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T-Mobile Takes $10 Home Phone Service Nationwide
25 Jun, 2008
T-Mobile is taking the gloves off in its battle against wireline voice carriers. They will take their T-Mobile@Home service nationwide on July 2nd. T-Mobile has been testing T-Mobile@Home in Dallas and Seattle and according to their press release, "...virtually all customers (97 percent) who had a traditional landline phone service reported dropping that service since adopting T-Mobile @Home." T-Mobile@Home is a VoIP powered voice service that uses a customer’s home broadband connection for connectivity. It’s priced at $10/month, and provides unlimited local and long-distance calling as well as basic features including voicemail, call forwarding and call waiting. The service is only available to T-Mobile customers who have a wireless contract of $39.99/month or more and requires the purchase of a $50 modem. The service utilizes UMA technology, which is also used for their Hotspot@Home service.
T-Mobile@Home offers some interesting competitive implications. It remains to be seen how consumers will react, but it seems like a decent value add to say to a customer who is buying a wireless service contract, we’ll throw in home phone service for an extra $10/month. That’s a pretty compelling differentiating feature that other wireless carriers can’t match right now. Bring your own broadband VoIP players like Vonage and Packet8 also seem vulnerable in this T-Mobile scenario. If I’m an existing T-Mobile and Vonage customer right now, why wouldn’t I switch to T-Mobile? Last I checked, Vonage didn’t have a $10/month plan. At the end of the day this strategy is more about maintaining and growing their core wireless business, than trying to take market share from traditional wireline voice business. Wireless providers are "pulling as many rabbits out of a hat" as possible these days to maintain and hopefully grow their business. The wireless market in the U.S. is approaching saturation. Expect to see more interesting strategies like T-Mobile@Home, as wireless carriers try to meet expectations of stakeholders in a sure to slow wireless growth market. Early indications are encouraging for T-Mobile. They tell PC World that 45% of T-Mobile@Home users in the Seattle and Dallas trials switched from other mobile operators.
T-Mobile Adds Handset to UMA Line-up
10 Dec, 2007
T-Mobile added the Samsung t739 Katalyst handset to their Hotspot@Home product line. The Katalyst is Unlicensed Mobile Access (UMA) capable, meaning it can route calls over a Wi-Fi connection. The Katalyst fills a gap between the existing low end and high end handsets for their Hotspot@Home service. The Katalyst offers a 1.3 megapixel camera, Bluetooth, and a 220 x 176 display.
Read more at this Engadget post.
Enough With the iPhone Already – AT&T To Launch Dual Mode Blackberry
19 Jul, 2007
RIM announced the launch of a dual mode Blackberry, which will operate on both GSM and Wi-Fi networks. The new Blackberry 8820 will launch on the AT&T network. It didn’t take long for RIM to get this new device to market. We reported about the FCC approval of the Blackberry WI-Fi device on July 9th. The new 8820 Blackberry also supports unlicensed mobile access (UMA) technology, which allows for seamless roaming between GSM and Wi-Fi. Although AT&T’s plan for UMA are somewhat unclear at this point. AT&T is expected to bring the 8820 to market later this summer.
New Wireless Strategy May Alter Competitive Landscape
19 Jun, 2007Cincinnati Bell recently announced its unlicensed mobile access (UMA) network strategy. UMA is a promising development which uses a convergence of multiple wireless frequencies to provide seamless mobile wireless access in a given territory. Cincinnati Bell claims to be first at launching a commercial UMA network, although T-Mobile has been trialing one for sometime. A subscriber’s mobile device automatically senses the best network to use for service, which can include Wi-Fi, Bluetooth, or a traditional GSM mobile wireless network. For example, while on the road in a car, a subscriber would probably utilize a GSM network, but while indoors, their handset would seamlessly switch to Wi-Fi. Such a network conceivably provides better coverage by automatically selecting the best network to use, while also providing the network operator more efficiency by offloading traffic to wi-fi networks where possible.
UMA adds promise to carriers who may not have significant licensed spectrum assets. As the technology matures, carriers without a current mobile strategy may find UMA provides them the opportunity to launch mobile wireless services. It’s too early to predict, but UMA may prove to influence the competitive landscape, by allowing carriers of all sizes and niches to offer a wireless play, positioning them to compete more effectively.
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Should Telephone Service be Free?
12 Oct, 2008
Comcast announced a new promotion last week that offers 12 months of free basic cable service for new customers who also sign up for an additional service. Customers who don’t want an additional service can get Comcast’s basic service of about 20 -30 channels for $10/month. The promotion is tied to the digital TV transition of February 2009 and entices potential customers to avoid the transition “hassle” by getting “free” cable service. “The simple fact is that basic cable is the easiest path through the digital transition and now consumers can get it for free,” said Derek Harrar, General Manager and Senior Vice President, Video Services for Comcast in a company statement. This move is similar to strategies pursued by other video service providers, who are hoping to leverage the digital TV transition for new subscriber additions.
But is this strategy a leading indicator for the future? Should basic core services like basic cable and basic telephone service be offered for free, used as a “carrot” to entice customers to buy “more important” services like broadband? Maybe a very basic phone service, with no LD, access to landline 911, and maybe outgoing service only (to avoid telemarketers) should be a free component of a bundled offering. Such a wireline service may appeal to a customer who previously cut the cord for wireless only, but also needs broadband. There is a growing portion of the population who find the value of traditional wireline phone service elsewhere – either through wireless or broadband/IP services. But, if they could get the security of landline 911, and an extra dial tone in their home as a free value add for subscribing to broadband (or video from a telco’s perspective), maybe a telco’s bundled offering may look more attractive than a comparable cable offering. I realize this idea is not appealing to the hundreds of ILECs who are a part of the current access/settlement system (in fact, it couldn’t work in the context of today’s regulatory structure), but I wonder whether it’s inevitable. In this possible future scenario, the current settlement system adapts to broadband as the underlying service, as opposed to voice.
This scenario cuts both ways. From a cable company’s perspective, a growing portion of the population is turning to the Internet as a source for their video content, and no longer see value in paying for a broad package of video as a part of a traditional subscription pay-TV service. But, if they could receive basic TV (which includes local broadcast affiliates) as a free value add for buying broadband, maybe the cable bundle is more attractive. In a true IP/broadband world, very basic phone and video service is relatively easy to deliver, and has little impact on bandwidth and network performance. Maybe the digital transition is opening the door to a future where free basic services are a regular component of a bundled offering. Thoughts?

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