Voice service, long the revenue engine of mobile operators, continues its inevitable slide toward commoditization. U.S. mobile operators have recently hastened the slide by announcing unlimited, nationwide, flat-rate voice plans for $100 a month. Some operators are addressing this issue by developing a next-generation ‘home zone,’ known as Home Zone 2.0 (HZ2.0).

Shaw: Operators are considering offering unlimited, flat rate data access to home zones.

An HZ2.0 service uses a low-power, in-building radio such as a femtocell or Wi-Fi access point to create a service zone. The access point connects to the mobile core network through the subscriber’s own broadband access network.

Operators such as T-Mobile and Sprint already have launched HZ2.0 services. An HZ2.0 service offers three specific benefits to the mobile operator.  First, it improves the coverage and performance of mobile services when the subscriber is in the zone. An in-building radio gives subscribers “five bars” of coverage, and more important for data applications, subscribers connect at multimegabit data rates expected of a true 3G service experience.

Second, handsets connected to the HZ2.0 network are offloaded from the outdoor macro network. This results in more cost-effective service backhaul, lower impact to the macro backhaul network and less contention for spectrum on the RAN.

Third, an HZ2.0 creates a low-cost, high-performance, location-specific service zone. When a device is attached in the zone, the network and the device are both aware of the location and therefore can receive differentiated services, billing and applications.

LOWER COSTS
For mobile operators, HZ2.0 has the immediate benefit of making voice services work better and cost less. By improving coverage and lowering the cost of delivering services, HZ2.0 is the first step in addressing declining voice revenues. By offering unlimited flat-rate calling plans in the home zone, operators can constrain the flat-rate plan to specific locations; locations with a backhaul cost that’s a fraction of the backhaul cost of the macro GSM network.

Having deployed an HZ2.0 service for voice, operators will take the second step of enhancing the offer to support data applications. Operators are thus considering adding unlimited, flat rate (or free) data access to their HZ2.0 offers to encourage subscribers to increase usage of their applications and access on-deck content.

The third step is to make data applications work better when delivered in the service zone. For example, a streaming audio service may detect that it’s connected via HZ2.0 and take advantage of the increased throughput of fixed broadband/IP by increasing the audio quality. Or an IPTV service may move to a faster frame rate.

The true power of HZ2.0 comes when the device and network begin to take advantage of the location aspect of the service. When the subscriber is connected to the home-zone access point, both the handset and network become aware that the subscriber is in a specific location (home, office) and that the access network is materially different from the existing GSM network.

Now it is possible for the HZ2.0 service to perform tasks based on location triggers. When you walk into your HZ2.0, the handset may notify a social networking site that you’re ‘home,’ or perhaps it may generate an SMS to another user (a parent?) to indicate an arrival or departure.

Configured for an enterprise deployment, the handset could notify a PBX or call server that a specific subscriber/handset is now “in the building.” When a call comes into the desk number, the PBX could be programmed to simultaneously ring the mobile and the desk phone when the subscriber is in the office.

This location awareness also invites new combinations of services. For operators delivering fixed-line telephony in the home, HZ2.0 makes possible a dual-ring configuration situation in which calls to the mobile device ring on the fixed network simultaneously.

Building on this, some applications on the handset might only operate when in the HZ2.0, as part of a move toward making the handset a member of the connected home.

In a connected home environment, other consumer electronics products create an ad-hoc network to share various types of data. One of the leading approaches is called the Digital Living Network Alliance, members of which use open standards to create compatible products.

When the handset enters the HZ2.0, it may detect a DLNA network in the home. An application on the handset would initiate and add the handset to the rest of the network.  Now photos on the phone can be uploaded to a photo sharing service or printed directly to a photo printer. Music files and video files can be synchronized directly with a media server, and so on.

It’s clear that operators need to think differently in this age of “free.” Developing an HZ2.0 strategy, via Wi-Fi or femtocell, to leverage the cost and performance advantages of the Internet, is a critical first step. It’s clear that a HZ2.0 strategy is the first step for mobile operators to truly own the home.

Shaw is AVP of Marketing for Kineto Wireless.