16 WBA Industry Report 2011 Global Developments in Public Wi Fi 1.00

www.wballiance.
com
Global Developments
in Public Wi-Fi
WBA Industry Report 2011
2
2011 Informa UK Ltd. All rights reserved. www.informatm.com
About the Wireless Broadband Alliance
Founded in 2003, the aim of the Wireless Broadband Alliance (WBA) is to
secure an outstanding user experience through the global deployment of next
generation Wi-Fi. The WBA and its industry leading members are dedicated to
delivering this quality experience through technology innovation, interoperability,
and robust security.
Today, membership includes major fixed operators such as BT, NTT
Communications, Comcast and Time Warner Cable; seven of the top 10 mobile
operator groups (by revenue) and leading technology companies such as Cisco,
Google and Intel.
These members serve over 390 million customers and have rolled out over
290,000 hotspots worldwide. They also work with international operators to drive
innovation, deliver seamless connectivity and optimize network investments.
The WBA Board includes AT&T, BT, Boingo, Cisco, Deutsche Telekom, KT, NTT
DOCOMO, Orange France, True Internet and TMN/Portugal Telecom.
Wireless Broadband Alliance Head Office
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CONTENTS
3 Executive Summary
4 An overview of todays Wi-Fi
ecosystem
7 Q&A: An interview with Chris Bruce,
Chair, Wireless Broadband Alliance &
CEO, BT Openzone
9 WBA milestones and achievements
11 Operator best-practice case studies
11 Operator case study: Boingo
12 Operator case study: China Mobile
14 Operator case study: Orange France
15 Operator case study: True
17 An overview of WBA member
companies
19 Wi-Fi ecosystem survey analysis
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2011 Informa UK Ltd. All rights reserved. www.informatandm.com
1.
This paper uncovered
unprecedented growth in Wi-Fi
hotspot deployments which are
predicted to rise 350% by 2015.
It found that 58% of operators -
including 47% of mobile operators
- believe Wi-Fi hotspots are either
very important or crucial to enhance
their customers experience; offload
busy mobile broadband networks;
and provide a value-added services
platform. The paper looks in detail
at the plans of four operators
Boingo, China Mobile, Orange
France and True.
2.
It found that a key factor in this
deployment activity is the rise in
mobile data. Global mobile data
traffic is expected to reach 16.84
million terabytes by 2014 which
operators plan to manage through
pricing strategies followed closely
by use of Wi-Fi-based offload. It
also revealed that smartphone
connections to hotspots will soon
overtake laptops globally. Laptops
now represent less than half (48%)
of the connections to hotspots, with
smartphones now encompassing
36% and tablets already on 10%.
In APAC, smartphones already
outnumber laptop connections
while in North America and Latin
America, smartphones and laptops
represent the same number of
connections.
3.
The paper also highlights several
barriers to further adoption and
usage of public Wi-Fi. These
include cumbersome authentication
procedures, the costs to access
the networks, user discovery of
available networks and security.
However, the report highlights that
several of these challenges will be
overcome by the Next Generation
Hotspots currently being trialled
around the world, which allow
users to seamlessly roam between
cellular and Wi-Fi networks
using their mobile handsets SIM
card as authentication, thereby
alleviating concerns surrounding
authentication, network discovery
and security. The research also
found that operators are already
overcoming the issues surrounding
the cost of access by increasingly
bundling public Wi-Fi access as
part of broadband or cellular
packages.
Executive Summary
4
Wi-Fi has firmly established
itself as the most heavily-used
wireless technology ever deployed
in terms of the volume of data
traffic transmitted over networks
using Wi-Fi, according to Informa
Telecoms & Media. The ever-
growing ubiquity of Wi-Fi networks
combined with the integration
of low-cost Wi-Fi chipsets into a
vast and mature ecosystem built
of thousands of devices and the
explosion of applications has
ensured that hundreds of millions
of users worldwide now make
regular use of Wi-Fi to access
the Internet. This has meant that
developing a Wi-Fi strategy has
become an imperative for virtually
all operators globally. According
to Thomas Wehmeier, principal
analyst at Informa Telecoms &
Media, any network director
seeking to efficiently and profitably
manage the follow of data traffic
across their network should be
looking to include Wi-Fi as part
of an holistic customer-centric
network strategy.
After successfully establishing itself
firmly as a must-have feature in
virtually every smartphone and an
increasing number of lower-cost
mass-market feature phones, the
second wave of Wi-Fi has truly
emerged. In 2010 alone, more than
1,950 device models supporting
Wi-Fi were certified by the Wi-Fi
Alliance, including almost 250 Wi-Fi
enabled smartphones (see fig.
1). In total, the Wi-Fi Alliance has
issued more than 9,000 product
certifications.
Support for Wi-Fi has come from
executives from the worlds largest
operator groups. In fact, eight of
the 10 worlds largest operators by
revenue have deployed their own
public Wi-Fi networks.
Connections to Wi-Fi networks have
historically been dominated by the
laptops of the mobile workforce,
but the rise of smartphones means
that they are set to take over as the
primary device connecting to public
Wi-Fi networks. Operators around
the globe are reporting that the mix
of devices connecting to their public
Wi-Fi networks is changing rapidly
on an almost daily basis and,
according to the joint WBA/ Informa
Telecoms & Media industry survey,
connections from smartphones and
tablets already account for almost
51% of the total on average.
There has always been a strong
community actively supporting the
Wi-Fi ecosystem through bodies such
as the Wireless Broadband Alliance,
although these typically represented
business units historically linked to
the fixed divisions of major operator
groups, such as France Telecom,
Deutsche Telekom, KT, NTT,
Telefonica and Portugal Telecom. As
mobile data markets develop and
as the penetration of smartphones,
tablets and other connected devices
increases, there is widespread
expectation that almost all operators
will be required to enter the Wi-Fi
space in some way to remain
competitive.
Operators have chosen a variety of
different strategies to meet customer
demand for Wi-Fi with their choices
typically dependent on the existing
status of the local Wi-Fi market and
their own market position and
network strategy. A large number of
operators, such as Thailands True,
South Koreas SK Telekom and
Chinas three operators, have
chosen to invest heavily in building
out their own extensive networks,
while others have preferred to
purchase wholesale capacity from
existing players or build partnerships
with some of the major Wi-Fi
aggregators, such as iPass or
Boingo.
An overview of todays Wi-Fi ecosystem
We urge all handset manufacturers to
provide [an] embedded Wi-Fi connection
and make it a default function
Wang Jianzhou, Chairman, China Mobile, February 2011
0
200
400
600
800
1,000
1,200
1,400
1,600
Other devices Smartphones Feature phones
2010 2009 2008 2007 2006
0
5
10
15
20
25
30
35
40
M
o
b
i
l
e

d
e
v
i
c
e
s

a
s

%

o
f

a
l
l
d
e
v
i
c
e
s
P
r
o
d
u
c
t

l
a
u
n
c
h
e
s
Source: Wi-Fi Alliance
Fig. 1: Number of Wi-Fi certified product launches, 2006-2010
5
In the era of explosive mobile data
traffic growth (see fig. 2), data
offloading has rightly been positioned
at the very front and center of
industry thinking, but the business
models that have driven and
continue to drive Wi-Fi investments
are extremely varied (see fig. 3).
In the UK, one of the worlds
most advanced markets for Wi-Fi,
investments are being underpinned
by a range of divergent business
models:
BT, the UKs fixed incumbent,
is using Wi-Fi as a means to
differentiate and add value to its
fixed-broadband offerings
Telefonica is using Wi-Fi to
build a location-based services
strategy
BSkyB has acquired The Cloud
and moved to build a multiscreen
content-delivery strategy for its
core satellite TV business that
relies on its extensive public
Wi-Fi assets.
The upshot of this widespread
interest in Wi-Fi is that the
number of public Hotspots is set to
proliferate, growing from 0.8 million
at the end of 2010 to 5.8 million
by the end of 2015, according to
Informa Telecoms & Media (see fig.
4). This research does not include
the 4.5 million community Wi-Fi
public hotspots provided through
FON and its successful partnerships
with leading operators, such as BT,
SFR Softbank and MTS.
Much of this growth will come from
emerging markets such as China,
India and Brazil where some of the
largest-ever mass deployments of
public Wi-Fi are being undertaken by
incumbent and new entrants to the
market: The worlds largest mobile
operator, China Mobile, is planning
to deploy a total of one million Wi-Fi
Hotspots throughout China. This
spread of public Wi-Fi networks
will be a truly global phenomenon
and operators in all regions and all
types of markets have declared their
intention to move into Wi-Fi. Recent
announcements of new rollouts span
markets as diverse as Romania,
Namibia and Qatar.
The expansion of public Hotspots
is not only being led by the land
grab for key venues, such as hotels,
stadia and airports, being witnessed
in new markets, but also by the
increasing density of Wi-Fi networks
in established markets. Wi-Fi is
increasingly moving beyond the
traditional prime locations to the
next generation of Hotspot locations,
such as retail outlets, local- and
wide-area outdoor Hotzones, as
merchants and Wi-Fi network
operators alike begin to understand
the variety of profitable business
models that can be underpinned by
deployment of Wi-Fi.
Whats happening in the public Wi-Fi
market is being matched equally by
continued penetration of Wi-Fi into
private households and businesses.
0
2
4
6
8
10
12
14
16
18
Africa/Middle East Europe Asia Pacific Latin America North America
2014 2013 2012 2011 2010 2009 2008
T
e
r
a
b
y
t
e
s

p
e
r

a
n
n
u
m

(
m
i
l
.
)
Source: Informa Telecoms & Media
Fig. 2: Global mobile data traffic, 2008-2014
0
1
2
3
4
5
6
2015 2014 2013 2012 2011 2010 2009
5.8
4.5
3.3
2.1
1.3
0.8
0.5
P
u
b
l
i
c

H
o
t
s
p
o
t
s

(
m
i
l
.
)
Fig. 4: Global number of public Hotspots, 2009-2015
Enhanced
user
experience
Data
offloading
Improve indoor
coverage
Value-added
services
platform
Churn
reduction tool
Customer
acquisition
tool
Wi-Fi access
revenues
Fig. 3: Business drivers for Wi-Fi investments
6
Hundreds of millions of Wi-Fi
enabled households and offices
are expected to emerge in the
coming years, according to Informa
Telecoms & Medias forecasts
(see fig. 5).
Although the Wi-Fi experience has
improved with the deployment of
802.11n and the implementation
of authentication based on 802.1x,
there is unquestionably still much
to be done to grow the adoption and
usage further and to build a first-
class user experience. Challenges
that must still be overcome include
simplifying the authentication
and sign-on process, establishing
a truly global roaming footprint
and addressing concerns around
security and privacy.
Just as fixed and cellular
technologies are not standing
still, the common standards that
underpin Wi-Fi technology are
evolving in parallel, with sometimes
interweaving paths. Vendor,
operators and Wi-Fi industry bodies,
such as the Wireless Broadband
Alliance and the Wi-Fi Alliance, are
responding to changing demands
from end users to develop new
standards and frameworks to further
enhance the Wi-Fi user experience
in terms of authentication, speed,
capacity, security and user
experience. Both operators and users
have come to rely on Wi-Fi, so it has
been compelled to grow smarter.
Carrier-grade Wi-Fi with telecoms-
grade reliability has become almost
a must. The focus today is on
simplifying the Wi-Fi user experience
and aligning it as closely as possible
with the mobile experience in
terms of connection management,
authentication and sign-on, charging
and billing, and importantly
security and privacy.
Although authentication methods
have improved in the latest Wi-Fi-
enabled devices, evidence suggests
that additional simplification and
automation is needed to drive
adoption of public Wi-Fi usage
outside the home. O2 UK has
reported that only 20% of the
potential base of users currently
access free public Hotspots provided
by its partners. This is despite
the fact that O2 has a customer
base that is tech-savvy and has
been bundling Wi-Fi for free in
smartphone tariffs since June 2008.
The UK has dense public Wi-Fi
and Wi-Fi awareness is very high
precisely the conditions one would
expect to drive leading levels of
public Wi-Fi usage.
As a result, support for SIM-
based authentication is expected
to proliferate with the strong
support of the operator community.
Standards such as EAP-SIM and
EAP-AKA are set to be included in a
greater variety of smartphones and
tablets and as more OEMs include
Wi-Fi in their devices.
In spite of the spread of sponsored
Hotspots that offer access for
free on a national basis to the end
user, users will continue to show
willingness to pay for Wi-Fi where
no alternative form of connectivity
exists or where Wi-Fi is perceived
as the best available form of
connectivity. The willingness to pay
and the amount paid is likely will be
proportional to the perceived quality
of the network performance on offer,
as well as perceptions of usability,
security and privacy, and will also
be focused on obtaining access in
key venues with high traffic demand,
such as airports, hotels and urban
Hotzones. The need to meet these
user expectations will be a strong
driver towards additional investment
into Wi-Fi networks and a move
towards Next Generation Hotspot
deployments based on common
standards. The good news is that
the industry has come together
to develop these standards. The
Wi-Fi Alliance developed the
Hotspot 2.0 specification that is
being used to certify products, and
the Wireless Broadband Alliance
is using Hotspot 2.0 certified
products to run its Next Generation
Hotspot trials to demonstrate
interoperability between operators,
roaming partners, and CPE and
device vendors. The results of the
trials will be published to the Wi-Fi
Alliance and the GSMA to continue to
inform and improve standards and
specifications.
The combined effort of the Wi-Fi
ecosystem to build the next
generation of Hotspots and a variety
of new business models that exploit
the enhanced capabilities of Wi-Fi
networks and devices will ensure
that Wi-Fi continues to dominate
as the most important wireless
technology in terms of data traffic
transmitted.
P
r
i
v
a
t
e

H
o
t
s
p
o
t
s

(
m
i
l
.
)
0
100
200
300
400
500
600
700
2015 2014 2013 2012 2011 2010 2009
646
571
492
416
345
282
233
Fig. 5: Global number of private Hotspots, 2009-2015
7
Q: What is the role of the Wireless
Broadband Alliance (WBA) in the
telecom industry in general and in
the Wi-Fi industry in particular?
CB: The WBA is focused on
driving the next generation of
Wi-Fi services for the benefit
of consumers. Were removing
the barriers to deployment and
take up which means ensuring
ease of access, robust security
and interoperability. In short,
were the organization that
establishes the specifications and
roaming mechanisms that help
consumers enjoy a seamless and
interoperable Wi-Fi experience
anytime, anywhere.
Q: How do you think users
connectivity needs are evolving and
what role do you think Wi-Fi has
to play in changing everyday user
behavior?
CB: With smartphone use set
to increase by 150% by 2015 and
mobile data usage continuing to
grow exponentially, Wi-Fi clearly
has a big role to play helping
operators manage demand. In
terms of usage patterns, we are
seeing a greater emphasis on
quick-to-consume snackable
content on the go and this
clearly plays to the strengths of
next generation Wi-Fi offerings.
But the point here is that the
general public doesnt care about
acronyms like 3G, 4G or Wi-Fi,
as long as they receive the right
communications experience. The
future of media and telecoms
involves hiding complexity from
the user and seamlessly employing
the wide spectrum of technologies
at our disposal to provide the best
possible experience in a world
where data demand is insatiable.
So its not a question of Wi-Fi
or any other access technology
changing user behavior. Its about
our industry as a whole delivering
a compelling and seamless user
experience, regardless of the
location or delivery mechanism.
The WBA has a key role to play
making this happen.
Q: How do you think these changes
have shaped the industrys
perception of the importance of
Wi-Fi?
CB: I think theres a growing
awareness that Wi-Fi is
fundamental to fixed, wireless
and mobile networks, and this
is reflected in the growing
membership of the WBA. In
particular, weve seen a big change
in mobile operators that now see
Wi-Fi as a complementary access
network able to intelligently offload
much of the rapidly growing
volumes of data traffic. For fixed-
line operators, Wi-Fi offers a means
to bundle wireless access for
customers when away from base.
Q: What do you think have
been the WBAs most notable
achievements during the past
year?
CB: At the top of our agenda
is our Next Generation Hotspot
(NGH) initiative launched in June
2011. This is a program born of
our conviction that public Wi-Fi
can only meet its true potential
if users can seamlessly and
securely access hotspots, thereby
avoiding todays challenges
around finding available networks
and then successfully logging
into them. These challenges are
set to be addressed by the Next
Generation Hotspots being trialed
around the world that securely
and automatically log users
into available Wi-Fi networks,
drastically simplifying the user
experience. I see the completion
of the NGH trial as a key milestone
in the WBAs goal to drive wireless
broadband adoption globally by
developing a common commercial
and technical framework for
interoperability across networks,
technologies and devices. Im
delighted that other industry
bodies like the Wi-Fi Alliance and
the GSMA have recognized the
value of this initiative and are now
working with us to help ensure its
success.
Q&A: An interview with Chris Bruce, Chair,
Wireless Broadband Alliance & CEO, BT
Openzone
Chris Bruce, Chair
Wireless Broadband Alliance
8
Q: Cellular standards are evolving
to LTE and LTE-Advanced, but at
the same time Wi-Fi standards
and technology are not standing
still either. How do you see Wi-Fi
technology developing and evolving
in the future?
CB: Once again I think its more
important to focus on service
delivery than the technologies that
sit behind it. Our aim should be
to make it as easy as possible to
connect to public networks, such
as those in airports, cafes and
other high footfall locations, as to a
persons home Wi-Fi network. This
is why the WBA is driving services
that will be more seamless, secure
and with better coverage through
next-generation hotspots. For
the foreseeable future, Wi-Fi will
co-exist with LTE as operators need
to maximize the use of all available
spectrum to meet the publics ever
increasing capacity demands.
Q: How is the WBA changing to
address the consumer and industry
developments youve described?
CB: Weve become more active,
more collaborative and more
focused on communicating the
strategic imperatives associated
with driving next generation of
wireless services worldwide. Were
continually working with a wide
variety of organizations including
the GSMA and the Wi-Fi Alliance
amongst others. Weve grown
our membership to almost 70
leading companies which include
major fixed operators such as BT,
Comcast and Time Warner Cable;
seven of the top 10 mobile operator
groups (by revenue) AT&T
Group, China Mobile, Deutsche
Telecom Group (T-Mobile), France
Telecom Group (Orange), NTT
DOCOMO Group, Telefonica Group
and Verizon Wireless - as well as
leading technology companies such
as Cisco, Google and Intel.
I think what is exciting is
the diversity of businesses
that recognize the value and
opportunities associated with
working with the WBA. For
example, the latest intake of new
members include a mix of leading
Wi-Fi, mobile and broadband
network operators; service
providers; and media players from
across the Americas, Europe &
Asia Pacific, as well as technology
providers and partners.
9
A unique industry forum
strategically focused on public
Wi-Fi, the WBA has delivered
several critical enablers since 2003
to facilitate seamless Wi-Fi user
experience and interoperability for
the operators worldwide.
WBA launched its award winning
WRIX Wireless Roaming
Intermediary eXchange, a
compressive set of Wi-Fi roaming
best practices & specifications,
in 2007 which has since been
widely deployed by an ecosystem
of leading operators, roaming
hub/ interconnect providers and
aggregators globally.
Having successfully built the
foundation to support global Wi-Fi
roaming, the WBA launched its
Next Generation Hotspot (NGH)
Program in 2011. The vision of
NGH is to facilitate a cellular-
like seamless, secure and easy
to use Wi-Fi experience and
interoperability across operators.
NGH will offer an improved user
experience through
Automated selection of approved
Hotspots
Reuse of mobile login credentials
Protection against loss of critical
user data
Protection against fraud.
Growing industry interest in
Wi-Fi 24 new members join the
WBA in 2011
With the growing interest in
Wi-Fi roaming and data offload,
the WBA has seen a significant
surge in membership with 24
new members joining the alliance
since the beginning of 2011 and
bring it to total of 68 members
globally. The mix of new members
includes leading Wi-Fi, mobile
and broadband network operators
and service providers from across
Americas, Europe & Asia Pacific as
well as technology providers and
partners.
WBAs Next Generation
Hotspot (NGH) program gains
momentum
An ecosystem-wide NGH Trial
was launched in June 2011 for the
end-to end inter-operator testing
and validation of key standards
802.1x, 802.11u and EAP-SIM/AKA
& EAP-TLS/TTLS authentication.
The NGH Trial participants include
a group of major global operators,
equipment vendors and roaming
Hub providers who will exercise
key NGH requirements for secure
and seamless auto-authentication
and connectivity on home and
roaming partners networks.
The phase-1 NGH Trial results,
expected in 1Q12, will include detailed
instructions for a NGH-based roaming
lifecycle and feedback on Hotspot 2.0
specifications to the Wi-Fi Alliance.
The NGH program will also develop
comprehensive operators guideline
to help operators migrate from
legacy to Next Generation Hotspots.
WBA milestones and achievements
2003
2004
2006
2007
2008
2009
2010
2011
Established WBA, started Wi-Fi roaming trials
First commercial Wi-Fi roaming announced among members
Wireless Roaming Intermediary eXchange (WRIX) development started
WRIX commercially deployed; WRIX wins WBI 2007 Awards!
Launch of User Experience Program for UAM
Seamless authentication work with FMCA & WiMAX Forum
802.1x /EAP-SIM trial between FMCA and WBA members
Findings of the 802.1x Trial published
WISPr 2.0 development initiated
EAP over WISPr 2.0 Trial launched
User Experience for Smartphone work launched
Next Generation Hotspot Program (NGH) announced
Launched NGH Trial & NGH Operators Guidelines projects
10
The phase-1 of the NGH Operators
Guideline is expected to be published
in 4Q11.
Completion of the NGH Trial will be
a key milestone in the WBAs goal
to drive wireless broadband adoption
globally by developing a common
commercial and technical framework
for interoperability across networks,
technologies nd devices.
WBA goals and objective for
2012
Building on its foundation of strong
operator-heritage and a set of
critical Wi-Fi roaming enablers
created by it, the WBA now aims to
focus on the following:
Enable an industry ecosystem to
promote the potential of Wi-Fi
as a complimentary technology/
service to meet customers
& public operators wireless
broadband needs
Tackle the barriers and further
the adoption of Wi-Fi service
through (a) ease of use, (b)
interoperability and (c) security.
Continue to drive the
development and deployment
of NGH across the ecosystem
and focus on ensuring
interoperability though a
compliancy programs for
operators globally.
Leverage WBAs existing
cooperation programs with GSMA
and Wi-Fi Alliance and address
gaps to facilitate standards
based Wi-Fi roaming, 3G/4G
interworking and data offload.
WBA and Wi-Fi alliance
to collaborate on Hotspot
innovations
During the WBA Roundtable in
Paris in June 2011, the Wi-Fi
Alliance and WBA announced a
collaboration to harmonize their
programs related to Wi-Fi Hotspot
ease of use and roaming. The
WBA's NGH Program & Wi-Fi
roaming efforts and Wi-Fi Alliance's
planned certification program for
Wi-Fi equipment are being worked
on with close coordination between
the two groups to help ensure the
best user experience.
WBA and GSMA cooperating on
Wi-Fi roaming
GSMA and WBA have started a joint
Wi-Fi Roaming Taskforce with the
intention of bringing together the
Wi-Fi and 3G/4G ecosystem in a
collaborative effort. Both, the GSMA
and WBA members have a strong
shared interest to improve the Wi-Fi
experience for their respective
customers and enable data offload
and roaming. A White Paper being
developed by 4Q11 by the joint
taskforce, the goals of which include
identifying gaps in available standards
and make recommendations to
address these gaps and define
and deliver a common technical
implementation of 3GPP to Wi-Fi
interworking for both devices and
network.
11
Key points
Boingo owns, manages and
operates a global Wi-Fi-Hotspot
footprint, the majority of which
is deployed in major airports in
North America, Europe and Asia,
with the rest in stadiums, malls
and restaurants.
Boingo has successfully pursued
a hybrid business model that
sees it sell wholesale and retail
access to its Wi-Fi network in a
number of ways.
The operator is evolving its
business model by teaming up
with consumer-product brands
so they can deliver branded
messages on the Boingo Hotspot
landing page.
Boingo sees a standards-based
approach to Wi-Fi-network
identification, authentication and
quality of service as essential
to accelerating use of the
technology among consumers.
Overview
US-based Boingo is one of the main
Wi-Fi operators in the US, offering
high-density, carrier-grade Wi-Fi
in public venues, with a historical
emphasis on large sites, such as
airports and stadiums. The operator
began selling Wi-Fi access in 2001,
focusing initially on the business-
travel ecosystem, emphasizing
airports and hotels. Boingo offers
both retail and wholesale Wi-Fi and
has about 25,000 Wi-Fi Hotspots in
the US, paid and unpaid, and more
than 125 roaming partners in 100
countries, offering access to about
400,000 Hotspot locations globally
via a single account.
The company has grown through
acquisitions: In 2006 it acquired
Concourse Communications,
which managed and operated
Wi-Fi services at 12 airports; in
2007 it acquired Sprint Spectrums
Wi-Fi network of seven managed
and operated airports and one
nonexclusive airport; and in 2008
it acquired Opti-Fi Networks
Wi-Fi network of 25 managed and
operated airports and Washington
State Ferries. The operator funded
its Wi-Fi business with three
rounds of venture funding before it
became profitable. It has continued
to expand its market presence and
generated enough capital for growth
and potential M&A with a May 2011
IPO.
Business model
Boingo owns, manages and operates
a global Wi-Fi-Hotspot footprint, the
majority of which comprises major
airports in North America, Europe
and Asia, with the rest in stadiums,
malls and restaurants. Boingo has
roaming partners in the US and
abroad.
Boingo sells both retail and
wholesale Wi-Fi access, and it sells
retail access on subscription, daily
and per-use bases.
Subscriptions are largely tied to a
geographic area (e.g., North and
South America, Europe or Asia)
and offer unlimited amounts of
Wi-Fi access to the Boingo global
network in that region for a number
of registered devices; the unlimited
plans cost US$9.95-34.95 a month.
Day-access rates start at US$6.95
in the US, while per-hour rates
start at US$1.99 in the US and 2.99
(US$4.70) abroad. Boingo also offers
a global plan that includes 2,000
minutes anywhere in the world
for US$59 a month. In September
Boingo launched an international
version of its Boingo Wi-Fi Credits
app on the iTunes App Store. The
base price for a global one-hour
Wi-Fi credit for iPad, iPhone and
iPod Touch users outside the US is
2.99 (US$4.07) (see fig.). The app
also enables users to see nearby
Wi-Fi Hotspots.
For its wholesale business, Boingo
sells access to its Wi-Fi network
to operators, including Verizon and
South Koreas KT and LGU+. The
operator generates revenue from
these agreements using a variety
of business models, including per-
user, per-minute and per-megabyte
revenue-share agreements.
Operators are signing Wi-Fi
agreements with Boingo to offload
traffic from congested cellular
networks, to offer cost-effective
data-roaming services outside
home networks, and to offer Wi-Fi
Operator best-practice case studies
Operator case study: Boingo
Source: Boingo
Boingo
12
where coverage is strong, such as in
airports and stadiums.
Boingo gives away Wi-Fi-
management and -location software
to retail customers and, as part of
its wholesale business, offers it as
a white-label service to operators
with which it has Wi-Fi agreements,
either in SDK or full app versions.
Results
Boingo had about 200,000 retail
subscribers at end-2010, up from
140,000 at end-2009. Retail monthly
churn decreased slightly in 2010,
to 9.5%, from 9.7% in 2009. Total
revenue grew from US$65.7 million
in 2009 to US$80.4 million in 2010.
The wholesale business contributed
45% to Boingos 2010 revenues, and
its retail business contributed 50%,
split 30% retail subscription and
20% single-use (day pass/hourly).
Boingo has seen the mix of Wi-Fi
traffic in its managed airports
change dramatically since
smartphone use took off, with
smartphones overtaking laptops
as the most widely carried Wi-Fi
devices in airports, even as the
number of laptops continued to
increase.
Between June 2007 and June
2011, Boingo saw 500% growth
in the number of devices seeking
Wi-Fi in its managed network of
airports. The growth was largely
driven by non-laptop devices, such
as smartphones and tablets. IOS
devices (iPhone, iPad and iPod
Touch) now represent 83% of all
non-laptop devices seeking Wi-Fi in
the managed network.
The growth in device numbers has
also been accompanied by a growth
in data consumption. The average
mobile devices used 114MB of data
in May 2009 and 211MB in May 2011.
Average megabytes per minute was
0.37MB in May 2009 and 0.89MB in
June 2011, pointing to the increased
consumption of higher-bandwidth
content, such as streaming video
and streaming audio. Future growth
in this area is expected, and it will
require continued investment in
network upgrades to support the
data demand.
Outlook
Boingo is teaming up with
restaurant and shopping-mall
chains and other retail-brand
facilities to expand the number
of venues in which it offers Wi-Fi
access. Boingo is also teaming up
with consumer-product brands so
they can deliver branded messages
on the Hotspot landing page. The
advertising message could be
linked to the users location through
advanced location-based services,
which advertisers could use to
offer store discounts based on user
proximity.
Boingo sees a standards-based
approach to Wi-Fi-network
identification, authentication and
quality of service as essential to
accelerating use of the technology
among consumers. Making the
3G/4G-to-Wi-Fi handover seamless
to the end-user will provide a viable
data-offload solution for carriers
while standardizing deployment for
Wi-Fi operators and manufacturers.
It will also make integration into
mobile operators cellular networks
easier and more cost-effective.
Operator case study: China Mobile
Key points
Wi-Fi constitutes an important
part of China Mobiles network-
traffic-management strategy,
because of strains on network
capacity.
China Mobile uses Wi-Fi to
augment its fixed broadband
network and mitigate the impact
of its competitors bundling
offers and also to support its 3G
network and compete better in
mobile broadband.
Two prohibiting factors are the
limited number of Hotspots and
occasional network-connection
problems. Take-up is also
limited by the relative complexity
of accessing Wi-Fi using
handsets.
The operator, which has about
60,000 Wi-Fi Hotspots now, has
an aggressive plan to deploy 1
million in the next three years
across China.
Overview
China Mobile began deploying Wi-Fi
in 2003, and its strategy underwent
a significant change in 2009 when
the operator saw smartphone
penetration increase dramatically,
along with the use of always-on
applications. Wi-Fi constitutes an
important part of the operators
network-traffic-management
strategy: China Mobile, which has
about 60,000 Hotspots now, has an
aggressive plan to deploy 1 million
Hotspots in the next three years
across China.
The majority of China Mobiles
Hotspots are operator-owned.
Most are in metropolitan
areas: hotels; restaurants and
cafes; transportation hubs; and
campuses. The operator has
some revenue-sharing deals, for
example with some Universities
and cafe chains.
13
Wi-Fi plays a central role in
complementing China Mobiles
GPRS/EDGE network and nascent
TD-SCDMA network in data-
intensive areas and will help the
operator do several things:
Offload data from its mobile
network and deliver higher data
throughputs to subscribers,
thereby enhancing the user
experience, which the operator
hopes will lead to reduced churn.
Augment its fixed broadband
network and mitigate the impact
of its competitors bundling offers.
Strengthen its 3G network and
be more competitive in mobile
broadband.
Maintain its superior network
advantage, appeal to users and
buy time for a full rollout of
TD-LTE.
Market positioning
China Mobile is offering both
a prepaid plan (at CNY0.05
[US$0.008] a minute) and a monthly
subscription for Wi-Fi access from
both handsets and PCs (see fig. 1)
but provided free Wi-Fi trials in most
cities from 2010 to mid-2011. The
operator also bundles Wi-Fi minutes
into some 3G plans.
The operator has begun marketing
the Wi-Fi service on a large scale
because of the limited number
of Hotspots deployed. It hopes to
encourage TD-SCDMA dongle users
to use the Wi-Fi network first and
then prioritize marketing of high-
bandwidth services, such as mobile
video, mainly to Wi-Fi users rather
than 2.5G-data-plan users.
University campuses are the only
places where China Mobile has
really promoted its Wi-Fi service.
The operator already has the
strongest brand equity among
university students with its youth
sub-brand, M-Zone. Universities
are one of the first areas where
China Mobile has been actively
expanding Wi-Fi coverage. The
operator has also been working on a
major initiative to enable automatic
authentication on the Wi-Fi network.
The operator offers special campus
Wi-Fi pricing plans that are cheaper
and provide more-generous minute
bundles for Wi-Fi access in a cluster
of local universities (see fig. 2).
Results
China Mobiles internal report
states that there were only 1.9
million users of its Wi-Fi service
in 2010, indicating the operator
has a significant opportunity to
dramatically increase the number
of its subscribers who access the
service. One prohibiting factor is
the limited number of Hotspots
and occasional network-connection
problems. Take-up is also limited by
the relative complexity of accessing
Wi-Fi-enabled handsets. The
operator sees laptops generating
most Wi-Fi usage at the moment.
Seamless handover and
authentication of Wi-Fi and mobile
networks is vital if Wi-Fi is to become
mass-market, especially for the
countrys low-end users, who make
up the majority of people using mobile
handsets to access the Internet.
Outlook
China Mobile wants a Wi-Fi
authentication client to be loaded
onto the smartphones it sells in
the future and is talking to device
manufacturers about enabling this.
Because the Chinese government
mandates that all Wi-Fi equipment
conform to the local Chinese
version of Wi-Fi, WAPI (Wireless
LAN Authentication and Privacy
Infrastructure), the operator might
face a challenge in offering Wi-Fi
roaming to customers.
China Mobiles network-capacity
strains mean that Wi-Fi has become
urgent in its network-planning
strategy. Wi-Fi will not only
ease the operators 2G-network
congestion problems but also
help the operator maintain its
technology leadership and offer a
better customer experience in a
cost-effective manner, even though
it does not have a strong 3G network
to compete with Chinas other two
operators.
R
e
v
e
n
u
e

(
C
N
Y

m
i
l
.
)
0
2
4
6
8
10
12
14
64.2%
1H10 1H09
8.20
13.47
Fig. 1: China Mobile's standard Wi-Fi rates
Monthly fee
CNY20
CNY30
CNY40
CNY50
Duration
200 hours
300 hours
350 hours
400 hours
Source: China Mobile
Fig. 2: China Mobile's campus Wi-Fi
rates in Guangzhou
14
The wide availability of Hotspots
and quality of service are two key
factors that will determine
whether China Mobiles Wi-Fi
service is a success. China
Mobile should also accelerate
the upgrades of its network and
handsets to enable seamless
authentication and handover of
the Wi-Fi and cellular networks.
The removal of complex login
and password details for users to
connect to the network is critical
if the service is to be taken to the
mass market.
Operator case study: Orange France
Key points
Orange France pursues a B2B
and B2B2C Wi-Fi strategy, the
foundation of which is its 2,100
premium (wholly run by the
operator) Hotspot locations.
Orange sees Wi-Fi very much as
a complement to its 3G network,
not as a way to substitute to
rolling out 3G, nor in the future,
its LTE network.
Because Oranges mobile
broadband tariffs come with
data, the operator doesnt
see that there is a reason for
users, given the quality of its 3G
network, to switch by themselves
from 3G to Wi-Fi.
Orange sees most of the Wi-Fi
usage among its own subscribers
coming from laptops: most
smartphone data usage is on the
3G network.
Overview
French incumbent Orange is the
leading fixed and mobile operator
in France. It launched its Wi-Fi
strategy in 2003 using a pay-as-you-
use time-based model.
The second phase of Oranges Wi-Fi
strategy began in 2008, when it
switched business models, including
Wi-Fi, for certain subscribers. At this
time, Orange also began a B2B2C
Wi-Fi model, forming partnerships
with venue owners so they could
propose Orange-operated Wi-Fi
networks with a paid or free model.
The foundation of Oranges Wi-Fi
network is its 2,100 premium
(wholly run by the operator) Hotspot
locations. Added to this network
are around 40,000 Hotspots run
by Oranges business broadband
customers that are able to activate a
Hotspot in a box on their customer
premises hotels, transport hubs,
stadia, cafes, etc. The operator has
no plans yet to team with third-party
Wi-Fi providers to augment its own
French Wi-Fi network.
Orange has struck deals with
Wi-Fi providers like operators and
aggregators to enable their users to
access the Orange network.
Market positioning
Both the coverage/capacity of its
3G network and B2B venue-owner
customers has determined Oranges
Wi-Fi strategic goals: Because it has
a widespread 3G network and has no
capacity problems, it has not been
aggressive in using Wi-Fi as a way to
offload capacity from its 3G network.
Orange sees Wi-Fi very much as
a complement to its 3G network,
not as a way to substitute to rolling
out 3G, nor in the future, its LTE
network.
Furthermore, because Oranges
mobile broadband tariffs come with
data included, the operator doesnt
see that there is a reason for users,
given the quality of its 3G network,
to switch by themselves from 3G to
Wi-Fi. Nonetheless, the operator
continues to examine the benefits
of 3G-to-Wi-Fi ubiquitous access
in order to provide its subscribers
with the best available experience. It
will also continue to support its B2B
partners to provide connectivity on
venue sites and improve its global
data footprint.
Similarly, and again because of
the quality of the coverage and
capacity of its 3G network, the
operator doesnt perceive there to
be any benefit in rolling out city-
wide Wi-Fi mesh networks. Orange
already bundles Wi-Fi access in all
its mobile data broadband tariffs
and highlights its Wi-Fi network as
a key benefit of choosing it rather
than its rivals. The operator also
offers hourly and daily passes for
access to its Wi-Fi network (see
fig.).
Results
Orange doesnt derive any direct
Wi-Fi revenue from the majority
of its mobile subscribers because
Wi-Fi access is bundled into its
broadband tariffs. The operator
shares investments with venue
partners to provide operator-class
Wi-Fi services at destinations for
its subscribers and ad hoc users.
Orange also provides Wi-Fi services
for in-bound roamers, opening its
network to its roaming partners and
allowing them to include Wi-Fi in
their retail offer.
Orange sees most of the Wi-Fi usage
among its own subscribers coming
from laptops: most smartphone
data usage is on the 3G network.
However, among in-bound roamers,
the Wi-Fi usage coming from
smartphones is growing.
15
Outlook
In France, the different fixed-
broadband service providers
proposed a community-based Wi-Fi
network based on home hubs by
enabling users to share their Wi-Fi
signal with other users. Millions
of users sharing their broadband
access would considerably increase
the operators Wi-Fi footprints.
Orange is backing the WBA Next
Generation Hotspot (NGH) initiative
to standardize SIM-based Wi-Fi
authentication. It sees this as crucial
to provide device manufacturers
with a single approach to Wi-Fi
management, which will make it
simpler for users to access the
network.
Price
1.50
4.50
15.00
9.90
Duration
30 mins
1 hour
10 hour
24 hours
Terms
Usable from 07:00 to 18:00 on the day of purchase from first
connection
Connection available for 30 days after first connection
Connection available for 30 days after first connection
Connection available for 24 hours after first connection
30.00 30 days 30 days of connection available for 30 days after first connection
Source: Orange
Operator case study: Orange France
Operator case study: True
Key points
True is Thailands leading
Wi-Fi provider and has a robust
strategy to consolidate its lead in
the market.
Seamless handover and Wi-Fi
authentication have been key
factors to enabling True to make
a success of Wi-Fi, judged by the
number of people who use the
service.
True has seen clear revenue
benefits from its aggressive Wi-Fi
strategy as well as cost savings
derived from shifting network
traffic from cellular to Wi-Fi.
The operator has aggressive
rollout targets and can be
expected to continue to see
success in signing up Wi-Fi
users as smartphone and
tablet penetration and use both
accelerate in the market.
Overview
True is Thailands only fully-integrated
communications company and the
leader in convergence.Thailands
True is a fixed, cable and mobile
operator and also produces its own
content that it offers to its subscribers
on an exclusive basis. True is third-
placed challenger to AIS and DTAC
on the mobile side; Thailands largest
broadband provider; and also second
in the country in terms of fixed-line
market share.
True sees Wi-Fi as a key
differentiator. It has aggressively
rolled out its Wi-Fi network to reach
40,000 Hotspots nationwide, focused
on the Bangkok Metropolitan Area,
having begun work on it in 2004.
The operator is the largest Wi-Fi
provider in the country and believes
that operating its own network gives
it a clear advantage over rivals
that either dont offer Wi-Fi access
or that have teamed up with third
parties for Wi-Fi access.
In line with its convergence strategy,
True positions Wi-Fi as another
way to deliver its exclusive content,
including TV programs, games and
news,, as well as a way to access
the Internet, seeing increasing
smartphone penetration and social
networking as key drivers of usage.
True began to see a clear need for
Wi-Fi access with the launch of the
iPhone in 2007. The operator sees
Wi-Fi as a key factor in the success
it has had with the iPhone it was
the first operator to officially launch
the device in Thailand and remains
the largest iPhone operator-
provider in the country and also
for its success with smartphones in
general.
Today, around 60% of Trues Wi-Fi
traffic is generated by smartphones,
while tablet-originated Wi-Fi use is
growing rapidly. In terms of specific
usage, Web browsing, accessing
Trues exclusive content and social
networking are the most popular
services that users access over
Wi-Fi.
Strategic goals
True has four main strategic goals
for its Wi-Fi network:
1. To differentiate from its rivals
in terms of the quality, ease-of-
use and coverage of its Wi-Fi
network.
2. To enhance its customers
experience.
3. To increase revenues.
4. To offload traffic from its 3G
network.
16
Market positioning
Trues mobile and broadband
subscribers pay THB100 (US$3.30)
per month to access the Wi-Fi
network. The network is not open to
those who are not True subscribers
except with a prepaid package
available on an online basis. However,
the operator doesnt market
this package very aggressively
as it focuses overwhelmingly on
positioning the network as a way to
generate use from its subscribers
and to attract fixed and mobile
customers from rivals.
True markets its Wi-Fi network to
complement its 3G network in order
to communicate and differentiate its
mobile broadband coverage, rather
than emphasizing one or other in
isolation (see fig.).
In July, True began to roll out an
802.11n network aimed at high-end
subscribers. This network offers
100Mbps download speeds for a
subscription of THB300 per month
to Trues existing broadband and
mobile customers. The operator
aims to roll this network out to 700
locations by the end of 2011.
For True, seamless MAC-address-
based authentication will enhance its
users Wi-Fi experience; it is a principal
differentiator for the operator over rival
Wi-Fi providers for the moment.
Seamless handover between 3G and
Wi-Fi networks is also an important
differentiator; True sees it as the
key to offering the best experience
of accessing the Internet while
on the go. True has been actively
participating in the development of
seamless authentication technology
in various forums and organizations.
Results
True has around 800,000 Wi-Fi
subscribers split roughly 50/50
between its fixed-broadband and
mobile user bases. Based on these
figures, Trues monthly Wi-Fi
revenues are around THB60 million
(US$2 million).
Trues financial benefits from Wi-Fi
also include the opex benefits
derived from the technology as it
enables the operator to offload a
significant amount of traffic from the
cellular network.
Outlook
True plans to expand its Wi-Fi
network in tandem with its DOCSIS
3.0 broadband network, which
it is in the process of rolling out
nationwide. True will use the
DOCSIS network to carry its Wi-Fi
traffic in areas where both are
rolled out.
The operator has very aggressive
Wi-Fi targets it plans to increase the
number of its Hotspots from 40,000 to
100,000 by the end of the year.
True sees Wi-Fi authentication as a
crucial factor that determines users
experience of the network, and
plans to upgrade to Next Generation
Hotspot based technology once it is
available and mature.
The operator has found striking
international roaming agreements to
be a challenge because there is no
standards framework for connection
and clearing in place. The operator
has around five operators each a
WBA member in the pipeline to
offer Wi-Fi roaming in partnership
with other operators on a bilateral
basis. True says that it has found the
WBAs roaming framework beneficial
to finalizing agreements with other
operators. In terms of national
roaming, True has signed a national
Wi-Fi roaming MOU with CAT to
further trial and monetize its network.
With the number of Thai consumers
adopting convergence lifestyles
on the rise, True expects that
the increasing smartphone and
tablet penetration, along with the
increasing need to access the
Internet while on the go and in
public spaces, will continue to drive
Wi-Fi use in Thailand and, as a
result, increase the importance of
its Wi-Fi network to end users.
Trues Wi-Fi and 3G marketing message
Source: True (www.truemove.com, www.truewifi.net)
17
The 68 member companies that make
up the Wireless Broadband Alliance
reflect the diversity and breadth of the
entire Wi-Fi ecosystem, including a
unique mix of operators, technology
vendors, device manufacturers,
roaming hub providers, content
providers and other industry players.
With over 40 operator members,
including a broad range of integrated
operators, mobile operators, broadband
ISPs and pure-play Wi-Fi operators,
the membership continues to reflect
the strong operator heritage that has
always characterised the WBA.
The membership of the Wireless Broadband Alliance has continued to grow at a strong pace during 2011 and
this year has seen the single largest intake of new member companies with a total of 24 new members joining by
October 2011. Major new companies that have joined the WBA during 2011 include Softbank Mobile, Time Warner
Cable, TeliaSonera Mobile Networks, BSkyB and SK Telecom.
The recent intake of members
during 2011 has continued to
expand the geographical diversity
of the WBA membership with
joiners representing new countries
including Canada, Israel, Malaysia,
Philippines and Nordic countries.
The United States remains the most
heavily represented country in terms
of member companies with 19 out
of 68 members headquartered in
the US, including 10 based Silicon
Valley-based members.
An overview of WBA member companies
Non-operators: 24
Operators: 44
Source: WBA
WBA membership mix, operators vs non-operators
0
5
10
15
20
25
Vendors and
other industry players
Wi-Fi operators
and aggregators
Integrated operators Mobile operators
21
13
20
14
N
o
.
Source: WBA
WBA member companies by company type
Wi-Fi operators/aggregators
Vendors & other industry players
Integrated & fixed broadband operators
Mobile operators
Member companies
18
19
Overview
The WBA/ITM survey carried out a
survey during September to gauge
the status of the Wi-Fi market. The
survey drew 259 responses from the
industry, with the majority coming
from integrated operators (see fig.1).
There was a broad geographic
spread among the respondents to
the survey (see fig. 2). Just under
30% of the responses came from
Western Europe, 22.2% came from
Asia Pacific, and 18.3% came from
North America.
Market status
Wi-Fi is becoming an increasingly
important part of operators mobile
broadband strategies. Wi-Fi is
deemed either very important or
critical by 58% of the respondents
to the WBA-ITM survey.
Additionally, 47% of the mobile
operator respondents believe Wi-Fi
is very important or critical as a
source of value to their company
underlining the fact that Wi-Fi is no
longer seen as a threat by mobile
operators.
This view is borne out by the
way that the number of mobile
operators incorporating Wi-Fi as
part of their broadband-network
strategies continues to grow.
Large-scale deployments by the
likes of PCCW in Hong Kong and
Japans KDDI are using dense Wi-Fi
coverage to provide fast wireless
data access, offload peak data
traffic from cellular networks and
support the delivery of new content
and value-added services. KDDI
is planning to expand its Wi-Fi
coverage from 10,000 Hotspots to
100,000 by next March.
Chinas operators have raised the
stakes further: China Mobile alone
plans to deploy 1 million Wi-Fi
Hotspots in the next two years.
On a more modest scale, South
Koreas SKT opened 10,000 new
Hotspots in 1Q11, and O2 in the
UK has embarked on a large-scale
program to build more than 15,000
Wi-Fi Hotspots in the next two-and-
a-half years.
The amount of traffic that
operators are carrying over
their networks is increasing
dramatically. US-based Wi-Fi
provider Boingo has seen the
type of smartphone use change
dramatically since the amount of
traffic generated over its Wi-Fi
networks leapt from 0.37MB per
minute in May 2009 to 0.89MB
per minute in June 2011, driven
by the increase in the number of
smartphone users accessing its
networks. BT, meanwhile, aims
to roll-out 500,000 Hotspots in
Central London in time for the
Olympics, and three million across
the UK
Expansion of the number of Wi-Fi
Hotspots will increase not just the
footprint of the Wi-Fi networks, but
also the amount of data that can be
carried over existing areas of high
Wi-Fi ecosystem survey analysis
WBA-ITM Wi-Fi survey
Other: 9.7%
Content provider: 1.5%
Device vendor: 0.8%
Chipset vendor: 3.1%
Network equipment vendor: 13.1%
MVNO: 0.8%
Integrated operator (fixed/mobile): 22.4%
Cable operator: 3.1%
Fixed-line operator: 3.9%
Mobile operator: 19.3%
Consultant, industry observer,
etc: 6.9%
Systems integrator: 6.2%
Wi-Fi aggregator: 3.9%
Pure-play Wi-Fi operator: 5.4%
Source: WBA-ITM survey, Oct-11
Fig. 1: What is your companys primary area of business?
Asia Pacific
22.2%
Africa
5.6%
Middle East
6.3%
Central & Eastern Europe
11.1%
Western Europe
29.8%
Latin America
6.7%
North America
18.3%
Fig. 2: In which region are you based?
20
usage. Among the respondents to
the survey, there is a broad spread
of opinion in terms of how much
expansion operators will undertake
on the Wi-Fi networks over the
next year but three quarters of
respondents (77%) are planning
to expand their networks in the
coming 12 months, while one
in four said they plan to expand
Hotspot locations by more than 50%
(see fig. 3).
As operators build out their
networks, new Hotspot venue types
are emerging as operators move
beyond the traditional domain
of hotels, airports and cafes.
According to the survey, the three
most important locations identified
for expansion plans are: wide-
area outdoor Hotzones; local-area
outdoor Hotzones; and transport
hubs (air, train, bus, etc.) (see fig.
4). The focus on rolling out Wi-Fi
to target larger public spaces has
been very strong in the US with
AT&T deploying hotzones across the
country and Cablevision in the New
York area.
Wi-Fi business models and
pricing strategies
In terms of pricing, it is becoming
increasingly prevalent for
operators to offer Wi-Fi as part
of some of their data plans or
broadband packages. This model
is intended to give customers
additional value to their mobile
or broadband packages, acting as
both churn reduction and customer
acquisition tools.
The WBA-ITM survey results reflect
this proliferation in business models.
However, bundling Wi-Fi with existing
subscriptions is the most popular
option by some margin (see fig. 5).
The survey shows that operators
have seen pricing levels remain
broadly stable (see fig. 6).
Other (please specify): 6.0%
Increase by more than 100%: 17.2%
Increase by 76-100%: 2.6%
Keep the same number of locations: 14.7%
Reduce number of Hotspot locations: 2.6%
Fig. 3: In terms of the expansion of your Wi-Fi network in the next 12
months, what growth do you expect to see in terms of Hotspot locations?
Other (please specify)
3.7%
Wide-area outdoor coverage
21.5%
Local-area outdoor Hotzones
19.6%
Airports
4.7%
Transport (trains, planes, cars)
17.8%
Bars, cafes, restaurants
10.3%
Hotels
11.2%
Retail
11.2%
Fig. 4: Which Wi-Fi venue type do you expect to see greatest growth in terms
of traffic demand in 2012?
0 5 10 15 20 25 30 35 40
Responses (%)
Bundled as part of regular mobile/
fixed broadband subscription
Free to end-user
Time-based pay-per-use (e.g. per
hour, day, week)
Dedicated Wi-Fi subscription
Bundled as part of other service
(e.g. retail products/services)
Other (please specify)
Volume-based pay-per-use
(e.g. per MB, GB)
36.7
20.2
18.3
9.2
8.3
4.6
2.8
Fig. 5: What is the most popular way to pay for Wi-Fi on your network?
Decreased significantly
4.6%
Decreased slightly
20.2%
Stayed the same
62.4%
Increased slightly
8.3%
Increased significantly
4.6%
Fig. 6: In the past 12 months, how have retail prices for public Wi-Fi access
developed in your market?
21
This shows that Wi-Fi is being used
both as a customer retention tool
and as a way to increase the value
the operators customers perceive
they gain from them. The top three
sources of value emerging that
operators are deriving from Wi-Fi
are: enhanced user experience; data
offloading; and value-added services
platform (see fig. 7).
The issue of free Wi-Fi Hotspot
access is an important one for
operators as they try and go
some way to meeting the end-
user perception that access to
Wi-Fi should be without any
additional cost to them beyond
their subscription with the
operator. PCCW in Hong Kong is
taking an interesting approach
to this by developing a new
business model that focuses on
generating additional revenue
from Wi-Fi venues (high street
retailers, coffee shops, etc). The
survey found that the transition
to Hotspots that offer notionally
free access to the end user
will continue. However, the
majority of respondents believe
the percentage of free Hotspots
is expected to increase only
moderately (see fig. 8). While
access costs are zero to the user,
the cost of supporting and offering
the Wi-Fi Hotspot is always
sponsored or supported by indirect
associated revenue streams, such
as customer loyalty, purchase of
goods or through advertising.
The mix of device types from which
connections to Wi-Fi Hotspots
originate is changing dramatically,
with smartphones unsurprisingly a
fast-growing source of Wi-Fi traffic.
According to the survey responses
from operators of public Wi-Fi
networks, laptops now account for
just 48% of connections on average,
with smartphones already generating
as much as 36% of all connections.
Despite having only really taken off
with the launch of Apples iPad in
2010, tablets already make up more
than 10% of connections. These
results differ quite dramatically
when looked at on a regional
basis; for example, smartphones
generating an equal amount of
traffic with laptops in North America
(43%), while tablets have already
reached 12.5% of connections on
average (see fig. 9).
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0
Rating average
Enhanced user experience
Data offloading
Value-added service platform
Customer acquisition tool
Network cost reduction
Wi-Fi access revenues
3.85
3.27
3.16
3.14
3.06
2.95
*On a scale of 1-5, where 1 = not important and 5 = critical
Fig. 7: How important* are each of the following benefits from operating a
Wi-Fi network as a source of value for your company?
Decrease heavily
0.4%
Decrease moderately
9.3%
Stay broadly the same
26.5%
Increase moderately
46.9%
Increase heavily
16.8%
Fig. 8: In the next 12 months, what do you expect to happen to the
percentage of free public Hotspots as a proportion of total public Hotspots
in your domestic market?
0
10
20
30
40
50
60
Other devices Tablets Laptops Smartphones
A
s
i
a

P
a
c
i
f
i
c

A
f
r
i
c
a
M
i
d
d
l
e

E
a
s
t
E
a
s
t
e
r
r
n

E
u
r
o
p
e
W
e
s
t
e
r
n

E
u
r
o
p
e
L
a
t
i
n

A
m
e
r
i
c
a
N
o
r
t
h

A
m
e
r
i
c
a
S
h
a
r
e

o
f

c
o
n
n
e
c
t
i
o
n
s

(
%
)
Fig. 9: Approximately what percentage of connections to your Wi-Fi network
is generated by the following devices, by region?
22
How do operators differentiate
their Wi-Fi networks? This is
becoming an increasingly important
question as more and more
operators add a Wi-Fi offering to
their fixed and mobile broadband
tariffs and also as more end users
assess which operator to sign up
to based on how strong its Wi-Fi
offering is. According to the survey
respondents, the principal means
for operators to differentiate their
Wi-Fi networks are: seamless
connection to Hotspots; common
standards; and enhanced security
and privacy measures (see fig. 10).
Network strategies
In high-traffic areas, Wi-Fis
potential as a means of offloading
both data and signaling traffic is
now being realized, assisted by
the vendors efforts to deliver a
consistent customer experience
by integrating Wi-Fi with
cellular networks more closely.
Deployments are frequently
aimed at applications beyond
those geared toward notebook/
dongle users to provide an
improved broadband experience
for operators growing smartphone
and tablet customer bases,
since Wi-Fi is well-suited to
the demands of applications
that use data in bursts and for
functions such as video and music
streaming.
The survey respondents indicated
that a large percentage of
smartphone-originated traffic is
now being offloaded to Wi-Fi. Again,
there are clear regional differences
in this, with Western Europe and
North America showing the highest
amount of average traffic offloaded
from cellular to Wi-Fi networks
(see fig. 11).
The impact of ongoing 3G rollouts
and upcoming LTE rollouts are
key considerations for operators
when considering their Wi-Fi
strategy. Some operators, such as
Orange France, dont suffer from
congestion on their 3G network,
but see Wi-Fi as a good technology
to improve indoor coverage, while
other operators, such as True in
Thailand and China Mobile, are
deploying Wi-Fi to complement and
increase overall network coverage
and capacity. The majority of the
survey respondents do not expect
the broader deployment of LTE to
have an impact on investments in
Wi-Fi, suggesting that operators
will adopt complementary
solutions to Wi-Fi and cellular
rollouts (see fig. 12).
0 1 2 3 4
Rating average
Wide selection of low-cost
Wi-Fi-enabled devices
Enhanced security and
privacy measures
Availability of common standards
Ease of roaming between operators
Availability of cheaper Wi-Fi
enabled handsets
Deployment of carrier grade
Wi-Fi networks
Seamless connection to Hotspots
SIM-based authentication
3.23
3.75
3.79
3.35
3.02
3.51
4.02
3.37
Fig. 10: How important* will each of the following sources of competitive
differentiation be as competition between Wi-Fi operators evolves?
0
5
10
15
20
25
30
North America Western Europe Average
81-100 61-80 41-60 21-40 10-20 6-10 0-5
R
e
s
p
o
n
s
e

(
%
)
Fig. 11: According to your best estimates, approximately what percentage
of smartphone-originated traffic is currently offloaded via public and/or
private Wi-Fi networks?
Operators will continue investing
heavily in Wi-Fi in parallel with LTE
43.9%
LTE will not have any material impact
on Wi-Fi investment levels
33.7%
The arrival of LTE will reduce
investments into Wi-Fi
22.4%
Fig. 12: What impact do you expect the deployment of LTE to have on Wi-Fi
investments by operators?
23
Wi-Fi-to-cellular offloading, small
cell deployments, optimization and
compression, and cellular network
strategies are all key tools at the
operators disposal to manage
mobile network volumes. However,
according to the survey respondents,
over the next 12 months, data pricing
strategies and Wi-Fi offloading will
be the most significant factors in
managing mobile network volumes
(see fig. 13).
Industry challenges
The industry faces some key
challenges to increasing Wi-Fi
adoption and growing the amount
of traffic on Wi-Fi networks.
Alongside work on the technical
evolution and performance of Wi-Fi,
work on standards and a number
of related industry initiatives are
addressing aspects such as network
discovery, identification, connection,
authentication and security all of
which are critical for the successful
and seamless integration of Wi-Fi
with cellular networks. These are
some of the challenges the WBAs
Next Generation Hotspot Initiative is
working to overcome.
This work is primarily designed to
improve and simplify previously time-
consuming and for users often
confusing processes such as Hotspot
selection, manual user-authentication
and log-in, and roaming-partner-
network selection. It is being driven in
the standards domain by the IEEE and
industry bodies such as the WBA and
the Wi-Fi Alliance. For instance, the
WBA has published specifications on
802.1x roaming on its website.
According to the survey respondents,
the most significant barriers to
further adoption and usage of Wi-Fi
are authentication, access costs and
security (see fig. 14).
Wi-Fi roaming is seen as very
important by the respondents
and they believe that key barriers
to a wider implementation of
Wi-Fi roaming are seamless
authentication, lack of a common
roaming standard and 3G/Wi-Fi
interworking (see fig. 15).
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0
Rating average
LTE deployment
Optimization & compression
Data pricing strategy
Small cell deployments
(femtocells, picocells)
Wi-Fi offloading
3.48
3.15
3.74
3.27
3.72
Fig. 13: How important* do you think each of following strategies to manage
mobile network traffic volumes will be?
0
10
20
30
40
50
60
O
t
h
e
r

(
p
l
e
a
s
e

s
p
e
c
i
f
y
)
D
e
v
i
c
e

b
a
t
t
e
r
y

l
i
f
e

(
p
o
w
e
r

m
a
n
a
g
e
m
e
n
t
)
N
e
t
w
o
r
k

s
e
l
e
c
t
i
o
n
R
o
a
m
i
n
g
U
s
e
r

a
w
a
r
e
n
e
s
s

o
f

W
i
-
F
i
S
e
c
u
r
i
t
y
N
e
t
w
o
r
k

d
i
s
c
o
v
e
r
y
A
c
c
e
s
s

c
o
s
t
s
A
u
t
h
e
n
t
i
c
a
t
i
o
n
R
e
s
p
o
n
s
e
s

(
%
)

11.8
22.3
28.4 30.6
38.0
38.4 38.4
41.9
50.2
Fig. 14: What do you consider to be the top three barriers to wider adoption
and usage of Wi-Fi among end users?
0
10
20
30
40
50
60
70
80
O
t
h
e
r

(
p
l
e
a
s
e

s
p
e
c
i
f
y
)
L
a
c
k

o
f

d
e
v
i
c
e

s
t
a
n
d
a
r
d
s
C
o
s
t

o
f

r
o
a
m
i
n
g
I
n
c
o
n
s
i
s
t
e
n
t

u
s
e
r

e
x
p
e
r
i
e
n
c
e
3
G
/
W
i
-
F
i

i
n
t
e
r
w
o
r
k
i
n
g
A
v
a
i
l
a
b
i
l
i
t
y

o
f

c
o
m
m
o
n

r
o
a
m
i
n
g

s
t
a
n
d
a
r
d
S
e
a
m
l
e
s
s

a
u
t
h
e
n
t
i
c
a
t
i
o
n
5.8
22.1
44.2 44.7
57.5
61.5
64.2
R
e
s
p
o
n
s
e
s

(
%
)

Fig. 15: What do you consider to be the three most significant barriers to a
wider implementation of Wi-Fi roaming?
24
Wi-Fi roaming is an area in which
the WBA is actively working
to address those challenges
so that operators can realize
currently untapped Wi-Fi roaming
opportunities. The WBAs WRIX
specification, released in 2007, is
aimed at resolving these challenges,
in particular by removing the need
for multiple VPN connections with
different configuration, and data
settlement procedures (WRIX-f,
WRIX-d, WRIX-i).
Importantly for many cellular
operators, the 802.11u standard
includes support for SIM-based
authentication in the form of the
IETFs Extensible Authorization
Protocol for GSM (EAP-SIM) and
UMTS (EAP-AKA), enabling the
subscribers profile to be carried
over from the cellular network into
the Wi-Fi session and providing a
similar level of security to the GSM/
UMTS network.
Summary
Wi-Fi is the most important
wireless technology in the world
based on the volume of data
traffic it carries and by quite
some distance too because of
operator and vendor commitment,
and because it often offers users
the best means of accessing
the Internet while on the go.
Its fair to say that we have very
much entered the second wave
of Wi-Fi, one that is much more
ubiquitous than the first wave, one
thats much more essential for
people who use and rely on the
technology.
The work of the WBA, in
conjunction with the broader
operator and vendor communities,
will do much to lay the foundation
for Wi-Fis growth to accelerate
and proliferate in 2012 and beyond.
While key challenges remain to
ensure this growth, our survey has
shown that the Wi-Fi community is
very aware of what these are and
how it needs to work together to
meet them.
Links
www.wballiance.com
www.wballiance.com/our-work/facilitating-global-wi-fi-roaming.html
www.wballiance.com/our-work/work-areas-a-activities.html
www.wballiance.com/our-work/trials-a-ecosystem-engagement-initiatives.html
www.gsm.org
www.ieee.org
www.wi-fi.org
www.informatandm.com
Copyright 2011 Wireless Broadband Alliance Ltd (WBA). All rights reserved. While every effort is made to ensure the information contributed by WBA to this report is
accurate, the WBA does not accept liability for any errors or mistakes which may arise in relation to the material contributed by WBA.
Acknowledgment
Informa Telecoms & Media acknowledges with thanks the news items and contributions submitted by Wireless Broadband Alliance and their members through the intermediary
of the Wireless Broadband Alliance and all copyright material and trademarks used in this report are the property of their respective owners.

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