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Wi-Fi vs. mobile: Free Ferrari or paid Pinto?

By Claus Hetting   /     May 12, 2015  /     Uncategorized  /  

Would you rather ride a supercar Ferrari for free or pay money for a chugging along in a Ford Pinto? It’s a ridiculous question, of course. Here’s the story.

Imagine this: You’re at home enjoying 280 mph (mbps) on your iPhone6. By the way, soon you’ll be racing at speeds like that in public spaces and of course at work. Then you move out of Wi-Fi coverage, and you’re back to being stuck in traffic running at 20 mph (mbps). You’re back in the Pinto.

Will consumers notice the Ferrari-Pinto gap? Of course they will. Will consumers want warp speeds everywhere they spend time? I think so. And they will have it. Sooner or later racetrack-quality Wi-Fi will be available in every place where people spend time. Most of it will be likely be free, freemium, or dirt-cheap.

Wi-Fi has been driving down the price/performance ratio of wireless access in leaps- lately with the first 802.11ac Wave II router (see it here). This high-performance piece of electronics serves up racetrack speeds for your mobile device and it’s (relatively) cheap.

The price/performance free-fall curve – otherwise known as Moore’s Law – is irreversible. It is estimated that the mobile industry will need 6 years to standardise 5G – whatever 5G turns out to be, and right now nobody knows. By 2021 Wi-Fi will deliver multi-gigabit speeds from the end of every capable broadband connection. It is estimated that there will be one public Wi-Fi access point for every 20 people on Earth by 2020.

Recently, 12 major global 4G carriers said they’re worried about the ‘disintermediation’ of cellular carriers. You might say what on Earth does that word even mean? Actually, it’s murky lingo for saying that they’re worried about becoming irrelevant and losing their trillion-dollar grip on mobile consumers. And they should be worried.

One of the signs is the MNO’s attempt to invade and potentially corrupt unlicensed (Wi-Fi) bands with 4G (LTE). Not only are LTE networks vastly more expensive to build, they also keep the Ford Pinto business model alive – in this case by throwing in LTE-U as a late update with a few modern parts. This is not going to fix the mobile industry’s problem: Too little, too late, and – not least – too expensive.

Google’s already on to this of course. Project Fi may not exactly be a free Ferrari – but it’s something like a cheap BMW. The beauty of Project Fi is that it relies on an ocean of tiny free Ferraris becoming available (Wi-Fi hotspots of course). The mobile part is to keep you ‘connected enough’ between hotspots. It’s just enough to keep you Snapchatting and Skyping.

Now that’s is the future of wireless :)

For the latest insights into the state of the Wi-Fi industry, the Wi-Fi Innovation Summit (WIS2015) is going to Johannesburg, South Africa on June 11th. Learn from the best, meet the leaders, and get inspired. Check out our program and register now!

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