WLAN poses threat to 3G data services

date: November 26, 2001

Fast access to the Internet, at speeds 100 times greater than over a GSM phone, will soon be a reality for mobile workers and WLAN will take some of 3G's revenue according to a new report, Public Wireless LAN Access: Market Forecasts, from Analysys.

Public wireless local area network (WLAN) services enable users to connect laptops and PDAs to their Internet service providers (ISP) or company intranets at speeds of up to 11Mbit/s compares to 2Mbit/s for 3G service. According to report author, Ross Pow, such services are now becoming available at airports, hotels and cafes in countries such as Austria, Germany, Norway and Sweden.

Analysys forecasts that the appeal of these services means that by 2006, there will be over 20 million users of public WLAN services in Europe, generating over EUR3 billion of revenues for public WLAN operators.

A major impetus for the development of this market, according to Analysys, is the industry-wide adoption of a common technical platform based on the IEEE 802.11b 'WiFi' standard. Rapidly growing numbers of devices, such as PDAs, phones and laptops, are now being shipped with cards already installed that enable access to public WLAN networks.

As originally stated in its August 2001 report, Public WLAN Access: A Threat to Mobile Operators?, WLANs do pose a significant threat to 2.5/3G operators. Analysys estimates that, by 2006, around 10% of 2.5/3G subscribers will also make use of public WLAN services, with mobile operators facing the prospect of losing up to 10% of their data revenue.

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