You don’t have to search extensively to find strong blog comments and feedback about poor mobile network coverage. For example , AT&T Wireless have come in for a huge amount of invective from their customers, with feedback ranging from unhappy to outrageous. Having paid for their cellphone service, customers expect to have full service everywhere. They don’t want to pay extra for coverage in their local area (although they may also actively oppose any new cellsites in their neighbourhood).
At the other end of the earth, a mobile network operator in Japan has been suffering a similar problem. Softbank bought their network from Vodafone and have been investing in more cellsites, doubling the number over the last 3 years. But they are still behind their competitors NTT DoCoMo and KDDI, claiming about 98% population coverage.
Softbank has a radical solution for this problem. From May 10th any Softbank customer, both private and small businesses, have been able to apply for a free femtocell. Not only is it completely free, but a dedicated DSL broadband line will be provided to hook it up to. With some 100,000 units stocked up, applications are expected to be frantic.
This innovative and bold marketing approach will give SoftBank first mover advantage. Many of those smaller shops are likely to sign up for this – their cost will only be $5/year for electricity to power the box, no other ongoing maintenance or broadband wireline charges should apply. With one femtocell in many shops and other premises, its likely that their competitors would find it difficult to install their own femtocell alongside – even if it was also completely free.
Whether the business case for this approach stacks up in other countries, I can’t say. But it certainly sets the bar for an attractive customer proposition that disrupts the current market position.
I see that Cisco's Internet Business Solutions Group also very much agrees with this approach, promoting what they call a "push" rather than "pull" business model for operators, who are encouraged to give femtocells away free of charge to their premium customers. They've written up their proposition in a free white paper. As suppliers of AT&T Wireless 3G Microcell, they obviously stand to benefit too.