Wi-Fi, mobile data, BYOD and tablets -- an interesting puzzle (Part 1)

Following up on our newsletter discussing the integral evolution of mobile data and Wi-Fi networks, several recent news items caught our attention including: AT&T's CEO-level comments on Wi-Fi offload, Cablevision's recent count of 35,000 public hotspots, and the Verizon Wireless "Share Everything" plans. These news items become an interesting part of the puzzle when combined with the trends for BYOD (bring your own device), along with the growing demand for tablet computers.

First, Randall Stephenson, chairman and CEO of AT&T, noted that even though AT&T offers its mobile users free access to over 30,000 AT&T hotspots, only about 1% of its mobile data traffic is offloaded onto the AT&T Wi-Fi network. Stephenson commented both in a Wall Street Journal op-ed, and again in a speech at the Sanford C. Bernstein 28th Annual Strategic Decisions Conference held in New York.

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Our observations: We were a bit surprised at the low take rate (1%) among AT&T mobility users to employ AT&T hotspots as a way to offload their mobile data plans. However, the 99% remainder shows how much AT&T mobility subscribers depend on mobile networks for data access. What we don't know is how much AT&T mobility users connect to "non-AT&T" Wi-Fi access points, but we know that multiple Wi-Fi networks supplement mobile data access.

Second, Cablevision already has over 35,000 hotspots that it owns and operates that its Optimum Online customers can use for free -- not counting the additional CableWiFi network access points its users will be able to share when outside the Cablevision footprint.

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Our observations: When "CableWiFi" participating partners (including Bright House, Cablevision, Comcast, Cox and Time Warner Cable) announced the CableWiFi alliance they noted that the initial 50,000 hotspots was a starting point, and with Cablevision already owning 35,000 of these it appears that the initial CableWiFi network's size estimates may be conservative. (Please see "Wi-Fi and Mobile Networks Grow, Evolve and Converge" for more details.) The growing number of Wi-Fi networks like those provided by Cablevision and CableWiFi can affect BYOD adoption how tablet are used to access the Internet.

Third, Verizon Wireless recently announced a new "Share Everything" plan that will allow customers to share voice, messaging, and data plans between multiple devices, including smartphones, feature phones, tablets, laptop dongles and mobile hotspots.

Our observations: These new plans give subscribers multiple options to use their monthly data allotment which is not tied to a particular device type or individual line. We believe this pricing model will have a further defining effect on BYOD and tablet adoption.

We'll continue this discussion and analysis in our next newsletter.

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