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INDOOR SMALL CELL VENDOR MATRIX

(Excerpt of Vendor Matrix)

Aditya Kaul: Practice Director, Mobile Networks abiresearch.com

APRIL 5, 2012

1. UBIQUISYS VENDOR MATRIX STANDING

Ubiquisys is ranked the #1 vendor in ABI Researchs indoor small cell vendor matrix. Ubiquisys gets top marks for continuing to innovate with technologies such as Cloudbase, SideStep, and the EdgeCloud. Its snap-on small cell for SFRs Neufbox solution is also the first of its kind in the market. Ubiquisys has proved that being a femto software-only provider is not such a bad thing after all. In fact, Ubiquisys continues to hold on to some of its hardware capabilities developing hardware for the likes of SFR and Intel. On the back of cutting edge innovation, Ubiquisys has signed a number of contracts, mainly through leading system integration partners NEC and NSN, but also has a direct contract to boast of with Softbank. In terms of number of contracts, Ubiquisys is in the same league as its larger competitors Alcatel-Lucent and Huawei. This demonstrates that Ubiquisys has been able to play on its strength as a femto specialist, continuing to expand its relationship with femto integrators and compete effectively with other large small cell end-to- end vendors.
Company 1 2 Ubiquisys Alcatel-Lucent Huawei Technologies Co Ltd ip.access Ltd Airvana Cisco Systems AirWalk Communications Inc Argela Technologies Samsung LG-Nortel Co Ltd Hitachi Ltd Hay Systems Ltd. Innovation 87 80 Implementation 85 89

3 4 5 6

68 71 64 57

91 80 66 72

7 8 9 10 11 12

65 54 38 28 24 25

65 63 57 61 46 33

NEW YORK +1.516.624.2500

LONDON +44.(0).203.326.0140

SINGAPORE +65.6592.0290

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2. UBIQUISYS COMPANY OVERVIEW

Ubiquisys Ltd, based in Swindon, United Kingdom, has been a key player in the small cell market. The company was formed in 2004 and is recognized as one of the pioneers in the small cell space. It is also one of the founding members of the Femto Forum. Operators that have commercially deployed Ubiquisys small cells include SFR France, Softbank Mobile Japan, TDC Denmark, Orange France, and Network Norway. Ubiquisys is known to have 29 commercial contracts for small cells including residential, enterprise, and metro small cells. Ubiquisys provides Femto Engine software, which is a set of applications that sits on top of the basic L1 modem. Some of the key features include adaptive radio resource management (RRM); autonomous decision-making capabilities for offload, media sharing, phone interaction, etc.; and a small cell self-organizing network (SON). Additionally, Ubiquisys provides hardware designs to device manufacturers to fast-track the production of new small cell variants that run on Femto Engine software. The first Ubiquisys small cell to be commercially launched by operators in January 2009 was the G2, a four-user residential small cell. Ubiquisys has an upgraded version known as the G3 that features eight calls and supports 14.4/5.7 Mbps HSPA. In terms of the access point-gateway interface, Ubiquisys supports Iuh, IMS/SIP, and GAN architectures. Femto Engine-powered small cells are available in a range of hardware configurations for enterprise, enterprise grid, indoor open space, and rural applications. Also of note, Ubiquisys is one of the first vendors to provide a metro small cell solution using its Femto Engine software. Ubiquisys has developed a unique new technology known as SideStep, which allows operators with two or more macro carriers to have a straddled femto carrier deployment. This is essentially is a third femto carrier that sits between the two bands, allowing for reduced interference. SideStep is being trialed by carriers and is expected to see commercial deployment soon. Intel and Ubiquisys have collaborated in developing Edge Cloud, which brings higher processing capabilities closer to the edge of the network. The Edge Cloud refers to a layer of extremely powerful Atom-based 3G/LTE small cell platforms that can process and even store high-end bulky content at the edge of the network instead of sending it back to the core network. Intel is using its Atom processors and the resources available to the Intel Developer Forum to develop the concept of the Edge Cloud along with Ubiquisys. The Edge Cloud can be used as a collective RAN caching solution or as a collective content processing layer. CloudBase is another unique small cell lifecycle management system from Ubiquisys, which uses cloud technology to activate, upgrade, recover, and enhance a fleet of small cell deployments.
.

Ubiquisys takes the top spot on the back of its continued commitment to innovation with technologies like SideStep, CloudBase, and EdgeCloud, while keeping their commercial contracts ticking through their NEC and NSN partnerships, comments Aditya Kaul, practice director, mobile networks. Alcatel-Lucent and Huawei have also seen commercial success over the past year in terms of contract wins, but Ubiquisyss dedicated focus on the small cell area allows them to stay a couple of steps ahead of their larger rivals when it comes to introducing innovative techniques that should shape the future of the small cell market.

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3. METHODOLOGY
The Indoor Small Cell Vendor Matrix compares small cell access point vendors and ranks them based on various criteria linked to Innovation and Implementation. This matrix primarily covers the competitiveness of vendors that provide access points for indoor residential and enterprises small cells. However, it does recognize the capability of vendors around outdoor metro and rural small cell solutions. ABI Research evaluates vendors on the basis of innovation and implementation by selecting multiple criteria related to product/company characteristics that serve as proxies for the vendors' performance in these two areas. Upon evaluation, vendors are assigned numerical scores that are aggregated and analyzed to provide overall rankings of each vendor on the Innovation and Implementation axes. The criteria specific to the evaluation of small cells include: 3.1. Implementation

End-to-End Solution Capability: measures ability of vendor to provide end-to-end solutions from chipset access point through to system integration. RFP, Trial, and Rollout Activity: measures commercial activity of vendor including participation in RFPs, trials, and commercial rollouts, with larger weight for live commercial rollouts. Ability to Scale and Commoditize Quickly: measures ability to scale operations to match upcoming spikes in demand for small cell access points. Carrier Relationships: measures existing relationships with carriersincluding Tier 1, 2, and 3 carrierswith larger weightage for Tier 1 carriers. Overall Financial and Organizational Health: measures financial health of the vendor. Silicon Strategy/Partnerships: measures the silicon strategy, silicon partnerships, or internal ability of a vendor to develop silicon. Software Stack Capabilities: measures the software stack strategy, software stack partnerships, or internal ability of a vendor to develop software stack.

3.2. Innovation

Cost: measures innovation and effort in reducing the cost of the small cell access point. Interference Mitigation Techniques: measures innovation and techniques involved in reducing interference from small cells. Standards-Compliant Network Interface: measures efforts to provide a standards-compliant small cell, including participation and submission to the standards themselves. Gateway/Handset IOT: measures effort of vendor in terms of handset and gateway IOT. L2/L3 Software Stack: measures innovation on the L2/L3 software stack. Hand In/Out Support: measures effort and innovation to provide hand-in/hand-out support on small cells. Module Support: measures the ability of a vendor to provide modular versions of its small cell that can integrate into third-party platforms. Femtozone Service/Application Framework Support: measures innovation and development of a femtozone services and application framework. Support for Multiple Form Factors: measures innovation and capability in providing multiple form factors (DSL/Wi-Fi integrated, set-top box integrated femto). Enterprise Small Cell Capability: measures innovation and capabilities for enterprise/business grade small cells. Metro/Rural Small Cell Capability: measures innovation and capabilities for metro/rural grade small cells.

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Small Cell Network and Operations Management: measures capabilities and innovations around small cell network management systems including fault diagnostics, device management, collecting network statistics, and performance management.

3.3. Rankings After individual scores are established for Innovation and Implementation using the above criteria, an overall company score is established using the Root Mean Square (RMS) method:

The resulting overall scores are then ranked and used for percentile comparisons. The RMS method, in comparison with a straight summation or average of individual innovation and implementation values, rewards companies for standout performance. For example, using this method a company with an innovation score of 9 and an implementation score of 1 would score considerably higher than a company with a score of 5 in both areas, despite the mean score being the same. ABI Research believes this is appropriate as the goal of these matrices is to highlight those companies that stand out from the others.

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4. VENDOR MATRIX SUMMARY

Despite increasing competition in the small cell market during 2011, Ubiquisys retains its position as the leading indoor small cell access point vendor for the fourth year in a row. Ubiquisys continues to innovate and differentiate itself with technologies such as SideStep (interference management), CloudBase (small cell lifecycle management) and EdgeCloud (Intel partnership combining cloud and small cell technology). Ubiquisys has also kept pace with its competitors winning contracts, almost equaling its big end-to-end vendor rivals, Huawei and Alcatel-Lucent. Its partnerships with NEC and NSN continue to bear fruit, allowing it to focus on its strengths as a small cell specialist. While it made a conscious transition to becoming a software-only supplier back in 2009, it has held on to some of its hardware skills and capabilities, using it to its advantage in the case of the Intel EdgeCloud solution and SFR's clip-on Neufbox solution. While other vendors seem to be closing the gap, Ubiquisys has managed to stay a couple of steps ahead, justifying its position as top small cell access point vendor in 2012. Alcatel-Lucent and Huawei are ranked #2 and #3 respectively, and continue to hold on to their positions from 2011. Alcatel-Lucent has benefitted immensely by being a top tier wireless infrastructure vendor having first mover advantage in the small cell space, especially compared to its rivals such as Ericsson and NSN. ALU continues to win contracts on the back of its end-to-end small cell vendor story; however, it does fall short in terms of technological and product innovation compared to Ubiquisys. Huawei, while having breezed through the competition steadily winning contracts hasn't been able to convert those contracts to volumes, just yet. Huawei's position as a small cell access point vendor is compromised due to its shortcomings on some of the innovation criteria including interference management, enterprise small cells, and small cell network and operations management. ip.access has gained two positions from 2011 in the matrix due to its recent innovations, including OysterCatcher (small cell performance management and diagnostic tool) and its focus on improving key capabilities in the software stack and interference management for small cells. While it is still behind the top three vendors in this market in terms of contracts, it does seem to have the right recipe to achieve long term success based on the intellectual property (IP) knowhow it has accumulated over the years and its large presence in the small but significant 2G enterprise pico space, which could prove to be an asset when competing for 3G enterprise small cell contracts. CDMA vendor Airvana has benefitted from Sprint's 3G small cell contract and has seen a large growth in volume shipments, overtaking AT&T's shipments as per ABI estimates. This has provided some bragging rights to Airvana, giving it a boost for some of the implementation criteria. However, Airvana does still have to prove itself in terms of product innovation, as compared to vendors such as Ubiquisys or even ip.access. Airvana has been through some financial reorganization, which has helped it focus its energies on the femto and small cell market, but at the same time limits its resource capabilities and scale of operations. The other CDMA vendor, Airwalk has also seen an enterprise contract from Sprint come to fruition, with Sprint now shipping Airwalk solutions as of 4Q 2011. This does give it impetus as a small cell vendor but its niche focus on enterprise small cells limits its competitive standing in the market, most of which is still driven by residential small cells. Overall, Airvana and Airwalk have a

2012 ABI Research abiresearch.com The material contained herein is for the individual use of the purchasing Licensee and may not be distributed to any other person or entity by such. Licensee including, without limitation, to persons within the same corporate or other entity as such Licensee, without the express written permission of Licensor.

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2012 ABI Research abiresearch.com The material contained herein is for the individual use of the purchasing Licensee and may not be distributed to any other person or entity by such. Licensee including, without limitation, to persons within the same corporate or other entity as such Licensee, without the express written permission of Licensor.

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5. TABLE OF CONTENTS
1. UBIQUISYS VENDOR MATRIX STANDING ..................................................................................................................... 1 2. UBIQUISYS COMPANY OVERVIEW ................................................................................................................................ 2 3. METHODOLOGY ................................................................................................................................................................ 3
3.1. Implementation .................................................................................................................................................................................... 3 3.2. Innovation ............................................................................................................................................................................................ 3 3.3. Rankings ............................................................................................................................................................................................. 4

4. VENDOR MATRIX SUMMARY .......................................................................................................................................... 5

2012 ABI Research abiresearch.com The material contained herein is for the individual use of the purchasing Licensee and may not be distributed to any other person or entity by such. Licensee including, without limitation, to persons within the same corporate or other entity as such Licensee, without the express written permission of Licensor.

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Published April 5, 2012

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2012 ABI Research abiresearch.com The material contained herein is for the individual use of the purchasing Licensee and may not be distributed to any other person or entity by such. Licensee including, without limitation, to persons within the same corporate or other entity as such Licensee, without the express written permission of Licensor.