Summary Bullets:
- Conventional wisdom says operators won’t share small cells.
- There’s reason to believe that could change in some areas.
“Operators don’t like to share.”
We hear it all the time. If small cells are the hot new toy this holiday season, we’ve already been warned that operators are not going to want to share them. There are some good reasons to use common, shared infrastructure (whether small cells or backhaul or something similar): to distribute deployment and installation costs; to overcome the resistance of municipalities and other site owners to clusters of hanging boxes; and, for indoor/enterprise deployments, to address operator neutrality preferences. However, we’re told that operators want to control their own fate. They want their small-cell networks optimized for their unique needs. So – at least initially, while they’re trying to climb the learning curve of small-cell networks – they don’t want to have to play nice with anyone else to get what they need.
So far, that appears to be borne out in the market. (NEC, a vocal proponent of gateway-sharing small-cells-as-a-service, told me at this month’s Small Cells Americas show that its indoor E-RAN solution is proving to be much more popular than the multi-operator option.) One small-cell vendor recently put it this way: Operators are likely to see small cells as a competitive differentiator. And you wouldn’t share your secret sauce, would you? I’d argue, though, that small cells will be a competitive differentiator for the operator that deploys them first. For all others (especially smaller players), it might make sense to use the deployed infrastructure of a third-party wholesaler to catch up to your competitors – 
to quickly restore an even playing field with the rival that rolled out small cells. Cable companies in the U.S. are already talking about offering wholesale small cell (and related backhaul) services. Ericsson has said it’s considering multi-operator versions of its indoor/enterprise Radio Dot System. Even folks at AT&T are talking about sharing – sharing small-cell spectrum (in the case of 3.5 GHz in the U.S.) and even, potentially, indoor infrastructure. Well, okay, AT&T with an asterisk: Gordon Mansfield, the AT&T VP who also chairs the Small Cell Forum, made the argument (in a chat with me at that same small-cell show) that even major operators are, in fact, open to sharing in some cases. After all, he said, the objection to sharing typically stems from the fact that, in the outside world, operators are on different grids, with different needs for antenna tilt and other tweaks. Inside enterprise buildings, however, operators’ RF needs are more likely to be closely aligned. So, why not share common antennas, the way operators sometimes do today with distributed antenna systems (DAS)?
Wait a minute. “Operators don’t like to share!” I told him over the hotel’s piped-in Christmas music.
Mansfield said, “That’s not really true.”
Thanks for sharing! Common sense and financial realities dictate that sharing will eventually take hold, although it may be a while yet. When they do share there will be opportunities to due cross operator value added services which would be similar to SMS in value and deployment as well as its profit opportunity.
Many good points here, Ed.
“Mobile Network Operators don’t play well with others…” has been the perceived wisdom for much of the last 20 years of the industry, and the reasons for this have been the huge cost of network infrastructure, roll out costs and the ability to differentiate on the quality, or at least the coverage, provided. Interestingly, in the last few years we have seen unprecedented levels of “coopertition” (Cooperation and competition) as operators indulge in various models of network sharing to reduce their costs and meet demand. Economics dictate that cooperation and sharing of resources is the only sensible way ahead.
However, Small Cells offer MNOs a great opportunity to go at it alone and try to differentiate. This is because at the microcellular level, mobile networks are not good! Coverage on major transportation routes – roads, railways and airports is often poor even for GSM voice let alone 3G or LTE data connectivity, but these are the locations where people want connectivity. There is an opportunity here to accurately locate and cheaply deploy small cells as a powerful differentiator in the battle against churn. For the agile operator, small cells are the opportunity to leap ahead of their competition and actually differentiate on customer experience.
In time we may again see operators joining forces to roll out small cell networks as they differentiate on the next new innovation, but for now most operators will see Small Cells are a way of getting ahead of the competition and will go it alone.
Justin Paul
Head of OSS Marketing – Amdocs