16_WBA Industry Report 2011 _Global Developments in Public Wi-Fi 1.00

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www.wballiance.com

Global Developmentsin Public Wi-Fi

WBA Industry Report 2011


2/242 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 nextgeneration 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 driveinnovation, 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

3 Tai Seng Drive #04-00

Singapore 535216

www.wballiance.com

www.twitter.com/wballiance

ABOUT INFORMA TELECOMS & MEDIA

Informa Telecoms & Media is the leading provider of business intelligence and

strategic marketing solutions to global telecoms and media markets.

Driven by constant first-hand contact with the industry, our 60 analysts

and researchers produce a range of intelligence services including news

and analytical products, in-depth market reports and datasets focused ontechnology, strategy and content.

Informa Telecoms & Media Head Office

Mortimer House, 37-41 Mortimer Street

London W1T 3JH, UK

www.informatandm.com

www.twitter.com/informatm

CONTENTS

3 Executive Summary

4 An overview of todays Wi-Fiecosystem

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 membercompanies

19 Wi-Fi ecosystem survey analysis

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3/243 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 servicesplatform. 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. Laptopsnow 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 trialledaround 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 increasinglybundling public Wi-Fi access as

part of broadband or cellular

packages.

Executive Summary



Wi-Fi has firmly established

itself as the most heavily-usedwireless 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 hasensured 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 profitablymanage 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, thesecond 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 fromexecutives 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 andtablets 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 widespreadexpectation 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 andnetwork 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 orBoingo.

An overview of todays Wi-Fi ecosystem

We urge all handset manufacturers toprovide [an] embedded Wi-Fi connectionand 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 devicesSmartphonesFeature phones

201020092008200720060

5

10

15

20

25

30

35

40

Mobiledevicesas%o

fall

devices

Productlaunches

Source: Wi-Fi Alliance

Fig. 1: Number of Wi-Fi certified product launches, 2006-2010



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 andcontinue 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,theUKsfixedincumbent,

is using Wi-Fi as a means to

differentiate and add value to itsfixed-broadband offerings

TelefonicaisusingWi-Fito

build a location-based services

strategy

BSkyBhasacquiredTheCloud

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 widespreadinterest 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 alltypes of markets have declared their

intention to move into Wi-Fi. Recent

announcements of new rollouts spanmarkets 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 thetraditional 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-Fimarket is being matched equally by

continued penetration of Wi-Fi into

private households and businesses.

0

2

4

6

810

12

14

16

18

Africa/Middle EastEuropeAsia PacificLatin AmericaNorth America

2014201320122011201020092008

Terabytesperan

num(

mil.)

Source: Informa Telecoms & Media

Fig. 2: Global mobile data traffic, 2008-2014

0

1

2

3

4

5

6

2015201420132012201120102009

5.8

4.5

3.3

2.1

1.30.8

0.5PublicHotspots(mil.)


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




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 authenticationand 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 hasbeen 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 usageoutside 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 andtablets 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 ofconnectivity. 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 inkey 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. TheWi-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-FiAlliance 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 dominateas the most important wireless

technology in terms of data traffic

transmitted.

PrivateHot

spots(mil.)

0

100

200

300

400

500

600

700

2015201420132012201120102009

646571

492

416

345

282

233


Fig. 5: Global number of private Hotspots, 2009-2015



Q: What is the role of the WirelessBroadband Alliance (WBA) in the

telecom industry in general and in

the Wi-Fi industry in particular?

CB: The WBA is focused ondriving the next generation of

Wi-Fi services for the benefit

of consumers. Were removingthe 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 usersconnectivity needs are evolving and

what role do you think Wi-Fi has

to play in changing everyday user

behavior?

CB: With smartphone use setto 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 onquick-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 fromthe 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 thelocation or delivery mechanism.

The WBA has a key role to play

making this happen.

Q: How do you think these changeshave shaped the industrys

perception of the importance of

Wi-Fi?

CB: I think theres a growingawareness that Wi-Fi is

fundamental to fixed, wirelessand 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 havebeen the WBAs most notable

achievements during the past

year?

CB: At the top of our agendais 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 andsecurely 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 userexperience. 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 thevalue 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


8/24



A unique industry forum

strategically focused on publicWi-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 ofNGH is to facilitate a cellular-

like seamless, secure and easy

to use Wi-Fi experience and

interoperability across operators.

NGH will offer an improved userexperience through

Automatedselectionofapproved

Hotspots

Reuseofmobilelogincredentials

Protectionagainstlossofcritical

user data

Protectionagainstfraud.

Growing industry interest in

Wi-Fi 24 new members join the

WBA in 2011With 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 acrossAmericas, Europe & Asia Pacific as

well as technology providers and

partners.

WBAs Next Generation

Hotspot (NGH) program gainsmomentum

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 exercisekey 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 developcomprehensive 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



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 goalto 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 enablerscreated by it, the WBA now aims to

focus on the following:

Enableanindustryecosystemto

promote the potential of Wi-Fi

as a complimentary technology/

service to meet customers

& public operators wireless

broadband needs

Tacklethebarriersandfurther

the adoption of Wi-Fi service

through (a) ease of use, (b)

interoperability and (c) security.

Continuetodrivethe

development and deployment

of NGH across the ecosystem

and focus on ensuringinteroperability though a

compliancy programs for

operators globally.

LeverageWBAsexisting

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 allianceto 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 offloadand 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.



Key points

Boingoowns,managesand

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.

Boingohassuccessfullypursued

a hybrid business model that

sees it sell wholesale and retailaccess to its Wi-Fi network in a

number of ways.

Theoperatorisevolvingits

business model by teaming up

with consumer-product brands

so they can deliver branded

messages on the Boingo Hotspot

landing page.

Boingoseesastandards-based

approach to Wi-Fi-network

identification, authentication andquality 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 operatorbegan 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 fundedits 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, themajority 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 ratesstart 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, Boingosells 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 cellularnetworks, 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



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 ofits 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. Totalrevenue 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 sincesmartphone 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% growthin 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 hasalso 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 willrequire 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-Fiaccess. 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-Ficonstitutesanimportant

part of China Mobiles network-traffic-management strategy,

because of strains on network

capacity.

ChinaMobileusesWi-Fito

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.

Twoprohibitingfactorsarethelimited number of Hotspots and

occasional network-connection

problems. Take-up is also

limited by the relative complexity

of accessing Wi-Fi using

handsets. Theoperator,whichhasabout

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 smartphonepenetration 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 hasabout 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 hassome revenue-sharing deals, for

example with some Universities

and cafe chains.



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: Offloaddatafromitsmobile

network and deliver higher data

throughputs to subscribers,

thereby enhancing the user

experience, which the operator

hopes will lead to reduced churn.

Augmentitsfixedbroadband

network and mitigate the impact

of its competitors bundling offers.

Strengthenits3Gnetworkand

be more competitive in mobilebroadband.

Maintainitssuperiornetwork

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 fromboth 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 amajor 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 todramatically 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 loadedonto 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 thoughit does not have a strong 3G network

to compete with Chinas other two

operators.

Revenue(CNYmil.)

0

2

4

6

8

10

12

14

64.2%

1H101H09

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-Firates in Guangzhou



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

OrangeFrancepursuesaB2B

and B2B2C Wi-Fi strategy, the

foundation of which is its 2,100

premium (wholly run by the

operator) Hotspot locations.

OrangeseesWi-Fiverymuchasa complement to its 3G network,

not as a way to substitute to

rolling out 3G, nor in the future,

its LTE network.

BecauseOrangesmobile

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. OrangeseesmostoftheWi-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 positioningBoth 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 rollingout 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 benefitsof 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 andcapacity 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 (seefig.).

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 forits 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.



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 firstconnection

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 f irst connection

Source: Orange

Operator case study: Orange France

Operator case study: True

Key points

TrueisThailandsleading

Wi-Fi provider and has a robust

strategy to consolidate its lead in

the market.

SeamlesshandoverandWi-Fi

authentication have been keyfactors to enabling True to make

a success of Wi-Fi, judged by the

number of people who use the

service.

Truehasseenclearrevenue

benefits from its aggressive Wi-Fi

strategy as well as cost savings

derived from shifting network

traffic from cellular to Wi-Fi.

Theoperatorhasaggressive

rollout targets and can beexpected 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 mobileoperator 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 keydifferentiator. 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 accessor 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 alsofor 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 overWi-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.


16/2416

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 subscribersexcept 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 tocomplement 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 monthto 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.

ResultsTrue 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-Fialso 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 outnationwide. 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 acrucial 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 nostandards 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 nationalWi-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 driveWi-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)

2011 Informa UK Ltd. All rights reserved. www.informatandm.com



The 68 member companies that make

up the Wireless Broadband Alliancereflect 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 reflectthe 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 diversityof 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 operatorsMobile operators

21

13

2014

No.

Source: WBA

WBA member companies by company type


18/24

Wi-Fi operators/aggregators

Vendors & other industry players

Integrated & fixed broadband operators

Mobile operators

Member companies

18 2011 Informa UK Ltd. All rights reserved. www.informatandm.com



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 under30% 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 respondentsto 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 mobileoperators 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. KDDIis 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 increasingdramatically. 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 0.89MBper 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 thefootprint 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?



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 ofrespondents (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 domainof 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 thecountry 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 customersadditional 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 12months, 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 termsof 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 accessdeveloped in your market?



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 thatoperators 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 anyadditional 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 notionallyfree 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, suchas 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 forjust 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 morethan 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 aWi-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 moderately46.9%

Increase heavily

16.8%


Fig. 8: In the next 12 months, what do you expect to happen to thepercentage of free public Hotspots as a proportion of total public Hotspotsin your domestic market?

0

10

20

30

40

50

60

Other devicesTabletsLaptopsSmartphones

AsiaPa

cific

Africa

MiddleEa

st

Easte

rrnEurop

e

Wester

nEurop

e

Latin

Ame

rica

North

Ame

rica

Shareofconnections(%)


Fig. 9: Approximately what percentage of connections to your Wi-Fi networkis generated by the following devices, by region?



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 broadbandtariffs 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 beyondthose 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, whileother 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 operatorswill adopt complementary

solutions to Wi-Fi and cellular

rollouts (see fig. 12).

0 1 2 3 4

Rating average

Wide selection of low-costWi-Fi-enabled devices

Enhanced security andprivacy measures

Availability of common standards

Ease of roaming between operators

Availability of cheaper Wi-Fienabled 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 competitivedifferentiation be as competition between Wi-Fi operators evolves?

0

5

10

15

20

25

30

North AmericaWestern EuropeAverage

81-10061-8041-6021-4010-206-100-5

Response(%)


Fig. 11: According to your best estimates, approximately what percentageof smartphone-originated traffic is currently offloaded via public and/orprivate 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-Fiinvestments by operators?



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 amountof 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 aresome 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 inthe 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 managemobile network traffic volumes will be?

0

10

20

30

40

50

60

Othe

r(ple

asesp

ecify)

Devic

ebatter

ylife

(powe

rman

ageme

nt)

Netw

orksele

ction

Roa

ming

User

aware

ness

ofWi-F

i

Security

Netw

orkdisc

overy

Access

costs

Authentic

ation

Responses(%)

11.8

22.3

28.430.6

38.038.438.441.9

50.2


Fig. 14: What do you consider to be the top three barriers to wider adoptionand usage of Wi-Fi among end users?

0

10

20

30

40

50

60

70

80

Othe

r(ple

ases

pecif

y)

Lack

ofdevic

estan

dards

Cost

ofroa

ming

Incon

sisten

tuse

rexp

erien

ce

3G/Wi-F

iinter

worki

ng

Availabilit

yofc

ommo

n

roam

ingstan

dard

Seam

lessa

uthentic

ation

5.8

22.1

44.244.7

57.561.5

64.2

Response

s(%)


Fig. 15: What do you consider to be the three most significant barriers to awider implementation of Wi-Fi roaming?


24/24

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 WRIXspecification, 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-basedauthentication 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 accessingthe 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 andhow 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.

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