The Quiet Expansion of Wi-Fi Networks

Wi-Fi

Wi-Fi (Photo credit: kristinmarshall)

I am sure I am like most business travelers and one of the first things I look for when I get to a new place is a WiFi connection for both my laptop and cellphone. Finding WiFi lets me get online with the computer and stops me from racking up data charges on my cell plan.

And for the longest time there has been very little public WiFi outside of Starbucks and hotels. But that is starting to change, at least in some places. There are several companies that have quietly been pursuing w WiFi deployments.

The biggest of these is the cable companies. It’s hard to get accurate counts of how many hot spots they have deployed. In 2012 a consortium of cable companies  – Comcast, Cox, Time Warner, Bright House and Optimum – banded together as the Cable WiFi consortium to deploy hotspots. Comcast claims that the industry has deployed over 300,000 hot spots. However, the Cable WiFi web site claims over 200,000. But whatever the number this is far larger than anybody else.

The Cable WiFi networks are offered to the customers of those companies as a mobile data extension of their service. Today these hotspots are centered around big cities – the northeastern corridor, San Francisco, Chicago, Los Angeles, Tampa, Austin and others.

The next biggest provider is AT&T which claims about 30,000 hot spots. AT&T claims over 705 million WiFi connections onto its WiFi network in the fourth quarter of 2012. However, Google has announced that it is getting in the game and nobody knows how big they might get with this effort. But their first announcement is that they are taking over all of the hotspots at Starbucks Coffee (which is a lot of the AT&T hotspots).

The cable companies have been deploying the hotspots in several ways. In some communities they are installing them on utility poles. In other situations they are going into establishments similar to the Starbucks WiFi.

WiFi is becoming more and more important to people’s daily life, so this trend is going to be very popular. Cellphone plans are getting stingier and stingier with cellular data at the same time that cell phones and tablets have the ability to use more and more data. If that data is not offloaded onto WiFi networks then customers are facing some gigantic cellphone bills.

WiFi is never going to be a replacement of cellular. For example, the technology used and the spectrum used make it very difficult to do dynamic handoffs like happens with your cell phone. You can literally walk out of WiFi coverage on foot where cellular coverage will stick with you driving at speeds of 60 miles per hour.

But people are finding more and more uses for WiFi all of the time, and so the desire for public WiFi is probably going to explode. The cable companies report that every time they open a new hot spot that usage explodes soon after people figure out it is available. One area where they have seen the biggest use is at the Jersey shore where vacationers and visitors are relieved to find WiFi available.

Anybody building a fiber network ought to consider a wireless deployment. There are several ways to monetize the investment. The obvious revenue from WiFi is through daily, weekly and monthly usage fees. But if you are a triple play provider, a more subtle benefit of wireless is in making your customers stickier since you are giving them a mobile component of their data service. Another revenue stream is to sell prioritized WiFi access to the local municipality, electric company and others, with priority meaning that their employees get a prioritized access to the network, with first responders trumping everybody else. There are also smaller revenue streams such as earning commissions on the DNS traffic for people who purchase products over your WiFi network.

Customers – Make Them Part of Your ‘Club’

Today’s guest blogger is Mike Fox. He was one of the founders of CCG and we still work together on a number of projects. He is working today for Fox Management Advisors. Mike can be reached at (307) 431-6543.

MotorcyclesFor the past decade or so, the telecom industry has made great strides to become more competitive and focused on evolving customer needs and desires. However, we still have a long way to go. Our industry is changing and many products and services that were once ‘cash cows’ are now becoming almost ‘commodity’ services (although, in reality, treating any of your services like commodities is both dangerous and fundamentally wrong – I’ll address this in more detail in a future entry).

For example, long distance used to be a huge money-maker for telephone companies. Today, with unlimited (although, not ‘free’) calling throughout the US as part of most calling plans (landline or wireless), the world has changed. For those of us old enough to remember, it wasn’t that long ago that every long distance call was carefully scrutinized by our parents! Today, we don’t care who or where our kids call, just so long as they don’t go over the minutes in their plan.

So, how do we structure our sales culture to attract and keep more customers? What makes them sticky? Is it price? No, that’s commodity sales think. There will always be someone willing to offer lower prices. Sure, you have to be price competitive, but you should never sell on price.  Rather, sell on value and work to generate loyal customers. Many of the most loyal customer bases in the world are very willing to pay above market prices for the stuff they want. Think of Harley Davidson, Apple Computers and Starbucks. All provide products and services at prices above their competitors, but their customer base is extremely loyal and willing to pay such prices. And, it’s not just about quality. Sure their quality is good, but it’s more the subjective aspects that make these customers loyal – e.g., it’s fun to be part of the Harley club! Simply put, passionate, loyal and, ergo, sticky customers have an emotional attachment to the brand.

Do your customers feel passionate about your products and services? If not, that can be changed.  Find a way to make help your customers connect with your products and services in a personal way. While there are many ways to accomplish this, one important aspect is to nurture your personal relationships with your customers. Make them feel like they are part of your community and an important part of your community. When I lived back east, I became friends with a manager at an Acura car dealership. Over a period of 9 years, I bought several cars from him, even two used vehicles that were not Acuras. I love the Acura brand, but that isn’t what brought me back since there were several other Acura dealers in the area. Rather, every time I walked in that dealership (and I did many times when I wasn’t buying), they made me feel welcome and ‘part of the club’.  It was fun and whenever I was in the market for a new car, that’s who I went to first. Let’s figure out a way to make your customers think of you first when they think of ANYTHING related to telecommunications. Even if you don’t sell what they need at the time, encourage them to come in to the office and just talk. Who knows, it might result in a sale and it certainly will encourage them to come back the next time when you do have something they want.