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Two-tier networks, comprising a conventional cellular network overlaid with shorter range hotspots (e.g. femtocells, distributed antennas, or wired relays), offer an economically viable way to improve cellular system capacity. The capacity-limiting factor in such networks is interference. The cross-tier interference between macrocells and femtocells can suffocate the capacity due to the near-far problem, so in practice hotspots should use a different frequency channel than the potentially nearby high-power macrocell users. Centralized or coordinated frequency planning, which is difficult and inefficient even in conventional cellular networks, is all but impossible in a two-tier network.
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