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Verizon will bring femtocells to market in 2009 that work with any Verizon handsets

Many cell phone users find that indoor coverage can be spotty at best. Dead spots inside homes or offices make it hard to get a signal and talk without interference or dropped calls. This is especially problematic for users who only use cell phones.

One way to improve cellular coverage indoors is by using a device that resembles your typical wireless router, known as a femtocell. Verizon Wireless has announced that it will be selling its first femtocell early next year. Verizon had previously said that it would launch femtocells this year, what led to the delay is unknown.

Verizon isn’t the only cellular provider that is offering femtocells. Both Sprint and T-Mobile offer femtocells to customers. The femtocell connects the cellular phone of a user to the broadband internet connection in a home or office to route calls over the internet.

Like any other VOIP service, call quality is likely to be affected by the available bandwidth on the network at the time. Sprint's femtocell is far from the bargain users will hope for at $99.99 for the hardware and an additional $10 to $20 per month for the privilege of using the femtocell.

T-Mobile also offers a femtocell-like service from called HotSpot@Home and requires a special handset to use whereas the Sprint and coming Verizon femtocells will work with any handset. Verizon is still mum on how much its femtocell will cost and what fees the femtocell will carry monthly. Pricing is likely to be in line with what Sprint charges for its femtocell service.



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Cell companies...uhg...
By drebo on 10/29/2008 2:21:29 PM , Rating: 5
I just don't get it. I understand charging for the hardware, sure, and maybe an initial setup fee, but to use the service? It would be far, far cheaper for Verizon/Sprint to take calls over the internet than at their cell towers. People using this device in their homes would be cheaper in operation for the cell company, not more expensive...so why charge for it?




RE: Cell companies...uhg...
By teldar on 10/29/2008 2:31:50 PM , Rating: 5
because they can. and because they're cheap bastards


RE: Cell companies...uhg...
By AlexWade on 10/29/2008 8:10:20 PM , Rating: 5
"Can you hear me now? What do you mean pay $10?"

Verizon Wireless ... we never stop overcharging you.


RE: Cell companies...uhg...
By VaultDweller on 10/29/2008 2:31:51 PM , Rating: 3
Because they think people will pay for it?

Finding ways to make money is kind of what they do.


RE: Cell companies...uhg...
By gramboh on 10/29/2008 2:33:59 PM , Rating: 5
It's hilarious because you are basically improving their network structure for them, at your OWN cost. Weak signals (unless you are in some kind of bunker) should not be happening in a typical home. Rather than upgrade network coverage, they are trying to pass the cost onto consumers and profit from it. Good business decision since I'm sure keeners will go for it.


RE: Cell companies...uhg...
By nace186 on 10/29/2008 2:57:35 PM , Rating: 2
Agree.

You know, it's probably cheaper to just switch to a different provider if you have reception problem in your house.


RE: Cell companies...uhg...
By UNCjigga on 10/29/2008 3:12:48 PM , Rating: 2
I disagree with your analysis of the business model. Charging for Femtocell service makes sense, provided you have the following conditions:

1) Hardware is free/100% subsidized through a monthly charge, or hardware is cheap (less than $50) with a very low monthly service fee (less than $15)

2) You have unlimited "anytime" minutes and unlimited data when using the femtocell. For people without a landline this is a very compelling feature to have and easily justifies the cost of a small monthly fee if you can stay on a cheaper plan.

Ideally, the service fee would allow you to pair the femtocell with a virtual "home" telephone number (i.e. while at home, calls from your cellphone appear to others as coming from a separate "home" number, while calls to your "home" number ring through to your mobile phone regardless of where you are).


RE: Cell companies...uhg...
By Alphafox78 on 10/29/2008 3:25:56 PM , Rating: 2
Knowing verizon im sure this will still count against your minutes. It might be worth it if it didn't count against them especially if you only had 450min a month plan but I doubt verizon would be so generous.


RE: Cell companies...uhg...
By jeff834 on 10/30/2008 9:00:31 PM , Rating: 2
As far as the Sprint one goes, minutes at home are unlimited.


RE: Cell companies...uhg...
By ebakke on 10/29/2008 3:44:01 PM , Rating: 4
quote:
Ideally, the service fee would allow you to pair the femtocell with a virtual "home" telephone number (i.e. while at home, calls from your cellphone appear to others as coming from a separate "home" number, while calls to your "home" number ring through to your mobile phone regardless of where you are).
How is that ideal, or useful at all?


RE: Cell companies...uhg...
By UNCjigga on 10/31/2008 4:59:38 PM , Rating: 2
It would be a nice option for landline replacement. If I have unlimited calls at home, I might as well use my cellphone for everything, right? But I don't necessarily want to give my mobile # to everyone.


By Rodney McNaggerton on 10/30/2008 12:21:40 AM , Rating: 2
Sprint is using the femtocell as a way to keep customers that are considering leaving. Call them up and complain about service and they'll waive the monthly fee and depending on how pissed you sound they'll wave the cost of the femtocell as well. It's called customer retention. I do believe that at some point in the distant future this will actually be offered to consumers with a lower cost.


RE: Cell companies...uhg...
By ira176 on 10/30/2008 1:07:16 AM , Rating: 3
Scarey thought, now the pressure is off of Verizon to provide the best wireless coverage they can. Verizon can now set up fewer towers, and then tell customers who have weak or no signals inside buildings that the only thing that they can do to improve the service is buy the new device and pay additional monthly fee for it.


RE: Cell companies...uhg...
By feraltoad on 10/30/2008 3:41:40 AM , Rating: 2
I bet some guy in a boardroom said, "Geez, will these customer people quite whining about good coverage in their homes. Ha, we oughta make them use Skype at home! Hey, wait a minute..."


RE: Cell companies...uhg...
By dragonbif on 10/29/2008 2:33:22 PM , Rating: 2
I use vonage at home for $24 a month and I have a cell phone with only 400min and 5000 night and weekend (free moble to moble). I dont mind having 2 phones and that way I do not have to give out my cell number if I do not want to and vonage lets me block numbers for free. If they are going to charge $20 a month to use that thingy to do what vonage does people should just get a home phone. I have never had a problem and I am pushing 4 years of service.


RE: Cell companies...uhg...
By feraltoad on 10/30/2008 3:43:48 AM , Rating: 2
Excellent point! Plus, if cell customers are paying for call forwarding anyway the people calling their cells would never know it was being sent thru vonage.


RE: Cell companies...uhg...
By Spivonious on 10/30/2008 9:55:54 AM , Rating: 2
And if you don't need more than 500 minutes each month, Vonage has a $15/month plan.


RE: Cell companies...uhg...
By amanojaku on 10/29/2008 2:42:38 PM , Rating: 2
If you think your broadband is expensive try paying business rates for network bandwidth. OC-192's aren't cheap, and the number of people using cellphones can fill up a pipe that large easily (~19,000,000 calls over a 10Gbit/sec connection.)

Oh, and companies are always looking for ways to make more money.


RE: Cell companies...uhg...
By Jellodyne on 10/29/2008 2:58:19 PM , Rating: 3
OC-192s aren't cheap, but once you spread the cost out among the 19 million callers its suprisingly affordable.


RE: Cell companies...uhg...
By amanojaku on 10/29/2008 3:04:11 PM , Rating: 2
Until you realize you need more than one. In every exchange point.


RE: Cell companies...uhg...
By drebo on 10/29/2008 3:40:00 PM , Rating: 2
Bandwidth is an overhead cost of doing business that they need to pay for whether or not people are using femtocells. However, which do you think is more economical: maintaining a single (or a couple) connections into a single data center, or maintaining/leasing capacity on cell towers/antennas throughout the company?

Through the use of the femtocell, the infrustructure (the internet) is no longer solely the responsibility of Verizon. I would bet my job that the bandwidth cost of a VoIP call over the internet is far cheaper than the cost of the slot on the cell tower as well as the same bandwidth required to get that call back to the switch. Remember, they're paying for that bandwidth already. With femtocells, they can now reduce their usage of cell towers. That's where the savings is.


RE: Cell companies...uhg...
By the goat on 10/29/2008 3:25:05 PM , Rating: 2
quote:
t would be far, far cheaper for Verizon/Sprint to take calls over the internet than at their cell towers. People using this device in their homes would be cheaper in operation for the cell company, not more expensive...so why charge for it?


They charge because they can. Same reason banks use to charge you a yearly/monthly fee to have an ATM card. It costs the bank a lot less if a customer uses the ATM instead of a live person teller. But the bank knows it is faster for the customer also. So they justify charging the customer and pocketing the money they saved (the bank gets double the money).

Of coarse if one cellphone provider simply passed the savings along to their customers (unthinkable), they would make even more money because of the large number of customers signing up for their service.


RE: Cell companies...uhg...
By drebo on 10/29/2008 3:32:05 PM , Rating: 3
My bank doesn't charge me a fee for my checking account or ATM card. All that's required is that I maintain a balance of $2,000 or more between all of my accounts, CDs, etc. Why? Because the more money I put into the bank, the more money the bank can reinvest. They're rewarding me by giving me free checks, free checking, and convinient service for making their job easier and more profitable. There's no reason cell companies can't do the same.


RE: Cell companies...uhg...
By ebakke on 10/29/2008 3:47:22 PM , Rating: 2
You conveniently left out your suggestion of how the cell companies should operate to "do the same". Please elaborate.


RE: Cell companies...uhg...
By drebo on 10/29/2008 4:12:50 PM , Rating: 2
Er, I thought I made that pretty clear when I said that the use of this service is actually cheaper for the cell company than normal use of the cell phones.

The idea is that the consumer does something to help the company (take load off of the cell towers, cheaper calls), and the company rewards the consumer for it (better signal).

Under Sprint's model, the consumer is paying for the priviledge of helping the company out.


RE: Cell companies...uhg...
By ebakke on 10/29/2008 5:21:24 PM , Rating: 2
I'm following you now (and I didn't realize that you authored the posts), however you'll probably remember that ATM fees used to exist, and many banks still charge them. Your bank isn't providing them free to you because they want some amicable relationship with you. They're doing it to compete and differentiate with their competitors. Banks (and every other business) are there to make money. If they could get you to pay ATM fees, you damn well better believe they would. Now apply that logic to cell phone companies. Until market forces push them to offering discounts, they'll charge as much as people are willing to pay.


RE: Cell companies...uhg...
By drebo on 10/29/2008 6:10:02 PM , Rating: 2
Well, the ATM fee analogy doesn't really fly here, as that would be akin to YOUR ISP charging you for making calls on the cell company network via this femtocell.

My bank doesn't charge me fees to use their ATM, and they don't charge me fees to use other ATMs. OTHER banks charge me fees to use their ATMs, which is akin to roaming on your cellphone. You're paying to use someone else's network. But, because ISPs don't (can't, at least policy-wise) filter your data with tiered charges for different types of data, there is no roaming. All it is is benefit to the cell company.


RE: Cell companies...uhg...
By ebakke on 10/29/2008 11:04:45 PM , Rating: 2
quote:
Well, the ATM fee analogy doesn't really fly here
You're the one who started using it!

And I think the ATM analogy does hold. The cost of the ATM itself is something the bank had to pay for, much like the hardware for femtocells costs money. In addition, the cell companies have to add capabilities within their networks to handle the transition from internet traffic to their voice networks (however they choose to do that). This is comparable to a bank requiring larger data capabilities for all of these remote terminals executing transactions. Neither of these are free, and as a result, they'll charge you for them. As more people begin to offer the same service, they'll use price as a means of differentiation.


RE: Cell companies...uhg...
By the goat on 10/30/2008 7:02:51 AM , Rating: 2
quote:
Well, the ATM fee analogy doesn't really fly here,


When I made the original analogy I was talking about how banks use to charge customers a yearly fee just to have an ATM card . Not the per use fee you get charged when using another bank's ATM. You guys might be too young to remember, but when ATM's first came out just having the card cost $5/month or more.


RE: Cell companies...uhg...
By ebakke on 10/30/2008 1:11:43 PM , Rating: 2
I still think the situations are comparable. :)


RE: Cell companies...uhg...
By cocoviper on 10/31/2008 2:04:33 PM , Rating: 2
The companies aren't charging for the service, they're still charging for the hardware per month.

For instance, the Sprint Airave costs $99 for the end user plus some fee in the $5-20/ mo range (depending on the plan types and options that you want). But the Airave itself is physically costing Sprint somewhere in the range of $230-300.

Market studies show that consumers, specifically American consumers like the thought of paying $99 + 5/ mo a lot more than $300 flat. I mean anyone that wanted to pay the flat rate would essentially be paying for 3+ years of monthly service upfront. I certainly don't see the point in that.


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