Public Wireless Access Will Grow

Wireless Internet access in public places is becoming all the rage in North America today as companies like iPass, Boingo, GRIC, and even the cellular carriers like T-Mobile, and many others try to see who will come out on top in the hotspot world. That race has yet to be won, but according to forecasts from the Boston-based Yankee Group research and consulting firm, the public wireless local area network (WLAN) market is poised for great growth once the carriers step up to embrace Wi-Fi.

In a report entitled “Public Wi-Fi LAN Threat Becomes Wireless Carrier Opportunity,” Yankee points out just what the title implies — the cellular carriers and their 2.5G and 3G networks will be able to take advantage of public access Wi-Fi instead of compete with it.

By the year 2007, there will be 4.6 million regular users of public WLANs according to the report. Of that number, 86 percent will be business users. The wireless carriers will be able to build this use out of their own subscriber base by using Wi-Fi to compliment their current access plans. The hotspots run by the carriers then become not only an additional revenue source, but also enable them to build on relationships with premium business customers.

This research follows closely with a similar report from Yankee from earlier this year where they came to similar conclusions about the 3G networks of Europe, stating that 3G and WLANs would exist in relative harmony.

Even with this massive expansion of hotspots and public Wi-Fi users, Yankee’s report still says that the revenue carriers will generate from out of hotspots will be only a fraction of their total revenues going forward.

The conclusion is that complementary WLANs will be big, but Yankee also says competitive scenarios are still a valid reason to get into the public WLAN market. Cannibalization of the 3G network traffic, with more people using Wi-Fi for their voice traffic as well as data, is predicted as being minimal, so there’s no reason for none-carriers to jump in as well.

Eric Griffith is the managing editor of 802.11 Planet.