i-mate Steps Up Differentiation With Cellular/Wi-Fi/VoIP Phones

By Joseph Palenchar On Feb 13 2006 - 8:00am

Cellular newcomer i-mate is expanding its distribution, diversifying its product selection to include a GPS-equipped PDA for navigation, and launching its first phones incorporating Wi-Fi and Wi-Fi VoIP service.

The company, whose handsets are all Windows Mobile-based GSM phones, is positioning unlocked phones as a way for dealers to differentiate their products from carrier-sourced products that are often also found in carrier-owned stores across the street, said Jon Driscoll, president of i-mate USA.

The time is right for unlocked-GSM sales, he contended, because as the market matures, “people are becoming more concerned about the devices and less about the service plan.”

The company, which is also targeting second- and third-tier carriers through such distributors as CellStar and InfoSonics, already sells through around 45 Web sites, including Amazon.com, and through brick-and-mortar retailers Car Toys and J&R Music World. In the first half, the company promises to announce availability through two major retail chains.

Through these dealers, i-mate's unlocked phones will appeal to consumers who are looking for differentiated product, Driscoll said. Of these, some consumers might be switching carriers but don't want to lock into a contract, and others might be consumers who want to stay with their current carrier but want to step up to a phone not offered by their carrier. In either case, consumer will be paying an unsubsidized price, but for the price, they'll get features unavailable from carrier-sourced phones, Driscoll contends.

For example, he said, all i-mate products not only come with Windows Mobile, but the latest products add built-in Wi-Fi and Skype VoIP service. Consumers will also be able to get other features that carriers don't offer, including virus-scanning service and a free hosted Microsoft Exchange account that lets users wirelessly synchronize their handset's Outlook applications.

i-mate will also differentiate itself by offering free downloads of select games, ringtones and wallpaper to the phones via connected PC from its Club i-mate site, where users can also download ROM-code updates. Users will also get 24/7 support over the phone and via live online chats as well as a free unlimited hosted e-mail account.

For retailers, selling an unlocked phone means forgoing a carrier's activation commission, but Driscoll contends that his 30-point to 45-point hardware margins will make up for it. Dealers will also be able to open up more display space for other products because they will be able to reduce the number of SKUs set aside for cellular phones, given that one unlocked phone will operate on multiple GSM carrier networks.

“We supply the files in the phones so you can select the configuration needed for a specific cellular network,” he added. The files are included in two new models that will replace current models in April, when i-mate will also ship its first non-cellular PDA. All three use the latest Windows Mobile 5.0 OS.

The Windows Mobile Smartphone edition SP5, which resembles a traditional phone with dialing keypad, is expected to retail for an unsubsidized $399. It features quadband 850/900/1,800/1,900MHz operation, EDGE Class 10, 802.11b Wi-Fi with Skype application, 1.3 megapixel camera, MiniSD slot, Bluetooth and mini USB with charging capability.

The $649 JAMin steps up to Windows Mobile PocketPC edition with touch screen but no dialing keypad. It also adds 802.11b/g Wi-Fi and 2-megapixel camera.

The GPS PDA is the $499 PDA-N, which comes with internal GPS antenna with included U.S. map on a 1GB memory card and voice-prompted turn-by-turn driving instructions. A suction-cup dash mount is also included. Other features include mini USB and 802.11b.

The PDA-N's price compares favorable with dedicated GPS handhelds that typically cost more than $500 with maps, Driscoll said.