Wi-Fi Hotspot Trends

An increasing number of mobile operators are opting for Wi-Fi because of increasing 3G network overloads, increasing popularity of Wi-Fi-enabled smart phones, together with the much greater speeds available and lower costs of Wi-Fi networks.

Based on various analyst reports, the data traffic for various operators had doubled during 2009 and expected more of the same in 2010. According to In-Stat report, mobile operators had become increasingly involved in the hotspot market globally as they assessed the potential of hotspots to offload wireless data traffic from overburdened 3G networks. Global hotspot usage would increase in 2009 by 47 per cent and bring total worldwide connections to 1.2 billion. Total worldwide hotspot venues have already reached approximately 245,000 locations in 2009.

Public Wi-Fi is becoming more pervasive with a 21.9 percent growth in locations in 2009. Additionally, overall Wi-Fi usage continued to grow, with an 8.2 percent increase in Q4 alone. Travelers took advantage of free Wi-Fi sponsored by Microsoft (Bing) and Google over the holidays. These campaigns contributed to an increase in usage at airports and cafés by 26 percent and 22.9 percent respectively in Q4’2009.

With the proliferation of mobile devices, more people are accessing the Internet outside their homes and offices, whether on a mobile phone, netbook, Mobile Internet devices, Tablets or even a gaming device. Over a billion new Internet enabled wireless devices are expected to ship this year alone according to Morgan Stanley, revolutionizing how people integrate media into their daily lives and changing the nature of advertising.

This ubiquity of Wi-Fi has created hotspot coverage as an expected amenity at many places of business. This along with various value add services (VAS) provided by hotspot operators coupled with the service being bundled with mobile plans, is making hotspot access much more consumer-oriented.

Analysts also predict free or nearly-free Wi-Fi will grow in other venues, such as in-flight. That service today can cost $5 to $15 for a wireless connection on a flight. Free Wi-Fi will help retain customers and give them a reason to come back, so indirectly there's a value for companies offering it. Advertising will be another way free Wi-Fi is financed, experts predicted. With an ad-based model, customers would agree to accept a certain number of ads in return for so many free minutes. Several models for financing free wireless access will emerge, and Wi-Fi will be increasingly offered for free.

This increased momentum in Wi-Fi hotspots has opened up tremendous oppurtunies for innovative service offerings to the end customers.

Stay tuned for these business oppurtunies in the next blog.