3G femtocells, which promise to deliver indoor coverage and cheap service for 3G networks, are a step closer, thanks to a base station built using chips designed for mass-market handsets.

Femtocells could solve the problems with 3G, by providing mobile coverage indoors and connecting to the cellular networks using the customer's own broadband connections, countering alternatives such as voice over Wi-Fi, where users make low cost calls on their own indoor Wi-Fi network. They don't require a dual-mode phone either, as indoor and outdoor coverage are on the same spectrum.

So far, it has not been clear how they will be paid for, but Cambridge Consultants has reduced the potential cost, by building a base station radio which uses consumer-grade handset silicon. This could cut the price of a femto to the point where operators can afford to offer them as part of a bundle with a 3G handset.

The base station, which supports the higher-speed HSDPT/HSUPA extensions to 3G, meets a reference design from Bath-based femtocell expert, picoChip, and has just two major silicon chips - the other being picoChip's signal processing silicon for baseband and control functions.

ABI Research has predicted that there could be 100 million base stations within homes in the next five years, and the industry has a group, the Femto Forum to promote the concept.

However, others are more sceptical, saying the concept will still be difficult to sell: "With the rapidly-growing installed base of non-femto home gateways and set-top boxes, most early femtos will need to be 'daisy-chained" via an ethernet port, adding to installation and configuration headaches," said Dean Bubley of Disruptive Analysis. "In the real world, people have multiple phones, households have members with different requirements, longterm contracts are always out of phase, and so on."