AT&T has signed an agreement with UK small scale cell site solutions developer ip.access worth $500 million over five years in order to deploy femtocell technology with the goal to distribute the devices for as little as $100.
Femtocells are small scale base stations that operate using a high-speed internet connection in order to take available spectrum and broadcast it over a small area, providing coverage in areas with spotty or unreliable service, such as high-rise buildings, areas with thick walls, or private residences. This is in contrast to UMA which requires specialized dual-mode handsets with Wi-Fi radios, and additonal costs for service
The advantages of a femtocell do come with downsides such as signal interference with multiple deployed cells, roaming issues, and spectrum allocation across cells. Another perceived advantage for carriers is the reduced infrastructure cost by offloading the cost of additional coverage onto the user instead of planning costly buildouts to increase coverage.
The femtocell has surfaced out of relative obscurity into a hot topic in recent months, with Sprint leading the charge with its Airave solution in limited markets. AT&T expects to conduct field trials of its femtocell solution later this year after completion of lab trials.