BT Dials Phone Convergence – Red Herring

 In convergence

UK carrier will introduce a corporate service that links the fixed and mobile networks.

September 14, 2006


British Telecom, the United Kingdom’s largest telecommunications company, said Thursday it will introduce BT Corporate Fusion, a fixed-mobile convergence service targeted at large corporations.

The telecom company, which is in the process of a $17-billion upgrade of its U.K. network, will be one of the first anywhere to offer a business-oriented service based on the convergence of fixed-line and wireless technologies.

Integrating cellular technology into the larger IP-based network has been a topic of conversation among major carriers, but other than the integration of the fixed-line and mobile charges on the same bill, little has been done.

The integration of the mobile phone into the IP network so that the network can recognize the cellular device, and switch its access automatically from the cell connection to the less-expensive broadband network connection, has so far been a relatively rare development.

‘It’s much more than stapling bills together.’
 -Rakesh Mahajan,

But BT has been marketing a consumer version of its convergence service. BT Fusion allows consumers to switch their mobile phones from the cellular network to the less expensive broadband connection when they are within Wi-Fi range at home (see BT Launches Hybrid Phone).

Shares of BT fell $0.02 to $48.98 at the close of trading Thursday.

Complex Convergence
Corporate Fusion seems to be a more complex version of BT Fusion since it must accommodate the corporate database along with traditional PBX communications.

“We are stitching together the Wi-Fi network, cellular network, corporate directory, and PBX [private branch exchange] functionality,” said Rakesh Mahajan, global director of mobility for BT’s Global Services. “It’s much more than stapling bills together. It’s about harnessing technology to make it work for you rather than you working for the technology.”

Corporate Fusion is still in its trial phase, but BT will test the technology with the Leeds City Council (LCC), the second largest local municipal authority in the U.K.

Employees of the council involved in the beta test will use dual-mode mobile phones that incorporate both GSM (global system for mobile communications) and Wi-Fi connections. It is likely that BT will also provide CDMA (code division multiple access) connections for its U.S. customers, but the company has not said so yet.

While on the council’s premises, the mobile phones will operate via the business Wi-Fi connection, and away from the premises it will operate as a cell phone.

It’s the Network
“It does not much matter who the mobile network provider is because the intelligence is in the BT network and in the PBX, not in the cell phone or the cellular network,” said Mr. Mahajan.

“Other than a bit of software sitting on top of the operating system in the phone, the mobile phone will be the same as any standard cell phone,” he added.

There are more than 400 mobile phone models currently being produced that have both Wi-Fi and GSM hooks, Mr. Mahajan said, and BT has helped “push the industry in that direction.”

BT plans to launch the service in the U.K. and Italy in January of next year, and in Germany, Spain, France, and the Benelux countries (Belgium, the Netherlands, and Luxembourg) between April and June 2007.
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