The research group iSuppli says that the ecosystem surrounding femtocells, or cellular base stations that improve indoor wireless coverage, is headed toward critical mass among all major nodes of the wireless supply chain and will vault into explosive growth after reaching a decisive watershed this year.

According to iSuppli’s projections, unit shipments of femtocells will more than triple this year, rising to 1.9 million, up from 571,000 in 2009. A period of phenomenal expansion then will follow, with shipments reaching 7.2 million units in 2011, up 289 percent from 2010.

Shipments will rise by 232 percent to reach 23.9 million units in 2012 and by a whopping 657 percent to hit 39.6 million units in 2013.

“Throughout the wireless supply chain, companies are busy mobilizing to provide solutions for femtocells, which resemble Wi-Fi routers in appearance,” said Francis Sideco, principal analyst for wireless research at iSuppli.

“Instead of enabling wireless local area networks, however, femtocell base stations improve 3G coverage inside buildings or homes—locations where wireless signals tend to be weak because of building materials blocking the signal or the site’s distance from a cell tower.”

Among participant nodes, Tier 1 entities in the United States and major global operators like Vodafone Group plc in the United Kingdom have launched femtocell solutions. Commercial deployments also are being launched by an increasing number of carriers around the world.

In addition to carriers, several device manufacturers are firming up their femtocell positions after recently announcing the selection of England-based company picoChip to supply the key baseband chipset components for their products.

Femtocells likewise are being evaluated by chipset suppliers such as Qualcomm and Texas Instruments, which are examining entry strategies for breaking into the market, as iSuppli reminds.

According to Sideco, given the inherent use cases and environmental requirements of indoor deployments, self-optimizing networks are essential to the success of femtocells.

“While technical and commercial challenges remain, femtocells are proving to be viable solutions for players in the wireless industry—especially mobile network operators—seeking to optimize their resources in providing seamless wireless coverage inside indoor environments,” says iSuppli.

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