Cellular traffic in the United States today is 40,000 times greater than it was 10 years ago. That equates to 37 gigabytes of data used per second, which is only expected to increase as the number of cellular subscribers and their data usage rates continue to climb.
Matt Grob, vice president and chief technology officer at Qualcomm Inc. (Nasdaq: QCOM), spoke about the company’s plans to accommodate this swell in data needs at a CommNexus event at Qualcomm’s headquarters Tuesday evening. He said Qualcomm has set a goal of supplying 1,000 times more cellular capacity in the next 10 years, and now the challenge is in developing technologies to make that a reality.
Shrinking the cell radius into smaller hotspots in addition to the main base station, “in combination with more spectrum and the best radios we can make, altogether is going to give us the 1,000,” Grob said.
As for increasing spectrum, a finite resource that can’t be created, most of the proposed increase will come in the form of Authorized Shared Access. ASA would allow cellular companies to enter into an agreement with entities like defense organizations, which currently claim 27 percent of the macro-suitable spectrum but only use that amount in rare cases. In this agreement, cellular companies would use that entity’s excess spectrum when it’s not needed, but be able to automatically transfer control back to the original owner when necessary. Grob said he expects a tenfold increase in spectrum over 10 years.
The next part of the equation is small cells for coverage, which will complement, but not replace, the existing macro network of base stations.
“We’re not going to dot the countryside with tiny base stations,” Grob said. “We’re going to put them as a densification method to compliment the macro, and in places where you can’t see the small base station, the macro’s still there to help you out.”
Adding just four small cells per base station yields 5.7 times more performance capability than currently exists.
While this solution solves one problem, it creates several more. The backhaul issue of having to install and wire the cells, the interference they can cause with other small cells and the problem of paying for them are all consequential side effects.
Grob said Qualcomm has been working on the interference problem for many years, and has several attainable solutions at this point. One such measure is to enable the small cells to communicate with each other and with the base station, and dial down when interference is detected. As for backhaul and the economics of it, there are several possible solutions.
Grob laid out three possible new business models resulting from the changing cellular industry: reciprocal access, paid local access and a wholesale small cell network.
In the reciprocal access model, you can either pay for the service or receive it for free. By choosing the free option, your access is then opened for others to use, and you in turn can use their coverage when you encounter it.
Paid local access already exists with Wi-Fi, where certain areas or entities like hotels for instance, can regulate the system’s use. Grob said the same can be done with cellular.
Lastly, the wholesale system would involve internet providers adding cellular chips to their existing product and connecting the bundle at a fee to wireless companies.
In terms of improving radios, Grob said that work would focus on a higher signal to noise ratio and building a better receiver and equalizer to increase capacity.
With a tenfold increase in spectrum and 20 percent of residencies installing small cells, Grob said the 1,000-times-capacity increase goal would be reached in 10 years.
Regardless of whatever models and strategies for meeting Qualcomm’s “1000x” goal come to fruition, it’s obvious that something has to be done — 3G and 4G connections only make up 30 percent of all existing cellular connections, but are growing at a rate of 1 million a day.