Femtocells face their tipping point


Verizon Wireless CTO Tony Melone said at the CTIA Wireless 2008 trade show this week that the carrier would begin offering femtocell products and service plans sometime this year. The pledge follows moves by two other U.S. carriers, Sprint and T-Mobile, into the femtocell arena. AT&T also is said to be evaluating a femtocell offering.

This kind of move isn't a real surprise for a company like Verizon Wireless, since Verizon Communications and its wireless sibling already have made other moves to vertically integrate its wireline and wireless services. What remains to be seen is what Verizon will charge for the femtocell device and the service plan. Sprint reportedly charges around $50 for the product and $15 per month for service. In wireless industry fashion, will Verizon be a copycat with its pricing?

In any case, Verizon's commitment, broader than Sprint's thus far and the only one by a U.S. telco that has both local wireline and wireless networks, may well bring femtocell deployment to its tipping point in the U.S. market. Virtually every U.S. wireline telco saw at least a slight increase in access line decline during the fourth quarter of last year. Femtocells, if priced right, could quicken the migration of customers from the wireline side of a large telco to the wireless side.

But, what if you don't have a wireless side?

Now would be a good time to get one. - Dan

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