Motorola has started testing 3G femtocells in Europe, a technology that should help to improve indoor reception and reduce at-home calling costs for 3G users.

Femtocells are small, indoor base stations that allow cellular calls to be routed out of the home via a DSL or cable broadband connection. They are seen as key to the growth of 3G services because connection speeds degrade when 3G handsets are used indoors, and femtocells help overcome this problem. They should also mean lower 3G bills for consumers, because operators can offer reduced rates for calls that are made over broadband networks, where bandwidth is more plentiful than on their cellular networks.

Motorola didn't say which operator it had started its trials with.

At least eight carriers in Europe have started trials or committed to undertaking them, said Stuart Carlaw, research director with ABI Research. Femtocells could be offered with 3G mobile phone packages by the second half of 2008, he said.

Motorola also didn't identify the manufacturer of the femtocells it is using. Motorola owns part of IP Access, one of several femtocell makers. Another is Ubiquity Software, owned by Avaya.