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Orange, T-Mobile Go Slow on Femtos

Michelle Donegan
LR Mobile News Analysis
Michelle Donegan
2/22/2010

Orange (NYSE: FTE)'s Orange and Deutsche Telekom AG (NYSE: DT)'s T-Mobile are not pursuing Femtocells for a consumer offering, execs with the carriers told Light Reading TV last week at the Mobile World Congress in Barcelona.

Although both operators have been dabbling with the home base stations for some time, neither operator plans to launch a major consumer service anytime soon.

Orange faces femto service competition from rivals in two of its European markets -- SFR in France and Vodafone UK in the United Kingdom. But this competitive situation has not spurred Orange to change its plans for consumer femtos. (See Vodafone Revs Femto Engine and France Fires Up Femtocells.)

Vivek Badrinath, Orange's executive VP for networks, carriers, platforms, and infrastucture, says the operator is not actively working on a femtocell offering for consumers, mainly because the small base stations still cost too much. In addition, the operator prefers to use WiFi for offloading mobile data traffic through its installed base of Livebox-branded residential gateways. In France, for example, Orange has 8.5 million Livebox users, according to Badrinath.

"The price points of femtocell technology still make it a bit beyond consumer pricing," he says. "The ability to use WiFi is much more industrial grade."

But Orange's position on femtos for consumers doesn't mean that the operator has ruled out using the little base stations entirely. Orange has been testing femtocells, using equipment from NEC Corp. (Tokyo: 6701) and Huawei Technologies Co. Ltd. , for enterprise customers. (See Femtos Mean Business for Orange and Huawei, NEC Score Orange Femtocell Deal.)

Deutsche Telekom's new CTO, Olivier Baujard, tells LRTV that the operator has "no mass market plan for femto." He says his firm is using the indoor base stations "tactically" to solve some specific indoor coverage challenges in the its own shops or for certain customers. Like Orange, Deutsche Telekom also favors WiFi.

"We have bet very early on the WiFi connectivity," says Baujard. "We use a lot of WiFi, especially in Germany, to offload data traffic as early as we can… We don't see a mass use case for femto deployment."

According to Bernard Scholl, T-Mobile's head of radio network design, voice, and data services, the operator is not using femtos in a very high quantity. "We use femtos in a very controlled way... where we plan, control, and operate the femtocells," said Scholl, who was speaking on a panel at the Mobile World Congress last week. "We think that to solve overall coverage problems, we can't replace the macro [network] with femtos."

Despite T-Mobile's early enthusiasm for femtos, the operator does not think they're ready for prime time now. T-Mobile, through its investment arm, T-Mobile Venture Fund , is a strategic investor in femto maker Ubiquisys Ltd. and femto chip startup Percello Ltd. . (See T-Mobile Joins Google, T-Mobile Invests in Femto Firm, UbiquiSys Gets Google Boost, and T-Mobile Backs Femto Chip Startup.)

Check out the full interviews with Deutsche Telekom's Baujard and Orange's Badrinath below:





— Michelle Donegan, European Editor, Light Reading Mobile

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