LTE Inadequate to Address Capacity Crunch

4G, femtocells and offload are all partial solutions, say European carriers

By Caroline Gabriel, Research Director, Rethink Technology Research

Although LTE upgrades are generally touted as the magic bullet that will save wireless carriers from the overload on their networks, they will not be enough on their own to solve the problem. This was the conclusion of a panel discussion at the Broadband World Forum in strike-ridden Paris.

The main factor limiting the impact of LTE on operators' data plans will be shortage of spectrum, argued Denis Gautheret, an executive at Deutsche Telekom. "Spectrum is just like gas. You don't have enough," he said, as Paris struggled with fuel shortages amid a wave of strikes over spending cuts. In particular, the lower frequencies support more cost effective coverage, but the desirable digital dividend band around 800MHz has very limited capacity, he said.

As reported by TotalTelecom, fellow European cellcos are taking different approaches to making up for the limitations of 3G or LTE. Jaime Lluch Ladron, technology executive at Telefonica, said the Spanish group is mainly focused on smaller cells for capacity, and femtocells to improve the indoor penetration of 2.6GHz, a key LTE band. "Telefonica is moving towards street level picocells and femtocells... based on this 2.6GHz frequency," he said.

Femto Forum chairman Simon Saunders, on the same panel, said it costs about $7-$9 per gigabyte to carry data on a wireless network, but by using femtocells in key areas, operators can bring about "a reduction in the cost per bit in the order of a factor of four".

Other tactics to address the data crisis were outlined too - Vodafone Spain and Elisa in Finland are going the damage limitation route, offering premium packages to enterprise or high value customers to prioritize their traffic, and offloading the rest. However Ladron spoke against the conventional wisdom that Wi-Fi offload is a key solution as the user experience is not under the carrier's control, and if customers have a poor experience "they will call us. They will get upset with us."