3GSM: T-Mobile's big idea - marrying 3G and Wi-Fi

T-Mobile has laid out its group strategy for 3G communications and immediately proclaimed the technology insufficient by itself - the operator is touting a mix of advanced cellular services and broadband local-area connectivity using Wi-Fi.

The German company is forecasting it will own and run 10,000 Wi-Fi hotspots by the end of the year - far ahead of rival mobile operators, some of whom barely have a Wi-Fi strategy - and claimed the technology a natural compliment to 3G.

Rene Obermann, T-Mobile Group CEO, said: "3G is like moving from a typewriter to a PC and is application agnostic. But it is not everything."

Wi-Fi typically refers to the IEEE802.11 standard that allows for bandwidth of up to 11Mbps or 54Mbps, depending on flavour, at a range of around 100m.

T-Mobile's vision is of customers hopping from broadband Wi-Fi, to W-CDMA-based 3G, to 2.5G GPRS networks where neither are present - all without knowing and probably for one set subscription fee. It is a dream shared by others. For example, both T-Mobile and rival Vodafone will bring out a PC card that allows such hand-offs this year.

Obermann added: "3G alone is not enough. Any [operator] doing it alone is making a mistake and missing opportunities."

Mark Boulding, senior analyst at Quocirca, said: "T-Mobile has been very active in hotspots, even compared to, say, O2 in the UK who have embraced them reasonably actively or Vodafone who have done a deal with The Cloud."

He reckons it is challenge for operators - whose core strength remains voice - to be more than a data pipe. An integrated approach could lead to them embracing IP, the data protocol the internet is based on, key to many apps now, in a way that bodes well for the future.

T-Mobile has also been touting "the first transatlantic Wi-Fi service", though experts agree partnering will still have to play a part.

On the subject of the US, CEO Obermann stressed how happy the company is with its American subsidiary, mainly based on its acquisition of Voicestream, and ribbed Vodafone CEO Arun Sarin on that company's failure to buy AT&T Wireless earlier this month.

"It's a shame we can't compete directly against Vodafone in the US," he said at a morning session at the 3GSM World Congress event in Cannes.

But despite progress in that country, it is notable that as of the end of last year the company counted only 13.1 million active users there. That compares to 13.6 million in the UK and almost exactly twice that figure in Germany, where it is the market leader.