Verizon shows the convergent way forward

Angel Dobardziev, Analyst

Last week Verizon outlined the details of its forthcoming Verizon iobi (eye-OH-bee) convergent solution and its Verizon One phone, joining a growing list of operators that have launched or are on the verge of introducing convergent solutions, including BT, France Telecom, Telecom Italia and TDC. On paper iobi and One look great – much will depend on their actual delivery of the promise, as well as their price and marketing.

Verizon iobi is a network-based convergent solution that not only integrates fixed with mobile telephony, but goes beyond to integrate any communications device, from fixed and mobile phone to PCs, laptops and PDAs. Besides voice, it can integrate on a single device all of users’ communications, voice, email, messages and voicemails. Verizon iobi includes real time call management, leaving the customers to decide where, how and if they receive calls and messages. This includes programmable call forwarding so calls can be directed users’ telephone/ PC or their mobile. It also includes multi modal communications: regardless of how a message comes through, the customer it can decide how to receive it, including by email, voicemail or SMS. If it can deliver all this seamlessly, and at the right price, Verizon iobi has the potential to be an outstanding service.

Verizon One looks like a top end cordless telephone, but there is much more to it. In addition to its touch screen computer, it has a built in DSL modem, which enables broadband access, and a WLAN router, which can connect all the PCs in a house wirelessly. Combined with Verizon iobi, Verizon One can synchronise calls emails, calendars and voicemails. The combination of iobi and One represents a strong convergent solution for residential customers and will build on the success of Verizon’s ‘Freedom’ bundles of flat rate fixed, mobile and DSL services.

Verizon’s iobi and One are great solutions, but their success is by no means assured. Verizon will have to convince ordinary people of real value of the solutions - the innovators and the early adopters will be the easy pickings for this solution. While the cost savings and peace of mind benefits of the ‘Freedom’ packages are easily perceived, the added value of convergent communications that Verizon iobi and One bring, will have to be effectively communicated to the masses.

We believe that the market is now right for convergent solutions such as Verizon iobi. Operators (and vendors) did not give convergent solutions the attention they needed up to make them a commercial success until a year ago, because they were pre-occupied with the ‘mobile land-grab’ and sorting the excesses of their international expansions. However, the growth slowdown is now focusing their minds. Many users are not only getting used to having a mobile phone and access to the Internet in addition to a fixed telephone, but increasingly demand solutions that will ensure that all communications devices work, and are controlled as one. The exciting times are yet to come.

For further information on fixed mobile convergence, please see Ovum’s forthcoming report: “Fixed mobile convergence: the opportunity assessed”. Angel Dobardziev is an analyst specialising in wireline strategy and wireline/wireless substitution and convergence. Please contact Angel on avd@ovum.com if you have any questions on the FMC opportunity in your market.