Why Isn’t FMC Ubiquitous?

FMC, or Fixed Mobile Convergence (News - Alert), appears like a no-brainer that should have had enormous success immediately — even before it was launched — both for the consumer and business markets. While the concept is simple and the market/user-pull (demand) should be great, implementations across the complex communications network infrastructures and, more importantly, who “owns” the customer and can bill for this convenience, is not so simple.

We certainly are not lacking for candidate solutions. And each candidate solution category generally supports one of the competing categories of providers who want to “own” the FMC customer. Some support the mobile/cellular operator by extending the cellular network into the home or business environment and keeping “calls” on the mobile network, even if the traffic partially travels on a wired broadband pipe. Some support the wireline carrier by attempting to drive all traffic (especially expensive international mobile calls) onto the enterprise wireline network. Some support the enterprise communications environment by extending the “PBX” features to the mobile device (cellular or WiFi (News - Alert) or dual-mode) allowing the user to determine how and where to extend his or her work space.

So, why isn’t FMC ubiquitous? Available everywhere and at an affordable price to both consumer and business users — and as we change roles during the day — many potential-FMC users act in both consumer and business user roles.

Let’s start with the consumer space, which should be simple, but certainly is not. Mobile operators continue to capture more consumers — by displacing wireline phones. And, now, with some FMC variants, wireless operators can extend cellular service into the home, perhaps further displacing the wireline phone. However, this often requires a wireline broadband connection to the home to “backhaul” the femto/nano-cell traffic to the cellular network. So the mobile operator benefits in two ways — keeping the minutes on the mobile network and getting the backhaul traffic off the mobile network, thereby lowering the mobile operator’s need to build further expensive wireless infrastructure. But the consumer still has to maintain a broadband connection — either from a telephone or cable company. Few telcos offer “Naked DSL” — a broadband connection without an associated telephone service. If from a cable company, customers likely require a minimum cable-TV service to receive cable-modem broadband. So, how does the user benefit? Note how we haven’t even included WiFi/Cellular dual-mode phones into this discussion, yet. And the enterprise confusion is even more complicated.

My conclusion is, as with many of these questions, that technology is not the issue — the critical issues needing to be solved are business model issues — who benefits and who needs to invest to support the solution. If there isn’t a match, the take-up is likely to be much slower than if there is a match. IT

David Yedwab is a Founding Partner in Market Strategy and Analytics Partners (News - Alert) LLC. Contact him at 908-879-2835 or [email protected].

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