Pent-up Demand for Mobile Connectivity from Rural Communities Primes US$ 20.2 Billion in Rural Cell-site Expenditure in 2019

Singapore - 20 Jun 2019

There is a growing divide in terms of the quality of mobile broadband coverage between rural and urban communities. Mobile operators are responding to local community and state regulatory pressure to ensure mobile cellular coverage is not just ‘voice-capable’ but also ‘mobile broadband-capable’. In 2019, an estimated US$20.2 billion will be invested in developed and emerging market rural cell-sites, a 1.2% increase from 2018, reports ABI Research, a global tech market advisory firm.

Mobile operators and infrastructure vendors are also in the process of rebooting the typical cell-site deployment approach. The macro base-station is now being complemented by low-cost small cells that deliver coverage to a specific rural village or town. Small cell unit shipments will grow at a compound annual growth rate of 10.9% to reach US$2.2 billion by the end of 2024.

“Novel engineering and manufacturing processes have not just made rural cell-site solutions cheaper but also more versatile,” says Ling Kangrui, Research Analyst at ABI Research. “Innovative re-inventions of the traditional cell site include Huawei’s RuralStar Lite and Nokia’s Kuha cell-site. Huawei claims that it has been able to reduce the cost of its RuralStar Lite solution to around US$20,000 and therefore offers a lower return of investment time of between three to five years. The Facebook-backed Telecom Infra Project (TIP) ventures, such as Parallel Wireless vRAN and Fairwave base station solutions, have radically altered the typical cell-site total cost of ownership model for the operator. Furthermore, tethered and untethered, “balloon-based” solutions such as Altaeros’ SuperTower and Alphabet’s Loon will potentially disrupt the macro cell-site business model,” Kangrui explains.

“Several mobile network operators are taking proactive steps to prioritize the coverage needs of their rural end-users,” says Jake Saunders, Vice President at ABI Research. “Telefonica has enabled mobile connectivity in remote Latin America by using the Parallel Wireless vRAN solution, which features multi-mode and carrier capabilities. Vodafone Egypt and Vipnet Croatia are some of the operators who have adopted Ericsson Psi Coverage, a low-cost RAN solution designed to utilize a single radio unit for rural deployment. There are also novel initiatives to combine solar-powered small cells with off-grid lithium batteries to provide communications and power to local communities,” concludes Saunders.

These findings are from ABI Research’s Mobile Cellular Deployment Solutions for Rural Cell Sites Application Analysis report. This report is part of the company’s 5G & Mobile Network Infrastructure research service, which includes research, data, and analyst insights. Based on extensive primary interviews, Application Analysis reports present  in-depth analysis of key market trends and factors for a specific application, which could focus on an individual market or geography.