Because it’s there: Keeping wifi usage on the radar

For all the column inches dedicated to the rapid evolution of the cellular network, the fact remains that the majority of smartphone-accessed data is consumed over wifi networks. Wifi specialist Devicescape has published research suggesting that between 60 and 70 per cent of all smartphone data is consumed in this way and, while this has clear benefits for mobile operators struggling to provision cellular network capacity, it also presents certain challenges.

Smartphone users on a wifi connection might be off the cellular network but they’re also off the radar. Mobile operators don’t know what their customers are doing with these sessions, and they may be missing out on crucial opportunities to engage with—and drive incremental revenues from—these users.

The introduction of LTE has not, as some might once have hoped, alleviated the capacity crunch on cellular networks. Improved performance is instead fuelling both consumption and demand, and operators are likely to become more, not less, reliant on wifi as the market evolves, says Devicescape CEO Dave Fraser.

With this in mind they would be foolish, he argues, to depend to such an extent on something they cannot control. “A mobile operator is a service provider and so it needs to have involvement in the customer experience,” he says, “even if that customer experience is happening off the network.” Indeed Devicescape is pushing for a change of perspective that will encourage operators to think about the “smartphone experience” rather than the “network experience”.

But “a certain amoung of reluctance” in operators’ approach to the wifi opportunity is at least understandable, he says. They have, after all, a cultural attachment to network deployment and ownership. And any operator that opts to build out its own wifi network will find it “very hard to move the needle” in terms of enhancing the service experience because of the sheer scale of deployment required, he says.

Another option is for operators to partner with existing wifi network providers. But neither partnership nor deployment, says Fraser, take advantage of the largest, densest deployment of wifi hotpsots already in existence—amenity wifi. From the smallest café to the largest sports stadium, there are hundreds of millions of access points already in place that are ripe, he says, for operator exploitation.

Devicescape has created a virtual, curated network of public and amenity wifi access points worldwide, using data on network performance from software installed on smartphones to measure and maintain quality of service. At last count there were 20 million hotspots in the network. Every connected device feeds back in real time, with access points taken out of the curated network when they fall below established standards of performance. Operators that partner with the firm can provide customers with access to this network, improving the customer experience with enhanced connectivity, says Fraser, and getting visibility into usage and behaviour in an environment where once there was none.

The firm has 12 operator partners currently shipping devices with its software embedded but operators are, on the whole, proving slow to embrace the wifi opportunity, Fraser says. “People in the [telecoms] industry tend to think very technically about the network, about whether it is cellular or wifi,” he says. “Too often they erect these divisions between the different network types while all the average consumer wants is to be connected and to have a great service experience. Why should they have to care about what network they’re on? Unfortunately users are exposed way too much to operators’ opinions.”

He continues: “Our vision was to take the wifi networks that had already been deployed and harness them in a way that would make it extremely palatable to an operator.”

Like a lot of startups Devicescape looked to tiers two and three of the operator pantheon for its early customer wins, among which there were challengers prepared to try something new. The firm’s first deal was with Metro PCS, which wanted to launch a smartphone experience despite not having a cellular network to support it. Metro was subsequently one of the first US operators to move to LTE, and was latterly absorbed by T-Mobile.

Further additions included Cricket Wireless (currently the subject of a takeover deal by AT&T), US Cellular and Cincinatti Bell but Fraser says it is now “extremely important that we engage with and finally win the tier ones as customers.” The acquisition of Metro PCS by T-Mobile and Cricket by AT&T could certainly help in this regard, but Fraser believes that it could take several years to bring one of the big US players on board. In the meantime the company is looking to expand into Europe, going after individual properties within the international tier one players’ footprints.

This decision might be explained in part by the density of wifi access points in some European markets. Devicescape recently identified London’s Oxford Street as the most connected street in the world, ahead of busy thoroughfares in New York City and Tokyo.

But the deployment of amenity wifi is on the increase everywhere, he says: “The sheer number of lcoations that are providing amenity wifi is a mega-trend.” Wifi is cheap and easy to install for smaller businesses and becoming a must have for larger ones, he says. And Devicescape is betting the future of its curated network on the expectation that premises owners will seek to upgrade their connections once they realise how attractive they are to customers.

Detractors have criticised Devicescape for selling something—wifi connectivity—that doesn’t belong to it. Fraser responds to this with the assertion that only one premises owner within its curated network has asked to be removed. It was a request with which the firm complied immediately, he says.

While the firm clearly believes that operators are the natural providers of a wide area wifi network like the one it has created—“Operators have huge brands and tremendous customer acquisition skills,” Fraser says—they are not the only type of organisation that might see the benefit.

Devicescape is already working with Intel for a service related to Ultrabook products and Fraser says it is, “conceivable that other device vendors may have a particular interest in using the amenity wifi network for their own purposes rather than in conjunction with operators.

Dave Fraser is presenting a Telecoms.com webinar: Carrier Wi-Fi—A view from the industry: Challenges, benefits and solutions on Wednesday February 12

He also suggests that content providers that are dependent on quality connections for the consumption of their content might see a benefit in becoming involved in the management of those connections.

But the firm remains focused on the operator community, not least because the insights into user behaviour that its platform offers, are deemed a natural fit with the existing efforts of mobile operators to turn such insights into new revenue streams.

“For the bigger brands this is not about something as simple as wifi offload,” Fraser says. “What the service provider should care about are the insights they can gain into subscriber behaviour across all types of networks. If operators are able to gain insights into off-net behaviour, whether it’s subscriber behaviour or network behaviour, then they will be able to offer much more meaningful products not only to their customers but also to other companies in the ecosystem,” he says.

Fraser is clear about his firm’s plans for expansion so success should be straightforward to gauge in 2014. If the AT&T Cricket acquisition goes through then Devicescape will have two deployments within large US operators. Whether AT&T and T-Mobile adopt the Devicescape service more widely will be one useful indicator and operator uptake in Europe another. “This is all about building a service delivery platform for operators,” says Fraser. “We think it will be compelling for everyone.”