networks, big pipes or something smarter. They appear to be searching for new versions of themselves. We think this is one of the reasons why multiple operators have chosen to share networks between one another.

At the same time, we’ve seen a change in spectrum licensing emerge in the US and Europe with Citizens Broadband and Licensed Shared Access. Alongside this, we’ve seen a corresponding shift in the small cell market from single operator applications to multi-operator applications.

We still see MNOs as our principal customers, but we think that the multi operator opportunity brings with it a whole range of customers that not only we could serve, but also that the operator could serve as well.

The fact is that mobile operators are still struggling. They are very good at dealing with consumer customers – they have a clear picture of what customers like and what they buy – and have a good idea of what the large corporates need. But they struggle with the guys in between, and that’s where we think they are missing valuable business. Together with the Small Cell Forum, we’ve identified a number of vertical markets that need multi-operator small cells to succeed. The most vocal players have been hotel chains and property developers.

Let me give you an example. Camden Housing Trust in New Jersey, USA, recently stood up at a meeting and told us that we were missing a trick. They told us that people will pay more for high quality cellular coverage in an apartment than they will for a granite kitchen. The owner knows that he can install a granite kitchen himself, but if the mobile coverage is inadequate he may be stuck in that situation indefinitely. In the homebuyers’ hierarchy of needs, cellular coverage has been neglected. Of course, a property company needs to get good cellular coverage from all operators, not just one. So they are crying out for operators to come together on this.

The hotel industry has the same challenge. The degree to which they get repeat business is partly down to the level of cellular coverage they provide – if there’s no coverage, people won’t stay at that hotel again. We know of one major chain that had this problem and tried to get the operators to respond to it. Unfortunately, the operators didn’t see it as their problem; the end user wasn’t complaining to the network operator, they simply chose to stay at a different hotel.  Hotel chains are a great example of a segment who is willing to pay for the infrastructure, but just don’t have any way to deploy multi-operator small cells today.

In order to address this gap in the market, ip.access is promoting a feature in its roadmap called Super Multi-Operator (SUMO). We’re taking the 3GPP feature known as Multi Operator Core Network (MOCN) and making it commercially workable, so that multiple MNOs can share the capacity of the small cell in a controlled way, according to a predefined sharing policy. It also allows the small cell operator to measure and manage resources used by each MNO, so you can wrap an SLA around the whole thing and bill for it at the end of the month. This enables you to wrap a business model around spectrum sharing in a way you couldn’t before, and opens up the opportunity for independent small cell operators to run the network.

TowerXchange: How are the Small Cell Forum advancing the cause of multi-operator small cells?

From a Small Cell Forum point of view, I and James Body from Truphone have put together a work programme to knock over the barriers to operators working together. We’re looking at whether these blockages are arising from regulation, technology or commercial factors. We’re also trying to work out why multi operator isn’t more widely deployed in small cells.

At Mobile World Congress a couple of papers were released by the Small Cell Forum. One was on the market drivers for multi operator and the other on the regulatory aspects.

Although ip.access are focused on SUMO and MOCN it’s not the only game in town. It’s one of several multi operator approaches including MORAN (a tower site sharing option where operators use their own spectrum), DAS, and other intelligent repeater type solutions. In short, we’re looking at a wide range of small cell and non-small cell technology that can deliver aspects of the multi operator experience. However, we do feel that the MOCN based technology is the right one.

MOCN is good for sites that don’t get enough traffic to merit a cell for every operator. But if you are sharing the cell amongst five operators, the business case springs into life. MOCN is a clear winner in this instance – one box, one piece of spectrum and one service provider.

We believe that the multi operator capability makes even more sense when the small cell network is being operated by someone independent. And tower companies fit well into that category. They already have the commercial relationships with the MNOs, and they understand how to operate and commercialise networks.

Running a small cell as a neutral host has a lot of mileage as a concept, especially with new bands like LSA spectrum or Citizen’s Broadband in the US.

TowerXchange: Could a towerco white label a small cell solution?

We are actively discussing this with a number of tower companies who have approached us on the subject. The real estate aspect of it is very interesting. While a tower company may have a macro station on top of a multi story car park, they may not actually have any coverage inside the building! We have a lot of experience in deploying consumer femtocells and as a result our technology is plug and play.  You don’t have to be a radio wizard to install it – it’s as easy as plugging in a Wi-Fi access point. So our technology lends itself well to white label situations.

TowerXchange: If the majority of small cell deployments will be shared between multiple operators by 2020 (80% according to the Small Cell Forum), what role could be played by third party infrastructure companies like tower companies?

The short answer is a big role. At the moment, there is a deployment group within the Small Cell Forum, which is led by Peter Love from Nokia. He and I believe that the tower companies have a big part to play within that group. Whether a deployment is multi operator or single operator almost becomes a secondary issue. Tower companies become a natural part of the deployment ecosystem, whether they are doing it on behalf of an operator, or a venue where they offer it as a service to multiple operators.

The other thing worth bearing in mind is that spectrum licensing is starting to liberalise with Citizens Broadband and Licensed Shared Access. One objection that gets raised from time to time is who is going to donate spectrum that they have spent billions of dollars on, to the benefit of competitors. However, commercialisation of the spectrum by a tower company can overcome this objection, unlock additional revenue from that spectrum, and create a win win situation for all parties.

Spectrum liberalisation can also accelerate multi operator deployments. For example, a tower company can put up a site and use spectrum in citizen’s broadband. Companies like ours can then connect the base station via MOCN to multiple operators’ core networks, using that neutral spectrum to provide coverage for everyone.

TowerXchange: Why do so few small cell vendors understand the opportunity that tower companies represent?

Speaking for myself and some of my colleagues, the small cell business started from a presumption, which we try and reconfirm as much as we can, that small cells are all about self-deployment. The idea is that you give them to the enterprise IT consultancy or consumer and they put them up themselves. When we think of how small cells are deployed we think of Wi-Fi.

It’s only been recently that we’ve realised that when you want to deploy small cells where there isn’t an IT company present – for example, in urban street furniture deployments – that you need a partner like a tower company. AT&T, for instance, confessed at a small cell conference recently that when they wanted to deploy a small cell to an urban site they couldn’t do it. They couldn’t provision backhaul to the lamppost in the area because it didn’t have a zip code, and their IT systems couldn’t cope with that. As a result, they had to undertake a big IT project to allow them provision fibre, power and a bracket to a particular lamppost, rather than just a zipcode. These are the kinds of things that tower companies understand really well.

While small cell developers are coming from a focus on small, self-deployed solutions like femtocells, tower companies are coming down from macro cells to metro cells and lampposts – perhaps we’ll meet in the middle!

TowerXchange: Please tell us about the use cases for ip.access’ SUMO solution.

Let me give you an example. One company is providing a private network to a Dutch hospital using our base stations. The service acts as a pager replacement system and a general communications network for the medical staff, using standard handsets.

In this case, the deployer – which plays the equivalent role of a tower company – is entirely responsible for the service. They decide where to place the small cells; how to go about the installation process; and what penalties they should be liable for within the context of an SLA. It’s very much a traditional ‘as a service’ model.

The capex for the equipment is borne by the deployer and they then rent the service to the facility. Although there aren’t multiple operators involved, the deployer is using non-traditional licensed spectrum, so it is putting in place a proxy for a future shared access solution.

TowerXchange: What can vendors do to enable tower companies to offer small cells as a service?

If you look at our service, we help tower companies to operate and manage networks. In common with other small cell vendors, we offer a management system with our solution and we can either operate that on behalf of the customer or provide that to the customer and allow them to integrate it with their own solutions.

If we are asked to manage the network, we will put in place a small team that will look after the performance of the network on a daily basis. They will respond to escalations and customer feedback and will fix particular issues.

For tower companies that don’t have RAN expertise in-house, we can offer ‘small cell as a service’; a management service that they can in turn offer to their customers. One of the reasons we like SUMO is because it allows companies to offer management services to multiple operators at once.

TowerXchange: Finally, please sum up your vision for the future of multi-operator small cells.

We hope that multi-operator small cells become the norm in the future. We’ve seen deployments being done with Wi-Fi because it’s intrinsically multi operator – it’s hard to get all the MNOs engaged in a given venue. We don’t think this will continue to be the case. We expect that small cells will be deployed in a multi-operator model as easily as Wi-Fi.

In terms of our longer term vision, we believe that LTE will start to displace Wi-Fi in application terms – LTE’s performance is superior in congested spectrum – so LTE will become the technology of choice rather than Wi-Fi.

At the same time we don’t expect LTE and small cells to drive Wi-Fi to an early grave. These technologies will exist alongside each other even when 5G comes along.