Carrier WiFi

Public WLANs: Confusion Reigns

Public wireless LAN may be the industry’s latest golden goose, but there are still some question marks hanging over its ability to lay eggs.

That's the conclusion to be drawn from Unstrung's March poll, aimed at gauging your opinion on how carriers should roll out public wireless LAN services (see Who Put the P in PWLAN?)

The majority of respondents (54 percent) remain unconvinced that a foolproof business model currently exists for the technology. Nine percent of you went far enough to claim that the likes of British Telecommunications plc (BT) (NYSE: BTY; London: BTA), France Telecom SA (NYSE: FTE), Swisscom AG (NYSE: SCM), and T-Mobile International AG (all currently rolling out hotspot networks) are just plain craazzzy – and that they will fail to recoup the costs involved. Fortunately for the carriers, however, some of you have kept the faith: Just over a third (37 percent) reckon users will be happy to part with their hard-won cash once they've started using the technology.

The mixed results come as something of a surprise following our previous poll, which asked readers to pick the three hottest investment prospects in the world of wireless networking technology (see What’s Hot in Wireless?). Only a month ago, 63 percent of you chose 802.11 wireless LAN technology as your top moneymaker. Oh, ye fickle readers.

And that's not even the bottom of our mixed bag of responses. In other news, 40 percent of you would rather carriers kept wireless LAN and cellular services separate, so as to enable hotspot usage on a pay-as-you-go basis, while opinion is split on the quality of current hotspot location coverage: A combined majority (51 percent) reckon carriers should be thinking outside the traditional airport/conference center/café space model and must start aiming both higher (parks and other public spaces) and more creatively (subway trains).

While you readers aren’t certain public wireless LAN will be the savior of carrier wireless data services, it’s clear that the only way anyone is going to make money out of it is to charge for usage, rather than give it away free as a perk when cellular services are purchased. 65 percent of respondents claim carriers would be nuts not to charge, given the cost of the hotspot site, equipment installation, and backhaul costs.

Finally, the good news for carriers is that the security issues currently plaguing the industry (see Hackers Crack London WLANs) could be less of an obstacle to commercial success than is commonly feared. Only 13 percent of you admitted to being nervous about logging onto hotspots, while a hard-nosed 44 percent argued that, while security remains a topic to be addressed, the current benefits of public wireless LAN outweigh any potential drawbacks. A carefree 43 percent said it didn’t worry you in the slightest, claiming the industry has been guilty of its traditional crime of overhype.

One sector in no current danger of being overhyped is the wireless network equipment business. Revenues slumped 18 percent last year, according to the latest Unstrung research, due to be published later this month, but signs of improvement are starting to emerge. Is it enough to indicate the beginnings of a recovery? Have your say on the market outlook by taking our latest poll, Wireless Equipment Vendors.

— Justin Springham, Senior Editor, Europe, Unstrung

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