BT goes Wi-Fi on Fusion offering

BT announced today a new version of its Fusion fixed/mobile convergence product that incorporates Wi-Fi and new handsets from Nokia, Motorola and Samsung.

BT Fusion Plus will be available in more than 400 Phones4u stores across the U.K. The company plans to have the first phase of its 12 Wireless Cities plan complete by the end of March 2008. Most of the U.K.’s major city centers will be offering Wi-Fi coverage. BT expects the new Nokia 6136, Motorola A910 and Samsung P200 Wi-Fi handsets to boost sales of its Fusion service.

The service includes free Internet access over BT Openzone hotspots at speeds five times faster than GPRS.

Carrie Pawsey, analyst with Ovum, said this latest evolution of Fusion will be more attractive to the consumer market than the former version, which is based on Bluetooth technology.

"To date, BT Fusion has not been successful with less than 50,000 subscribers. However, the announcement today of its Wi-Fi Fusion for consumers is a step in the right direction for BT,” Pawsey said in a statement. “Not only does it allow Fusion to extend into the wider OpenZone network but it is also an opportunity for the operator to change its tariffs, marketing and positioning of Fusion which were previously inhibiting its appeal.”

Pawsey said the Wi-Fi-based service will feature more competitive pricing, simpler tariffs, increased handset range and have a high street presence. Although the extended range of handsets is still limited, BT has a roadmap for more devices during 2007. Pawsey anticipates other vendors providing handsets for UMA Wi-Fi.

“Since it launched the [Fusion] service, BT has learned a lot in the market place, and we are seeing evidence of this in the second evolution of Fusion. We expect BT to go full throttle with the new improved Fusion. With this launch, together with the other FMC services launched by Orange, Telecom Italia and TeliaSonera, we will now find out for real if consumers want FMC or not,” Pawsey said.