In his wireless blog, Alastair Brydon compares Vodafone’s Sure Signal UK femtocell offering with T-Mobile’s US smartphone WiFi applications, with some surprising findings.
Offloading to femtocells or WiFi allows a mobile operator to bypass its expensive radio network infrastructure and should allow a mobile customer to freely use intensive applications, such as video streaming. However, unlike data traffic carried by WiFi, data carried by Vodafone’s Sure Signal femtocells is counted as part of the user’s data allowance. With relatively low smartphone data allowances, as discussed in our previous post, mobile users are being unnecessarily restricted. If this issue is not addressed, WiFi will be the preferred choice for many users.
Not surprisingly, a recurring topic at MWC 2011 in Barcelona has been the surge in mobile network data traffic, and how mobile operators will cope with this. Sales of smartphones increased by around 75% in 2010 and mobile application development continues to flourish with initiatives such as the Wholesale Applications Community. Inevitably, such trends will accelerate the growth of mobile data traffic.
Most operators accept that some form of traffic offloading is required, but there is still no consensus on whether femtocells or WiFi provide the best long term solution. Femtocells seem the natural choice for mobile operators, because of the closer integration with their existing networks, if only it weren’t for the fact that someone has to pay for them!!! WiFi provides a somewhat looser interworking with the operators’ networks and there have been concerns about handset choice, battery life and service integration. However, WiFi has the great benefit that there are already hundreds of millions of access points situated in the homes, offices and public places where users may wish to access broadband services. Furthermore, recent developments such as the Kineto Wireless Smart WiFi Application are providing increasingly attractive propositions for customers and operators.
It is useful to compare two current examples to illustrate this point. T-Mobile in the USA and Vodafone in the UK are using WiFi and femtocells, respectively, as indoor base stations for their networks. In both cases, the propositions are aimed initially at improving indoor coverage, but the same solutions will ultimately have benefits for network traffic too.
In the USA, T-Mobile has offered “WiFi Calling” handsets and calling plans since 2007. In November 2010 it added to these by launching the Kineto Wireless Smart WiFi application on Android smartphones. The application automatically registers on an available WiFi network when the smartphone is within range, and turns off the cellular radio to conserve power. The user then makes calls, sends texts and establishes data connections over the WiFi connection. Voice calls and texts are charged at the normal rates but data connections are free. A great benefit of the service is that it can be used anywhere that the user can access WiFi, so is not tied to a particular access point. Thus, the user could have voice calls at the domestic rate (for example included in a bundle) and have free data, even when roaming, if there is WiFi available. From a user’s point of view this is highly attractive.
Contrast this with Vodafone’s Sure Signal product in the UK. Customers pay GBP50 for the Sure Signal femtocell box, which connects to the customer’s standard fixed broadband connection. As in the T-Mobile example, voice calls and texts are charged according to the customer’s existing tariff or bundle. However, data traffic is not free. It is charged at the same rate as it would be on the wider mobile network. Given that a customer may well have the alternative of free WiFi in the home, this seems highly unattractive. A further important difference is that a femtocell is only of use in its home location, whereas the T-Mobile smartphone application can be used on any WiFi access point available to its user.
If femtocells are to succeed, the industry needs to find a commercial model that is able to simultaneously cover the cost of the box and deliver a customer proposition that is attractive to users. Otherwise, it will be overtaken by increasingly sophisticated, effective and cheap WiFi alternatives.