Surveys point to explosion in WiFi usage; The next challenge is monetizing that usage

A host of new studies have come out in the last two weeks that point to the value of WiFi-enabled mobile phones.

This week, DeviceScape, developer of the Easy Wi-Fi application, released results of a survey among its users to find out the desires of users when it comes to WiFi [1]. Some interesting results include the fact that 93 percent of buyers of devices say they base their decision on the availability of WiFi in a device and 85 percent said they wanted to switch automatically between 3G and WiFi in a device (that number could be skewed somewhat given the market that DeviceScape plays in). What was a particularly low percentage to me was the fact that 53 percent of those surveyed want to use only free WiFi. That number was surprising given the fact that AT&T users, the primary users of WiFi at this point, get WiFi access for free with certain smartphone data plans. But the survey included worldwide users and those who travel a lot.

Last week, WiFi equipment provider Meraki released its own study [2], revealing a huge jump in WiFi access coming from mobile devices in North America, [2]which isn't surprising given the popularity of the iPhone. The company compared activity seen by a single set of randomly selected Meraki wireless access points in North America in 2008 and 2009 in order to understand macro-level traffic and end-user device trends.

The number of client devices, such as laptops and handheld devices, observed by the same set of Meraki access points grew dramatically by 41 percent from 149,687 devices in 2008 to 211,190 in 2009. The number of Apple devices observed, including laptops, iPhones and iPods, grew 221 percent. Apple devices now represent 32 percent of all the devices seen by this set of Meraki networks in North America, compared to just 14 percent in 2008.

And this week, ABI Research said WiFi is fast becoming a "must-have" handset feature. "The picture may be unique to each carrier," said analyst Michael Morgan, "but in the end WiFi can offer most operators ... two key benefits: extended reach and/or network load reduction." Therefore, based on operators' and users' newfound appreciation for WiFi, ABI predicts shipments of WiFi-capable handsets will double from 2009 to 2011. The research firm said that 144 million WiFi-capable handsets will be shipped this year, and number that will jump to more than 300 million in 2011.

It's no secret that WiFi usage is exploding. I think the next challenge is monetizing that usage. While access is free for a lot of users, service providers and venue owners can garner significant value in running applications over them. Venue owners tried to do this early on, but didn't have the traffic to monetize it. Today, smartphone users are actively seeking out WiFi connectivity, whether because its free or because it offers better download speeds.

We're already seeing some movement in the space. WeFi, creator of the community-based WiFi network, launched a mobile app storefront powered by WiFi that will feature data-heavy applications that are best-suited for WiFi connectivity [3]--they'll run over the best WiFi [3]connection located by WeFi. Called WeFiApps, the portal offers themed app palettes that focus on communications services, entertainment and information categories with apps that range from mobile video to social networking. Services such as video uploading and downloading, games and other applications that require constant Web connectivity are central to the storefront.

And Apple of course, is allowing some applications, such as the SlingMedia TV app., to only run on WiFi on the iPhone, although you could argue that is out of necessity given the potential 3G network clogging problems such an app may present, according to AT&T. Nevertheless, we could see a whole subset of WiFi applications coming out of the iPhone world.--Lynnette [4]