Western Europe adopt FMC in greater numbers

With the advent of new technologies and innovations in Europe, telecommunication service providers are increasingly offering fixed-mobile convergence (FMC) solutions. These solutions enable carriers to offer a wide range of core services, irrespective of the device or access network available to the end user.

“FMC will drive the adoption of next-generation handsets, primarily dual-mode wireless fidelity (Wi-Fi)/cellular handsets, which will enable users to seamlessly handover from a cellular network to a Wi-Fi one and vice versa, so as to provide optimum quality of service (QoS),” say Senior Analysts at Frost & Sullivan. “This will benefit both end users and carriers; while carriers can use wireless local area networks (WLAN) to improve coverage inside buildings, end users can avail cheaper voice calls by connecting to the WLAN network.”

One of the advantages of having WLAN capabilities in a dual-mode device is to run high bandwidth data applications. With the evolution of high speed downlink packet access (HSDPA) in 2006, cellular carriers are able to get throughputs in the range of 1.8 to 3.6 Mbps, which will increase to 14.4 Mbps in 2007. This will practically meet the requirements of an average user.

Presently, the variety of dual-mode handsets available from different terminal vendors in the commercial market is limited. Moreover, they are expensive in comparison to their GSM counterparts. Hence, dual-mode handsets will need to be priced low to achieve high-scale adoption.

In April 2006, the UK Regulatory Board, Ofcom, granted UK GSM spectrum licenses to 12 carriers in the digital enhanced cordless telecommunications (DECT) Guard Bands of 1781.7-1785 MHz band, paired with the 1876.7-1880 MHz bands. Due to the regulation of power emission levels by Ofcom, the coverage and performance of such a global system for mobile communication (GSM) licenses will be similar to that of Wi-Fi and the spectrum license will be primarily used for indoor coverage at homes and enterprises.

However, while users will need a dual-mode handset for Wi-Fi, these low-power licenses can work on cheaper GSM handsets. If this proves successful in the United Kingdom, the trend will gain acceptance in other parts of Europe.

A key issue facing the industry today is the lack of perceived return-on-investment by deploying FMC solutions. Many carriers rightly argue that investing in infrastructure and systems to offer converged solutions may not provide adequate payback.

“This belief is further reinforced by the fact that several mobile carriers that had invested substantially in third generation (3G) deployments and licenses faced low customer adoption for their services due to the poor performance of 3G technology,” opine the analysts. “Besides, developing FMC services can be time-consuming and costly because of the diverse technologies and protocols used in different networks.”

Therefore, carriers will need to adapt to end-user demands for attractive bundles and focus on increasing customer loyalty as an important objective, along with increasing revenues. Operators with the capabilities to offer FMC services need to create attractive value propositions develop awareness of their services and provide customer support.