Monday, January 27, 2014

Deutsche Telekom Finds Carrier Wi-Fi Does Not Reduce Mobile Network Demand

Deutsche Telekom, like other mobile service providers, hopes that carrier Wi-Fi will reduce demand on its mobile networks. The problem: it doesn't seem to work. 

In other words, the technique doesn't work: demand on the mobile network is not reduced, at least in tests conducted in Rotterdam and Hamburg, where carrier Wi-Fi, it was hoped, would reduce demand on the 3G and 4G networks.

In fact, the test showed very little change in mobile network demand, and in some cases an increase in demand on the mobile data network.

The reasons require some application of economics principles, namely that behavior (demand) changes when there is a change in supply. It is likely people behaved differently, consuming more data, when they knew Wi-Fi was available, but also did not reduce their mobile usage.  

Also, it appears applications and devices behaved differently when WiFi was available, conducting app updates, for example, when in the Wi-Fi zones, without affecting mobile network usage. 

Deutsche Telekom has partnered with Fon to increase its Wi-Fi coverage in Germany, hoping that will help Deutsche Telekom manage its data infrastructure costs. 

NTT Docomo has found other problems, such as excessive interference in Tokyo, for example, that appear to limit the usefulness of outdoor carrier Wi-Fi services. 

Other studies suggest small cells, especially indoor cells, will be necessary.

Some might argue the amount of offloaded data is not the issue. Customer experience advantages, or cost of delivering capacity might be the more important values, some would argue. Hetting Consulting argues the real advantage is simply capital investment in mobile networks. 


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