Vodafone’s femtocell pricing is wrong

Earlier this year I bought a femtocell from Vodafone, a product/service they have branded Sure Signal.  As you may know these devices plug into your broadband router at home and act like a mini-base station improving the mobile reception around your house.  Before we installed Vodafone’s Sure Signal reception in our kitchen was poor, and since we got it working (which was a painful 2 month process I won’t go into here) reception has been great all around the house.  

The fact that we have installed the femtocell is also great for Vodafone.  A small gap in their network coverage has been filled, we are less likely to churn now (both Fiona and I would have to leave Vodafone at the same time and get a new femtocell as well as new phones) and probably most importantly our calls and data traffic are now routed over our Virgin broadband connection instead of Vodafone’s network.
That is all good, principally because there is more capacity on the broadband networks than on the mobile networks.
What bugs me is the pricing.  
  • Firstly we paid Vodafone £50 for the Sure Signal box which I only need because their network coverage isn’t what it should be and once I have it installed reduces their costs by taking traffic off their network and putting it onto another network (which I pay for separately.
  • Secondly the calls that are made from our Vodafone phones and routed now through the Sure Signal over the VirginMedia network are counted as part of our price plans in the same way as normal mobile calls
  • Thirdly, and this is the killer that I learnt this morning, data routed through the Sure Signal will count towards monthly limits under the new 3G tiered data plans

To me all this is wrong, by charging consumer for the privilege of taking traffic of its network Vodafone is having its cake and eating it.  Instead they should be giving the box away and carving out calls and data sent over the Sure Signal from monthly bundles. 

  • Or you could move house…

  • 🙂 I hate to think of the post I might write if we have to move house because of a network operator…

  • You probably can't because you have a company mobile but I'd have switched providers. Number 3 is just taking the piss out of the customer isn't it?

  • My thoughts exactly

  • gavinw

    For number 2 & 3, I guess it’s the promise of mobility which may be why the calls and data still count towards your plan – you have to trade off the pricing against the rare times when you have to run out of the house whilst in a call or downloading something.

  • GavinWong

    Not to mention telling the operator that you're moving the femtocell…

  • Pingback: Femtocell market update for week of 14 Jun 2010 « 3G In The Home()

  • I'm sure that is whay they would argue…

  • afternoon

    Perfect example of the culture of greed which still prevails at the operators. You pay them to use your own broadband!

  • DeGVR

    This piece and most of these comments seem very shortsighted. A large portion of the cost of a mobile operator come from routing the network traffic inside their own network, and getting it to the endpoint (which might be with a different operator, thereby incurring even more cost). None of these costs are taken away when you make a call through the femtocell.
    On top of that what you're not thinking about is the overhead of managing a massive amount of little cells on operator's network, as opposed to their normal grid of masts and cells. There's a lot to do to make sure these are all routed ok.

    There's no such thing as “free” network traffic, so just because you manage to get your call/data-request into their network in a different way, why would that not count against your usage?

    I do think that charging £50 for the privilege of being able to make a call (and rightly pay for it) on their network seems shortsighted. But in great scale of things I suspect this is more a 'threshold-charge', to make sure that they only the people who really need one get one – and they don't have to deal with the complexity of having a network of a millions of cells. I'm already starting to see reports of people who get it free from Vodafone anyway in the right circumstances, which seems like the right thing to do.

  • Some good points here, not least the idea of charging £50 to make sure people are serious (they wouldn't give me one for free). You have also made me think that Vodafobe still have to pay to terminate calls in the receiving party's network. That said, surely the greatest part of their cost of goods sold is carrying the signal over the mobile portion of their network?

  • To my mind there's a bigger opportunity they're missing too, which isn't mentioned in this post – unless I am missing something, Vodafone should be using Nic's femtocell to allow *any* Vodafone subscriber within range to make/receive calls. I am sure Virgin Media will have something to say about that eventually but in the near-term this would extend Vodafone's signal coverage in a peer-to-peer way that would scale beautifully and (I assume) far more capital-efficiently than the traditional model. FON would appear to be close to this model tho I haven't followed them for ages and their UK traction (judging from my wifi signon screens) appears to be limited.

  • The thing to think about with this idea is incentives, otherwise I might have something to say about a bunch of other people piggy-backing on my broadband. Fon have set up a payments infrastructure to make it worthwhile, Voda et al would need something similar.