T-Mobile Invests in Femto Firm

T-Mobile Venture Fund has revealed itself as a strategic investor in U.K. femtocell startup Ubiquisys Ltd. and says that T-Mobile International AG is trialing the vendor's 3G home base station in Europe. (See T-Mobile Bets on Ubiquisys.)

T-Mobile Venture Fund, which is run by Deutsche Telekom AG (NYSE: DT)'s venture capital business, T-Venture , announced today it was an investor in the $25 million B round of funding that closed in July 2007. Google (Nasdaq: GOOG) also invested in the femto startup at that time. (See UbiquiSys Gets Google Boost, Google Invests in 3G Startup, and Femtocell Startup Pockets $25M.)

In total, Ubiquisys has raised $37 million since it was formed in 2004, but neither party is disclosing the level of T-Mobile Venture Fund's investment, nor what stake it holds in the up-and-coming vendor.

What is clear, though, is that Ubiquisys is attracting top-name investors -- its early backers also include well known VC firms Accel Partners , Atlas Venture , and Advent Ventures , and now it has the financial support of a major international carrier. (See UbiquiSys Gets $12M.)

"T-Mobile is a hugely important force in the mobile industry," says Keith Day, VP of marketing at Ubiquisys. "[The strategic investment] brings a strong operator focus to our business… It does signal a closer set of conversations and relationships that we can build on."

T-Mobile Venture Fund also revealed that T-Mobile is trialing the Ubiquisys 3G ZoneGate femtocell in Europe but did not provide any more specific details. Its press release states only that the ZoneGate femto is used by Ubiquisys partners, such as Nokia Siemens Networks and NEC Corp. (Tokyo: 6701), to satisfy operator trials, "including T-Mobile." (See Nokia, Ubiquisys Team Up and NEC, Ubiquisys Team.)

Ubiquisys's Day would not confirm to Unstrung which of his company's OEM partners T-Mobile was working with or whether T-Mobile was trialing the standalone ZoneGate femtocell or the Netgear Inc. (Nasdaq: NTGR) gateway, which has integrated the ZoneGate femtocell technology. (See Netgear Gateway Goes Femto and Netgear, Ubiquisys Team.)

"We have a trial with T-Mobile in Europe and we've been working with them since 2007… but we're not releasing details," says Day.

It is understood, however, that T-Mobile is conducting femtocell trials in Germany, the Netherlands, and the U.K. (See T-Mobile Trials Femtos and Femtocells Brace for Big 2008.)

The operator will demonstrate the ZoneGate femtocell in the T-Mobile Pavilion at the CeBIT trade fair in Hanover, Germany, this week.

T-Mobile is the second operator, after Telefónica O2 Europe plc , identified publicly as a trial partner for the Ubiquisys 3G home base station. The vendor claims it is involved in about 10 operator trials worldwide. (See Vodafone, O2 Test Femtocells.)

Unstrung understands that French operator SFR , which is 43.9 percent owned by Vodafone Group plc (NYSE: VOD), is among those trialing the Ubiquisys femtocell. In addition, Ubiquisys participated in a femtocell demonstration with Japan's Softbank in 2007. (See Vodafone Picks Femto Vendors and Ubiquisys, Softbank Demo .)

— Michelle Donegan, European Editor, Unstrung