Vodafone Germany Launches Wireline Attack With EUR100 Box

FRANKFURT -(Dow Jones)- Vodafone Group's German unit Monday said it will launch its long-awaited offensive that aims to encourage German households to cancel their traditional fixed-line phones, by offering a similar product that runs on Vodafone's third-generation wireless network.

The U.K. mobile operator will launch its earlier announced Talk&Web-Box - that enables consumers to make calls, receive faxes and surf the Internet through Vodafone's wireless network - for EUR99.90 in combination with a monthly subscription of EUR49.95 for at least 24 months.

This price means a hefty cut to its earlier indicated price for the communications box, manufactured by Novatel Wireless Inc. of the U.S.. In March, when Vodafone first unveiled the box to the public at the CeBIT technology fair in Hanover, Germany, management indicated that the likely price would be around EUR500, triggering a storm of critical analysts' comments, who found the price excessive.

Vodafone offers its box in combination with its residential so-called "At Home" offering, that runs over its 3G network, which is underutilized as mass-market take-up of 3G is still far off. To use the service, consumers plug the box into an electricity socket and attach any fixed-line phone, fax or computer.

The EUR49.96 a month "At Home" service includes a flat-rate voice subscription and Internet access at six times the speed of an ISDN dial-up connection, or 384 kilobytes a second, though the transmission isn't as fast as a fixed-line digital subscriber line, or broadband, connection.

Vodafone is launching the product as telecom operators talk up the potential of converged wireless and fixed-line services. BT Group PLC this spring launched a phone that allows people to make calls on the fixed network but reverts to a mobile when they leave the home. MmO2 PLC's Genion service enables consumers to call at cheaper fixed-line rates on their mobile phone when they're at home.

The German offering is primarily aimed to encourage German customers to cancel their fixed-line accounts, most of which are with incumbent operator Deutsche Telekom. But it will also see Vodafone compete with its own German wireline unit Arcor, which it plans to dispose off as early as in 2006.

Vodafone Germany has said that the company is running test for similar offerings in different countries, as it considers to launch the service outside of Germany.

Company Web site: http://www.vodafone.de

-By Joon Knapen, Dow Jones Newswires; +49-69-29725509; joon.knapen@dowjones.com

(END) Dow Jones Newswires "

Posted to the site on 24th October 2005