AT&T Offers 'Wireless Home Phone'

AT&T is adding a new prepaid option for its “Wireless Home Phone” service, which uses the wireless network to provide the equivalent of fixed network voice service. Available March 22, 2013, the new prepaid service costs $20 each month for unlimited, nationwide calling.

Customers can pay $15 each month incrementally to add 1,000 minutes of international long-distance, including wireless and landline numbers in Mexico and calling to over 50 other countries such as Canada, China and India.

Prepaid accounts include a one-time cost of $99.99 for the Wireless Home Phone device.

The new prepaid service implies a retail value for unlimited domestic calling of about $20 a month.

The new retail packaging illustrates the reasons why firms such as AT&T and Verizon Wireless think they can rely on their Long Term Evolution networks as a substitute for both voice and broadband access, "in region."

Especially for voice services, where actual bandwidth demands are quite low, it makes sense to find new ways of “filling the pipes,” as the voice portions of the legacy networks increasingly have spare capacity.

The logic is similar to the ways fixed network service providers can approach copper access networks that increasingly have spare capacity because fewer than half of homes passed by the network actually buy a voice service.

On both fixed and mobile networks, voice bandwidth increasingly is more available than in the past, simply because fewer customers are buying (fixed) or fewer customers are using the network (mobile).

The other issue is out of market reach. Since no fixed network service provider reaches much more than 30 percent of potential homes, the ability to sell a “fixed voice” service that uses the mobile network means AT&T or Verizon Wireless can sell the equivalent of fixed network voice services outside the areas where either firm has fixed network facilities.

In that sense, the AT&T “Wireless Home Phone” service is functionally equivalent to a competitive local exchange carrier offering, allowing AT&T to provide “fixed” voice service outside the home regions where the company has fixed facilities.