3G Data and For-Pay Wi-Fi Services Face Tough Sell

US Ariz. : Lack of perceived value by consumers for 3G bandwidth indicates continued downward pressure on cellular data pricing, and will also dampen prospects for for-pay Wi-Fi service providers and aggregators, reports In-Stat. Nevertheless, because consumer enthusiasm for free Wi-Fi is ample, Wi-Fi hotspot operators do have an opportunity to exploit the technology's low barriers to entry and its horizontal business model.

"Both cellular and Wi-Fi are currently serving mobile data users" says Allyn Hall ( inset ), In-Stat analyst. "However, so far, neither service has found the sweet spot, the perfect balance of speed, coverage, and price."

A recent report by In-Stat found the following:

- Amongst Wi-Fi users, more than 60% sometimes or always plan their travel with Wi-Fi availability as a consideration.
- 1Q04-1Q05 year-on-year Wi-Fi revenue and shipment growth was strong, but quarter-on-quarter growth figures show an overall slowdown.
- According to an In-Stat consumer survey, laptop/notebook computers are used for mobile data almost twice as often as cell phones.
- More than one-third of Wi-Fi users use only free Wi-Fi connections, and 18.9% use Wi-Fi only at home or at work. Nearly two-thirds (61.7%), however, also said they use commercial hotspots.

The report, "3G and Wi-Fi: In Search of the Sweet Spot" (#IN0502026MBD), covers the market for wireless data services. It features the results of a proprietary consumer survey covering their use of and preferences regarding 3G and Wi-Fi data services. It also includes data concerning consumers' willingness to pay for these services.

This Weeks 3G News By Photos
This Weeks 3G News