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Truphone wins injunction against T-Mobile. Lives to fight another day.

Widely reported yesterday, Truphone scored a small victory in its fight with T-Mobile over access.  T-Mobile had chosen to block calls to Truphone numbers, arguing that Truphone was not a mobile operator (since it had no network of its own), and therefore T-Mobile shouldn't be required to pay mobile termination fees to Truphone.  You could still make a phone call from a Truphone enabled mobile phone, just not receive one.  A London judge yesterday agreed to grant injunctive relief to Truphone, and required T-Mobile to pass calls pending a trial or some other extra-legal agreement between the companies.

Scrappy Truphone CEO James Tagg positions this as a victory for consumers.  For Truphone, however, this is a life or death issue.  Being allowed to participate in the rich stream of mobile termination fees vs T-Mobile's prior offer of fractions of a cent is what makes it possible for Truphone to offer unlimited free calls to its customers via their wireless phones.  Fortunately for T-Mobile, the types of phones that Truphone can run on represent a relatively tiny portion of the market.  If Truphone was capable of running on any standard cell phone, they'd have a threat on their hands that they would need to deal with very quickly, indeed.

{ 4 comments… add one }

  • Aswath July 17, 2007, 7:32 am

    I think that the dispute is a bit more legally nuanced for me to fully appreciate it. I understand that Truphone stipulates the interconnect carrier T-Mobile has to use. You can see the details at http://telebusillis.blogspot.com/2007/07/truphone… . Like I said this is all too legal for me. But one thing I conclude: the fight is not between VoIP and its foes; it is an intramural fight in the regulated world.

  • Alec July 17, 2007, 8:45 am

    Indeed, Aswath. Truphone have just published the judgement, and it appears that what they have won is this: T-Mobile must pass calls to Truphone, but only at the very low rates they initially proposed.

    If that's the case, then they are really not a lot further ahead than before. People can make calls to Truphone from T-Mobile, but Truphone's business model won't work for long at the rates they're getting paid.

  • Aswath July 17, 2007, 8:57 pm

    So it looks like a manufactured victory for Truphone. Essentially they agreed to the tariff proposed by T-Mobile, but it is being clothed under "court ordered injunction".

    My understanding is that in UK, termination charges are higher for wireline to wireless calls. So if such calls are in sufficient number, they should be doing just fine. By the way, after all the promises of new features that VoIP will deliver, it looks like the industry has settled on "CLEC without facilities" feature alone.

  • Alec July 18, 2007, 2:11 am

    I think Truphone is more than a "CLEC without facilities" — they've got presence, for instance, in their feature set. The problem for them seems to be the "without facilities" business model. The guy they're depending on to get paid doesn't want to do it!

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