BT to dish up wi-fi FMC cocktail

BT is developing a converged mobile product that it claims will allow companies to cut their mobile phone bills.

The telco announced on Thursday it will work with Alcatel to create a service called Enterprise FMC, which stands for fixed-mobile convergence. It will use dual-mode phones that support both wi-fi and GSM, and BT says it will allow colleagues to call each other for free in some circumstances.

Last year BT launched a similar product for home users called BT Fusion, which supports Bluetooth and GSM.

Steven Evans, BT's chief of wireless broadband and future products, said Enterprise FMC will allow users to call each other over wi-fi.

Evans said: "When you're in the enterprise, you can connect to the wireless local area network. Calls that you make to another user in the same office, another office, a wi-fi hotspot or even at home will be free calls."

He added: "The larger the enterprise, the larger the number of calls made between employees," arguing that it will allow companies to make significant savings.

But it appears businesses which deploy the system could face other costs. Evans said companies will be able to give their dual-mode phones either a fixed-line or mobile number. If a user with a fixed-line number receives a call while out of wi-fi range, their company will be billed for the cost of transferring that call to the GSM network.

If the company has chosen the mobile number option, callers will be billed at mobile rates whether the user is in the office or not, even though the company's wireless equipment - not the mobile operator - is terminating the call.

Evans added: "If the enterprise has chosen a fixed number, then the enterprise will pick up the cost of the mobile leg of the call when a user is out of the office."

He denied this could put companies off the service: "People will find they can achieve a cost saving based on free mobile calls over wi-fi." Evans declined to give the service tariffs.

BT hopes to launch Enterprise FMC in early 2007, which may give mobile operators time to develop competing products. Vodafone, for example, already offers free calls between colleagues through its Sharetime tariff.

Rupert Goodwins and Graeme Wearden write for ZDNet UK