Rakon targets burgeoning femtocell 3G market

The company has three different potential solutions for the femtocell market at the moment

Auckland-based global positioning system component manufacturer Rakon is targeting the emerging market for consumer base stations, or “femtocells”.

The company has a team, mainly based in the UK, working on frequency control solutions for the 3G base-station market, says Rakon’s marketing manager, Justin Maloney.

Femtocells sit in users’ homes or offices. The technology provides 3G voice and data indoors — improving indoor network coverage — using the customer’s own broadband to connect to the operator’s network.

Rakon develops high performance frequency control technology, based on quartz crystals, for applications such as GPS and wireless communications. The company has three different potential solutions for the femtocell market at the moment. Which solution gets adopted will depend on factors such as exact implementation, standards and how risk-averse the manufacturers want to be, says Maloney.

The Rakon products cover the medium risk, low risk and no risk areas, and the differentiator is price. The medium risk, less expensive, product, is based on TCXO (temperature-compensated crystal oscillator), but the requirements for femtocells are pushing the boundaries for what that can deliver.

That is why it is called a medium risk solution, says Maloney. The low risk product is also TCXO-based, while the no risk solution is a TCXO/OCXO (oven-controlled crystal oscillator) hybrid, called Triton. Triton can achieve performance well over the requirements, Maloney says.

For femtocells, the standard accuracy requirement is 0.1ppm (parts per million), he says. The main challenge is to meet this requirement at the right price.

Current femtocell base station solutions cost in the region of US$100 (NZ$133), but to make the products commercially viable, the price needs to come down to somewhere around US$25-50 for the Triton solution, and around US$10-20 for the TCXO solutions, says Maloney.

3G network operators in the UK could begin testing femtocell technology before the end of the year, according to IDG News Service in London. Vodafone Group in the UK issued a request-for-proposal to femtocell vendors earlier this year.

New York-based ABI Research forecasts that the market for femtocells will reach 36 million units per annum by 2012 after introduction in 2008.

Rakon is a member of the Femto Forum, a group that will promote open standards around the technology. The Forum was launched in July.

Another area of interest for Rakon is the GPS-enabled smartphone market. The company is likely to be supplying radio/GPS units to Research In Motion’s (RIM) Blackberry 8800 series in the future.

The company is in talks with RIM, but Maloney can’t confirm or deny whether RIM will be using Rakon’s units. It is a target for the company to be a supplier to RIM’s GPS-enabled handheld product line, he says. If Rakon is not a supplier now, the company is certainly working with RIM to make sure it will be a supplier in the future, he adds.

What is currently being used in GPS-enabled cellphones is a 3.2 by 2.5 millimetre TCXO, says Maloney, and that is at the large end of standard for cellphones. Later this year Rakon is launching into volume production of a next-generation 2.5 by 2.0 millimetre, 0.5 ppm (parts per million) TCXO.

“That is definitely targeted at the likes of RIM and other handset manufacturers who want to incorporate GPS. Those guys need something really stable, but they need it small and low-cost,” he says.

Including the radio frequency component is something that manufacturers have struggled with, says Maloney. Dedicated RF-engineers are scarce, and RF design processes take time, he says. Rakon’s RF module takes care of that, and even if customers change everything else in a circuit, the RF design stays consistent. This helps simplify product design, he says, and can help manufacturers reduce time to market, as no in-house RF design expertise is needed.

The smaller you are trying to make a RF circuit, the harder it gets, because there is more opportunity for interference. Rakon has managed to shrink its RF circuit down to 7mm square, and the future generation is 5 millimetres square, says Maloney.

The RF/GPS units do not necessarily translate into price-savings for the customer, it is rather a cost neutral solution, he says. But the RF component makes Rakon a valuable provider, as the manufacturers don’t have to spend time and money on in-house RF design, redesign and debugging, he says.

The downside of this market segment is it’s a long process getting up to high volumes, he says.

Rakon was founded in 1967. The company has over 100 engineers on staff, including 10 PhDs globally, of which two are in New Zealand. It also employs around 300 manufacturing staff.

Earlier this year, Rakon acquired the Frequency Control Products business (FCP) of UK-based C-MAC MicroTechnology.

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