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23 Mar 2017

World without Wi-Fi looms as unlimited plans rise



In this edition of the Microtechs blog, we take a look at this article written by Olga Kharif.


The Wi-Fi icon – a dot with radio waves radiating outward – glows on nearly every internet-connected device, from the iPhone to thermostats to TVs. But it’s starting to fade from the limelight.


With every major US wireless carrier now offering unlimited data plans, consumers don’t need to log on to a Wi-Fi network to avoid costly overage charges anymore, which threatens to render Wi-Fi obsolete. And with new competitive technologies crowding in, the future looks even dimmer.


“You could see a big switch,” said Tim Farrar, founder of Telecom Media Finance Associates. “Your coffee shops may be less compelled to provide Wi-Fi for you now.”


In an all-data-you-can-eat world, consumers’ use of Wi-Fi at public places like stadiums and airports will drop to a third of all mobile data traffic from about half, Farrar estimates. This means businesses not upgrading public access Wi-Fi as often. Smartphone users might not even turn on their Wi-Fi capability, according to Barry Gilbert, an analyst at researcher Strategy Analytics.


“At Sprint Corp, where unlimited plans are the norm, customers aren’t waiting until they get to a Wi-Fi hot spot to watch the latest video. They are staying on cellular,” said Craig Moffett, an analyst at MoffettNathanson.


“Customers are rational. When pricing incentives favour Wi-Fi, customers use more Wi-Fi. When pricing incentives shift, so does behaviour.”


At home as well. Almost a third of people don’t use a home broadband internet connection because they have an unlimited data plan on their phones, according to a recent survey by ReportLinker.


Slow and uneven erosion


The erosion of Wi-Fi’s influence is likely to be slow and uneven. While unlimited data plans make the technology less necessary for phones, many home devices, from a MacBook to an Amazon Echo, still use Wi-Fi to connect to the internet. Wi-Fi also helps fill in gaps in some office buildings and homes that have spotty cellphone coverage.


Some wireless carriers also still rely on Wi-Fi networks to handle a large portion of the growing volume of internet traffic. Putting all of that Netflix-bingeing and Spotify-listening on cellular networks could strain capacity.


“Wi-Fi has consistently stayed ahead in terms of performance and its ability to move large amounts of data,” said Kevin Robinson, vice president of marketing for the Wi-Fi Alliance, a consortium of more than 700 companies.


“The market is going to decide which technology provides the best capabilities for the end user. To displace a technology like Wi-Fi is likely very optimistic.”


Unlimited plans aren’t the only threat. Wi-Fi has survived 20 years and spurred a roughly $US20 billion ($26 billion) industry of gear, service providers and chipmakers – mainly because its technology is open to innovation and it operates freely in the nation’s unlicensed airwaves. Wi-Fi now faces competition from other technologies that also run in those same frequencies.


Customers are rational. When pricing incentives favour Wi-Fi, customers use more Wi-Fi. When pricing incentives shift, so does behaviour.


New technologies


A new system called LTE in Unlicensed Spectrum – or LTE-U, which depends on a combination of new small-cell towers and home wireless routers – risks congesting the spectrum upon which Wi-Fi relies.


In decades past, the nation’s unlicensed airwaves were mostly known for their use by garage door openers, cordless phones, and the occasional baby monitor. Now they’re full of traffic from Wi-Fi networks that connect smartphones, laptops, set-top boxes, game consoles, and a whole host of smart devices to the internet. As LTE-U moves in, Wi-Fi may get drowned out.


“Places where operators have traditionally looked to Wi-Fi, they’ll leverage LTE-U,” said Kyung Mun, an analyst at researcher Mobile Experts.


Developed by cellular carriers and their vendors, LTE-U may act as a disincentive for companies experimenting with Wi-Fi calling, including Comcast, and those dabbling in fibre networks, like Alphabet’s Google.


But LTE-U also benefits users. Consumers don’t have to type in passwords and sign in to every network like they do for public Wi-Fi hot spots. They can seamlessly move between their carriers’ cellular network and LTE-U, and not really know the difference.


User benefits


LTE-U – and a related cellular advancement, LTE-LAA – will also require less equipment. A 180,000-square-foot building would need 24 new access points instead of about 80 Wi-Fi hot spots, according to Amit Jain, vice president of marketing and product management at hardware maker SpiderCloud Wireless, which plans to ship LTE-U and LTE-LAA equipment in the second quarter. However, the total cost of deployment would be similar to Wi-Fi, Jain said.


Annual shipments of LTE-U/LTE-LAA-capable access points will increase to about 1.1 million units globally by 2020, up from tens of thousands in 2016, according to Mobile Experts.


“You could see LTE in the house, in the enterprise, and the role of Wi-Fi morphing into something different: a legacy technology,” said independent wireless analyst Chetan Sharma.


Companies like Cisco Systems are already considering developing new gear that can accommodate both Wi-Fi and LTE-U technologies.


“It’s too early to say what will win out,” said Mike Iandolo, vice president and general manager at the mobile technology group at Cisco. “LTE has an advantage, but there’ll still be a place for Wi-Fi.” The company’s goal is to ensure its Wi-Fi portfolio evolves to meet the needs of customers, he said.


Another technology that risks making Wi-Fi outmoded is something called CBRS, short for Citizens Broadband Radio Service. The new system lets anyone share a huge swath of spectrum being used by the US Navy. In February, Nokia Oyj, Alphabet and Qualcomm tested LTE technology on the airwaves to broadcast a live high-definition video of cars racing on a track in Las Vegas.


More reliable than Wi-Fi, CBRS may ultimately be a better option for factories, airports and ports, according to Michael Peeters, head of innovation portfolio management at Nokia and president of CBRS Alliance, whose membership includes AT&T Inc., Charter Communications Inc. and Comcast. The first CBRS devices should be certified for use in mid-2017, he said.


5G spread


On top of all these threats to Wi-Fi is the coming spread of 5G, which promises to let consumers download a high-definition movie in less than a second. By using CBRS, wireless carriers can deploy 5G faster and easier, using the shared airwaves instead of trying to acquire spectrum licenses at auction or through deals.


In the nearer term, Wi-Fi is already starting to disappear from people’s daily routines.


“Before I would have to go and find a Wi-Fi hot spot, which was very inconvenient for me,” said Michael Kimbrough, an entrepreneur in Birmingham, Alabama, who last month signed up for an unlimited data plan from Verizon Wireless. “Now I don’t have to do that.”




The full article can be read here: http://www.smh.com.au/business/innovation/world-without-wifi-looms-as-unlimited-plans-rise-20170312-guwfua.html

Photo Credit: iStock


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