Tushar Kapadia, Telecom Infrastructure Consultant

Tushar Kapadia, Telecom Infrastructure Consultant

Small cells have gained popularity as a promising solution ever since 4G long term evolution (LTE) network roll-outs started internationally and in India. Their technical merits, cost benefits and features have gradually made small cells the preferred choice compared to macro sites in urban and semi-urban locations.

Put in perspective, small cells are low power radio access base station transceivers (BTS) of small form factor, easily mountable on light poles and street furniture. In the absence of a strict definition, small cells can be viewed as a solution co­m­prising various technologies for in­door or outdoor radio coverage.

Recently, the Telecom Regulatory Au­tho­rity of India gave final recommendations for 5G spectrum pricing, which in­clude a reduction of over 35 per cent in floor price of the 3300-3670 MHz band. The De­­part­ment of Telecommunications (DoT) is expected to conduct auctions of various frequency bands in the coming months and thereby, Indian subscribers will soon avail of the much awaited 5G wireless services, enabling faster data speed with ultra-low latency. Now, telcos in India have a challenging task to launch 5G network services, which are highly capital intensive.

It appears that despite superior features of small cells, they have not yet created ex­citement for towercos in India. Here is an overview of challenges as well as opportunities with respect to small cell deployment for enabling 5G services.

Role of small cells and selection criteria for 5G

Small cells have several distinct advantages over macro sites for 5G networks.

  • Capacity: Internationally, 5G services are rolled out in various frequency band layers such as low band (< 1 GHz), mid band GHz to 6 GHz) and high band (24 GHz to 40 GHz millimetre wave) ba­sed on the requirements of coverage, capacity and latency. Hence, small cells are more suitable for metros and cities for densification of networks through mid-band and high-band frequencies, whereas macro sites are suitable for coverage in rural areas and highways.
  • Backhaul: 5G services offer faster data rates and require large backhaul capacity, which can be achieved with fibre. Mi­crowave links are less suited in urban areas with high-rise buildings. For compact installation of small cells outdoors or indoors, fibre backhaul is desirable.
  • Ease of installation and operational costs: For improving viability of 5G services, it is essential to control opex. Small cell technologies can address complex challenges of network optimisation and simplify the installation process.
  • Site acquisition, power connection re­quirements: Small cells occupy less space and consume substantially less po­w­er as compared to macro sites. Hence, for faster roll-outs small cell sites are suitable from the standpoint of site acquisition and utility power connection.

Key challenges

While small cell solutions offer excellent benefits for 5G success, some major challenges to be addressed are:

  • Capital expenditure for spectrum: As per telcos, the reserve prices for the ensuing 5G spectrum auction are high.
  • RAN technologies: Telcos have carried out successful pilot projects and trials of open radio access network (RAN) technologies and software defined networks using common off-the-shelf hardware for reducing network costs. However, for large-scale deployment of 5G networks in various frequency bands, dependence on existing original equipment manufacturers of integrated RAN technologies may continue for a while.
  • Need for strong use cases for India: In countries that have rolled out 5G servi­c­es, use cases of 5G services in­clu­de ad­va­n­ced healthcare, autono­mous cars, virtual reality, augmented reality and ga­ming. The suitability of these use cases remains to be assessed to generate large-scale revenue opportunities for telcos in India.
  • Fiberisation and right of way for fibre: At present, less than 25 per cent towers are fiberised in India. Hence, the majority of existing tower sites are less suitable for 5G BTS. Fibre-to-the-home (FTTx) or building premises) services by broadband internet service pro­viders and telcos can be an enabler for 5G roll-outs. Yet, FTTx due to high sp­eeds and aggressive tariffs can throw up competition to 5G.
  • Data tariffs for mobile data: Compa­red globally, Indian telcos have the lowest mobile data tariffs. With such benchmark tariffs, it remains to be seen how the Indian subscribers who are price sen­sitive accept large tariff hikes for su­perior 5G technologies.

Towercos as neutral hosts

Across many countries, small cells for 4G LTE networks are deployed to ease up a few dark spots in dense localities, where macro sites were not suitable. In India also, similar initial trends are found. But in the case of 5G roll-outs, small cells have a do­minant role and may necessitate acquisition of new site locations far more than the present count of macro tower sites. It is a well-known fact that in the past 15 years Indian towercos have played an im­portant part in rapidly increasing teledensity multifold through mobile penetration. Hence, telcos can once again tap the po­t­ential of towercos. Also, it is pertinent to co­mprehend challenges of towercos as neu­tral host providers for 5G roll-outs:

  • Investment and skill enhancement for a significant role of towercos: Tra­ditionally, towercos have carried out site operations and maintenance of passive in­frastructure. For bringing value to tel­co customers, towercos in the avatar of digital infracos would require investing in monitoring tools, automation, sy­st­e­ms and solutions, which hitherto we­re in the domain of telcos. Also, upgradation of the skills of technical workforce for ac­tive network operations, first-level ma­intenance, data analytics and op­ti­misation is needed.
  • Active infrastructure sharing policy: Towercos are companies registered by DoT as IP-1 category infrastructure pro­­viders for services to licensed telcos. Towercos are not permitted to own any active telecom equipment; they can de­ploy radio access equipment or antennas only on behalf of telcos. Towercos can own dark fibre but are not permitted to provide lit-up fibre services.
  • Engagement terms for towercos: The only source of revenue for towercos is telco tenants. Hence, for towercos, it is necessary to enter into long-term master service agreements of appropriate en­gagement and commercial terms with telcos in order to ensure their viability and help them recover their in­vest­ments and cost of efforts.

The way forward

Small cells are set to become an integral part of 5G networks. For running successful and profitable 5G services, telcos’ stakes are high. Their pivotal position to onboard towercos as important stakeholders in the long journey through an innovative win-win approach is inevitable.