Public WLAN Access in Western Europe and the USA: market analysis and forecasts

• What type of players are most active in the public WLAN market in Western Europe and the USA?
• How do pricing and revenue distribution arrangements need to evolve to ensure market growth?
• What are the main uncertainties that need to be overcome for the successful development of this market?
• How quickly will WLAN devices penetrate the business and consumer markets?
• What rate of growth can be expected in numbers of hotspots?
• What options do service providers have for increasing their effective WLAN service coverage?
• How many public WLAN users will there be?
• What will be the total revenue generated by public WLAN services in Western Europe and the USA?
• What strategies will ensure success in the public WLAN market?

• Mobile operators: understand how public WLAN will affect the cellular market, and its impact on key cellular customer segments.



• Fixed operators and MVNOs: evaluate how public WLAN services can provide a route for entry into the market for high-speed cellular data services.



• Analysts: learn how the market will evolve and identify those players that are likely to participate.



• Equipment vendors: quantify by country the scale of the equipment and implementation opportunity related to public WLAN networks. Determine key potential types of customer and the motivations that will encourage them to invest in this market.

0 Summary

1 Despite slow progress, the growth potential of WLAN is still substantial

2 Hotspot coverage is growing across Western Europe and the USA

2.1 There are now just over 4800 hotspots in Western Europe and the USA, and we expect this to grow to 57 000 by 2007

2.2 Investment by both major telecoms operators and independent players is increasing

2.3 Roaming is acknowledged as essential to increasing an operator’s footprint

3 Technical and regulatory barriers to growth are being addressed

3.1 Interoperability issues with other technologies are being resolved

3.2 The evolution of technology standards will aid the market in the long run

3.3 Security concerns can be addressed with effort from service providers and users

3.4 Regulation is favouring making spectrum available for public services

4 Service propositions and pricing must evolve to boost adoption

4.1 Service development must have the mass market in mind

4.2 Pricing mechanisms are still evolving

5 Several business models have emerged for WLAN

5.1 The distribution of revenue between key players depends on their relative negotiation strength

5.2 Mobile and fixed operators will have the ultimate advantage and independent players should partner with them

6 The public WLAN market could generate USD5.47 billion by 2007

6.1 WLAN devices are rapidly penetrating the market and will allow new value-added services to be offered

6.2 Hotspot deployment will move beyond the high-value locations that currently dominate

6.3 Pricing will evolve to support new service propositions

6.4 The consumer market will take off from 2004

6.5 Total revenue for public WLAN has the potential to reach USD5.47 billion by 2007 for Western Europe and the USA

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List of Figures and Tables

Figure 2.1: Hotspots in Western Europe, by country, February 2003

Figure 2.2: Total hotspots in Western Europe

Figure 2.3: Total hotspots in the USA

Table 2.1: Fixed and mobile operators in the WLAN market in Western Europe and the USA

Table 2.2: Independent operators in the WLAN market in Western Europe and the USA

Table 2.3: Selected companies that have withdrawn from the public WLAN market

Table 3.1: Regulatory status for the 2.4GHz and 5GHz bands in selected Western European countries and the USA

Table 4.1: Pricing mechanisms adopted by key service providers in Western Europe and the USA, February 2003

Table 4.2: Suitability of pricing options according to different location and user types

Figure 5.1: The public WLAN value chain

Figure 5.2: Expected revenue split across the value chain

Table 5.1: Attractiveness of the main types of location

Table 5.2: Revenue-sharing agreements with property owners selected by some service providers

Table 5.3: Dominant business models in Western Europe and the USA

Figure 6.1: WLAN-enabled access devices in Western Europe, by country

Figure 6.2: WLAN-enabled access devices in Western Europe, by type of device

Figure 6.3: WLAN-enabled access devices in the USA, by type of device

Figure 6.4: Public WLAN hotspots in Western Europe

Figure 6.5: Public WLAN hotspots in the USA

Table 6.1: WLAN penetration by type of location in Western Europe and the USA, 2007

Figure 6.6: WLAN hotspots in Western Europe, by location type

Figure 6.7: WLAN hotspots in the USA, by location type

Figure 6.8: Examples of pricing for 24-hour flat-rate access

Figure 6.9: Examples of pricing for monthly flat-rate access

Table 6.2: Average monthly ARPU levels for Western Europe and the USA

Table 6.3: Proportion of owners of WLAN-enabled devices who will take up public WLAN services when available, 2007

Figure 6.10: Public WLAN unique users in Western Europe, by country

Figure 6.11: Public WLAN unique users in Western Europe, by type of user

Figure 6.12: Potential public WLAN users in the USA, by type of user

Figure 6.13: Total public WLAN revenue in Western Europe, by country

Figure 6.14: Total public WLAN revenue in Western Europe, by type of user

Figure 6.15: Total public WLAN revenue in the USA, by type of user