XO Preps FMC Service

XO Communications and Sotto Wireless will begin trials of a fixed mobile convergence solution in Seattle. The Unwired Office integrates customers’ fixed and wireless communications services into a single platform with one smart phone that can be used in the office or on the go for voice, email and Internet access as well optional IP desk phones.

The Unwired Office includes a business phone system, broadband network access and mobile phone service. Features include a high-speed dedicated Internet access; hosted private branch exchange system; individual smart phones with one telephone number for office and mobile calling, wireless email and messaging; optional IP desk phones; and anywhere coverage through in-office Wi-Fi networks and wireless service. In addition, the service enables businesses to transparently extend the office phone system to the home or branch office by using existing cable or digital subscriber line broadband services.

The service uses dual-mode smart phones from Nokia, such as the Nokia E61i, that feature both office Wi-Fi and cellular network connectivity options, full keyboards, and productivity applications. The hybrid wireless capabilities allow employees to use the Nokia smart phones to make calls over Wi-Fi networks and use cellular networks when employees are away from the office.

Online Time up 24%

User time spent online is up 24 percent over about the last year, according to Compete data.

3G iPhone Next Year

Make your plans accordingly.

Will Google Bid?

The deadline for filing an application for the 700-MHz auction is Dec. 3. The actual auction starts Jan. 24; the names of the bidders will be disclosed on Jan. 14.

Prediction: Google will submit a bid of $4.6 billion. But maybe no more than that, and the winning bid will certainly be higher. Now that Verizon has agreed to open up its mobile network to any compliant device or software, and having already gotten working agreements with Sprint, T-Mobile and Clearwire, Google might not need to secure spectrum simply to ensure that its open approach to the mobile Web has a place to develop.

European Commission, FCC Disagree on Competition

As U.S. competitive local exchange carriers and cable companies await key decisions from the Federal Communications Commission, the quantitative tests of "effective competition" are key. And on that score the FCC and the European Commission do not see eye-to-eye. In the video arena, the FCC targets the 30-percent market capture level as denoting "effective competition." In the voice services area the test seems to be 20-percent share loss by incumbents. The EC doesn't even think 50-percent loss of market share by incumbents is sufficient.

The disparities in thinking about what marks "effective" levels of competition leaves at least some room for new thinking on what measures might be required to stimulate even more robust levels of competition. In mass markets, 30 percent quite often is the share held by the market leader.

Verizon Wireless Takes Reasonable Gamble

One might argue that Verizon Wireless is gambling with its whole business model in allowing use of technically-compliant devices and software on its network next year. But one can point to the experience of wireless operators in Europe, who have used this "open" model for years, to see it is not so dangerous.

In fact, Verizon gains more than it might potentially lose, just about any way you want to spin the matter. First off, it gets great press for breaking the "closed" mobile model on a voluntary basis. Also, it is betting, likely reasonably, that the overwhelming mass of buyers still will prefer the old model of "discounted phone, two-year contract."

Verizon also uses the CDMA platform, which already means there is less handset choice than possible on a GSM network, since the GSM market is so much larger, globally. Verizon just might stimulate a bit more handset and software choice by going open.

Also, open is inevitable. The 700 MHz spectrum requires such device and software openness, so it is coming to the market, in any case. Verizon might as well "look good" rather than resisting the inevitable.

Open also means Verizon has a shot at creating a more robust developer community, a helpful asset indeed as more innovation moves to the software realm.

There's very little, if any, downside and lots of upside. Not since AT&T launched its "Digital One Rate" has any leading mobile provider taken a step that will reverberate throughout the whole industry. Sometimes, innovation is not just something small companies pull off. Sometimes very large companies do it as well. And maybe, sometimes, only a very-large company can cause a major change. On occasion, innovation may require the push only a very-dominant firm can supply. This appears to be such a case.

$2.4 Billion CLEC Decision Near

Sometime between now and Dec. 5th, the Federal Communications Commission is slated to make decisions that could significantly raise wholesale access and transport tariffs in six markets, including Boston, New York, Philadelphia, Pittsburgh, Providence, and Virginia Beach.

Customers can anticipate an additional $2.4 billion in extra charges for communications services, according to a study by QSI Consulting, if the rules are relaxed.

Basically, Verizon argues that market competition in each of the six markets is equivalent to that found in the Omaha, Neb. market, the benchmark used by the Federal Communications Commission to deregulate wholesale access rules and rates that have been favorable to competitors.

Up to this point, competitors in the six markets have been able to buy wholesale access and transport at rates below “retail” special access rates. Should Verizon prevail, it would be free to raise prices as it sees fit, with the likely result that wholesale rates would rise to just about what the retail special access rates are.

QSI estimates increased telecommunications expenses incurred by consumers for retail mass market, enterprise, and broadband access services would be $1.054 million, $747 million, and $565 million.. This amounts to a rate increase of $114 annually for an average household, QSI says.

Users in New York would wind up paying as much as $1.4 billion extra. In Philadelphia costs could rise $345 million; $380 million in Boston; $104 million in Virginia Beach and $177 million in Pittsburgh.

Consumers would wind up paying as much as $1 billion more for services; enterprises $751 million and broadband access users $565 million.

Opponents of the plan tend to think they have done what is needed to make the FCC commissioners aware of how woefully undeveloped access competition is in the six markets. But one never knows.

“The concern is that though the numbers are clear, there are media issues also on commissioner minds,” says Covad VP Angela Simpson. The danger is that the forbearance issue might wind up being a bargaining chip as commissioners grapple with the broader media deregulation issues.