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Analyst: Femtocell market may lose momentum

Posted: 03 Jan 2012 ?? ?Print Version ?Bookmark and Share

Keywords:femtocell market? operator contract? shipment volume?

ABI Research has released the details of its latest research that should worry the femtocell market. The number of operator contracts has increased dramatically, but the number of femtocell shipments can barely keep up. Last year, only 2.5 million femtocells were shipped, a far cry from 3-4 million that were estimated.

Fueling the higher expectations was the increase in femtocell commercial operator contracts that reached 88 in 2011. Included are individual operator contracts awarded to femtocell vendors, as well as multivendor contracts offered by some operators. Out of the 88 contracts, 37 operators have launched services, with many more expected to launch this year.

Alcatel-Lucent, Huawei and Ubiquisys are closely tied in terms of the top share of contracts. Huawei and Alcatel-Lucent have 27 operator contracts each, while Ubiquisys has 28 contracts through NSN and NEC collectively.

However, the market share of unit shipments looks very different compared to the contract market share. Cisco/ip.access and Airvana/Ericsson are closely tied for top share and collectively represent 55 percent of the market's shipment volume. Cisco/ip.access supplies to AT&T and Airvana/Ericsson supplies to Sprint.

"With two of the 37 femtocell operators making up 55 percent of the shipments, the risk is that the market will lose its momentum if the status quo doesn't change," stated Aditya Kaul, practice director, mobile networks at ABI. "Femtocells are still largely used as Band-Aid solutions by most operators to cover up coverage holes. While operators like SFR in France are attempting to move beyond the Band-Aid proposition and use it as a competitive acquisition tool, the market needs many more SFRs to carry the momentum forward and achieve true mass-market status."

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