T-Mobile launches fixed/mobile convergence

T-Mobile has pulled off the first mass-scale launch of fixed/mobile convergence in the U.S., further blurring the already wavering divide between wireline and wireless provider. But T-Mobile isn't the only operator tackling FMC. It's not even the first to launch. Cincinnati Bell pulled the tarp off of its own unlicensed mobile access project on Father's Day, revealing it already had 1500 customers using their Wi-Fi networks to connect cellular calls from home.

Though they're using the same technology, Cincinnati Bell and T-Mobile are approaching the market from different angles. CinBell, as a landline voice and broadband provider in Ohio, is looking to inexorably link its wireline and wireless service, embracing the concept that customers' first choice in voice communications is data. It's a choice that its Tier 1 counterparts are also wrestling with as they explore their convergence options.

T-Mobile, however, doesn't have the wireline networks of an AT&T or Verizon Wireless. In fact, for T-Mobile, FMC is a double bonus, said Moe Tanabian, principle with Interactive Broadband Consulting Group, which advised T-Mobile on its UMA launch. While wireline/wireless operators have to wrestle with the problem of cannibalizing their own traditional voice services to offer Wi-Fi voice in the home, Tanabian said, T-Mobile has no such qualms.

“T-Mobile doesn't have any landline or fixed business,” Tanabian said. “Any dollar it earns off of UMA is a dollar it steals from a landline carrier.”

The result is that T-Mobile not only gains an efficient way to grow its coverage and a new revenue stream at very little expense, but it also allows T-Mobile to play in the incumbent telcos' and the cable operators' sandbox, enabling it to turn their DSL and cable broadband connections into backhaul for its own wireless network.

Helping T-Mobile also is public understanding of what FMC is. The mass market usually doesn't comprehend the esoterics of radio technologies, resulting in a long public education campaign for any carrier launching a service based on a new technology. But Wi-Fi is a technology that the public has not only widely adopted, it's one it readily understands, making the coverage and savings benefits of any Wi-Fi/cellular convergence service obvious, said Karen Hanley, senior director of marketing for the Wi-Fi Alliance. According to a study conducted by ABI Research for the Alliance, one in four cell phone users said they switch carriers to get Wi-Fi capabilities in their devices either for improved coverage or for cost savings, Hanley said.

Those market demands are leading other operators to explore their own FMC plans, and most of them have launched some sort of FMC trial. Their plans, however, may not necessarily involve Wi-Fi. In the last year, femtocells have become a hot technology, attracting carriers' interest because they don't require dual-mode handsets or changeover in radio technologies to work. The femtocell acts as a miniature base station in the home, transmitting the same cellular signal as a macro cell, and, like UMA, it uses a home broadband connection to backhaul the cellular call to the carrier's network.

Hanley said, however, that Wi-Fi currently has the momentum with the infrastructure already built into millions of homes nationwide. While technologies such as UMA require new handsets, the Alliance has already certified 120 different dual-mode devices. One thing that is often forgotten about in the debate over FMC is Wi-Fi's fat-pipe data capabilities. While the initial FMC deployments focus on voice, more and more devices designed to switch between Wi-Fi and cellular data connections are hitting the market — Apple's iPhone being the most prominent example. That demand for data will build upon the initial excitement for dual-mode voice, Hanley said.

“It's important to keep in mind that Wi-Fi is very pervasive,” Hanley said. “There are already 300 million users of Wi-Fi worldwide. With that kind of penetration and its cost-effectiveness, you have a recipe for continued growth.”