18 stakeholders, representing all segments of the telecoms infrastructure ecosystem, gathered for TowerXchange’s first working group focusing on small cells and DAS at the TowerXchange Meetup Asia 2016. Participants were excited to learn about the imminent availability of multi-operator small cells, and discussed the drivers and inhibitors for towercos or MNOs to provide ‘Small Cells as a Service’.
Working group participants
MNOs and towercos: Aird Towers (Australia), Bharti Infratel (India), edotco (Bangladesh, Cambodia, Malaysia, Myanmar, Pakistan, Sri Lanka), Indonsat Ooredoo (Indonesia), Indus Towers (India), MPT (Myanmar), Service Telecom (Russia), STP (Indonesia), Vodafone Procurement Company (Global)
Suppliers: Abloy, Electroskandia, Enatel, GSM Telecom Products, GS Yuasa, ip.access, IPS, MAFI, Metka, ZTE
Key learnings
LEARNING 1: Towercos represent a significant addressable market for small cells vendors, particularly if they can develop multi-operator solutions.
LEARNING 2: Securing rights of way with local government planning authorities will be critical if small cells are going to be deployed in large numbers in Southern and Southeast Asia’s densest cities.
LEARNING 3: Where possible, towercos plan to leverage existing street furniture to rollout outdoor small cells.
LEARNING 4: Micros sites, DAS and IBS are already being deployed by towercos across Southern and Southeast Asia. While small cells are already being rolled out by towercos and MNOs in India, the next markets to adopt may be Malaysia and Indonesia in 2017, with Myanmar soon to follow.
LEARNING 5: A number of towercos, particularly those in Indonesia, are exploring diversification into fibre to provide backhaul for small cells.
LEARNING 6: While small cells remain complimentary, not competitive to green field towers, some commentators expect demand for new green field towers to slow, replaced by demand for small cells.
LEARNING 7: Increasing pressure to deploy aesthetically pleasing or camouflage sites will accelerate demand for small cells.
LEARNING 8: MNOs with substantial spectrum holdings may be more inclined to build 4G into the macro network than to utilise small cells as widely as some forecasts have suggested.
LEARNING 9: The cost benefits of sharing small cells will significantly increase the addressable market.
LEARNING 10: You don’t need the antenna itself to be shareable to share a small cell site: passive infrastructure can be shared, with multiple independent small cells mounted for each operator…
LEARNING 11: …However, towercos are keen that multi-operator antennas be developed – indeed TowerXchange has identified five multi-operator small cells already on the market.
LEARNING 12: Stakeholders interested in the development of multi-operator small cells should connect with the Multi-operator working group at the Small Cell Forum and the Multefire Alliance.
LEARNING 13: Regulation could be an inhibitor to the development of multi-operator small cells. Towercos must be licensed and permitted to deploy small cells, and spectrum sharing should be allowed within the context of shared small cells.
LEARNING 14: Competitive sensitivities may adversely affect the appetite of some CTOs and network planners to share antennas, while each MNO will inevitably have slightly different preferences regarding the azimuth of the antenna.
LEARNING 15: If a commercial sharing model can be agreed, the towerco could end the debate about who pays for small cells, landlord or operator.
LEARNING 16: The ideal outcome for towercos is that small cells be shareable under long term contracts with multiple operators, making them as investible as green field towers.
LEARNING 17: The emerging market for small cells in Southern and Southeast Asia may be as much driven by towercos as by MNOs.
Executive summary
The tower industry has huge, largely untapped, demand for small cells, DAS and every variant of indoor and outdoor coverage solution in between. Given that 68% of the world’s 4.04mn greenfield towers and rooftops are now owned by towercos as opposed to MNOs, towercos are increasingly trusted to deliver the network densification necessary to deliver a true 4G customer experience, and are in prime position to lead the deployment of ‘small cells as a service’, critical to enabling the 5G revolution.
So what do towercos want from small cells?
“We see small cells as a solution to provide vertical space in dense urban environments where there might be little or no land available,” said one towerco. “It’s simple: we want to meet our MNO customer’s small cell requirements,” said another.
“I’m keen to learn about the evolution of multi-carrier small cells,” said a third towerco.
MPT, edotco, STP and Vodafone Procurement Company were kind enough to take lead roles in this working group, and shared some of their requirements and experiences with small cells at the outset.
MPT: leveraging small cells for infill capacity
The massive rollout of green field towers in Myanmar has attracted plenty of headlines, but as the 4G rollout begins, the country’s MNOs are increasingly exploring small cells to provide infill capacity through lamp posts and roof top sites.
Incumbent and market leading MNO MPT, backed by the capital and expertise of KDDI, attended the working group primarily in information gathering mode. “We’re exploring opportunities with landlords and discussing rights of way with government stakeholders to install small antennas, and we’re finding DAS quite popular with the owners of large commercial buildings.”
Will MNOs self deploy small cells in Myanmar, or partner with towercos, TowerXchange asked? “It depends on government policy and towerco appetite,” suggested the representative from MPT.
TowerXchange subsequently learned that one of Myanmar’s newer towercos has recently been awarded an exclusive government contract to provide infill sites using lamp posts and monopoles in Myanmar’s second largest city, Mandalay.
edotco: business case for small cells more compelling if shared between multiple tenants
edotco is already serving as an independent provider of DAS in Myanmar, and is working with local authorities to explore small cells for street level coverage against a vision to sync-up small cells and the macro network to provide seamless coverage.
“Small cells are a more commercially attractive opportunity if they can accommodate more than one tenant,” said edotco.
Asked about the current state of small cells within edotco’s portfolio, their representative said “expect small cells and DAS in our catalogue in Malaysia from late 2017. Demand is building in other markets, such as Sri Lanka, but there have been no deployments yet.”
To date edotco has utilised various pieces of ‘street furniture’ to deploy sites, connecting billboards and phone booths with fibre, but has yet to deploy anything strictly defined as a small cell. “Small cells will come later when customers demand 200-250MB per second, driving further cell site densification.”
STP: investing in fibre, readying themselves for small cells to come to Indonesia
10% of STP’s 7,000 sites are microsites, typically consisting of a pole with fibre connection to a BTS hotel. While there are no small cells in their network yet, they do have some IBS with traditional antenna sharing.
“We see a great opportunity to deploy small cells in Jakarta and other high density cities in Indonesia as they will be faster and easier to deploy than macro or micro sites.”
STP has invested in BIT Teknologi Nusantara to accelerate their fibre rollout, securing a long term agreement with local authorities in Jakarta which will enable future small cell deployments. “We see small cells as the future of network deployment, hence our investment in fibre.”
Macro sites will continue to play an important role, but the rollout of macro sites will slow, replaced by an increasing demand for sites with a smaller footprint, more suited to urban densification. With governments driving the deployment of aesthetically pleasing sites, there is a growing need for small cells.
“All Indonesia’s MNOs are deploying 4G, to date primarily overlaid on existing sites, but when consumer adoption demands that the rollout progress to infill capacity, time pressures are going to prompt the deployment of thousands of small cells,” concluded STP. STP, and their peers Protelindo, Tower Bersama, Balitower and IBS Tower, are positioning themselves to play a leadership role in small cells in Indonesia.
Vodafone: small cells a niche capacity solution
If STP and MTP offered insights into the future of small cells in Asia, Vodafone offered a insights into the current reality of small cells across their 25 country footprint. Small cells have been deployed by Vodafone in The Netherlands, for example, as long as three years ago, with typical use cases being mounting on bus stops to boost capacity.
“Our primary objectives with small cells are to provide capacity to reinforce 3G and 4G performance,” said Vodafone’s representative. Other deployment scenarios focus on high ARPU customers where QoS is key, such as in the enterprise market.
Seen as a niche capacity solution, with 4G already widely deployed in Western Europe, less small cells have been deployed than initially forecast, as a number of operators have found it more economical to build 4G capacity into the macro network than to deploy thousands of small cells. However Vodafone reported growing interest in cost effective shared small cell networks provided by towercos, and interest in IBS and picocells.
Multi-operator small cells
Stage one of multi-operator small cells involves the sharing of passive infrastructure: sites and mountings designed to deploy multiple antenna according to tenancy demands and frequency requirements.
Stage two would involved deployments where the antenna itself could be shared by multiple-operators. Participants in the working group revealed that at least five multi-operator small cells were already on the market: Ericsson’s Dot, ip.access’s SUMO, and solutions developed by SpiderCloud Wireless, NEC and CommScope.
One of these vendors was present at the working group; ip.access. “We are trying to make the active infrastructure shareable by developing devices for multiple RF carriers.” ip.access called attention to a proof of concept they have commenced with an MVNO in the UK, and to the multi-operator working group within the Small Cell Forum and the Multefire Alliance as two bodies progressing developments in this field.
“We want long term, investible contracts with multiple tenants like we have with macro sites,” said one towerco. “Small cells have got to be shareable. A microcell cannot become a tree of multiple antennas – it will become impossible to hide. The antennas themselves must be shared.”
“Towercos can deploy our equipment, the software enables multiple MNOs to use the small cell, based on one MNO’s spectrum, which other MNOs then pay to use,” suggested ip.access.
Potential regulatory inhibitors
While technology is one inhibitor to the sharing of infrastructure, regulatory regimes could be another. In many countries, towercos are licensed only to manage passive infrastructure: “we can share only antennae and fibre, not the actual BTS,” said one towerco. Spectrum sharing, as proposed in the ip.access example, is also permitted only in certain countries.
“Small cells are already shareable between multiple-operators,” said Kieron Osmotherly, CEO of TowerXchange at the towers regulatory conference that followed the Meetup. “Towercos must be licensed and permitted to deploy these solutions as they can accelerate the creation of a high quality network. We urge regulators to futureproof towerco licensing and infrastructure sharing policies, otherwise they will only find themselves having to redraft within one to two years!”
Potential network planning inhibitors
“Deploying the heterogeneous network at street level depends on radio network planners. So a big challenge will be convincing rival radio network planners to share with one another!” Admitted one MNO. “The azimuth will need to be different for different MNOs – I’m not convinced we can even share the passive infrastructure at many small cell sites.”
“I still feel the towerco can be a neutral host of 4G at all layers of the network,” countered a towerco. “MNOs may have different target markets, and different local network requirements, but they set aside their competitive rivalry to share the macro network. The towerco can plan the network. The towerco can deploy the capex. And the towerco can be a neutral negotiator with government stakeholders.”
“While we share some macro towers, MNOs have different network planning philosophies, different marketing and different commercial models. From the CTO’s point of view, it remains difficult to accept a neutral host model,” opined another MNO.
edotco cited the example of Cyberjaya in Malaysia, where they deployed a shared, common antenna system to provide coverage to a previously uncovered region. “When one operator provides coverage, the other MNOs follow each other to the same location soon enough. We can overcome egos and apply the same philosophy of infrastructure sharing to small cells as to the macro network.”
It was evident there is imminent demand for a variety of site typologies to supplement the macro network in Asia, from micro sites, DAS and IBS to indoor and outdoor small cells. It was also evident that forward-thinking towercos stand ready to meet that demand
Addressable market in Southern and Southeast Asia
It was evident there is imminent demand for a variety of site typologies to supplement the macro network in Asia, from micro sites, DAS and IBS to indoor and outdoor small cells. It was also evident that forward-thinking towercos stand ready to meet that demand. Competitive and regulatory inhibitors remain to be overcome in certain markets, but these issues were swiftly put aside when the benefits of tower sharing were demonstrated – the same acceleration could take place in small cells.
While there are substantial small cell deployments in Northern Asia, volume deployments of small cells were perhaps 6-12 months away for many Southern and Southeast Asian markets. Even Singapore had seen only limited small cell deployment to date.
