Six Competitive Factors for Wi-Fi HotSpot Success
In the Beginning
Wi-Fi hotspot access has not achieved the ubiquity in coverage, the consistency in quality of service, nor the frequency in usage anticipated when the market initially began to expand in 2001. However, the market for public Wi-Fi access remains a vital market with continued network and usage expansion. Shifts in the market that have begun to transpire over the past several years will be the key to future revenue growth in the Wi-Fi hotspot market.
The Wi-Fi hotspot market has grown from a network of fewer than 100 venues and a handful of players in 2001 to an anticipated 180,000 locations worldwide by end of 2007. Wi-Fi hotspots are available in numerous location types, but for classification purposes, MultiMedia Intelligence groups venues into 9 distinct categories including airports, cafés, convention centers, hotels, marinas, public, retail, RV park, and transportation. The most common venue types in terms of quantity or frequency of usage are airports, cafés, and hotels.
The players in the Wi-Fi hotspot market vary almost as much as the location types. Initially the Wi-Fi hotspot market was developed by remote access providers delivering wired broadband access to business travelers, which then morphed into wireless access as Wi-Fi become prevalent. Leading mobile and fixed line telecom providers quickly entered the market either through acquisition of existing Wi-Fi hotspot networks or organic network deployment. In the US market, many of these players soon exited the market, or chose to provide Wi-Fi hotspot access to their customers through wholesale arrangements. Internationally, large operators continued to be the primary Wi-Fi hotspot providers: however, the European market is now moving more to the wholesale model.
Simultaneous to network growth, the universe of Wi-Fi hotspot providers expanded rapidly over the initial years of the Wi-Fi hotspot market, with thousands of small providers operating networks. To address the growing hotspot fragmentation, roaming providers emerged in 2001 to consolidate the numerous independent networks under a single access subscription. Roaming providers either sold access to this consolidated network to enterprises, individuals, or wholesale.
The market continued to develop under this paradigm of increasing market fragmentation and rapid footprint expansion. Some element of consistency was introduced to footprint expansion in 2002 with the introduction of “branded” hotspots. Wi-Fi hotspot network providers began entering into arrangements with leading venue brands such as Starbucks, Borders, and McDonalds, to provide service across all the brand’s store locations. This allowed Wi-Fi hotspot user some element of expected coverage in certain venues.
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Added: Wednesday, February 06, 2008
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