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SA Service Providers Need to Embrace Wifi

Published by on Jul 6th, 2012, No Comments

A recent Cisco Internet Business Solutions Group (IBSG) survey has found that increased global demand for mobile devices and network connectivity sees Wi-Fi and traditional mobile networks playing critical roles to meet the needs of consumers. This means that business and hardware makers should embrace Wi-Fi connectivity as a standard going forward.

The Cisco research highlighted that the majority of mobile devices have Wi-Fi Internet access capabilities. In fact, with the exception of smartphones, Wi-Fi is now the predominant access technology for mobile devices. There has also been an increase in ‘nomadic’ devices like laptops, tablets, and eReaders that almost exclusively connect to the Internet through Wi-Fi.

Research Key Highlights:

  • Entertaining from home – Mobile devices are now increasingly used for entertainment. Almost half of mobile users are consuming all forms of video, music, books, and games on their devices on a regular basis. This trend is expected to increase as devices become more powerful and networks become faster. Interestingly, mobile access no longer exclusively means using devices while on the road. According to the IBSG survey, consumers use their mobile devices for more than 2.5 hours at home on a typical day. People are expecting to increase their home use of mobile devices even more. This shift in where people use their mobile devices has seen an increase in the connection through Wi-Fi. Even the majority of smartphone users are supplementing their mobile connectivity with Wi-Fi. With the exception of coverage, people prefer Wi-Fi over mobile to connect their devices. While Wi-Fi is not able to compete with the ubiquity of cellular network coverage, respondents consider Wi-Fi easier to use and more reliable than mobile.
  • Free Wi-Fi access needs to grow – According to the survey a third of mobile users are taking advantage of public Wi-Fi hotspots on a weekly basis. The most popular locations are public outdoors, coffee shops, restaurants, and retail stores. With publicly accessible Wi-Fi evolving so quickly, people are expecting free Wi-Fi access. The rapidly evolving public Wi-Fi business has significantly changed consumers’ expectations. As a result, today very few the users surveyed are actually paying for public Wi-Fi. This is still especially a problem in SA which has not yet embraced “no questions asked” free wifi in public places.
  • A growing preference for Wi-Fi to mobile for connecting mobile devices – If given a choice between access networks, the survey highlighted that mobile users choose Wi-Fi over mobile across all network attributes, with the obvious exception of coverage. Also worth noting is that across most attributes, one-quarter of consumers see no difference between the two networks. While Wi-Fi cannot compete with the now nearly ubiquitous coverage of cellular networks, it is remarkable that consumers consider Wi-Fi easier to use and more reliable than mobile. And, despite the technical superiority of cellular mobility in the area of security, people clearly do not make this distinction. As is often the case with technology, there seems to be a huge gap between the technical reality and user perception across the key distinguishing attributes of the two access networks.
  • The “New Mobile” = Wi-Fi + Mobile – The results of the Cisco IBSG survey seem to indicate that the market is on the verge of a “New Mobile” paradigm – one in which Wi-Fi and mobile networks are seamlessly integrated and indistinguishable in the mobile users’ mind. Almost 60 percent of consumers surveyed were “somewhat” or “very” interested in a proposed offer that provides unlimited data across combined access networks for a flat monthly fee. The biggest perceived benefits were lower overall costs and unlimited data, signalling the end of uncertainty about overage charges. However, more than one-quarter of people liked the location flexibility, reliability, and seamless transfer between networks that this proposition offered.

 

Key Considerations, Implications and Potential Strategies for Service Providers to Capture Wi-Fi Opportunities in South Africa:

  • Offering free public Wi-Fi access with a home broadband subscription will become an important factor in how service providers in South Africa can capture Wi-Fi business opportunities to retain existing customers and attract new ones. In South Africa, hotspot visitors still usually have to pay to surf, and while some hotspots offer free access, the service is still often erratic because they have to find ways to manage the high bandwidth cost.
  • Pressing need to incorporate Wi-Fi as an integral part of portfolio. As the history demonstrates, South Africa will follow the Wi-Fi usage trend in the US subsequently, in order to compete effectively South African service providers will need to incorporate Wi-Fi as an integral part of their portfolio utilising pricing, marketing, and new technological solutions to create compelling and integrated offers and solutions of value to mobile users.
  • Targeting Wi-Fi use in the home by creating solutions and incentives Service Providers in South Africa can encourage users to offload mobile traffic at home, while retaining the ability to provide a unique and differentiated customer experience.
  • Deliver on the New Mobile. Align network architectures and deploy appropriate technologies to deliver a seamless, integrated mobile Wi-Fi user experience. As demand for mobile devices and network connectivity continues to grow in South Africa, both Wi-Fi and traditional mobile networks will be critical to meeting the needs of mobility-enabled consumers.

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