No Wi-Fi Business Model? Hardly

The Wi-Fi hotspot market continues to experience strong growth in deployed venues and usage, driven largely by wireless and broadband providers embracing Wi-Fi both as a competitive differentiator and enhancement to core services, says In-Stat.

Despite the continued growth in hotspot deployments, the underlying business model remains uncertain, the firm say.

“We are a decade into the introduction of hotspot services and the market is still working out the revenue model,” says Amy Cravens, Market Analyst. That might not be the best way to put matters.

“Initially the market was based on pay-as-you-go revenues, with providers hoping it would evolve into ongoing subscriptions and corporate accounts," says Cravens. There is a business of that sort, but it arguably is much smaller than some initially had expected.

But that doesn't mean there is not a business model. The business model simply is largely indirect, rather than direct. For some hotspot operators, the revenue model is products sold. For service providers, the revenue model is subscriptions to fixed broadband services that offer metro Wi-Fi access as a feature. For others, such as some airline lounges, Wi-Fi is an amenity paid for through the annual membership fee.

Wi-Fi hotspots most certainly have a business model. It simply is not a direct model, in most cases.

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