Installed base of Wi-Fi devices grew to nearly 7 Billion in 2016, driven largely by increasing smartphone adoption. Higher throughput, interoperable and backward compatible industry standards (from IEEE and backed by the Wi-Fi Alliance), other performance improvements as well as technical capabilities for operators including Passpoint and VoWi-Fi, have helped drive this huge success. Homespots and low cost hotspot deployment have increased the total number Wi-Fi areas (hotspots + homespots) from less than 30 million in 2013 to 85 million in 2016, with expectations of 113 million for 2018.
Wi-Fi calling/VoWi-Fi is very attractive for mobile only (and mobile mostly) operators, providing multiple benefits in addition to boosting indoor coverage, including countering OTT providers, leveraging IMS and VoLTE investments and supporting 2G and 3G spectrum liberation. VoWi-Fi is also fundamental to Wi-Fi first MVNOs and is an attractive option for fixed-mobile operators.
Wi-Fi network monetization takes many forms and though the opportunity is not significant, it provides for incremental revenues from across all customer groups (from consumer to wholesale).
Wi-Fi enables the most progressive operators, notably the three South Korean carriers, to provide the fastest speeds. By aggregating Wi-Fi with LTE (with MCP TP) downlink speeds of ~1Gbps are possible. While AIS from Thailand has launched with this non-standard technology, diverse operators such as Chunghwa from Taiwan and M1 from Singapore are among the first to invest into LWA, the standardized technology for LTE-Wi-Fi aggregation.
The report "Carrier Wi-Fi: Monetization Models and the Future of Wi-Fi in the Context of 5G", provides an analysis of the business models available to different operators to benefit from and monetize Wi-Fi networks. It includes data and insights on the Wi-Fi technology status and trends with respect to the growth in installed base of Wi-Fi hotspots, homespots and devices and traffic worldwide. The report outlines the future evolution of the technology as mobile networks migrate to 5G. Built on real-world examples, the report examines the five key business models for Wi-Fi, their fit by operator type and the critical considerations and strategic options for operators and vendors.
Specifically, this report:
- Provides data and insights on the Wi-Fi technology and outlines the future of the technology.
- Provides an assessment of business models built around Wi-Fi worldwide, and examines these business models from the perspective of their fit for different operator types taking into account operator portfolio breadth.
Key findings of the report include:
- Standardization, performance improvements and operator support continue to drive Wi-Fi adoption. Homespots and low cost hotspot deployment have increased the total number Wi-Fi areas (hotspots + homespots) from less than 30 million in 2013 to 85 million in 2016, with expectations of 113 million for 2018.
- Wi-Fi supports multiple business models for operators. There are five broad Wi-Fi business models available to network operators which can and should be used in combination (they are not mutually exclusive), though not all are relevant to all operator types. Integrated (fixed-mobile) and fixed-MVNO operators can benefit from all the different business models available while mobile first operators are more limited.
- The investment and operational costs of Wi-Fi must be kept low because the revenue upside is limited. There are multiple partnership opportunities which can help to keep costs down including joint ventures, roaming, wholesale, OTT providers, Wi-Fi specialists, venue owners, advertisers, payment providers etc.
- Wi-Fi network revenue upside must be maximized and thus sold across the organization from the consumer and business facing departments to advertising/media and wholesale divisions.
- Wi-Fi helps networks evolve by accelerating migration to 4G, freeing up spectrum for refarming and can form part of future heterogeneous networks and 5G. Wi-Fi or not, unlicensed spectrum will form part of future LTE and 5G networks.
- The report provides a comprehensive examination of operator business models in the global market to help executives fully understand market dynamics, determine what works and what doesn’t, formulate effective product development plans and optimize resource allocation and return on investments.
- Each business model is analyzed to highlight notable approaches as well as how different types of operators, whether fixed only, fixed-mobile or mobile only are leveraging the technology to suit their particular context.
- The report highlights innovative and progressive approaches from operators around the world, including both developed and developing regions.
- The report discusses concrete opportunities for Wi-Fi, providing a number of actionable recommendations for operators and vendors.
- The report provides multiple insights into Wi-Fi including the current status, standards development, traffic growth, factors impacting use, network cost minimization approaches and technology evolution.
Section 1: Market context
Definition of Wi-Fi
Status of Wi-Fi
Operators and Wi-Fi
Wi-Fi traffic growth
Wi-Fi vs cellular data
Wi-Fi network options
Evolution of Wi-Fi
Wi-Fi and 5G
Section 2: Business model analysis
Wi-Fi business models by operator type
Direct or sponsored monetization
Managed & wholesale monetization
Increasing spend with Wi-Fi
Mobile data offload
Future of Wi-Fi
Wi-Fi and 5G
Key Findings and Recommendations
Acronyms and definitions
About the authors
List of Exhibits
Exhibit 1: Wi-Fi standards
Exhibit 2: Installed base of Wi-Fi devices, 2014 and 2016
Exhibit 3: Global installed base of hotspots & homespots, 2013-2018
Exhibit 4: Global IP traffic by access technology, 2015-2020
Exhibit 5: Portion of time spent on Wi-Fi by smartphone users by country, August 2016
Exhibit 6: Boingo revenue breakout, Q3 2011 & Q3 2017
Exhibit 7: Hotspot & homespot network of operator case studies
Exhibit 8: Comcast Wi-Fi hotspot network 2014-2017
Exhibit 9: Alternative ways to use unlicensed spectrum
Exhibit 10: Wi-Fi and 5G
Exhibit 11: Business model fit by operator type
Exhibit 12: Operator options for Wi-Fi monetization
Exhibit 13: Alwayson alternative payments
Exhibit 14: Wi-Fi advertising
Exhibit 15: Virgin Media Wi-Fi for retail
Exhibit 16: Covering key areas
Exhibit 17: KPN fixed-mobile convergence benefits
Exhibit 18: Vodafone (ES) churn, Q1 2017
Exhibit 19: Proximus Smart Wi-Fi
Exhibit 20: EE & Mobifone VoWiFi
Exhibit 21: VoLTE & VoWiFi
Exhibit 22: Mobile data growth by access technology, 2016 and 2020
Exhibit 23: Alwayson airtime to Wi-Fi data conversion
Exhibit 24: LTE and unlicensed 5Ghz
Exhibit 25: WI-FI and 5G multi-connectivity network