* GSM mobile handsets to a broadband-connected PC
At the Consumer Electronics Show in Las Vegas last week, magicJack demonstrated a working femtocell at that connects GSM mobile handsets to a broadband-connected PC. Commercial service is planned for Q2 2010, with service prices less than $20 a year to make and receive unlimited local and domestic long-distance voice calls over the YMAX VoIP network. The femtocell USB device is priced separately at $20.
At the Consumer Electronics Show in Las Vegas last week, magicJack demonstrated a working femtocell that connects GSM mobile handsets to a broadband-connected PC. Commercial service is planned for Q2 2010, with service prices less than $20 a year to make and receive unlimited local and domestic long-distance voice calls over the YMAX VoIP network. The femtocell USB device is priced separately at $20.
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Connections to the PSTN are provided from the femtocell to the PC connected over the Internet using the YMAX network; YMAX owns magicJack. The magicJack femtocell is slightly larger than a USB thumb drive. Future plans calls for a femtocell device that includes on onboard CPU so that it won’t require a PC to operate.
When setting up a connection for the first time between the magicJack femtocell and the user’s handset, the magicJack femtocell discovers and then calls the handset. Once the user enters a correct password, the handset’s unique international mobile station equipment identity (IMEI) number is bonded to the femtocell so only authorized users can access the service.
On the downside, magicJack’s femtocell does not work with CDMA-based devices so Verizon and Sprint’s handsets will not work with this design, although dual-mode smartphones that operate on both GSM and CDMA networks will work. The femtocell range is limited to about 3000 square feet because it is designed not to interfere with commercial GSM networks owned by companies such as AT&T and T-Mobile. Since the femtocell is not operated by a wireless carrier, once the user leaves the range of the femtocell, the call is dropped because there is no hand-off between the femtocell and the commercial GSM network. In its current iteration, the femtocell will only support voice service so SMS and data services are not supported; however, future software upgrades could enable data services.
Our observations: Carriers such as AT&T and T-Mobile that have paid for GSM spectrum may not take kindly to magicJack’s unpaid use of that spectrum, although magicJack’s founder Dan Borislow remains confident the magicJack approach is permitted under FCC rules. While we’re not in the business of rendering legal or regulatory opinions, any legal action by T-Mobile or AT&T could delay or prevent magicJack’s market entry. But if the company is successful with its offer, then $20 a year for unlimited domestic calling over a VoIP network using existing GSM mobile devices is a pretty compelling proposition.
