T-Mobile’s 20Mbps 3G service aims to destroy landline phones

The UK’s home broadband market is being shaken up at the moment, with Carphone Warehouse (our leading mobile phone retailer) offering free broadband bundled with its TalkTalk landline phone service. Now, T-Mobile has waded in by threatening to replace the landline altogether – both for voice calls and broadband data services.

T-Mobile’s plans involve using HSDPA to ramp up the data transfer rates of its 3G service from the current 384kbps to 1.8Mbps in 2006, and then onto 20Mbps by 2010. Better still, the service is completely open, and is offered at a flat rate of just £8.50 ($15) per month for unlimited use.

Who needs a landline?

T-Mobile have noticed that younger users of phones rely so heavily on their mobiles, they rarely use landlines, except for high speed data access via broadband. Sensing a change in consumer behaviour, T-Mobile are positioning themselves to take advantage of the increasing number of households that are dispensing with landlines altogether. With HSDPA, 3G speeds are more than a match for home broadband connections, and at just £8.50 per month, the total service is actually cheaper than the combined land-line voice and broadband rate charged by the telcos. With this new service, there’s no reason to keep a landline, even for high speed data access.

Mobile Networks as Bit Pipes

This could be the sea-change that’s necessary for mobile services finally to take off. T-Mobile has seen the light, and recognized that mobile network operators are just bit pipes – they’re not content providers, and can’t get away with charging absurd sums for poor content.

Walled Gardens kill content

Mobile operators’ portals and walled-garden Internet access are rapidly becoming a thing of the past, and not before time. Despite spending £22.5 billion in the UK alone for high speed 3G data rates, the operators’ practice of restricting the content users can access has led to just 10% of UK mobile phone users downloading content of any sort. In response to user demand, the handset manufacturers are circumventing these limitations by offering WiFi on their latest models, letting users use their home broadband connection to access whatever content they wish without the extortionate charges imposed by the operators. With T-Mobile’s latest plans, this is no longer necessary, as data charges over their mobile network could be significantly cheaper than over a home broadband connection.

Changing industry landscape

An intriguing game of chess is clearly going on between the mobile operators, land line operators, broadband ISPs, cable companies and even mobile phone retailers. Who wins is currently anyone’s guess, but the telephony landscape is changing beyond recognition, and with it, the services and content we can expect. About time, too!

[Source: The Business, The Independent]