Mobile operators have been urged to improve the reception of 3G signals inside buildings in an effort to increase the appeal of 3G networks.

3G networks are becoming increasingly popular for mobile broadband access, thanks to the fall in connection costs. However, research firm In-Stat says that the biggest challenge facing mobile subscribers at the moment is the lack of indoor coverage of 3G signals. It warns operators will have “limited success” with their 3G services without addressing the indoor coverage issue.

And it says that the cost to address these shortcomings with traditional macro base stations solutions is too high and not possible for most mobile operators.

"Microcells, picocells, and femtocells address these challenges in a much more cost-effective manner," said In-Stat analyst Allen Nogee.

"By providing smaller and less powerful base stations in smaller areas, like public spaces, offices, and even homes, carriers can provide better coverage in more specific areas without a huge capital investment."

And it seems that In-Stat believes there is a healthy future for microcells, picocells, and femtocells. Recent research has found that the number of these devices are expected to surpass 31 million units by 2012, says the researcher.

It also suggests that an entirely new device segment is emerging, namely the Enterprise Picocell, where these devices will configure themselves like home femtocells, but for the enterprise business customer.

The researcher also believes that microcells, picocells, and femtocells can help carriers reduce churn as they provide better coverage to their existing customers. These products also offer the ability for operators to get into niche areas currently not served by cellular service, such as on aircraft and cruise ships.

Yet it remains to be seen whether the indoor coverage issue of 3G networks is such a big deal for users in the United Kingdom, where fixed-line broadband access has a very high degree of geographical penetration. Indeed, it is estimated (by BT) that 99 percent of the UK has access to a fixed-line broadband connection.

"We are constantly looking to extend the reach of 3G and are looking at all technologies that will extend the signal further and give better quality," a Vodafone spokesman told Techworld. He estimated that Vodafone's 3G network covers more than 92 percent of the UK.

O2 meanwhile has recently met the terms of its 3G licence in the UK by reaching 80 percent national coverage. "O2's strategy has been to roll out our 3G network in areas where there is the most demand, providing high quality, in-building coverage in those areas," said an O2 spokesman.

Both T-Mobile and O2 are currently running a trial of the indoor base station technology.