A UK start-up has promised indoor 3G "femtocells" that will offer cheap calls and better coverage inside buildings.

ZoneGate, from Swindon-based Ubiquisys, will be a low-power residential access point that mobile operators can use to offer cheap calls and data to mobile devices, when the user is at home. Like devices using Wi-Fi under the Unlicensed Mobile Access (UMA) scheme, it plugs into a broadband connection and backhauls calls and data over the Internet, but uses the operators own 3G spectrum to handle calls, the company explained.

"Mobile operators want UMA, but they don't want to encourage Wi-Fi handsets, because other VoIP providers could benefit," said Will Franks, chief technical officer of Ubiquisys. Using the same spectrum also means that users won't need to change their handsets or get a dual-mode phone, he said.

The scheme is similar to the GSM picocells offered by those wanting to exploit the DECT guard band spectrum recently released in the UK. "The problem with the UK DECT guard band is it's a UK-only DECT guard band," said Franks. Besides, he argued, 3G usage is set for a massive upsurge.

The box will be in technical tests early in 2007, and in consumer testing by the middle of the year, said chief executive Chris Gilbert, with services by the end of the year. No operators are signed up publicly yet, but many will come forward to find ways to make use of the free bandwidth in the home, he said. "There's enough capacity for four simultaneous TV streams - not broadcasts - in the home," he said, predicting video podcasting and other downloads sent to phones while users are in range, for viewing at any time.

The device is clearly consumer-focussed, because that is where the market size and the demand for bandwidth is, but business will get spin-offs, said Gilbert: "When users with 3G laptops get home, they don't bother to turn on the Wi-Fi." They then complain of poor service, and run up large bills. ZoneGate would let them leave the 3G running without burning up their firm's telecoms budget, he said.