Amenity Wi-Fi Goes Mainstream

Posted on November 6, 2013

Recently I had the chance to talk to Light Reading’s Dan Jones about the changes taking place in amenity Wi-Fi. Dan had written previously about the Facebook/Cisco collaboration to offer stores a solution for free Wi-Fi, whereby consumers “sign in” with their Facebook credentials. He’d also written an interesting article after our conversation (which you can read here), so I thought I would expand on it with our perspective on wider market dynamics.

Wi-Fi is one of the most important communications enablers we’ve ever experienced. In fact, with more than half of the traffic on our smartphones and tablets being carried by Wi-Fi, it’s arguably the dominant means of service access in use today. Despite Devicescape’s passion for Wi-Fi, our belief is that the combination of cellular and Wi-Fi is the most powerful—and required—way to deliver the experiences that users demand. (Read more of our opinions in the Always Best Connected post.)

Wi-Fi has moved out of our homes and offices into the public arena in a big way. Amenity Wi-Fi, which we define as the shared Wi-Fi intended for guests and customers of businesses and public spaces, is a massive force and becoming more recognized as a mega-trend. Our CVN, composed entirely of high-quality amenity Wi-Fi, has scaled to over 16 million locations, and there are clear signs of acceleration.

In the past few years we’ve seen major retail brands deploy amenity Wi-Fi. Some U.S. examples include Target, Nordstrom, Home Depot, and Safeway. Yet it’s interesting to now see the big Internet companies moving into the space previously occupied by a set of smaller regional players and a few large service providers. Beyond Facebook and Cisco, Google recently displaced AT&T as Starbuck’s Wi-Fi provider; they also announced their intent to promote Google Wi-Fi at similar high-value locations.

What’s going on? In our view, this activity is a reflection of two key initiatives: engagement and insight. Amenity Wi-Fi offers a uniquely flexible and low-cost way for stores and brands to engage their customers right in the location where such engagement is most valuable. Product finders, shopping recommendations and comparisons, special offers, and promotions are increasingly prevalent. Similarly, amenity Wi-Fi complements the information available on the cellular network to provide retailers and others insights into their customers’ preferences and patterns. The end result: Improved competitiveness or services. For companies such as Facebook and Google, businesses driven by information and connections, it makes sense to leverage and promote this huge platform of amenity Wi-Fi and access to the same sort of data that the mobile operators have via their cellular platforms.

Despite all this momentum, it’s still an early and experimental period for amenity Wi-Fi. As I observed in Dan’s article, it’s unclear whether users will take the time to discover and sign-in to the Facebook/Cisco network. Our data overwhelmingly suggests that most people can’t be bothered with the complexity. Worse, users are becoming leery of providing Facebook credentials because of concerns about privacy and the information being extracted and used. Devicescape’s own product for amenity Wi-Fi owners, Popwifi, takes particular care to be simple to use with no sign-in, to embrace any type of hardware without change, and to be independent of any one service. (Facebook is just one of the options which can be selected through the Popwifi service.) As amenity Wi-Fi becomes more ubiquitous, we have no doubt that user behavior and preference are going to play an increasingly larger role in determining which models will be attractive and successful, and which others will fall by the wayside.