T-Mobile USA, the fourth largest US mobile network operator, is to launch next week a $10-a-month broadband VoIP, or Voice over Internet Protocol, service that will be available to most T-Mobile wireless subscribers.

The nationwide service, dubbed T-Mobile@Home, will allow customers to make unlimited local and long-distance calls using an ordinary fixed line phone or cordless handset plugged into broadband connection via a dedicated internet router manufactured by Cisco’s Linksys unit that will cost $50 with a two-year contract.

Subscribers to the new service, which will also support a wide range of telephony features including call waiting, caller ID, three-way conferencing, voicemail and call forwarding, will be able to keep their existing home phone number, but can also add a second voice line.

The move poses a further challenge to traditional fixed line carriers, cable TV operators that have launched internet telephony services in the past two years and independent VoIP providers like Vonage Holdings.

It could also help T-Mobile, which is owned by Deutsche Telekom, retain and expand its mobile customer base in the face of increasing competition from AT&T’s mobile unit and Verizon Wireless, the two largest US mobile operators, and Sprint Nextel, the struggling third-largest mobile carrier.

The new service represents T-Mobile USA’s first push into the fixed telecommunications market and highlights the continued convergence of fixed and mobile telecoms operations made possible by growing deployment of broadband internet services by both telecommunications and cable TV network operators.

T-Mobile USA executives said they view the @Home service, which had previously been tested in the Dallas and Seattle local markets, as a viable alternative to traditional fixed line telephone services. They said they expected it to attract T-Mobile customers who want to cut their monthly telecoms bills.

According to report prepared last year by Scarborough Research, a market research firm, families based in the US spend an average of $65 per month on home phone service. “For years, the traditional landline companies have been great at consistently delivering one thing to their customers - a high monthly bill,” said Robert Dotson, T-Mobile USA’s chief executive.

Source:ft.com