Who Cares About Wi-Fi Quality?
The timing couldn’t be worse, considering how Wi-Fi dependency continues to soar. Take AT&T Inc. (NYSE: T), whose customer base took all of 2008 to hit 20 million Wi-Fi connections. They took only six months in 2009 and five weeks in 2010 to match that.
The dependents also include companies that are quietly building countrywide databases of Wi-Fi signals – both public and private – for goals that almost certainly include being able to locate and deliver services to mobile users without the help and royalty expectations of wireless carriers.
As discussed in the new Heavy Reading Mobile Networks Insider report, “More Wi-Fi Means More QoS Challenges for Operators,” although 3G offload is a major reason why Wi-Fi spending and usage keep growing, there are plenty of other reasons why service providers of every stripe are expanding into 802.11.
For example, MSOs such as Cablevision Systems Corp. (NYSE: CVC) – whose New York-area Wi-Fi network was used more than 1 million times in its first seven months – love Wi-Fi because it’s a way to get into the wireless market without the steep cost of spectrum and cellular infrastructure.
In some cases, Wi-Fi is the only way for an operator to deliver value-added, market-differentiating services. For example, at AT&T Park in San Francisco, iPhone owners can connect to the stadium's Wi-Fi network to watch instant replays and other content from the Giants' Digital Dugout. That content is unavailable over 3G not because of bandwidth limitations, but rather because Wi-Fi is a local-area technology, and the Giants control all digital rights in their facility.
The common denominator for all of these business models and revenue opportunities is that they’re seriously at risk if users perceive Wi-Fi as slow and unreliable. Not surprisingly, interference is typically the top concern for wireless carriers that are considering adding Wi-Fi to their service portfolio. "For mobile operators' RAN engineering teams, the very first question is, 'What about interference?'" says Steven Glapa, senior director of field marketing at Ruckus Wireless Inc. .
The catch is that although interference is a problem, it’s often not the main reason for poor QoS. "Authentication not happening is the No. 1 problem we typically have to deal with," says Marcio Avillez, iPass Inc. (Nasdaq: IPAS) VP of supply management.
This isn’t a minor issue. For example, if that hot spot charges a fee, and the user doesn’t have an account with that operator/aggregator, then the problem becomes lost revenue because the user will not purchase a day pass for service. Another example is a business traveler who can’t connect to the employer-approved hot spot service and goes with whatever is available, possibly a rogue AP.
For operators and aggregators, the good news is that there’s no shortage of Wi-Fi infrastructure designed to work around interference and other QoS gremlins. Those QoS-enhancing features also don’t necessarily come at a steep price premium. For example, Ruckus's BeamFlex architecture puts a large number of smart antennas into an array that connects to a smaller number of radio chains via a digital switch. The company says this design is less expensive than if there were a 1:1 ratio between smart antennas and radio chains.
Hotels are another big market for next-gen gear, especially those that cater to business travelers or charge a fee for Wi-Fi. In fact, the J.D. Power and Associates 2010 North America Hotel Guest Satisfaction Index Study found that Wi-Fi is among the top five "must-have" amenities.
"It's not unusual for us to be called into a hotel that's still operating an 802.11b network from over a decade ago, and they're dealing with 20, 30, 40 percent reimbursements to users who don't like their Wi-Fi," one Wi-Fi vendor says. Upgrading the network is cheaper than reimbursements – or telling guests to blame global warming.
— Tim Kridel, Contributing Analyst, Heavy Reading Mobile Networks Insider
This report, "More Wi-Fi Means More QoS Challenges for Operators," is available as part of an annual single-user subscription (six issues) to Heavy Reading Mobile Networks Insider, priced at $1,595. Individual reports are available for $900. To subscribe, please visit: www.heavyreading.com/mobile-networks.