Service Convergence

Rajesh Jain blogs on WSJ article:

Imagine walking to work while talking on your cellphone. Out on the street, you're using a cellular network and paying your mobile provider for each minute you gab. But once you reach the office, your cellphone detects a signal from your company's wireless Internet, or Wi-Fi, transmitter and automatically switches you from the cellular network to the Wi-Fi one. Your call is now being routed over the Internet, saving money on cellphone fees. You're also able to browse the Web on your cellphone at superfast broadband speeds.

Such technology -- under development in Japan and elsewhere -- stands to revolutionise telecommunications on two levels. For the consumer, the technology combines the convenience of cellular access with the low cost and high speeds of Wi-Fi, all in a single device. For the industry as a whole, this technology illustrates a new but increasingly common theme: how the convergence of once-discrete technologies -- in this case, mobile-phone service and the Internet – is pitting unlikely rivals against each other in a battle for chunks of a brand-new territory.

Japan serves as a prime example. Here, two companies have just announced handsets that function on cellular and wireless networks. One is made by NEC Corp. and will be marketed by NTT DoCoMo Inc., Japan's largest cellular provider. The other device is from Fujitsu Laboratories Ltd., a unit of computer-maker Fujitsu Ltd., which has long cooperated with DoCoMo by making handsets for the carriers' exclusive use. This time, however, Fujitsu, in a joint-project with telecommunications equipment-maker Net-2Com Corp., is striking out on its own.

Of course, Japanese companies aren't the only ones developing such devices. Other companies, including Motorola Inc., Schaumburg, Ill., and Hewlett-Packard Co., Palo Alto, Calif., have unveiled phones that combine cellular and Wi-Fi technology.