WLAN-Cellular Convergence - The Carrier Business Case for WLAN, UMA and VoWLAN

SUMMARY

Overview

In the last two years,Wi-Fi technology has matured.The cost of infrastructure and devices has fallen, its security has improved (at least technologically), and third-party solutions have been introduced to support on-network Wi-Fi roaming and seamless call handover between wireless local area network (WLAN) and cellular. Mobile operators took advantage of some of the new Wi-Fi capabilities, using the technology to support delivery of mobile data bundles, but they now face a new challenge:"Mobilizing" WLAN and enabling Voice over Internet Protocol (VoIP) on WLAN networks seems to be giving fixed carriers and mobile virtual network operators (MVNOs) a chance to get some of their voice business back from mobile carriers.This raises questions about the extent of danger to the traditional mobile operator business, as well as the nature of the WLAN technology in the future.

In this report,we ask - and provide answers to - the following questions:

• Where does WLAN stand today?
• Is the nomadic WLAN business model still viable?
• What are the benefits of WLAN-cellular bundling for mobile carriers?
• Can WLAN co-exist with 3G?
• Is the introduction of voice over WLAN (VoWLAN) inevitable?
• When will VoWLAN be ready?
• What will be the adoption and revenue of UMA and VoWLAN solutions?
• How can mobile carriers respond to the introduction of VoWLAN?

This report helps you to:

• Maximize revenues from enterprise and consumer WLANcellular convergent services
• Attack the segment better and faster than your competition
• Evaluate the impact of WLAN-Cellular convergence on revenues, subscriber acquisition and retention
• Understand drivers behind WLAN/VoWLAN and UMA adoption
• Identify best practices from carrier experience

This report includes:

• 22 Carrier and Market Case Studies
• WLAN, UMA, and VoWLAN subscriber and revenue forecasts
• WLAN market analysis through 2010
• Global and regional analysis of WLAN carriers and markets
• WLAN vs. 3G discussion
• VoWLAN analysis
• Convergent services strategy analysis

Target Audience

Mobile Operators:

Assess the impact of WLAN,VoWLAN and UMA on traffic and revenue Size the market and revenue opportunity for WLAN-cellular convergent services Benchmark existing WLAN-cellular bundled services Evaluate competitive threats from fixed-mobile convergence providers

Convergent/Fixed Operators/MSOs

• Assess VoWLAN and UMA on traffic and revenue
• Size the market and revenue opportunity for fixed-mobile convergent services
• Evaluate technology options for fixed-mobile convergence

Hot Spot Providers

• Assess impact of WLAN-cellular bundling on traffic and revenue
• Understand impact of the adoption of bundled services on hot spot growth

Vendors:

• Understand the drivers behind WLAN/VoWLAN and UMA adoption
• Identify key players and their strategies
• Evaluate the technologies best-suited for FMC services from operator viewpoint
• Understand the operator value proposition for WLAN,VoWLAN and UMA

TABLE OF CONTENTS

Executive Summary

Section 1: Charting the WLAN Boom, from Portable Broadband to Voice and Mobility

• 1.1 WLAN Boom:Why Telcos Can't Ignore WLAN
• 1.2 The Next Step for WLAN: Enabling Voice and Mobility
  • 1.2.1 Is VoWLAN Ready?
  • 1.2.2 New Wi-Fi Standards: Enabling Voice and Multimedia
  • 1.2.3 Wi-Fi Security: At Last in Place, But Still Doubted by Many
  • 1.2.4 Unlicensed Mobile Access

Section 2: Do Mobile Carriers Need WLAN?

• 2.1 What Carriers Want
• 2.2 What WLAN Offers: From Broadband Portability to Fixed-Mobile Convergence
• 2.3 Nomadic WLAN: Looks Good on Paper, Generally Falls Short
  • 2.3.1 Positioning: High Speed at a Fraction of Mobile Cost
  • 2.3.2 Pricing: Predominantly Prepaid
  • 2.3.3 A Vulnerable Business Model
  • 2.3.4 New Models for Nomadic WLAN: From Wi-Fi to WIMESH
• 2.4 Bundled WLAN-Cellular: A Necessary Marriage of Technology and Convenience
  • 2.4.1 Positioning: From Prepaid Wi-Fi to Bundles
  • 2.4.2 Extending the Hotspot Network: The Roaming Challenge
  • 2.4.3 Convenience of Bundled Pricing:Many Networks - One Bill
  • 2.4.4 WLAN Bundles: Uptake and Revenue Potential
  • 2.4.5 The Next Step in Bundling: Toward Ubiquitous Networks
  • 2.4.6 Technology Alternatives:WLAN vs.Mobile 3G Networks
  • 2.4.7 The Business Case for Bundled WLAN: From Add-on to Integration
• 2.5 Transformational WLAN:Delivering the Unavoidable VoWLAN
  • 2.5.1 FMC Value Proposition: Clear for Mobile Data, Not So Much for Mobile Voice
  • 2.5.2 VoWLAN: More Threat than an Opportunity for Mobile Carriers, But Is It Avoidable?
  • 2.5.3 Impact of WLAN as Part of a UMA Consumer Solution
  • 2.5.4 UMA Business Models
  • 2.5.5 Alternative Solutions:Versions of UMA
  • 2.5.6 A New Type of MVNO: Wi-Fi for Youth
  • 2.5.7 Enterprise VoWLAN: Predominantly Niche Use in the Short Term
• 2.6 Carrier Strategy: Choosing the Right Path

Section 3: Impact of Cellular-WLAN Convergence

• 3.1 Impact of Cellular-WLAN Convergence:Market Perspective
• 3.1.1 WLAN Mobile Data Adoption and Revenue Implications: Small Contribution
• 3.1.2 UMA Revenue Potential and Churn Implications
• 3.1.3 WLAN and VoWLAN Implications for Mobile Traffic
• 3.2 Cellular-WLAN Convergence: Competitive Perspective
• 3.3 Integration of WLAN Technology by Tier 1 Vendors

Section 4: Regional Analysis

• 4.1 WLAN in North America
  • 4.1.1 Cingular Wireless
  • 4.1.2 T-Mobile
  • 4.1.3 Verizon Wireless
  • 4.1.4 Helio
  • 4.1.5 Boingo
  • 4.1.6 Wayport
• 4.2 Regional Analysis: WLAN in Asia Pacific
  • 4.2.1 Telstra Australia: The Fastest-growing Wi-Fi Provider in 2005
  • 4.2.2 China: Low Broadband and Wi-Fi Device Numbers Inhibit Growth
  • 4.2.3 India:WLAN for Rural Broadband
  • 4.2.4 Japan: MVNOs and 3G Entrants to Drive Future Wi-Fi Rollouts
  • 4.2.5 KT:WLAN Lull after Initial Strong Growth
  • 4.2.6 Taiwan: Using Wi-Fi to Achieve a Ubiquitously Wired Society
• 4.3 Wi-Fi and Cellular in Europe
  • 4.3.1 Orange:WLAN for Ubiquitous Wireless
  • 4.3.2 T-Mobile: WLAN in the Center of Seamless Data Services
  • 4.3.3 KPN HotSpot: Flat Data Access, but No Wi-Fi Bundling Yet
  • 4.3.4 Vodafone: Wi-Fi Skeptic?
  • 4.3.5 The Cloud: New Business Models for WISPs
  • 4.3.6 TeliaSonera HomeRun:WLAN for Convergent Fixed-Mobile Services
• 4.4 WiFi and Cellular in Latin America
  • 4.4.1 Brazil:Major LA Market for Enterprise Mobility
  • 4.4.2 Mexico:WiFi as Broadband VAS Differentiator
  • 4.4.3 Chile: No Mobile Carrier Presence So Far
  • 4.4.4 Argentina: 2006 to Become a Year of WLAN-Cellular Bundling

List of Exhibits

• Exhibit 1: Major Carrier WLAN Launches
• Exhibit 2: Wi-Fi-Enabled Device Sales, 2005-2010
• Exhibit 3: Global Hotspots, by Region, 2005E and 2009F
• Exhibit 4: Selected Wi-Fi and UMA Handsets
• Exhibit 5: Global Broadband Penetration, by Region, 2001-2010
• Exhibit 6: Broadband and WLAN Penetration Is Correlate
• Exhibit 7: Voice ARPU by Region: Price Decline Continues
• Exhibit 8: Mobile Churn Remains High
• Exhibit 9: Pending Plans for Selected MVNO and UMA Launches
• Exhibit 10: UMA Network Architecture
• Exhibit 11: Global Fixed-Revenue Growth, 2001-2010
• Exhibit 12: Global Mobile Data Revenue Growth, 2001-2010
• Exhibit 13: WLAN and Changing Carrier Strategic Objectives
• Exhibit 14: WLAN Suite of Services
• Exhibit 15: WLAN vs. Cellular: Technology Comparison
• Exhibit 16: Nomadic WLAN Hotspot Carrier Business Case
• Exhibit 17: Prepaid WLAN Access Prices
• Exhibit 18: Nomadic WLAN Roadmap and Universe of Service Providers
• Exhibit 19: Wi-Fi Roaming: Payment Structure
• Exhibit 20: The Largest WLAN Providers and Roaming Partners
• Exhibit 21: Selected Examples of Subscription and Bundled WLAN Plans
• Exhibit 22: KT:WLAN Subscribers in South Korea
• Exhibit 23: Many Services - One Network
• Exhibit 24: Orange France Mobile Broadband Launch
• Exhibit 25: WLAN vs. 3G Technologies
• Exhibit 26: A Case for Converged and Mobile Carriers: Subscriber Gains
• Exhibit 27: UMA Revenue Calculations for a Converged Provider and a Mobile Operator
• Exhibit 28: O2 Genion and Surf@home solution
• Exhibit 29: UMA vs Home Zone Solutions
• Exhibit 30: Enterprise Data Revenue: Private Circuit and Mobile Remote Access
• Exhibit 31: Smartphone and PDA Forecast, 2004-2010
• Exhibit 32: VoWLAN vs. DECT for Enterprise Customers
• Exhibit 33: Carrier WLAN Strategies
• Exhibit 34: Paid WLAN Subscriber Forecast, 2004-2010
• Exhibit 35: Fixed WiMAX (802.16d) Adoption Forecast, 2005-2010
• Exhibit 36: UMA: Global Household Subscribers, by region, 2005-2010
• Exhibit 37: UMA: Global Consumer Revenue by region, 2005-2010, US$bn
• Exhibit 38: Mobile VoWLAN: Churn Implications (US$)
• Exhibit 39: MVNO Subscriber Share, NA and Europe
• Exhibit 40: Vendors and Their Strategic Approach to WLAN and WiMAX
• Exhibit 41: Number of Paid Wi-Fi Hotspots,North America
• Exhibit 42: North American Top Paid Hotspot Providers 2005
• Exhibit 43: Cingular Data Plans
• Exhibit 44: Wi-Fi Bundling Strategy
• Exhibit 45: Wayport Service Pricing
• Exhibit 46: Developed Asia Pacific Markets: Broadband and Mobile Data Penetration in 2005
• Exhibit 47: Selected Asia Pacific Wi-Fi Prices
• Exhibit 48: Telstra Wi-Fi Pricing
• Exhibit 49: WLAN services in China
• Exhibit 50: Major Pan-European Wi-Fi Hotspot Provider Market Share
• Exhibit 51: France and UK: Orange Holds a Significant Share of Mobile Workers
• Exhibit 52: T-Mobile European Hotspots
• Exhibit 53: T-Mobile Bundled Wi-Fi Pricing
• Exhibit 54: KPN Hotspot Pricing
• Exhibit 55: Selective Vodafone Wi-Fi Pricing
• Exhibit 56: TeliaSonera Sweden and Finland: Capitalizing on Market Leadership in All Areas
• Exhibit 57: Selective TeliaSonera Wi-Fi Pricing
• Exhibit 58: Latin American Hotspots