WiFi revenues not keeping pace with user growth

27 Aug 2008

The number of public WiFi hotspots continues to rise globally but revenues do not match growth in usage, according to In-Stat.

Because of this trend, hotspot operators are turning to other methods to generate revenues," said In-Stat analyst Daryl Schoolar.

"Operators have started bundling hotspot access with other services, such as fixed and mobile broadband," Schoolar noted.

"This way, consumers can access hotspots without paying a separate fee, and operators can generate some access revenue by bundling the cost of the service into a bigger service package that consumers are willing to purchase," he added.

According to In-Stat's consumer survey, people are increasingly using hotspots for personal reasons but survey respondents are showing an increased reluctance to pay for hotspot access.

Nearly half of the respondents surveyed said they would only use a free hotspot. Access revenues, therefore, will start to decline due to increased competition and users' reluctance to pay, In-Stat said.

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