Cisco Systems, Inc. (NASDAQ:CSCO) to build smaller base stations

Networking equipment and infrastructure provider Cisco Systems, Inc.(NASDAQ:CSCO) plans to build smaller cellular base stations to provide connectivity for mobile network operators, the company's Chairman and Chief Executive John Chambers said on Tuesday.

Instead of setting up large "macro" base stations it will now focus on the smaller cells to cover smaller areas to allow mobile service providers effectively use available spectrum.

So far the company has left this part of the infrastructure in providing connectivity to companies that are part of the mobile network world such as Nokia Siemens networks, Alcatel-Lucent and Ericsson to name a few.

Though Cisco has been talking about making move into the cellular radio market for some time now, this is the first definitive information that the company has provided about its plans in this segment.

Mobile network providers need to co-ordinate between small and macro base stations to carry calls and data services. Since radio spectrum is fixed and often available only at a premium they need to use these stations judiciously.

"We're going to move into small cell, and then we're going to combine small cell with [service-provider] Wi-Fi, with 3G, with 4G, with our architectural plays," Chambers told analysts in a conference call after announcing the company's third quarter results.

He clarified that the company would not make traditional base stations, such as those that are found on towers, but would make the kind of stations that are designed to go on top of light poles.

Combining small cells with Wi-Fi in the same access point may be a natural move for Cisco and is one that other vendors are already working on.