[November 1, 2004]

BT’s All-in-One Bluephone Ready by Next Year

BY JOHANNE TORRES

British Telecom made the headlines today when the company officially announced the availability of its new all-in-one telephone project code-named Bluephone. The new phone is said to connect to landlines, mobile and also VoIP through WiFi networks. The company expects Bluephone to reach the market by the end of next year.

The company says Bluephone is the first of its kind. "’Bluephone’ is a BT-developed product and is the first in the world that’s being done this way, although other people are playing with tariffs," said John Lee, BT’s WiFi general manager/convergence. "It means you can use a mobile phone when in ‘Bluephone’-enabled sites - that could be in homes, offices or public places -- and you make your call via your mobile phone over the fixed network rather than mobile network. This gives improved voice quality and improved coverage therefore very good reception over a low-cost, fixed network. You will still get your mobile voice and data -- SMS messages and voice mail -- over fixed network,” he added.

The giant telecom promises to offer future customers mobility, flexibility, simplicity and cheaper calls with Bluephone. BT started working on this project back in April 2003, then announced in May 2004 that it was joining forces with Vodafone to offer a converged fixed-mobile communications service. The Vodafone linkup allows BT to become a 'mobile virtual network operator' -- offering a mobile service without the need for the capital investment of rolling out a network.

The company explained that in order for the “Bluephone” to work, users need to be within range of a Bluephone-enabled site, be that at home, office or hot-spot public site such as a coffee shop, to have the call go across the PSTN network. When the user is away from the Bluephone-enabled site or out of range, the handset will act as a standard mobile phone and send and receive calls over the GSM network. The seamless ability to roam and switch between networks is yet to be perfected by BT’s development team. BT Centre in London has been beta testing the device and invited 65 suppliers to participate.

BT wants to push this project to aid its efforts to persuade mobile users back on to the fixed network. The telecom faces this challenge since fewer households in the UK have landline phones than five years ago. "Even if people have a fixed line they are still making mobile calls from home," noted Lee. "BT wants to maintain and grow its share of the fixed line and mobile revenues. The project is seen as being very strategic, putting BT back into the mobile market place, and increasing mobile customers and fixed revenues as well. It’s also tied in to existing major business and consumer product development programs within BT."

BT is still struggling with pricing at this point. The telecom plans to offer different packages such as allowing customers to have up to five handsets on one contract or getting free calls up to two minutes long. "We want to make this as cost-effective for the user as possible," stated Lee. "For a reasonable initial outlay, it will be improving the quality of mobile calls, be easy to use and ultimately saving you money. We will be offering significant cost savings against today’s mobile spend."