Jupiter research predicts WiFi service providers will need to look beyond consumer revenues for positive ROI

December 3, 2003

2 Min Read

LONDON -- Jupiter Research today announced that according to a new report, Wi-Fi will evolve from today's stand-alone business model, dependent on consumer revenue as the primary source of ROI, to one of many applications that offers not only productivity savings to the enterprise, but also revenues both from consumers directly and from other enterprises.

Enterprises (i.e., hotels, airports, retail establishments, etc.) will install high-speed Internet access and use wireless networks to create ubiquity that will both enable employees to be more productive and to offer new services to consumers. The report outlines the level of consumer interest today as well as the economics of hotspot services and how Jupiter Research expects the market to evolve.

Based on interviews with dozens of companies and a recent Jupiter Research consumer survey, the new report "Public Hotspots: Who Will Make Money" finds that 70% of online consumers are aware of wireless, high-speed Internet access (Wi-Fi) in public places, but only 15% have used it, regardless of location, and only 6% have done so in a public place. However, only 1% has paid for the service, while 3% have paid indirectly through their usage at a hotel or airport.

According to Julie Ask, Research Director at Jupiter Research, "Given the relatively low usage by consumers today, service providers and venues will have to look beyond consumer revenues to realize a positive return on their infrastructure investments."

The report finds that in the near term, enterprises will leverage their Wi-Fi networks for internal productivity gains and new service offerings, while service providers that leverage their existing assets - whether for backhaul infrastructure or corporate contracts for remote connectivity services - to offer Wi-Fi as part of a bundled offering will make money on public hotspots.

Longer term, the consumer revenue opportunity is expected to improve as business travelers - that are among the 37% of the online consumer market who indicated that they might pay - offer a potentially lucrative market whether they pay directly through their own service provider or indirectly through their company's remote connectivity service.

Jupiter Research

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