in Commentary

In the end it’s about economics: Wifi vs. 3G et al

Although I’m surely in the camp of folks who’d love unlimited high-speed Mobile data (3G/4G/LTE/…) for the rest of my life I recognize that isn’t a viable business model.  Although Wifi service is also becoming metered the offered capacities and performance at a given cost are superior. It simply costs less to provide a specific level of service using this type of technology than using Mobile spectrums. Not only is the up front cost lower but the ongoing costs of keeping up with new technology is lower as well (i.e. upgrade costs). Time to market is another issue as AT&T has publicly stated multiple times one of the reasons they can’t keep up with demand is the inability to gain rights to add new cell sites or upgrade existing ones. We should ultimately expect a Wifi descendant to be our primary “un-wired” technology with Mobile spectrum providing service when we are “in the gap” between Wifi connections.

Wifi investment would be climbing rapidly now except for one thing – much of the public Wifi infrastructure is owned by, yes you guessed it, companies like AT&T who are presently milking Mobile users for as much money as  they can. It’s the Mobile data users who are propping up their revenue stream as legacy technologies erode. They don’t have much incentive to wean users from expensive Mobile data plans hence they currently only favor Wifi in places like Times Square and Super Bowl venues where Mobile spectrum is utterly unable to deal with the demand.

But as I stated in the opening, the relative infrastructure costs will ultimately cause them to switch horses.

Facing data caps, consumers keep turning to Wi-Fi — Broadband News and Analysis.

Write a Comment

Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

To respond on your own website, enter the URL of your response which should contain a link to this post's permalink URL. Your response will then appear (possibly after moderation) on this page. Want to update or remove your response? Update or delete your post and re-enter your post's URL again. (Learn More)