Rogers rolls out cellphone-home phone hybrid

(CBC) - Rogers Communications Inc. is aiming to speed up the rate at which Canadians are getting rid of their land lines with cellphones that make calls over the internet at home.

The company is launching phones on Wednesday through both its Rogers Wireless and Fido brands that function as a regular cellphone outside the home, but also connect to the internet through Wi-Fi when in range of the customer's home router.

The phones use cellular airtime regularly outside the home, but calls are unlimited once they switch over to the Wi-Fi connection.

The home-calling feature is available to post-paid customers only and costs an extra $15 a month, or $20 with unlimited long distance in North America. Both plans come with a free optimized voice router, which covers a range of nearly 280 square metres and hooks up to a high-speed internet connection from any service provider.

These so-called "dual mode" phones are aimed at cellphone users - particularly younger customers - who don't want a land line or are thinking about getting rid of it, Rogers chief marketing officer John Boynton told CBCNews.ca.

"It's a way for them to have just one phone period," he said. "This is one phone, one phone number, one voice mail, one caller ID."

The company is offering only one handset per brand - the Nokia 6086 for Rogers Wireless and the 6301 for Fido - but new devices should become available quarterly as other manufacturers get on board, Boynton said.

About 6.4 per cent of Canadian households have scrapped land lines in favour of going with cellphones only, according to Statistics Canada - a proportion that lags most other developed countries. Industry observers have attributed this lag in "wireless substitution" to the fact that Canada does not have a major cellphone-only provider that has pushed consumers to get rid of their land lines.

All three of Canada's major cellphone providers - Rogers, Bell Canada Inc. and Telus Corp. - also offer home phone service, and none has been quick to chip into that business, analysts say.

Dual-mode phones a better fit for Canada: analysts

Eight other carriers in the world have introduced dual-mode phones, starting with BT in Britain in 2005.

BT, which does not have its own cellphone offering, introduced its Fusion phone in conjunction with Vodafone Group in order to patch a hole in its product offering. T-Mobile offers a similar dual-mode phone in the United States, where it does not have any land-line offerings.

Analysts said dual-mode phones are an even better fit for the Canadian market because carriers do not have to adjust their existing pricing plans. U.S. carriers offer significantly more airtime for less than their Canadian counterparts - AT&T, for example, offers 900 minutes for $60, while Rogers charges $100 for 800 minutes.

"It makes even more sense here than it does in the U.S. because it lets the carriers preserve their existing wireless price plans, but also gives people the effect of a big bucket of minutes when using their cellphone at home," said telecommunications consultant Mark Goldberg. "It should help people make the decision to get rid of their land line."

Goldberg said it also makes more sense for Rogers to introduce the dual-mode phones because it has a relatively small share of the home phone market, compared to Bell or Telus.

"They have no residential service that they're cannibalizing" outside of the big cities, he said.

The announcement comes on the heels of two other big product unveilings by Rogers.

The company last week launched Nokia's N95 cellphone, a critically acclaimed high-end mobile entertainment device, and said it will introduce Apple Inc.'s vaunted iPhone later this year.

Goldberg said the spate of new products demonstrates the technological advantage Rogers has over its rivals.

All three products are available only through carriers that have GSM networks, which Rogers has, and not from operators that use the rival CDMA technology, which Bell and Telus do.

"Rogers is taking advantage of the technologies that are available," Goldberg said. "It's over to Bell and Telus to see what their response is going to be."