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T-Mobile USA announced on June 27 the first carrier-based converged cellular and Wi-Fi phone system in the United States.
The new converged system uses a new series of GSM/Wi-Fi handsets and a Wi-Fi Internet router optimized for voice traffic.
The new product offering is designed primarily for consumer use and is called T-Mobile HotSpot @Home. Its designed so that the handsets communicate as normal GSM phones when theyre in an area where Wi-Fi isnt available and switch seamlessly to Wi-Fi when they come into range.
T-Mobile, based in Bellevue, Wash., is offering unlimited Wi-Fi use as part of the package. Currently the only two handsets available for this offering are the Samsung t409 and the Nokia 6086. The routers are available from D-Link and Linksys.
Currently T-Mobile is offering the unlimited Wi-Fi voice plan for 9.99 per month for a single line, and $19.99 per month for up to five lines. The company says that the phones are aimed at customers in the 18-34 age range and for families.
However sources familiar with T-Mobiles new offering say that its only a matter of time before these products show up in the enterprise arena.
While T-Mobile refuses to speculate about the use of its convergence technology in business, others arent so shy. Tole Hart, an analyst at Gartner, said that while he thinks the T-Mobile offering has a few issues that remain to be resolved, he wouldnt be surprised to see T-Mobile Hotspot @Home start entering smaller enterprises almost immediately. However, he said that it was primarily being aimed at consumers for the time being.
However, he doesnt think itll move into larger enterprises immediately. “The enterprise market is different. There will be upgrades required in the Wi-Fi market. If you have a system designed for voice, youll be OK,” Hart said.
However, Hart said that the biggest challenge will be the limited number of handsets currently offered by T-Mobile that will work with the @Home product. He said that for the targeted age group to really accept them, the handsets need to be more stylish. “T-Mobile has offered the most economical choice. This service might be more attractive a year from now when you can get the handset you want,” Hart said.
However, more attractive handsets are on the way. “Youll begin to see additional devices that support this technology,” said T-Mobile spokesperson Peter Dobrow. “The future of the service is to build this technology into the majority of devices going forward so consumers can have this as an add-on feature,” he said.
“That said, this is a new technology and a new service and as we move forward well see a lot of interest,” Dobrow said, when asked about expansion to small and midsize businesses. However, he declined to discuss T-Mobiles plans to make the jump to enterprise convergence. He did not, however, rule out that it was in the works.
Dobrow pointed out that the calls are already secure, so that communications were possible over any available Wi-Fi access point, not just the dedicated access points offered as part of the announcement.
Dobrow said that the T-Mobile product uses GSM over IP rather than the more traditional VOIP (voice over IP) that many other products offer. The routers designed to optimize for this will provide priority for voice calls and also let T-Mobile engineers access the access points remotely to help solve problems, he said.
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Bound for Business
In addition, the specialized access points have other important features. “Also it enhances the battery life of the device. Weve tweaked the communication between the router and handset to be more efficient,” Dobrow said.
Forrester Research analyst Charles Golvin also doesnt think that T-Mobiles solution will remain strictly a consumer offering for long. “There is tremendous demand from the business community already,” Golvin said.
“Enterprises have been crying for dual-mode wireless phones from the carriers for some time. They have wireless LANs, they have big data pipes. When they see employees running around with cell phones, they see money leaking out,” he said.
Golvin said that in the past, carriers havent been willing to offer products that are acceptable to most enterprises. He thinks that something like the T-Mobile convergence offering probably will be acceptable, but a great deal will depend on the enterprise and its specific needs.
“I think its not sufficiently compelling for enterprises to switch over their cell phone service,” Golvin said. “Some small enterprises may be interested in this solution. The offering is limited to these mainstream phones. If its a small enterprise thats not data-dependent, then this is a viable solution.”
Golvin said that the biggest shortcoming right now is that T-Mobile isnt offering its converged product with support for BlackBerrys or other data devices. The T-Mobile Dash, although it supports both GSM and Wi-Fi, will not work with the @ Home product, for example.
Golvin said that there are other factors that may slow down adoption of the T-Mobile service, including the need to save on landline service and the need to have a broadband connection. He noted that getting a DSL connection from carriers might be problematic. “It might be hard to get the broadband without the phone line,” he said.
Frank Hanzlik, Managing Director of the Wi-Fi Alliance, said that he welcomes the HotSpot @Home offering and hopes that more carriers will move in a similar direction. “Wed certainly like to see it become more pervasive from more carriers,” Hanzlik said.
“The benefits of having Wi-Fi and cellular connectivity together are significant. Its really about using the best pipe for the environment and application youre in,” he said. Hanzlik noted that his organization has already certified more than 100 Wi-Fi capable phones.
Dobrow said that to create this product, T-Mobile leveraged its expertise with Wi-Fi hot spots as well as with GSM. T-Mobile has a global network of such public Wi-Fi access points to work with.
“We have expertise in Wi-Fi, and obviously thats what we leveraged,” he said. He also noted that this is in line with the companys long-term strategy. “T-Mobile is in the business of replacing land lines,” Dobrow said.
Phones for the T-Mobile converged offering currently cost $49.99 each with a two-year contract. The specialized routers are offered for free with a mail-in rebate. The unlimited voice plans will eventually rise from where they are now, but T-Mobile has not said how long the introductory pricing will last.