Fongo Aims to Become Fourth Wireless Player, But Fails

by Istvan Fekete on May 8, 2013

Waterloo-based Fongo, one of the fastest-growing mobile telecom companies, launched Fongo Faces yesterday and aims high: to become the fourth wireless player, claiming it has a spot in the Canadian wireless industry.

The idea of calling for free is awesome, and I love it. Fongo Faces is just about to provide Canadians with greater choice and control of their mobile smartphone phone service experience.

What Fongo does is the following: You can eliminate long-distance and local calling costs, eliminate or reduce your texting costs, eliminate the cost of premium features such as caller ID, and reduce the cost of voice minutes.

As Dave Bullock points out in the press release announcing Fongo Faces, the company believes it can be a powerful alternative for Canadians, and it is poised to break the incumbents’ control over the Canadian wireless market.

“We’ve been programmed as Canadians to believe we can choose from only three telecom companies — the blue team, the red team or the green team — and these companies control so much of what we see and do on a daily basis,” said Dave Bullock, president of Fongo Inc. “Millions of Canadians are stuck in expensive contracts with their wireless carriers, but that doesn’t mean their carriers should control what they see and feel each time they use their phones.”

But the reality looks different: Fongo uses Voice-Over Internet Protocol (VoIP) to place and receive calls and send and receive messages. For this reason, it is strongly tied to your existing data plan, which could be 3G or 4G, or a nearby Wi-Fi connection.

So what this means is that it is offering a false sense of freedom to Canadians, because Fongo needs to use your data plan, which, if I recall correctly, is offered by one of the existing wireless players. Fongo uses 0.5 MB of data per call-minute, which makes a 500 MB data-plan enough to have 1000 minutes of talk per month.

In fact, you need to have a smartphone and a data plan (this usually comes with a 3-year contract, unless you want to limit yourself to your home wireless network), and with Fongo you can expect to have much higher data usage, which accounts for the biggest chunk of Canadians’ cell phone bills.

The only way Fongo could serve as a fourth wireless player for Canadians is to buy Wind Mobile or another wireless startup.

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Written by: Istvan Fekete. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

{ 1 comment… read it below or add one }

B. Dunlop May 8, 2013 at 9:33 pm

I think the point that Fongo (and other m-VoIP guys) are making, is that their service can be combined with any data plan to provide an end-to-end talk & text service every bit as good as what the big boys are charging… but your bill at the end of the month will be $15-$20, not the $100 that many folks are paying now. It’s both a function of routing calls and texts over data instead of airtime, but also offloading to WiFi wherever available. Agree with you that “full freedom” requires Fongo or others to offer their own data plan – but I don’t think that’s far off – in the mean time, data-only plans ARE available from all of the incumbents contract-free if you own your phone, and start as low as $10. The model of “sign up for a data plan and then choose your own talk & text service” is the future of mobile IMHO. Having tried many of these m-VoIP services, Fongo seems roughly the same in terms of call quality (quite decent I thought), but the big difference is a free Canadian phone # and free long distance, which I haven’t found from any of the others.

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