Vodaphone Subsidises Femtocell; At&t Should Take Note

Posted by Kallan Dahn Thursday, January 21, 2010

In a bold move to bolster the uptake of their femtocell devices Vodaphone has cut the price of their units rather significantly.  The move will drop the price of their unit from 160GBP ($285 USD)  to 50 GBP ($80 USD).  The company will also allow users to purchase the unit on a monthly basis paying 5GBP ($8 USD) per month.  The move  comes shortly after the release of the iPhone for Vodaphone.  Vodaphone has already acknowledged problems that have been occuring with other networks and data congestion, namely the release of the iPhone with Orange, wich released day one with about 20,000 iPhones hitting the network, and of course here in the US At&t has suffered serious blows to their network reliability.    Vodaphones release yeilded nearly 50,000 iPhones sold on release day, but Voda claims that their network is ready to handle the load.  Vodaphone has been preparing for the launch for nearly a year to make sure their network would not break.  So far so good, but the move with dropping the femtocell price to bolster the uptake is a smart move on the part of Voda, as it will divert much the the iPhone data traffic off of their network, and place it comfortably in the ILEC or cable provider offering the high speed connection that wires to the femtocell. This is like a great security blanket for users and the company themselves to make sure the quality of the network is not greatly impacted.  At&t should take a close look at this model as it may provide significant releaf from the damage the iPhone has done to their network.  Granted this is a very short term fix, but anything for them at this point is a great amount of help.  Deffinately now that their investment rating was dropped by Townhall Investment due to lack of network spending.  The $5 Billion USD estimate to catch At&t's network quality up to that of Verizon is stagering, and this may be a way the company can quickly recover thier position in the market, while they are working on making the necessary transitions.









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