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-This paper looks at a new method of handling the expected traffic fluctuation in micro and pic0 cellular environment. The bunch concept, which is introduced in the UMTS proposal, is investigated under various traffic conditions. Its performance in traffic hot-spots is compared to that of a conventional microcellular network. The results show that the outage probability is dramatically reduced with the use of distributed antennas. Capacity analysis of a basestation with distributed antennas is also found to be up to 4 times higher with 8 extra antennas than for a single basestation under the same conditions. I IntroductionThe last few years have seen a tremendous growth in the mobile communication industry. Reduced subscriber rates, improved handset technology and better service provision from the cellular operators are perhaps the main reason for this growth. The increased number of subscribers has forced the cellular operators to deploy microcellular networks in the city centres to meet the demand. The physical size of the basestation makes it difficult to position it at the optimum location. In addition, the rapid fluctuations in the capacity demand due to high bit rate services, makes the capacity planning very difficult.In light of this situation, a novel Bunch concept consisting of a central unit and remote antenna units has been proposed for UMTS [ 11. This paper sets out to investigate how effective this new concept is to handle unevenly distributed traffic. In addition, a capacity analysis is undertaken to see how much additional capacity the distributed antenna system can potentially provide.Section 1 discusses the technical aspects of the Bunch concept. The air interface access techniques and radio resource management techniques, which will be employed in UMTS, is covered in Section 2. Section 3 discusses the network simulation and the analysis which will be undertaken. Finally in Section 4, the results are discussed and a number of conclusions are drawn. I1The UMTS bunch concept "In the pic0 and microcell environments the major challenge is to meet the very fast changes of the required transmission capacity on the radio interface due to high bit rate services"There are two possible distinct network topologies that can be employed, namely distributed or centralised architecture. Distributed architecture has the advantage that decisions can be made locally and therefore will require less signalling and decrease the delays due to decision making. On the other hand, it provides less control over the overall network performance and the performance may be sub-optimal. Centralised solutions can maximise the resource utilisation and provides a great deal more flexibility but at the cost of increased signalling overhead and more complex radio resource management algorithms. In a micro and picocellular environment there will be severe fluctuations in traffic demand, user mobility and traffic types. This highly complex environment will require advanced Radio Resource Management (RRM) algorithms and it ...