According to a new research report by Berg Insight (www.berginsight.com), the installed base of small cell base stations increased to about 4.1 million units worldwide in 2012. Growing at a compound annual growth rate (CAGR) of 46.2 percent, the installed base is forecasted to reach 40 million units by 2018.

Small cells encompass a range of low power cellular base stations including femtocells, picocells and microcells with gradually higher output power and capacity in terms of simultaneous users. Small cells are designed to complement the large base stations forming the cellular macro network by providing enhancements in coverage and capacity in locations such as homes, offices and public venues.
 
"Mobile operators worldwide are experiencing rapid growth in mobile data and signalling traffic," says André Malm, senior analyst, Berg Insight. He adds that total mobile data traffic in cellular networks is likely to grow at a compound annual growth rate (CAGR) of more than 50% from 2012 until 2018. A combination of approaches can be used to meet the rising demand for data traffic.

These include acquiring more spectrum, using more advanced radio air interfaces, making the macro layer denser by installing more base stations in traffic hotspots, as well as introducing heterogeneous networks (HetNets). HetNets are composed of multiple radio access technologies, architectures, backhaul solutions and base stations of varying transmission power. Examples of low power nodes include Remote Radio Units (RRUs) and Distributed Antenna Systems (DAS), as well as small cell base stations such as microcells, picocells and femtocells.
 
Small cell solutions have been available for many years. Mobile operators have for instance deployed microcells to improve coverage in outdoor locations where macrocell solutions are unsuitable mainly due to high cost. DAS have been used to enhance coverage in public indoor areas.

More recently, operators have begun to deploy femtocells to improve network coverage for residential and small business customers. However, with the introduction of HetNets, operators will be able to install and manage a much larger number of small cells that increasingly become integrated nodes providing capacity enhancement to the network.

"Furthermore, small cells are gradually becoming multi-mode solutions, incorporating cellular access technologies including 3G/LTE, in addition to Wi-Fi," says Malm.