While Wi-Fi continues to enjoy a second youth, Vodafone Netherlands is introducing a femtocell for the consumer and business market. The device costs EUR 85 and offers speeds up to 14/5 Mbps. The femtocell (SignaalPlus Plug & Play) can be programmed for a specific set of up to 32 users or opened to all Vodafone customers. The connection is routed over a fixed broadband line.
The femtocell is marketed as an instrument to improve network coverage indoors and is dependent on a reliable broadband connection. Use of voice, SMS and data over the device is deducted from the user's standard monthly subscription. Skype and other VoIP apps are not blocked, except if this is part of the conditions of an older Vodafone subscription.
After a slow start, the femtocell (or picocell) has been launched by various operators worldwide, such as Sprint (US), Telefonica (Europe and Latin-America), Vodafone (UK), SFR (France) and SK (South Korea).
Offering femtocells is a smart strategy for operators: network coverage improves, while the cost of the investment is largely covered by the customer. The latter not only buys the femtocell, but also handles the backhaul over their own broadband connection. The challenge for the marketing department is how to convince the subscriber to help Vodafone in such a way. It also feeds the competition, which can argue: switch from Vodafone to us - you won't need a femtocell as we take responsibility for building a good network.
The second problem is Wi-Fi. This technology, offered over licence-free spectrum, has become so widely available that the arrival of the femtocell is almost too late. Furthermore, using Wi-Fi ensures you don't quickly exceed your data bundle, while the femtocell offers no protection against expensive overage charges. And when it comes to the business market, with users at different operators than Vodafone, the usefulness of the femtocell is limited.
A few years ago Wi-Fi projects, led by municipal governments, were sprouting like mushrooms. Many were ended due to financial problems, but many more still remain, as people have realised that offering Wi-Fi free is often the better option. Sometimes only a slower version is free, while the faster service must be paid for. Recent examples include the Dutch towns Rijssen-Holten and Veenendaal, O2 and Virgin Media in London and Google in Kansas City (as part of its local fibre network). Then there's also the Wi-Fi plan at Ziggo, which is also a wholesale customer of Vodafone. The cable operator plans to use Wi-Fi as an alternative to the mobile network.
Conclusion: it's highly questionable whether Vodafone can successfully sell the femtocell in a country where Wi-Fi coverage is only increasing.
