Da Nile Runs Through Barcelona

To read this week’s accounts of the 3GSM speech by the CEO of T-Mobile, da Nile is no longer just a river in Egypt. Hamid Akhavan said that while VoIP may be cannbializing the wireline voice business, it will have “far less impact” on the mobile phone business.

Translation: we have a closed and locked business model, we control the handset, and we will refuse to let our customers use VoIP.

Some choice quotes:

"When people talk about VOIP, they think free," Akhavan said. "With any mobile service provided over the Internet, you're going to need to buy a data package."

Translation: we will charge them so much that VoIP is uneconomical.

“There are all sorts of technical issues that make mobile VOIP services difficult to implement,” he said. Technical issues related to how networks pass on IP addresses of mobile users have not been completely resolved, he noted. “Take reachability, for example: How can the call come to me?”

While SkyPE is certainly aware of mobile phone issues, I guess Akhavan hasn’t noticed that problems such as routing incoming calls and emergency phone location have been solved with cell phones and are being solved with landline VoIP.

Certainly all these things may happen. But I have a two word retort: Wi-Fi hotspot. Even ignoring VoIP-over-3G deals, who’s going to buy a smartphone that doesn’t work with free (or more reasonably priced) Wi-Fi hotspots? The operators who cripple their handsets (like Cingular does with the Nokia E62) will find that people will go to other vendors (or buy uncrippled phones like the E61 on the open market).

All this tells me is that T-Mobile does not see business users as important to their US market share. T-Mobile has spent more than $100 million to wire every Starbuck’s in sight, but apparently they’re not serious about leveraging the possible synergies to drive cellphone subscriptions.

Meanwhile, Hamid Akhavan argues that the impact of mobile data services will be greater than that of the (fixed line) Internet. Apparently he hasn’t listened to Mike Mace. (Big mistake).

As the cartoon says, he must be on something.

Graphic credit: “Pepper … and Salt,” Wall Street Journal, Feb. 14, 2007

Technorati Tags: business models, mobile phones, T-Mobile, VoIP, Wi-Fi