Western Europe unimpressed by fixed-mobile convergence

Mobile operators are finding it "truly difficult" to sign customers to new fixed-mobile convergence (FMC) services in Western Europe, market watchers revealed today.

IDC's recent study of FMC examined the experiences of Western European operators in launching services, and noted that many are struggling to get offerings off the ground.

"Orange has had the most positive start with its Unik service in France, but other operators have struggled," said Jill Finger Gibson, EMEA research director at IDC.

"This shows that FMC technology is moving in the right direction and is not the major hurdle to FMC adoption, at least in the consumer segment.

"That hurdle is getting the customer proposition correct, launching the service only when the necessary prerequisites are in place, and positioning an FMC service as a must-have rather than a nice-to-have."

IDC's report advises operators considering consumer services to avoid positioning FMC as a new standalone product. Instead, it should be positioned as a complement to existing broadband and mobile services.

In particular, IDC stressed that operators planning on launching an FMC service need to ensure that a "significant number" of their existing broadband subscribers are already familiar with and using home networking equipment.

Ultimately, home broadband penetration combined with home network penetration is the necessary prerequisite for the launch of an FMC service, the analyst firm believes.

Based on the technology and service developments over the past year, IDC estimates that the FMC services market in Western Europe will grow at a compound annual growth rate of 173 per cent to reach $2.65bn by 2011.

During the forecast period, the major FMC opportunity will be in the consumer and small/medium business segments rather than the large enterprise segment.

The first deployments of FMC have been with consumers and have shown that people will buy the service if the messaging, pricing and device offers are right.

IDC believes that significant penetration of FMC in the enterprise sector will only occur after 2011, as the technologies needed for enterprise FMC to appeal to business technology decision-makers are still in the development stages, and enterprise adoption of new technologies is a gradual process.