How to Succeed with Fixed-Mobile Convergence

• 0. Summary
• 1. Network operators need to take a fresh look at the options for FMC
• 2. FMC can take different forms, but will only succeed when it benefits both end users and operators
  • 2.1 Most network operators will offer services over both fixed and mobile access networks
  • 2.2 Different types of network operator may have different approaches to FMC
  • 2.3 If FMC initiatives are to succeed, there must be compelling benefits for end users, and targeted marketing will be critical
  • 2.4 If FMC initiatives are to succeed, they must not introduce major new drawbacks for end users
  • 2.5 If FMC initiatives are to succeed, there must be strong benefits for network operators
  • 2.6 There are different types of FMC, with different levels of implementation complexity
• 3. Early device convergence using UMA dual-mode voice handsets has had limited success
  • 3.1 UMA-based voice services are at the forefront of early device convergence
  • 3.2 Most UMA services have failed to achieve significant take-up
  • 3.3 Early consumer UMA services are undermined by product and marketing weaknesses, and face strong competition
  • 3.4 High up-front costs have limited the adoption of dual-mode handset solutions by enterprises
• 4. Device convergence will improve but cellular-only services will still have the edge in many markets
  • 4.1 Improvements will enhance the attractiveness of UMA-based dual-mode handset services for end users
  • 4.2 Other UMA developments could hinder the take-up of dual-mode handset services
  • 4.3 SIP and IMS cause further uncertainty over the future prospects for UMA
  • 4.4 Cellular-only services will also improve, countering advances in UMA-based dual-mode handset services
  • 4.5 Dual-mode handset voice services will be limited to a small number of integrated operators in particular countries
  • 4.6 There may be future opportunities for device convergence with data services, although femtocells could be an alternative
• 5. Operators will need both fixed and mobile access, but not necessarily fully converged networks
  • 5.1 All network operators will need fixed and mobile access
  • 5.2 Different degrees of network convergence are possible
  • 5.3 The challenges and costs of complete network convergence will deter most operators until at least 2015
  • 5.4 Operators need to focus on pragmatic network convergence and seek opportunities with market convergence
• 6. There are major opportunities in marketing convergence for network operators and other organisations
  • 6.1 Marketing convergence can avoid the need for device and network convergence and is not limited to network operators
  • 6.2 Mobile-only operators are beginning to apply marketing convergence as they embrace fixed broadband services
  • 6.3 There are opportunities for marketing convergence around fixed and mobile broadband data services
  • 6.4 Success with marketing convergence will require strong distribution channels and the right network economics
  • 6.5 Operators must take account of the limitations of marketing convergence
  • 6.6 FMC initiatives must be driven by company strategy, not network strategy, and must meet customer requirements

Actions

• Figure 0.1: The three levels of FMC
• Figure 2.1: Market research indicating that saving money would be a key motivation for customers to adopt FMC solutions
• Figure 2.2: Market research indicating that costs would be a deterrent to customers adopting FMC solutions
• Figure 2.3: The three levels of FMC
• Figure 3.1: Number of customers for UMA FMC services from BT (UK), Deutsche Telekom (Germany) and France Telecom (France), June 2005 to June 2007
• Figure 3.2: Estimated cost per user of upgrading a company network to support dual-mode handset voice services
• Figure 4.1: Decline in mobile voice spend per minute for selected countries, 1Q 2005 to 4Q 2006
• Figure 5.1: Fully converged network architecture
• Table 2.1: Examples of FMC initiatives by a variety of network operators
• Table 2.2: Characteristics of the different levels of FMC
• Table 3.1: Examples of device convergence services using UMA