Prospects for public WLAN 'strong' in Europe, US

12 March 2003 -- Growth of the public wireless local area networking (P-WLAN) market is set to continue in both Europe and the USA, according to a new report published this week by Analysys.

Mar 12th, 2003

-- Revenue and specified "hotspots" to grow from USD33.4m and 4,800 in 2002 to USD5.5bn and 57,000 in 2007.

-- Growth slower than anticipated.

12 March 2003 -- Growth of the public wireless local area
networking (P-WLAN) market is set to continue in both Europe and the USA, according to a new report published this week by Analysys, (www.analysys.com).

This growth is being driven by business travellers' appetite for cheap and fast remote access to the Internet.

The report, Public WLAN Access in Western Europe and the USA: market analysis and forecasts, anticipates that revenue will grow from USD33.4m in 2002 (USD10.9m in Western Europe and USD22.5m in the USA) to USD5.5bn by 2007 (USD2.64bn in Western Europe and just under USD2.8 billion in the USA).

Hotspots, which are currently being installed in airports, hotels, conference facilities, cafés, restaurants and rail stations, are estimated to grow from 4800 in 2002 (1400 in Western Europe and 3400 in the USA) to 57,000 by 2007 (30,000 in Western Europe and 27,000 in the USA).

"Whilst take-up of public WLAN services has been slower than we anticipated, it still represents a significant opportunity for operators and other service providers," said Maja Kecman, main author of the report.

"In both Europe and the USA, telecoms operators have shown interest in the WLAN market as a complement to their existing networks, but have been cautious about investing in an uncertain market where there are still technological and regulatory issues to be resolved."

Market uncertainty is compounded by the fact that no single business model has yet emerged, say the authors. The report outlines five main business models, the most common of which involves the hotspot site owner and operator (or wireless Internet service provider (WISP)) acting as the main players in the P-WLAN value chain.

"We expect the dominant business models to evolve significantly in the next three or four years," said San Francisco-based report co-author, Monica Paolini.

"By 2007, the US market will be characterised by a non-integrated value chain, with retail service providers not having exclusive control of the network infrastructure. In Europe, we expect fixed and mobile operators to prevail as they are able to leverage their existing customer base and backhaul agreements more effectively."

Written by Maja Kecman with Monica Paolini and Ross Pow, Public WLAN Access in Western Europe and the USA: market analysis and forecasts evaluates the state of the P-WLAN markets in Western Europe and the USA, according to progress in the areas of network coverage and roaming, technology standards, regulation, pricing and service offerings, and business models.

The report also includes forecasts of the size and value of the market across Western Europe, specifically France, Germany, Sweden, and the UK, as well as that in the USA.

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