Fixed mobile convergence (FMC) is taking off around the world, though its take-up may not be apparent in the US, where momentum is still building. FMC is a service in which the same handset has access to services through a fixed network in addition to a wireless network. The same handset can be used in the home and office and also send and receive cellular calls when traveling in the wider world.

FMC suffered early on from too many technical approaches and too few standards. A number of operators conducted trials but hesitated to commit to full deployment. Fortunately, that period is behind us. Standards have been established and the industry seems to have coalesced around the dual mode WiFi/cellular approach. Operator trials have been replaced by new product announcements and large scale deployments have begun—at least in the consumer segment.

FMC can be accomplished in a variety of ways. Figure I-1 compares three of the most common FMC configurations in consumer homes with the existing scenario: Wireless substitution, Voice over Wireless Local Area Network (VoWLAN), and Fixed Cellular.

Figure I-1 Common Fixed Mobile Convergence Scenarios

- Wireless Substitution—is a common trend today. Essentially the customer abandons their landline phones in favor of wireless.

- VoWLAN—is becoming the predominant solution for FMC. The handset contains a radio that can connect to WiFi within the home or office and traditional cell networks outside the home or office.

- Fixed Cellular—telecommunications services are provided to the customer over a wireless network instead of a wireline network, but the handset is not transportable. Although fixed cellular has some FMC characteristics, it is not true FMC.

Pseudo-Convergence is another significant aspect of the FMC landscape. It is a price promotion or bundling of services that provides incentive for the customer to retain their wireline telephone but does not offer single handset with access to both cellular network and WiFi network. Wireline carriers are pursuing such tactics while they sort out the longer term issues of FMC.

1.2 FMC Stems Line Losses for Wireline-Only Carriers

Today, most wireline carriers around the globe are witnessing access line losses as a result of wireless substitution, the tendency of telecommunications users to drop their landline service entirely in favor of a cellular phone. Whether the subscriber is in Asia, the US, Latin America, or Europe, substitution is occurring because wireless services are becoming pervasive, increasingly convenient to use, quality and availability is improving, and the price of wireless service is decreasing. For example, according to the US FCC, the number of landline phones in the US dropped for the first time in 2001, with a decline of 0.4 percent.

Over 20 million lines have been disconnected between the peak in 2001 and 2006 (the latest year in which the statistics have been reported). ILECs......

Market Segmentation

By Global Region
Americas
US
Rest of Americas
EMEA
France
Italy
UK
Rest of EMEA
Asia Pacific
Japan
Rest of AP
Latin America
Consumer FMC by Global Region
Revenue ($ Millions)
Subscribers (Millions)
Cellular Subscriberrs (Millions)
VoIP Households (Millions)
Enterprise FMC by Global Region
Systems (Units)
Equipment Revnue ($ Millions)
Service Revenue ($ Millions)
Mobility Annual Minutes of Use Average by Industry (US Enterprises)
Mobility Annual Minutes of Use Average by Industry (W. Europe Enterprises)
United States
Consumer FMC Revenue
Consumer FMC Subscribers
Wireless-Only Households
Access Line Substitution, Residential and Business
Average Monthly Minutes of Use
Cellular Subscribers
Wireless Monthly Minutes of Use
Wireless Revenue
Residential Broadband Subscribers
Residential Broadband Revenues
Residential Broadband VoIP Subscribers
Residential Broadband VoIP Revenue
Cellular-Only Households