Wednesday, 20 August 2008

Hotspot Access Revenues Not Keeping Pace with Usage Growth

The number of hotspots providing public wireless LAN access continues to grow globally and more people are using them, reports In-Stat. But access revenues do not appear to be keeping up with the growth in use, the high-tech market research firm says.

"Because of this trend, hotspot operators are turning to other methods to generate revenues," says Daryl Schoolar, In-Stat analyst. Operators have started bundling hotspot access with other services, such as fixed and mobile broadband. 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.

Recent research by In-Stat found the following:
• People are increasingly using hotspots for personal reasons.

• Survey respondents are showing an increased reluctance to pay for hotspot access. Nearly 50% of respondents said they would only use a free hotspot.

• Access revenues will start to decline due to increased competition and users' reluctance to pay.