T-Mobile USA launches WiFi access for cellphone users

Stuart Corner
Thursday, 28 June 2007 10:13

Your IT - Home IT

T-Mobile bills the service as "ground-breaking" but this type off offering is well established: as the BT Fusion service in the UK, and as the Vodafone Home Zone service in several markets Most notably that of T-Mobile's parent, Deutsche Telekom.

Germany was the first market to get the Vodafone service, where it is known as Vodafone Zuhause. And it has been a spectacular success. In March 2007 Vodafone Germany was reported as having  two million customers, a tenth of its total customer base.

Deutsche Telekom had also entered the market in Germany, in August 2006, but scrapped the service in March 2007 with a reported less than 10,000 users. According to one report the service failed to take off "because it was simply too expensive, poorly marketed, and lacked compelling features." It was also offered by the fixed line division of DT and competed with another offering from the mobile division.

No doubt T-Mobile will have learned much from this experience, and it does not have the same internal conflicts to deal with in the US.

Generally FMC offerings are seen as primarily benefiting fixed line operators, allowing them to fend off competition from VoIP providers by offering mobility at fixed line prices. That is BT's strategy with its Fusion service (it is not a mobile operator, it resells services from Vodafone UK)

At first glance, an FMC offering from a mobile provider has the potential to lose revenue. However the trend to abandoning fixed lines is very real and an offering such as T-Mobile's makes it a strong contender when such customers are choosing a cellular service. It also gives the mobile provider an opportunity to get into offering a bundle of mobile and broadband access service and, down the track content packages that will span both fixed line broadband and mobile: such as IPTV and mobile TV.