Canadian service providers are hoping Wi-Fi will enable them to lighten the load on their cellular networks. Wi-Fi as a voice medium is a ready technology, they say, but a commercially viable business plan is still being developed.
Universal mobile access (UMA) is about tunnelling voice traffic over a Wi-Fi home base station and getting it off the GSM cellular network. The technology has been tried and tested, but its implementation requires significant investment to upgrade the Wi-Fi infrastructure to support quality of service.
Dual-mode handheld devices — PDAs, pocket PCs and cell phones capable of handling cellular and Wi-Fi traffic — are available in beta form and service providers are keen to figure out a way to move users off the cellular network onto Wi-Fi when they aren’t mobile.
But while the combo phones are available from a technical perspective, they say there are obstacles for widespread consumer adoption of these devices.
“If you’re at home on your couch and you’re using your cell phone, you don’t have to do a lot of research to realize you’re not mobile,” says David Robinson, vice-president of business implementation for Toronto-based Rogers Communications Inc.
He says service providers are expending substantial amounts of capital to support users on a mobile network and they’re not using its mobility, while Wi-Fi exists as a much cheaper alternative.
“We set ourselves up as an industry, where we had a network that was under-utilized at certain times and so we created off-peak pricing to fill the void.
“But now that void is the peak,” says Robinson. “So we’re deploying capital against fixed revenue, which is a bad business model.”
Robinson says Rogers has undertaken trials with the UMA converged technology, but some challenges have yet to be resolved. “We know the technology works, but we’re trying to determine how to position it.”
Combining Wi-Fi and cellular in one device is not the issue — it’s actually creating a service that works by having seamless hand-off between a Wi-Fi and a cellular signal, according to a representative from another Canadian service provider.
And the quality of the phone’s Wi-Fi connection requires considerable investment. “There are many challenges around quality of service and making sure the minimum bandwidth is maintained to support the voice application,” says the source.
A service provider has to place additional equipment on the back-end that will manage the Wi-Fi call by allocating specific bandwidth and ensuring the call is receiving priority.
Too many users on one hotspot can overwhelm the connection. “Voice cannot accommodate those fluctuations in available bandwidth, say 1Mbps down to 100Kbps.
“When you’re speaking, all the bits and bytes have to flow through at the speed and the order in which they’re brought in, otherwise you’re going to have cut-outs and digitization of the sound quality. The whole thing will not be a fluid call, the way you’re used to it.”
Robinson says Rogers is heading towards an access-agnostic view for future phone services. “I can see a time in the very near future where you can be sitting in a mall and have three networks available. You’ll be able to choose between Wi-Fi, Wi-Max and 3G cellular.”
“The ultimate iteration is that we provide this seamlessly so that customers are unaware of what access technology is being applied against their need. Ideally, you shouldn’t have to care, or even know.”
But as these new dual-mode devices become more ubiquitous, the combo phones could jeopardize other business models, says one analyst.
“The technology may threaten the cellular business in terms of how service providers harvest their revenues now by charging significant premiums for long-distance and roaming,” says Iain Grant, managing director of the SeaBoard Group, a research and consulting firm in Montreal.
“The Wi-Fi network is going to probably migrate a lot of traffic from the standard cell phone to a Wi-Fi-based phone.”
Similarly, Grant is concerned about the high-speed data models such as EV-DO or EDGE. “We’re seeing Wi-Fi coming in at 2Mbps. It’s really hard then to get excited by all this innovation from Bell, for example, moving from 400Kbps to 800Kbps, when you’re sitting in a hotspot with 2Mbps for free versus $80 per month.”