T-Mobile pushes hotspots instead of shared data

T-Mobile USA, which has registered its disdain for multi-device service plans offered by rivals, is adding Smith Micro Software's connection manager to mobile hotspot devices and smartphones it markets in a bid to encourage customers to connect their Wi-Fi devices to T-Mobile's 3G and 4G networks.

The thin client (pictured) is an optional ad-on for Smith Micro's software.

Devices for T-Mobile's network that are equipped with Smith Micro's software will likely hit the market before year's end. "We are in the process of implementation," Sunil Marolia, Smith Micro's vice president of product management, told FierceBroadbandWireless

The operator is adding QuickLink Zero, an embedded connection manager, to unspecified mobile hotspot pucks that it carries. The software eliminates the need for driver installation in linked products to enable plug-and-play functionality. Optional companion software installs on a Wi-Fi enabled PC, tablet or e-reader to provide added functionality for users, including data usage alerts.

T-Mobile USA is also adding QuickLink Hotspot to certain smartphones, enabling users to leverage existing Wi-Fi hotspot capabilities on those handsets and extend their cellular service to other devices, said Marolia.

Using hotspot devices and tethered smartphones to link other devices, including tablets and gaming devices, to the cellular network "opens up a large market for operators, who were primarily in the past just focusing on monetizing their device portfolios," he said. "Now they've got a whole new channel of monetization by expanding to all of these Wi-Fi only devices through this means."

Using Wi-Fi to link devices to a cellular network is better for consumers than buying a plethora of cellular-embedded devices. "Consumers don't want to activate a new 3G subscription for every single device in their household" or pay extra to have cellular radios in every device, Marolia said.

"This is the best of both worlds for both operators, who are going to drive more data usage, as well as consumers, who can add on at will any Wi-Fi devices they have in their household at the time they actually need those (cellular) data services," he added.

T-Mobile's adoption of the Smith Micro connection manager software suits its long-standing position on multi-device pricing plans, which it has consistently rejected. The operator publicly assailed the shared-data plans that rival Verizon Wireless (NYSE:VZ) recently introduced for being costly, complicated and punitive.

The idea for QuickLink Zero arose when Smith Micro was asked by mobile operators to help them drive demand for cellular-enabled tablets, said Marolia. In doing the research, Smith Micro realized that most users to do not want to commit to embedded cellular functionality in a device, preferring instead to buy Wi-Fi only devices and add 3G or 4G access to them only as needed.

A growing body of research agrees with that viewpoint. Recently CCS Insight predicted the share of cellular-enabled tablets will slip in coming years, falling to 37 percent of tablet shipments in 2016 from 48 percent in 2011. The firm said that during 2011, about half of the owners of cellular-enabled tablets did not activate the service with a carrier.

Operators have been touchy about smartphone tethering over the years--with some supporting but charging extra for it and others ostensibly not supporting it at all--and many carriers' tethering policies have evolved over time.

Early this week, the FCC announced Verizon will pay $1.25 million under a consent decree and allow customers to download Android applications that allow them to turn their phones into mobile hotspots. The FCC found that due to open-access rules governing its 700 MHz C-Block spectrum, Verizon was wrong to block access to such apps, which customers were using to get around Verizon's old $30 monthly mobile hotspot charge.

Currently, under Verizon's new Share Everything shared-data plans, mobile hotspot access is available for no additional fee.

For more:
- see this Smith Micro release

Related articles:
Verizon to pay $1.25M to settle claims over blocking tethering apps
Entner: Shared data plans highlight competitiveness in wireless industry
Is cellular connectivity a necessity for tablet users?
Analyst: Cellular-enabled tablet sales to drop through 2016
AT&T follows Verizon with 'Mobile Share' shared data plans
Verizon launches shared data plans, as T-Mobile knocks them
T-Mobile isn't jumping on the shared-data plan bandwagon

This article was updated on Aug. 2, 2012, to update Sunil Marolia's title because the information initially supplied to FierceBroadbandWireless was incorrect.

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