Several European mobile operators are investigating the possibility of integrating a UMTS base-station module into a home gateway connected via ADSL. The idea is to provide an extension of the 3G network, with a home gateway transformed into a simplified 3G pico base station, and DSL access providing the backhaul between the home and the operator's core network. This network extension would provide dedicated 3G access (via W-CDMA or HSDPA) for any type of cellular service: voice, Internet browsing, content download, TV streaming, etc.
If this idea turns out to be feasible, there could be many implications for the telecoms consumer market.
3G in the home
The service could potentially offer a dedicated connection to the 3G network when at home, for any 3G device, with a guaranteed data rate. That should enable 3G service users to enjoy a much better quality of service at home than when they are using the shared 3G infrastructure - no network congestion, no interference from other users and no interference from other radio technologies. HSDPA could theoretically deliver several megabits per second in this configuration.
A key benefit is that there is no impact on the device, as the same access technology is used at home as well as outside (contrary to dual-mode approaches). It can also re-use existing 3G handover technology to switch between the home cell and the rest of the 3G network.
The last - but not least - advantage is that it gives mobile operators the opportunity to design residential cellular-based services for the consumer market. In particular, it would enable them to offer specific home tariffs for voice and data services. That could be a decisive factor when competing against fixed ISPs and alternative wireless access technologies, such as Wi-Fi or WiMAX.
It also opens up some interesting opportunities to the operators for extending their cellular networks. This solution could mean that the customers finance - at least partially - an increase in network capacity.
It is too early to draw any firm conclusions, as there are two big challenges. First, the 3G home gateway costs need to be very low (typically a few hundreds euros), which requires the simplification of the UMTS Node B equipment that would be integrated into the ADSL home gateway. Second, the 3G radio network configuration is tricky. The equipment needs to be self-installable by the user at home, and at the same time, the operator must avoid interference with the rest of its 3G network.
These are big hurdles, but assuming they can be solved in the next two to three years, the implications for telecom operators and service providers could be huge.
Today, a high proportion of mobile voice calls are made at home - figures of 30% to 40% are often quoted. At the same time, mobile users are generating more and more mobile data traffic while at home. It is clearly a challenge for mobile operators to keep benefiting from this situation, and at the same time offering more attractive services and good connectivity to users at home.
This project could be an interesting solution, but only for those mobile operators that have control over broadband fixed lines. Fixed-mobile convergence so far has mostly meant cannibalizing mobile traffic by re-routing traffic through fixed lines. What if it became a way to do the opposite and increase mobile usage‾
Vincent Poulbere is a senior analyst with Ovum