Nokia to trial 'home base stations'

Poor mobile phone reception within the home could soon be a thing of the past as mobile phone operators prepare to trial a technology called femtocell that enables the installation of tiny indoor base stations.

Existing networks use giant masts to transmit data to customers across a large area, but such blanket coverage often means that reception within the user's home or workplace is substandard. While some telecoms companies have started deploying "home hubs"to offer converged fixed and mobile services, femtocells would not limit customers to using specific handsets or operators.

The technology has been thrust into the spotlight this week after Nokia Siemens Networks said it expected to commercially deploy the technology in the third quarter of 2008 after trials. On the operator side, O2 has previously expressed interest in the technology, while Orange and Vodafone are assessing the potential of femtocells. The Japanese operator Softbank has also talked about launching the technology commercially.

Ubiquisys, a leading femtocell vendor, expects trials to begin in Europe this year. Martin McNair, a general partner at Advent Venture Partners, which has backed Ubiquisys, said that the technology would provide customers with better reception than a digital cordless phone, and will benefit mobile phone companies by stimulating more usage indoors, where most mobile phone calls are made. He said that mobile phone companies are likely to subsidise the mini base stations - which will be about the size of a small router and plug into a broadband connection - to benefit from higher mobile usage and increased customer loyalty.

Stuart Carlaw, an analyst with ABI Research, said that the femtocell market will be worth $2bn by 2011 at a conservative estimate.