O2 launches combined Wi-Fi and 3G service

Mobile operator O2 has launched a 3G datacard as part of a service combining general packet radio service (GPRS), 3G and Wi-Fi access.

The company said it will deliver 3G services to 20 cities by Christmas, and provide access to more than 6,000 wireless hotspots through deals with Wi-Fi providers BT Openzone, The Cloud and Excilan.

O2's Connection Manager software allows the mobile user to connect using the datacard to whichever of the wireless technologies is most appropriate.

The company said its GPRS services already cover 98 per cent of the country.

"This is single-service approach; you get single-service support and single billing," said Mike Short, vice president of research and development for O2.

"We held a 500-person 3G trial and focused on what the customer wants: simple service, decent support and good data speeds. We'll launch consumer services when we're ready; that may be by Christmas, or it may not."

The choice of 3G coverage areas, including London, Birmingham, Liverpool, Manchester, Glasgow and Edinburgh, is based on locations with the highest GPRS usage, O2 said.

The company has promised to cover 50 per cent of the UK with 3G by June 2005, and says it is on course to provide 80 per cent coverage by the end of 2007.

"It's a finely balanced decision," said Andy Buss, senior analyst at Canalys.

"The fact is, 3G services are ultimately suited for downloading and more advanced functions. Handsets for consumers now are starting to provide these kinds of services. For them it's probably better to hold off and focus on the business data user."

GPRS/3G customers can access the services with a card costing £110. O2 offers a variety of payment packages, with less expensive options for voice contract services. Wi-Fi costs £30 per month flat rate for unlimited access.