UMA: The Place for Me?
Before it does, however, carriers need a little more insight about the impact these technologies could have on their business models. More than anything, they want to ensure that they don't cannibalize their lucrative voice minutes any faster they have to by adopting "Internet economics."
One way for operators to test the waters of convergence without fully taking the plunge is to adopt Unlicensed Mobile Access (UMA), a standards-based mechanism that allows operators to leverage some of the benefits of IP access and short-range unlicensed radio, yet preserve the operator call model and seamless in-call handover. Because of these attributes, UMA has emerged as the operator's choice for FMC services, despite the existence of an array of sexier, more exciting alternatives.
A number of service provider UMA initiatives are covered in the new Unstrung Insider report, Wireless VOIP & UMA: Friends or Foes?
BT Group plc's (NYSE: BT; London: BTA) Fusion service in the U.K., delivered in conjunction with a mobile virtual network operator (MVNO) agreement with Vodafone Group plc (NYSE: VOD), is one such real-world example of convergence in action. The service may not be convergence nirvana, but it's a step in the right direction.
Promotions for "Fusion" are all over the weekend newspapers in the U.K. these past weeks, and this initial marketing provides a clue about the real motivation behind UMA: It appears to be not so much about providing a convergent service for its own sake, but more about bundling mobile, fixed-line telephony, and broadband into a single subscription. It doesn't take huge leap of imagination to figure on BT Openzone hotspot access being added to the mix.
And it is this bundling of broadband access (whether hotspot or residential) with mobile that appears to be driving adoption of UMA across the GSM industry, with mobile carriers such as T-Mobile USA, Cingular Wireless LLC, Telecom Italia Mobile SpA, and Orange SA all expected to introduce services in 2006.
Speaking in October 2005 about Orange's proposed convergence services, centered around the "LiveBox" home gateway product (dubbed "convergence in a box"), Vivek Badrinath, executive VP of products, technology, and innovation at Orange Group, shed light on the real business drivers for convergence services: "It is, more than anything, a loyalty factor for an operator with both broadband and mobile."
But the "loyalty bundle" won't be enough to sustain operator convergence initiatives for long, nor will it match their ambitions, finds the Insider report. What's required from wireless LAN and IP access are services that fundamentally enhance the mobile user's experience – for example, common address books, common messaging and presence across wireless/wireline platforms, and high-bandwidth, low-latency multimedia services to indoor mobile-device users.
For the sake of industry and consumer confidence in FMC, it would be great to see UMA succeed. But UMA alone is not enough. For the technology to survive, it must evolve and integrate with more disruptive trends in mobile and Internet technology and usage.
— Gabriel Brown, Chief Analyst, Unstrung Insider
The report, Wireless VOIP & UMA: Friends or Foes?, is available as part of an annual subscription (12 monthly issues) to Unstrung Insider, priced at $1,350. Individual reports are available for $900. To subscribe, please visit: www.unstrung.com/insider.