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Cisco's small-cell move is focused, but its network aims are ambitious

The company will show off its first licensed small cells along with services software that goes deep into the carrier core

By Stephen Lawson
February 19, 2013 08:02 AM ET

IDG News Service - Cisco's long-anticipated entry into cellular base stations will come at Mobile World Congress next week, along with the company's familiar promise of an end-to-end architecture.

Having the dominant vendor of Wi-Fi gear in the cellular RAN (radio access network) business may help to fuse the two technologies into a powerful combination that boosts mobile speeds. But Cisco's more likely to affect indoor cells than those outdoors, where makers of long-range "macro" radios are already well established and pushing smaller cells of their own, industry analysts said.

Cisco's announcement of small cells and an outdoor backhaul platform on Tuesday, just in time for MWC, came after a long, slow climb toward the licensed RAN market in which the company introduced just about everything short of a cell. In addition to gear for the cores and edges of mobile carrier networks, Cisco has been selling carrier Wi-Fi access points, including ones with slots to add cellular radios, and partnered with startup ip.access on home femtocells. Now it's finally adding cells themselves, though not the type that go in towers.

Not just a formula to generate more profit for Cisco, the company's entry is part of a trend that came into the spotlight a year ago with mobile giant Ericsson's acquisition of carrier Wi-Fi vendor Bel Air Networks, Yankee Group analyst Ken Rehbehn said.

"This is a natural next step," Rehbehn said. "It gives the operators a choice. It gives Cisco an opportunity to leverage something that they are very strong at, which is excellent Wi-Fi capabilities for network operators."

On Tuesday, Cisco is introducing a standalone 3G small cell, a 3G module that can be added to its carrier Wi-Fi access points, and a backhaul router that's designed for use outdoors in combination with public small cells. It's also announcing Cisco Quantum, a software architecture introduced on Tuesday that's designed to let carriers get better performance out of their networks and present new types of services and offers based on real-time network data.

Some carriers have been using Wi-Fi for years to take mobile data traffic off their scarce licensed spectrum and offer subscribers higher speeds in crowded places such as coffee shops and arenas. Small cells are designed to do a similar thing in a different way with a carrier's own licensed spectrum, reusing in a small area the frequencies that already travel from cell towers across a whole neighborhood.

Rather than dive in at the deep end of the market with small cells for public, outdoor use, Cisco is wading in around enterprises, an area it knows well. Both of the cells it's announcing on Tuesday are designed to work in tandem with its Wi-Fi gear in enterprises. They'll give users another option for connectivity that they may need based on what device they're using and what kind of radio spectrum is available, according to Cisco.

"It will speed the deployment of the small cells in cases where there's Wi-Fi," Rehbehn said. In that sense, Cisco's move into licensed-spectrum small cells is just an expansion of its efforts at extending mobile networks with Wi-Fi, rather than a head-on challenge to the cell establishment.

Outside of enterprises, restaurants, stadiums and other closed areas, small cells are likely to carry the same brands as the big base stations on nearby towers, Rehbehn said.

"It remains to be seen how effectively [Cisco] can go head-to-head with the larger OEMs that own the vast majority of footprint with the mobile operators," Rehbehn said.

The main reason for this is technical, he said: Because macro cells transmit throughout the pockets of space served by outdoor small cells, preventing the two types of networks from interfering with each other is a major challenge. Though there are standards for doing this across vendors, most mobile operators will stick with one supplier just to be safe, Rehbehn believes.

And Cisco, true to the words of CEO John Chambers last November, will draw the line at building small cells, analysts say. "It would be a fool's errand for them to make macros" because that's a mature and slow-growing business compared with small cells, Rehbehn said. By contrast, Cisco sees Wi-Fi as the leading edge of carrier networks. For at least two quarters, its carrier Wi-Fi sales have doubled from their year-earlier pace.

However, Cisco thinks it's destined for more than leading the mobile world into the Wi-Fi era. With many of its routers deployed in the cores of mobile networks, and a growing stable of technologies for managing systems throughout a carrier's infrastructure, Cisco says it can make every subscriber's mobile experience better.

Over the past 18 months, Cisco has spent $1.5 billion on acquisitions to help build up the technology that's going into Cisco Quantum, said Shailesh Shukla, vice president and general manager of the software and applications group in Cisco's Service Provider Mobility division. The result will be an architecture that stretches from the wireless edge of the network into the wired core.

The software will be able to analyze data about what's happening on the network in real time so carriers and other companies can take advantage of it, Shukla said. Among other things, carriers or content providers could sponsor extra data for their subscribers when they are about to go over their monthly caps. But Quantum will also be good for overall performance improvements, such as ensuring a stadium network keeps up with demand as thousands of spectators stream in, he said.

On Tuesday, Cisco announced that Vodafone Netherlands has deployed a component of Quantum to enable application-level usage controls for enterprise customers, among other things.

A network-spanning architecture is key to making those visions into reality, according to Cisco. "You can't do this in piece parts," Shukla said.

Cisco won't be the only RAN vendor with its own wired-network components. Alcatel-Lucent has been taking market share from Cisco with its 7750 SR edge router, and Ericsson is also inching into this area with its Smart Services Router line, Yankee's Rehbehn said. But as they quickly move from traditional telecom infrastructure to Internet Protocol, carriers are undergoing a sea change that could help to lift Cisco, Rehbehn said.

"Operators may begin to look very carefully at the evolution of their core network," Rehbehn said.

Stephen Lawson covers mobile, storage and networking technologies for The IDG News Service. Follow Stephen on Twitter at @sdlawsonmedia. Stephen's e-mail address is stephen_lawson@idg.com

Reprinted with permission from IDG.net. Story copyright 2014 International Data Group. All rights reserved.
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