Do Operators Want Wi-Fi
By Eric Lin, Wed Feb 25 00:00:00 GMT 2004

Following yesterday's announcement of PDA phones from Nokia and Motorola with built in Wi-Fi radios, the big question becomes whether carriers will offer customers a handset with an alternative built in.


News.com takes the con side of the debate. Their argument rests on most carriers' weakness in the Wi-Fi space. As far as infrastructure, not all the carriers have national Wi-Fi networks, or even a roaming / rebranding agreement with a Wi-Fi ISP. They also worry that carriers have no way to hand off data from one system to the other. A Deutsche Bank Securities analyst who is quoted worries about this as well and doubts the carriers are prepared to handle billing. News.com rounds out their list of concerns with another one we've heard before: what if built in Wi-Fi allows users to make VoIP calls from their home or office WLANs, bypassing the carrier altogether, putting them out of their own business.

Wi-Fi Networking News predictably takes the pro Wi-Fi stance, however they also acknowledge hesitance on the part of the carriers. A Gartner analyst points out that networks will eventually have to give in to combined handsets, but they will try to hold out until they have Wi-Fi infrastructure. The author himself makes the point that since these are being marketed as business tools, carriers will have to realize that many of the users will be more interested in using their own Wi-Fi in the office, and then cellular data or Wi-Fi hotspots when on the go.

Operators, especially in North America where mobile data is still slow to take off, want to do as much as possible to drive data use on their networks. If a handset is more data-centric because it offers a variety of connectivity options and a strong data-centric OS, it should drive data-usage of all types including high-revenue cellular data. But instead of thinking of long term data addiction these new devices could encourage, carriers might be too focused on the short term. Alan Reiter has learned that at least one carrier has requested that users be blocked from storing photos on their handset or a memory card, forcing them to use MMS in order to save or share pictures snapped on cameraphones. This kind of desperate attempt to drive cellular data is unlikely to yield long term profits or user satisfaction.

Despite the short-sighted attitude of some operators, I still believe there are pro-Wi-Fi carriers. During a previous career, I personally was asked by corporate sales reps and executives from a US operator how soon they would be able to get cellular / Wi-Fi converged handsets as far back as 18 months ago. They already had a demand both from within their company as well as from their customers. These users wanted one device they could use in their office, on the go, and at home. They wanted the flexibility of using the fattest pipe available at any given time. If anything, customers have gotten even more demanding about getting as much data as possible on one device since then. Carriers like T-Mobile have the most to gain from converged handsets since they own both types of networks, but other carriers with a strong business focus and an eye on data users are just as likely to offer these new handsets to please their corporate customers. Giving customers one device that they can use with maximum potential from anywhere makes for some very loyal users.