Fixed-Mobile Convergence

          Fixed-mobile convergence (FMC) caused excitement and confusion in the IT world in the last eighteen months.  There has been a great deal of industry rant about FMC and its roles in Voice over the Internet Protocol (VoIP). FMC brings the structure for shifting VoIP and cellular telephony to a new level of both mobility and convergence, particularly when matched with presence management online. An amazing powerful combination set that is not yet widely mature and deployed. 

          Although VoIP is experiencing fast growing momentum and deployments, many of its key advantages have not yet been completely achieve due to the lack of interoperability. Leading technology companies are working together to drive end-to-end standards for rich interoperability that will bring this benefits to fruition.

          Voice over the Internet Protocol (VoIP) is an IP telephony term for a set of facilities used to handle the delivery of voice information over the Internet. VoIP involves transporting voice information in digital form in discrete packets rather than by using the traditional circuit-committed protocols of the public switched telephone network (PSTN). A vital advantage of VoIP and Internet telephony is that it steers clear of the tolls charged by ordinary telephone service.

          In addition to IP, VoIP uses the real-time protocol (RTP) to help guarantee that packets get delivered in a timely way. Using public networks, it is currently difficult to guarantee Quality of Service (QoS). Better service is possible with private networks managed by an enterprise or by an Internet telephony service provider (ITSP).

          Many mobile operators are interested in the potential for growth through FMC. At this year's 3GSM World Congress, CEOs from NTT DoCoMo, T-Mobile and Orange spoke on a keynote panel. A very important point discussed was that most telephone calls originate within buildings, where mobile coverage is poorest. As such, residential users are often forced to keep their fixed-line services for use when they are at home. The same applies in office buildings, with the added problem that wireless operators haven't been in a position to offer the Centrex or PBX features that enterprises require. In theory, however, that could potentially change with the advent of IMS and FMC, at least in theory.

          Fixed-mobile convergence relies on broadband Internet access for the “fixed” part and wireless LANs to enable converged handsets. The timing is right as wireless LANs cover many enterprises today and home WiFi setups are spreading rapidly. Broadband Internet access is also available in thousands of public hotspots, through a confusing range of service offerings — some rather expensive, and others completely free. The first round of convergence depends upon handsets that support 2G, 3G and WiFi connections on the same phone. Mobile operators then use an IMS platform to transparently combine regular mobile service on their 2G or 3G mobile network with VoIP services over WiFi and/or fixed broadband access. And because the mobile portion of FMC uses the existing mobile number and existing mobile switching systems, mobile operators have an advantage.

          FMC is the ability to acquire your voice, data network, mobile and your other communcations from the same carrier, and have it all in one bill.  FMC provides the promise of savings as a direct outcome of the economic leverage gained from paying such a large bill every month.

          Fixed-mobile convergence is alluring to operators because IP Multimedia System (IMS) is a logical extension of their existing networks and the resulting services make the most of operators like NTT DoCoMo’s installed base.  In addition, FMC represents an option for the mobile operators to vend new services directly to enterprises.  Most mobile services are retailed to consumers, even though the bills are paid by enterprises.  Launching a direct relationship with the enterprises opens new service and new revenue possibilities for mobile operators.

          There are several advantages brought about by Fixed-Mobile Convergence to enterprise and end users. It allows personal/private number separation or a single number that enables presence capabilities and location transparency.  It uses a single device with integrated PBX and PIM capability.  FMC offers a single integrated voicemail box; single work/private directory and look up functionality.  It has mobile call features and has fixed/PBX functionality on mobile devices (mobile conferencing, calling, call transfers and call waiting).

          For IT managers, FMC offers a dismantling of the management barriers and costs between deploying separate fixed and mobile telephony through a fused and centralized service.  It enables the enterprise to leverage existing PBX technology or future fixed investments while delivering cost-effective mobility.  Although it is difficult to measure, FMC allows ROI associated with greater employee productivity. FMC also facilitates in a reduction in and greater control of mobile costs through PBX-routing capability.

          FMC promises a superior user experience delivered cost-efficiently and with nprecedented convenience. FMC offers service providers the potential for first-mover advantages to attract customers and gain momentum. It extends an opportunity for service providers to enter new markets and to bridge the wireless/wireline divide.

But this isn’t just about voice. The industry sees video and multimedia as the means to capture customers and differentiate from client-centric solutions (e.g., Skype over WLAN) — in particular to take content from the existing world and customize it for delivery to mobile devices. The key to a successful FMC deployment is to compete not on price, but with value-added services.

Links: Voip Architecture

VoIP Service Competition

          Competing with service providers is a critical advantage because of the dozens of VoIP service providers that have crowded the market. With FMC, the mobile operators' advantages are important for not just their large customer base that relies on accustomed mobile functionality, but — most importantly — extensive coverage going far beyond anything we can imagine for WiFi in the next ten years. Without broadband Internet access, the VoIP service providers are a significantly smaller threat to mobile operators' FMC services. As claimed, the aim of fixed-mobile convergence is to hit the sweet spot of high convenience and low cost.

          Independent VoIP services are a looming threat for 3G mobile operators. Fixed-mobile convergence will bid them a viable competitive advantage for a while. But as 3G data services get better, WiFi continues to spread and WiMAX emerges, the VoIP service providers will begin to compete head-to-head with the mobile operators offering their own converged services.

          Eventually, mobile operators will need to split their integrated mobile telephony business into a mobile access business and one or more Internet brands, so they'd be well advised to start planning for that right now. A FMC service will take them beyond their own networks.

          Today, mobile operators have an opportunity to profit from an aggressive rollout of FMC services, with their innate but short-term advantages, to build a global branded VoIP service that can survive when competing VoIP providers start leveraging mobile broadband Internet access.

          Critical shifts are about to occur in the enterprise telephony landscape over the coming 18 to 24 months as a number of supply and demand trends coalesce to bring about integration of fixed PBX and mobile telephony systems in the enterprise. These forces will encourage fixed-mobile convergence (FMC) in the large enterprise segment in the next 5 years, creating new service models around high-value managed telephony services. Recent announcements from European incumbent operators British Telecom and Telia-Sonera which plan to offer FMC-based telephony solutions to corporate customers in Europe serve to underscore this prospect.

          Voice remains the most common and costly enterprise application today, reaching most employees and consuming 10% to 25% of enterprise ICT budgets annually. Additionally, enterprise telephony costs are growing and becoming more distributed across multiple cost centers because of an increasing amount of mobile working. These mounting expenditures, either centrally managed or individually expensed by employees, have frustrated many IT managers and financial controllers in the past several years. Recent supply initiatives have brought together multiple players from the traditional fixed and mobile worlds to address these trends. These partnerships have raised the near-term prospect that service providers will be able to address the complex enterprise requirement for telephony services that leverage fixed investments and simultaneously deliver a host of mobility, productivity and cost-control benefits. Vendor portfolios are evolving into offering an array of enterprise FMC solutions that will address multiple enterprise requirements and open up new partnerships, go-to-market models and service opportunities for a cross section of industry players over the coming years. Those that embrace FMC based telephony services will enjoy lower customer churn levels, increased account penetration, average revenue per enterprise uplifts and, perhaps most important, increased strategic standing with valuable enterprise customers.

Links: Business Voip