Converged Voice Offer

There are two aspects to this:

- Fixed Mobile Convergence. Typically promoted by operators with both fixed and mobile networks, technical solutions have been created which combine both to offer a seamless service to a single device. Examples include BT Fusion and Orange Unik.

- Fixed Mobile Substitution. Typically promoted by mobile operators, this encourages users to rely only on their mobile and not have a fixed line at all.

Operators have been promoting packages of combined services in order to reduce the likelihood of churn, and to capture revenues for a wider range of services and thus increase their revenues. By offering a femtocell, this would encourage all users in the home to be on the same operators network so they can share the benefits of the solution. In return, the operator would offer lower prices, reflecting reduced costs of handling traffic via the femtocell (no expensive basestation site rental or transmission/energy costs) and possibly operate at a lower overall margin, but make more overall profit through higher revenue and only one set of bills and accounts to manage.

Within the fixed communication services, there are already many examples of “triple play”, which combines fixed phone line, broadband internet and TV. There are competing offers in the UK from:

- Sky satellite TV operator, which bought a broadband internet company (Easynet) and can now offer TV, telephone and broadband in a single package.

- Virgin Media, which operates a cable network for TV, telephone and broadband, and can also offer mobile phone service through what was Virgin Mobile (an MVNO).

- BT. The incumbent telephone operator, which offers not just telephone and broadband, but now seeks to offer TV services using IPTV and downloading to a set-top box which also receives FreeView free digital terrestrial TV. It also offers a dual-mode WiFi service through Vodafone called BT Fusion.

- Orange. This mobile operator also offers broadband internet through its parent France Telecom (which bought Wanadoo/Freeserve).

A converged voice offer with a femtocell would be targeted at replacing the cordless phone, and may also offer a landline number (01/02 or 03 prefix) which does not have a high cost to the calling party.

A scenario may be as follows:

The landline number for the house is transferred to the new service using Local Number Portability (note this is technically different to Mobile Number Portability). Calls to this number are handled by the mobile operator but do not attract a high termination charge, and so are low cost to call.

Incoming calls to this “house” number are routed in parallel to all phones actively connected to the femtocell – similar to ringing all the cordless phones in the house. Users who are away from the house would not be called at this stage. If there is no answer, or nobody at home, then either:

a) the caller is diverted to a specific mobile number. If the call is answered, then the receiver would pay incoming call charges at their standard rate (or use minutes from their call plan). If unanswered, then diverts to mobile voicemail (again with incoming call charge).

b) The caller is diverted voicemail immediately. This could be the mobile voicemail of the householder.

A separate mobile phone could be provided for general “house” use, which always stays in the house and has a landline number.

Calls could be transferred between users, and even potentially when to any mobile even if the person is away from home. This might require some additional feature development on the mobile phone itself, to improve the user interface and provide easy access to those features during a call.

The technology to do this has been created by several startup/internet companies, and a successful one – GrandCentral – has been bought by Google. See http://www.grandcentral.com/about/google

This services offers

- Single number which rings multiple phones in parallel until one answered

- Diversion to voicemail

- ListenIn to any caller during the voicemail announcement

- Web or mobile browser review of voicemail messages

- Call any number on your contacts from the web/email by first calling your phone and then the destination number.

An alternative view is that Fixed Mobile Substitution is continuing at a rapid pace. Statistics reported show that the percentage of calls originating from mobiles has grown to around 25% of all calls in Germany, and almost 75% in Finland. There may be two factors for this:

- More people have signed up to a mobile package with inclusive minutes, whilst still paying per use on their fixed line phone. Thus the marginal cost of making a call on the mobile is zero, where a call from the fixed phone would cost money. Office workers are now being encouraged to call their colleagues from their mobile, rather than desk phone, because its cheaper.

- The cost of calling a mobile from a fixed phone is artificially high due to the termination charges which mobile operators make to receive calls. Many mobile packages include free call allowance to any other mobile network.

However, most businesses publish fixed numbers which allow them to handle multiple calls, direct them to the appropriate department, and handle out of hours announcements. Small businesses (eg tradesmen) are commonly publishing their mobile numbers to allow direct access including out of hours, and also using their mobiles as the primary outbound phone.

Calls to international destinations and premium numbers, such as televoting lines, are costly from mobile phones – sometimes a factor of 3 or more times as expensive. This leads frequent callers to these numbers to take special measures, such VoIP internet calling or use of low cost indirect providers for international calls.

Incoming telemarketing calls are usually directed through fixed numbers due to the low cost. There are far fewer direct telemarketing calls to mobile phones because of the higher cost to the caller, and this may be seen as a benefit by those users. In the countries such as the USA where mobile numbers are charged the same as fixed lines, and incoming calls are charged to the mobile user, there remains high levels of telemarketing traffic which has limited the takeup of mobile phones in the past.

Research from the Carphone Warehouse has suggested that people view mobile phones as a personal device, whereas fixed phones are a community service. Thus for single households, substitution of the fixed phone by the mobile is quite attractive, but for groups including families, businesses and organisations there remains a need for a single addressable telephone number.

What this could lead to is a diverged telecom economy:

- Those with fixed lines only, who will pay a premium to call those on mobiles. These users will prefer not to call mobile numbers as a rule.

- Those with mobile lines only, who will typically have a package which covers most of their regular usage. These users will prefer to make calls from their mobile because of the low or zero marginal cost.

In order to alleviate the cost of calling, we may see growth in lower cost numbers being published:

- Businesses may opt for freephone 0800 numbers which are re-routed to the mobile and are free of charge to the caller.

- Personal mobile users may opt to have an additional standard fixed number, which they give out to friends and family only, and for which they pay to receive calls (possibly from their inclusive minutes package).

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