The Mobile Internet Report Key Themes*

Wi-Fi Case Study #3 –
Wireless-Only Companies Must Purchase Wi-Fi Access
Wireless companies need access to a strong Wi-Fi network, in our view.
In dense European cities, this can be achieved by access to a fixed network
provider that has opened its consumer Wi-Fi boxes (Iliad, BT).
In the US it is more likely going to be through owned or third party Wi-Fi
networks.
O2 UK is paying BT for access to its ~500K BTFon points of presence, plus
Openzone POPs in dense areas. This is key to transferring iPhone Internet
access traffic away from the macro network. BT recently took over the
Starbucks Wi-Fi concession in UK/Ireland from O2.
T-Mobile USA markets 10,000 hotspot locations in the US. These include
brand-name locations such as Starbucks (though run by AT&T), Barnes &
Noble, Hyatt Hotels and selected airports.
As use of Wi-Fi hand-off of Internet access increases, the cost to wireless-only
companies of providing a large number of hotspots is also likely to increase.
Source: Nick Delfas, Morgan Stanley Research.
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