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November 19, 2004

Free the T-Mobile 4,700...4,800...4,900

By Glenn Fleishman

Two smart guys talk about T-Mobile’s behavior in clinging to metered session pricing: John Yunker of Byte Level Research talks about the inexorable path to flat-rate pricing for not just data, but voice. T-Mobile wants to keep charging by the hour or day and not roam with other carriers, but they’re ignoring the reality of all that’s happening around them. (T-Mobile’s recent roaming agreement with the WBA has its best benefit, as I noted a few days ago, for their existing and potential flat-rate subscribers who travel regularly but infrequently overseas and who also have cell service from T-Mobile.)

David Haskin of Mobile Pipeline—a publication for which I’m writing two articles—references Yunker’s monthly newsletter and notes that John writes there, “The only question is when, not if, Starbucks will offer Wi-Fi for free.” Yunker says that Starbucks managers are pushing for free access for their customers. But as I’ve written many times, inclusion of T-Mobile locations in other companies roaming plans is just as good as free in some ways. I agree with Haskin’s analysis of the market.

Free means never having to say you’re sorry; for-fee means that you’re making a promise about service. If T-Mobile switched to Wayport’s view and charged a fixed rate per location per month to roaming partners instead of letting their partners go free, T-Mobile would vastly increase usage while reducing customer irritation and billing support issues.

In speaking to various Wi-Fi industry figures over the last six months, it’s clear that the question is not whether Starbucks will turn its Wi-Fi billing off, but rather when, not if, T-Mobile will open itself to roaming partnerships that don’t rely on their structure for session billing.

T-Mobile may be making the internal numbers they need to continue to expand, but Wi-Fi routes around pricing bottlenecks the same way that the Internet routes around outages. SBC has produced a model that all of its DSL subscribers will be incredibly motivated to adopt because of its cheap and easy nature. If SBC customers can’t roam onto T-Mobile locations, they’ll roam onto partners of SBC. Just chart the fluid dynamics of it, and T-Mobile will see ever-declining usage as the SBC/Wayport approach grows.

Posted by Glennf at November 19, 2004 12:52 PM

Categories: Hot Spot

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» Another Reason for Community Wireless Networks. from saschameinrath.com
I definitely agree with Glenn's take on flat rate charges being more useful than per-minute charges for Internet applications like VoIP. But I don't see even flat-fee services catching on widely until WiMax technologies combine phone and Internet connect [Read More]

Tracked on November 20, 2004 5:50 PM

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