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Would you like to cut your monthly cellphone bill by two-thirds or more for service that worked some of the time and not everywhere?
Neither would we.
In a nutshell, that’s what Cablevision announced on Monday, a new Wi-Fi mobile phone service called Freewheel that will launch in New York. For $29 per month ($10 for existing Cablevision customers), Freewheel offers unlimited calling and data, but only while on a Wi-Fi network.
Cablevision isn’t the first to pitch Wi-Fi as a low-cost alternative to traditional cellphone service, but most other players in the Wi-Fi calling market — including FreedomPop and Republic Wireless — have deals with cellular providers to use the networks as a fallback where Wi-Fi isn’t available, which is in a lot of places. Republic offers a $5-per-month Wi-Fi-only option, but only about 5 percent of Republic’s several hundred thousand customers sign up for that plan. And of those, 40 percent upgrade to an option with cellular coverage.
“We thought it was going to be big,” Republic Wireless CEO David Morken told Re/code. “It’s not. It’s a niche. … Cell coverage is just still so important as a backup.”
Even Google is said to be partnering with cellular providers for its planned entry into the space.
Cablevision, for its part, stresses that it has a dense, carrier-grade network with 1.1 million hotspots in the greater New York area, making its coverage unlike any other cities where Wi-Fi networks are spotty, consisting mainly of a few restaurant chains and public places.
“That’s not the experience here,” Cablevision Chief Operating Officer Kristin Dolan said in an interview. And when customers do travel, Dolan noted that the company has deals allowing customers to also use the Wi-Fi networks of other cable companies.
As for not having a cellular network as a back-up option, Dolan said, “It was a conscious choice,” noting that 93 percent of cellphone data is already being sent over Wi-Fi networks.
Dolan said that while Freewheel supports calling and texting, it is really aimed at a new generation that relies mostly on data use.
“We are looking more forward than backward,” she said. While acknowledging that it’s not suited to everyone, Cablevision is pitching the service as well suited for parents who want to give a first phone to kids, for those on a very tight budget as well as college students who tend to hang out in places with lots of Wi-Fi coverage.
In addition to the limitations of Wi-Fi, Cablevision is starting with a single phone model, albeit a well regarded one. They are offering the Moto G for $99, below its typical selling price of around $180. Among those leading the charge for Cablevision is Kevin Packingham, a former executive at Samsung’s U.S. operation.
It’s worth noting that while the Moto G has special software to route calls and texts over Wi-Fi it can still call 911 using the cellular network.
Of course, it makes sense that Cablevision and potentially other cable companies want to test the waters for this. Cable companies have flirted with wireless options for years as an effort to offer a “quadruple play” along with home phone, TV and Internet services. Cox offered its own cellular service directly until 2011, while several cable companies have partnerships with Verizon to sell mobile service. And cable companies are seeing their core TV service increasingly under threat.
This article originally appeared on Recode.net.
