Shared Infrastructure for Small Cells?

Service provider thinking about infrastructure sharing always is intimately and directly related to their perceptions of business advantage. Actors will favor sharing when economic or business advantage can be obtained, and will oppose it when there is perceived harm.

New questions will arise as small networks become essential for 5G networks. In many markets and scenarios, it will be argued that only a shared infrastructure approach will work.

Networks that are dense, with large numbers of small cells, and virtualized baseband signal processing, will require a huge number of new radio sites, backhaul links and power sources. In markets with multiple suppliers, there is “a clear argument for a single, shared network,” argue Rethink Wireless analysts.

On the other hand, as always, larger suppliers will think hard about any shared infrastructure proposals that allow competitors to compete more effectively. In the U.S. market, that has been a major reason why larger incumbents have resisted and opposed mandatory wholesale requirements that are similar to shared infrastructure proposals.

As always, that might be an argument better received in some markets than others. Where one or two suppliers believe they have financial or other advantages favoring building and owning their own network, they are likely to act that way. In other markets, where no single provider believes it can reap advantages for building and owning its own small network, cooperation and shared infrastructure are likely to be better received.

Those third party networks might work much as tower companies now operate, offering colocation and backhaul to multiple mobile operators. There are some differences, where it comes to small cells.

Cable TV operators long have expected their dense high-capacity networks would allow them to become retail or wholesale operators of small cell infrastructure. That means multiple entities might believe they have advantage where it comes to access networks. AT&T, with its large fixed network footprint, is among them.

Most other fixed network telcos, including Verizon, have smaller in-region fixed assets to leverage. Sprint and T-Mobile US would be most likely to favor some shared approach, as they own virtually no fixed network assets. It is possible each of those firms, if acquired by a cable operator, would have less interest in third-party shared small cell infrastructure, unless their parents wished to consider it.

And even there, cable operators are more likely to partner with other cable operators to fill in the out of region coverage.

At the moment, one might argue the prospects for small cell infrastructure in the U.S market are less favorable than in some other markets.