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Vodafone revs up UK femtocell program

Sure Signal sexier than Access Gateway

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Last June, Vodafone UK became the first European operator to go live with femtocells, though the indoor base stations remained somewhat shadowy in the carrier's portfolio. Now it is bringing them out into the marketing daylight with a rebranding and a price cut.

The device, originally called the Vodafone Access Gateway, is now more snappily named the Sure Signal. This reflects the initial focus of the cellco's marketing of the product, the promise of improved indoor 3G coverage and signal quality. Mobile operators are looking for many benefits from their femtocell investments - some consumer driven, such as new apps and homezone tariffs; some geared to their own economics, such as offload of traffic from the macro networks to devices backhauled by the user's own broadband lines.

But in the first stage, as successfully demonstrated by the US carriers, the most readily understood, and urgently needed, benefit is indoor penetration. In October, a survey of UK mobile users by ADC found that 27.6 per cent of respondents believed their work had suffered because of weak cellphone reception indoors at home or the office.

The Sure Signal will now be promoted and sold more aggressively, said one Vodafone insider, and the pricing has been made keener to match. It will now cost just £50 ($81), down from £160. Consumers can also opt to pay £5 a month for a year to get the femtocell, if they are on contracts of more than £25 a month; or for two years if their deals are worth less than that.

One of the dilemmas for carriers is whether they can charge for femtocells, or need to offer them 100 per cent subsidized in order to boost uptake and gain the benefits of data offload. So far Vodafone is pursuing something of a middle road, despite complaints from some consumers that they should not have to pay to compensate for an operator's poor coverage.

Various reasons can be deduced for the timing of the stepped-up push behind the femtocell. Vodafone has managed to convert its back office system to allow for automatic provisioning of the devices - seen by other early adopters, such as AT&T, as an essential condition for volume adoption. Its supplier SFR is understood to have ramped up its manufacturing output considerably this quarter.

And of course, Vodafone UK launched the iPhone last week - the handset has famously put strain on the network of its previously exclusive UK carrier, O2, and femtocells will be one way to ensure data-centric smartphone customers get a high quality experience, indoors at least.

"No other network in the UK can ensure a great mobile phone signal in the home, because the Sure Signal is unique to Vodafone," said the operator's UK CEO Guy Laurence. "Customers tell us it is life-changing."

The Sure Signal offers download speeds of at least 1Mbps, connects to any broadband line, and can be registered with up to 32 different mobile phones and used by up to four handsets simultaneously (provided they are all Vodafone customers of course).

Copyright © 2010, Wireless Watch

Wireless Watch is published by Rethink Research, a London-based IT publishing and consulting firm. This weekly newsletter delivers in-depth analysis and market research of mobile and wireless for business. Subscription details are here.

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