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Carriers air their wireless game plans

Carriers air their wireless game plans

A few years ago, it seemed telcos like Bell Canada and Telus Corp. faced a significant threat in Wi-Fi, a technology that provided mobile data connections that were fast enough to compete with the carriers' zippiest cellular data offerings. But today carriers see Wi-Fi as less of a threat, and more of a complementary product to their existing cellular portfolios.

"Everybody knew Wi-Fi as a strategic threat," said Allan Rosenhek, an independent consultant working for Telus Mobility. "We came to the conclusion that it's better to be a player."

How did the telcos manage to turn a former foe into a friend? What will carriers do with Wi-Fi now that they have embraced it? Those are the sorts of questions that came up during a panel discussion at Wi-Fi Planet, a technology conference held in Toronto from March 16 to 18.

Panel moderator Derek Kerton, principal of wireless consultancy the Kerton Group, said the carriers view Wi-Fi and cellular as different technologies for "different usage patterns." Although they're both wireless data services, Wi-Fi seems better suited to people who carry laptop computers, who want to mull over corporate documents, and chat with colleagues via instant messaging programs while online. Fast cellular data service is more for people who take quick glances at news headlines and e-mails while on the move.

Shawn Winter, senior associate director of wireless LAN solutions at Bell, said his firm started selling enterprise WLAN packages because corporate customers were investigating the technology and wanted Bell's help to deploy it.

Bell sees Wi-Fi as "a natural extension of wired data networks" as enterprises sought ways to stretch LAN connectivity beyond the reach of your average Ethernet cable.

As for public Wi-Fi, Bell has rolled out 32 wireless hotspots over the past few years, offering untethered Web access for free, all in the name of market research. Winter said the company wanted to know how people used Wi-Fi before putting a price tag on it.

Winter said some of Bell's hotspots now operate as pay-per-use Web stops. The price: C$6.95 (US$5.16) per hour. But Bell still isn't convinced that public Wi-Fi is a viable business on its own. "We couldn't find any really good data that this is a good business to get into."

Rosenhek said Telus is equally skeptical. "I think the jury's still out" as to whether public Wi-Fi is a moneymaker, he said, adding that Telus has a four-pronged marketing approach to wireless LANs that includes home networking, enterprise networks, hotspots and interoperability issues.

Even Sean O'Mahoney, head of Vancouver-based Wi-Fi network operator FatPort Corp., couldn't say public Wi-Fi would catapult his company into riches. But in the face of competition from 800-pound competitors like Bell and Telus, O'Mahoney seemed confident that FatPort would survive. He said the company has an advantage over the carriers because it's small, quick to move where the market dictates, and it has low overhead costs, what with 10 employees on the payroll.

Kerton said end users might be able to discern the market-share balance of Wi-Fi network operators in a particular area by looking at the prices that providers charge for wireless Web access. In Europe, he said, carriers run nearly 70 per cent of the Wi-Fi hotspots; users pay US$7.70 per hour of connection time in France. In North America, carriers control 25 per cent of the hotspots. Small, independent companies run the majority of public Web access points. The average connection price in the U.S. is US$3.75 per hour.

Kerton suggested greater competition among hotspot providers in North America accounts for the lower prices, however, he added that Canada bucks that trend. Here, he said, it seems Bell, Telus and other regional telcos control the market, yet prices remain low.

Rosenhek disagreed with Kerton's assessment of the Canadian Wi-Fi sector. "I wouldn't view Canada as being dominated by the telcos," he said, pointing to FatPort as the market leader in terms of the number of hotspots deployed.


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