Oct. 25, 2006

Two wireless service providers have begun offering their customers handsets that can move between cellular and Wi-Fi networks.

The move marks the first serious attempt at commercially available converged wireless services in the U.S.

T-Mobile USA is targeting its offer to a limited number of Seattle-area consumers with a trial of its new T-Mobile Hotspot @ Home product, while mobile virtual network operator Embarq Inc. is moving out of trial mode and expanding its offering for business customers from three to six of its markets.

According to a site set up by T-Mobile USA for the Wi-Fi/cellular service (http://theonlyphoneyouneed.com), the two dozen participating T-Mobile USA stores in the program are located in western Washington.

The service requires a dual-mode phone from T-Mobile USA, a hot spot add-on to a voice plan, and a special wireless router for use in the home.

T-Mobile USA spokesman Peter Dobrow said that the service offers better in-home coverage for customers, plus the ability to make unlimited calls from home and when within range of a T-Mobile USA hot spot in places such as Starbucks coffee shops.

Although the phones are voice-centric, data such as text messages can also be sent via Wi-Fi when the phone is using that network, Dobrow said.

The handsets T-Mobile USA is offering for the service are both being sold for $50 with a two-year contract and after rebate: the Nokia Corp. 6136 and Samsung Electronics Co. Ltd.’s t709, according to Dobrow.

The router is currently being offered for free and is optimized for the T-Mobile USA service; Dobrow confirmed that a regular wireless router could be used, but added that “We don’t recommend that.”

The $20 hot spot service can be added on only to T-Mobile USA voice plans of at least $40 per month.

Dobrow said that T-Mobile USA will not comment on its future plans for the service or how long the trial might last.

Meanwhile, the Sprint Nextel Corp. landline spin-off and MVNO Embarq is debuting the commercial availability of its Smart Connect service, which offers seamless transitions between the cellular network and a landline, or the cellular network and a business’ Wi-Fi network.

Smart Connect is aimed solely at business customers and has been in trials since the fourth quarter of 2005, according to Tom McEvoy, president of business markets for Embarq.

The service comes in two iterations.

Basic Smart Connect service can be used on any voice phone from any wireless provider as long as the customer has Embarq service for the business landline.

A customer speaking on his cell phone outside and entering his office can push a button on the office phone and have the call seamlessly transferred to the office phone. The call can also be transferred back to the wireless phone by pressing a button on the handset.

A more expensive option, Smart Connect Plus, has the ability to transfer the call seamlessly between the cellular network and a business’ Wi-Fi network, McEvoy explained.

The Smart Connect Plus service is currently available only on Embarq’s most expensive device, the UT Starcom Pocket PC 6700 smart phone, which retails for $570. Other devices will eventually be added, and Embarq expects to have the service available in most of its major markets by the middle of next year.

McEvoy said that although Embarq designed the service for use by large businesses in a campus environment, the company has discovered that small- and medium-sized businesses are eager to try it as well.

He cited studies from Pyramid Research that around half of a business’ mobile minutes are used while in the office, meaning that the ability to transfer calls to another network can help businesses reduce their wireless use.

Prices for Smart Connect range from $15 to $20 per month, while Smart Connect Plus will cost customers either $20 to $25 a month.

“This is the first commercially available product that blends wireline and wireless to give the customer improved quality and lower cost,” said independent telecom analyst Jeff Kagan.

“This should be very popular with their business customers” added Kagan.

Source: RCR News