April 2, 2010: istockAnalyst – iSuppli recently published a study contending that the next big thing in hi-tech is the femtocell.
April 2, 2010: istockAnalyst – iSuppli recently published a study contending that the next big thing in hi-tech is the femtocell. Two questions immediately come to mind: what the heck are femtocells and can an investor make money on them?
Femtocells are cellular base stations that improve indoor wireless coverage. Femtocell base stations improve 3G cellphone coverage inside buildings or homes â€” locations where wireless signals tend to be weak because of building materials blocking the signal or the site’s distance from a cell tower. A femtocell acts somewhat like a WiFi hotspot or a wireless router, providing access to the cell carrier’s network for multiple devices within a building. With some carrier networks straining to keep up with the demands of increasing numbers of users surfing the web from their smartphones, femtocells are being looked at as a way to improve service without having to build as many expensive cell towers or spend so much to increase bandwidth.
The growth story —
iSuppli has this to say with respect to growth: femtocells are “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.”
They expect shipments to triple this year. They then expect shipments in 2011 to be 289% higher than 2010 and so on. The chart below shows the sharp ramp in shipments.