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Voodoo's Hotspot DoubleUp

Light Reading
LR Mobile News Analysis
Light Reading
9/29/2003

Wireless behemoth Vodafone Group plc (NYSE: VOD) has confirmed rumors it will not deploy its own large-scale European rollout of public wireless LAN hotspots, but will instead partner with rival network offerings.

Today’s deal with BT Openzone -- allowing Vodafone customers to access wireless LAN hotspots through the Openzone network -- is the first step in Voodoo’s partnership strategy (see Lucent Wins at Verizon, KPN and BT Offers Wholesale WiFi).

“In general, the global strategy will be to partner with other hotspot providers,” says John Earl, senior group communications manager. “Occasionally we may look at operating our own sites, but that will be the exception to the rule. You can assume we will be doing further deals across the group on a similar basis.”

The move brings an end to speculation that the carrier is losing interest in the market (see Vodafone: Cooling Off on Hotspots?). A deal to equip Lufthansa’s airport lounges and a low-profile Irish rollout remain its only in-house network deployments to date (see VOD Ireland to Deploy WLAN).

“I am not surprised by this at all,” comments Ian Keene, vice president of telecommunications research at Gartner Inc.. “When you look at the skills needed to be a successful hotspot operator, a lot of that ability falls to the wireline carriers rather than the mobile operators. A lot of people assume that because this is wireless technology it must be a core area for mobile operators and they will own the business. Certainly not.”

Vodafone’s plan contrasts with aggressive pan-European strategies from the likes of Swisscom Eurospot and T-Mobile International AG (see Swisscom Buys a Bevy of PWLAN and T-Mobile Tarts Up WiFi Service).

“Vodafone probably thinks it is difficult to see where the profit is going to come from,” adds Keene. “It isn’t that important for it to own the hotspots itself.”

— Justin Springham, Senior Editor, Europe, Unstrung

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