Summary

The femtocell services coming out of Sprint and Verizon look similar - both focused on coverage and voice services. The reliance on voice services is logical given subscriber priorities and a lack of inexpensive, dual-mode 2G/3G femtocells.  Verizon's focus on coverage, alone, is nonsensical.

Analysis

Verizon's Network Extender femtocell service bears a striking resemblance to Sprint’s Airave. 


Both cost money up-front (~$100 @ Sprint, ~$200 @ Verizon).  Both improve cell coverage in the home.  Both are limited to CDMA2000 1X (IE, 2G) voice and data services.  Beyond the similarities, some pundits in the media have given an edge to Verizon for its lack of a monthly fee, vs. the $4.99 per month base rate Sprint charges.  This is insane given the difference in device costs (it would take a Verizon user 20 months to recoup the price difference).  It’s equally insane given a lack of femto-specific service plans offered by Verizon compared with the $10 and $20 per month (individual and family) unlimited service plans coming out of Sprint.


Potentially, of course, both operators might be considered insane for offering voice-focused, 2G femtocell services in a market where mobile data is all the rage.


To be fair, you can’t blame Sprint or Verizon for the focus on 2G.  With limited dual-mode chipset options (in infrastructure, at least), a combination 2G-3G CDMA femtocell would essentially require two sets of silicon, adding to costs.  As a result, CDMA operators have to choose between 2G or 3G femtocells and the importance of voice coverage to subscribers means that 2G wins.


You can, however, blame operators for a lack of compelling service thinking.  Yes, improved coverage and signal quality will appeal to some subscribers.  Most with truly bad coverage will simply move to another operator with better coverage…or an operator with femtocell services that offer attractive femtoc-specific tariffs (such as Sprint or reportedly AT&T going forward)

Peter Jarich consults with leading institutions through GLG

Peter Jarich, Research Director

What is a GLG Leader?|GLG Leaders are a separate tier of Council Members with a Council Rank in the top 5%. These GLG Member Program participants are eligible for ongoing, in-depth consultative relationships with GLG clients.

Research Director, CURRENT ANALYSIS, INC.

 
Analyses are solely the work of the authors and have not been edited or endorsed by GLG.