Fixed-mobile convergence: the dress rehearsal is over, it's time for the real thing! Equipped with a sturdy IP backbone, providers mature into the world of multi-service

America's Network, June 1, 2004 by John C. Tanner

Around 10 years ago, the telecom industry was buzzing--as it does--about fixed-mobile convergence (FMC). Billed as the "ultimate telecom merger," FMC envisioned a future where there was little or no difference between fixed-line and mobile phone services. Mobile phones would have the same value-added features as fixed-line (caller ID, call waiting, etc.) and could give the fixed-line phone worldwide mobility. And all this would be provided under a single phone number, with a single bill and a single point of contact for customer service.

That was then. The FMC buzz fell by the wayside, in part because of the shift in hype to things like 3G and Wi-Fi, and in part because of the effect the busting of the telecoms bubble had on capex spending.

On the other hand, it's not as if FMC never entirely happened. Most mobile networks today offer call forwarding, caller ID and voicemail. Conversely, some fixed-line operators are offering SMS services. More and more people are using mobile phones as their home phone, keeping their landlines strictly for broadband service. Meanwhile, it's now possible to access data services on cellphones, and even laptop computers now have wireless mobility capabilities, not just through Wi-Fi, but also 2.5G and 3G mobile networks.

In other words, FMC is already happening. And the industry is suddenly buzzing again.

MORPHING DEFINITION

The buzz was considerably noticeable at the recent 3GSM World Congress in Cannes. Vendors like Siemens mobile and Nortel Networks talking up their next-generation network products as the next step in FMC now that 3G networks are a reality and will be moving to IP cores--and, to an extent, all-IP traffic--in the next couple of years. Some argue that 3G itself is a form of FMC, as are IP-enabled smartphones that can download applications.

In fact, FMC is becoming an increasingly complex concept to define, encompassing a wide variety of technologies from the core to the handset, says Patrick Liot, VP of solutions marketing at Alcatel.

"When we talked about fixed-mobile convergence in the old days, it was primarily a technology pitch for intelligent networks. Now it's a more user-centric focus," he says. "If you look at the more advanced markets, where there is heavy usage of PCs and mobile phones, you see more services like voicemail and email that are unifying themselves around the customer, not the network."

This, Liot says, is enabling new services that allow providers to be more competitive and develop innovative offerings.

"This is changing the way the industry competes. It used to be that only mobile companies competed with mobile companies, and fixed competed with fixed, and ISPs competed with ISPs, but now this is no longer the case, so it's like these industries are converging into a single telecoms industry."

WHO NEEDS FMC?

Not that it's that easy, says Mike Murphy, Asia-Pacific VP of wireless networks at Nortel Networks.

"While being technically possible now, the advent of a common infrastructure providing convergence for fixed and mobile services brings accompanying issues associated with ensuring that service quality, reliability and service level differentiation for end-users can be not only assured but enhanced," Murphy says.

That said, however, he does stress that convergence addresses the need by both fixed-line and mobile operators to move up the value chain and avoid serving as simple access pipes.

"Services present and future have to be meticulously managed with aspects such as QoS, service level assurance, bandwidth management, policy management and reliability that are critical to provide the range of service level quality and differentiation that is and will be expected by end-users," he says.

More to the point, Murphy adds, the old solution of "siloed" networks with separate infrastructure components to address each aspect of the subscriber's services isn't going to cut it in the face of dramatically increasing traffic levels, particularly data. This raises capex and opex issues that convergence can address, he says.

"Convergence is really about providing a consolidated network architecture that allows all the operator's access technologies to be hosted by a multiservice edge and a high-capacity and scalable core network."

While much of this implies that FMC has more to offer operators with both fixed-line and mobile networks, Ovum senior analyst Angel Dobardziev says that standalone fixed-line and mobile service providers can also benefit from FMC.

"FMC services present fixed operators with a golden opportunity not only to generate new revenue streams and act as a one-stop-shop for customers' fixed and mobile needs, but also to defend effectively against mobile substitution," Dobardziev says. "Smooth operating, well-priced FMC phones are the most effective weapons against both access substitution as well as call substitution, enabling fixed operators to bring mobile in-premise calls back onto the fixed network."

By the same token, FMC is attractive to mobile operators hoping to convince fixed-line users to cut the cord. "We've seen some evidence of this in Europe, where mobile operators create home zones where the customer pays lower charges at home and normal charges outside," he says, though noting that thus far, many fixed-line customers are reluctant to go completely mobile--not to the point of giving up their fixed-line phone.