Detractors of Fixed Mobile Convergence can’t see the value in being able to walk into your office talking on a cell phone, then pick up your desk phone and seamlessly continue the call. They are right; that’s a small hook on which to hang a massive reworking of the corporate voice network. But that’s not Fixed Mobile Convergence, so it’s a straw-man argument. In Fixed-Mobile Convergence, you walk into your office talking on a cell phone, sit down, and continue the conversation on the same cell phone. The value driver is that you no longer need a desk phone – that’s a big saving.

So now you are wondering where the “convergence” is in this scenario. Isn’t this just FMS – Fixed Mobile Substitution? Yes and no. If the wireless connection remains cellular it is FMS. But the second big value driver comes in if it seamlessly transitions to Wi-Fi or Bluetooth, and stops using cellular minutes. This is FMC. The line between FMC and FMS is quite blurred. FMS has the disadvantage that signal coverage can be weak in some buildings, and if everybody in a densely populated office goes the FMS route, the cell won’t have the capacity to serve them all. But this problem is addressed by an interesting new product category called the femtocell, which is just like a Wi-Fi access point except it runs cellular frequencies and protocols. So if you deploy femtocells in your office you are going the FMS route, if you use the Wi-Fi network instead you are doing FMC. So the FMC scenario requires the phones to be dual mode (cellular plus Wi-Fi). FMS has the advantage that the phones can be cheaper, since they can leave out the Wi-Fi radio.

Another issue is who manages the cell phone. Voice Service Providers for years have been pushing a service called Centrex, which obviates the need for a PBX on the company premises. But most businesses have resisted. They prefer to control their communications infrastructure themselves. This same objection applies to FMS, but not necessarily to FMC. With the enterprise oriented (i.e. non-UMA, non-IMS) flavors of FMC, once the call is on the Wi-Fi network it is just a regular VoIP call on the corporate PBX. This means that it is billed at non-cellular rates (free on internal calls), and it can offer all the regular PBX features.

From a market segment point of view, the Blackberry is the closest thing to an enterprise cell phone that currently exists. But it doesn’t (yet) offer any PBX call features nor does it have Wi-Fi, and it is sold through and controlled by the mobile network operators, so it also fails on the score of not being controlled by the IT department.

Nokia, recognizing these issues, sells their Eseries phones not only through mobile operators but also through interconnects, the same distribution channel as PBXs. Nokia has also endowed their Eseries phones with enterprise-grade manageability (though it is with carrier oriented OMA-DM, rather than the enterprise oriented WBEM). So Nokia’s Eseries strategy still lacks PBX features on the phone. But the Eseries phones run on Symbian’s S60 operating system, for which there is a vibrant developer community, so if there isn’t yet a third-party PBX style client for it, there soon will be.

Another cell phone project taking this approach is OpenMoko. This goes even further than Nokia’s Eseries, since all the software, including the operating system (Linux) is open source.

FMS in the enterprise

Value-conscious consumers are increasingly wondering why they need to pay for two phones, and deciding to save by ditching their wireline phone. This is technically termed FMS – Fixed Mobile Substitution, . Will the same thing happen in the business phone world? There’s a precedent for it. Desktop computers are being routed from offices by mobile PCs. Could desktop phones be displaced by mobile ones in the same way? It has been reported that more than half of calls made from businesses are cellular, so the substitution in usage is well under way already.

There are several objections. The sound quality of cellular conversations is abysmal. The cost per minute is much higher. Business desk phones have all sorts of features that cell phones lack. The form factor of cell phones is inconvenient in some ways – you can’t clamp them to your ear with your shoulder, to free up your hands. Plus cordless phones have been available for PBXs for years, and they have sold very badly.

Almost everybody in business has a cell phone. There is no way that these people are going to abandon their cell phones, but if the technical and usability obstacles are removed, they may see no further need for a desk phone. Cutting this expense has to be attractive to businesses focussed on ROI.