It’s always nice to get things for free. For instance, if you’re a Verizon Wireless mobile broadband subscriber, you just got access to oodles of Wi-Fi hot spots at no charge thanks to a program rolled out earlier this week.
Verizon says that it’s all about giving customers choices and options. But analysts say that even though Verizon isn’t getting the kind of negative publicity that AT&T sees related to its network, promoting Wi-Fi is one way to get data hogs off the 3G network.
Verizon’s mobile broadband subscribers – folks plugging into their network on USB dongles, air cards and personal hot spots – use a lot ofbandwidth. A Verizon spokeswoman wouldn’t go so far as to say the reason for the free Wi-Fi offering is to keep data users from taking down the network with high-bandwidth applications. She cited the more noble reason of keeping customers from surpassing their allotted data limit.
However, some observers interpret the move as a way to offload data-hogging mobile broadband users. “It just makes sense that if you have a large bucket plan for data access, why not send it over Wi-Fi versus fairly expensive 3G networks,” says In-Stat analyst Frank Dickson. “Wi-Fi is a more cost-effective way for carriers to handle traffic.”
“As these networks start to compete with broadband services,they’re coming under excessive loads,” says analyst Phil Marshall with the YankeeGroup. “Verizon has been late to the game, they’ve resisted the use of Wi-Fi aspart of their network strategy. Now they’ve recognized if they don’t use Wi-Fi,they’ll have problems competing with AT&T’s network.”
AT&T has embraced Wi-Fi as part of its network strategy.It operates the nation’s largest Wi-Fi network, with more than 20,000 hot spotsand currently is offloading about 15 percent of iPhone Internet traffic ontopublic Wi-Fi.
Verizon historically was resistant to the idea, even running negative ads about Wi-Fi. For a time, the carrier had a limited selection ofWi-Fi enabled handsets, which was comprised mainly of Nokia’s XV6700 and XV6800 models.
Until July 2009, it only carried versions of the BlackBerry without Wi-Fi. Verizon cited technical reasons – such as lack of space for another radio in the device – but some industry insiders speculated the carrier was leaving out the function in order to keep its data revenues up.
Regardless, those days are over. Verizon now has several Wi-Fi enabled devices such as the Motorola Droid, Samsung Omnia II and the BlackBerry Storm2 9550. It also has pledged to expand its portfolio of Wi-Fi enabled handsets.
The free Wi-Fi service is not available for smartphone users, who can piggyback on public Wi-Fi networks but must pay for private hot spots, including those provided free to mobile broadband subscribers. A spokeswoman was unable to say when or if free Wi-Fi for smartphone users would become available.
Of course, Verizon may not need to be in a big hurry toroute data traffic over Wi-Fi. The Motorola Droid isn’t the burden to Verizon’snetwork that the iPhone has been to AT&T’s network.
But new ways of managing network traffic are likely to become more important over the next year. The FCC could enact net neutrality regulation that would make it difficult (if not illegal) for carriers to block bandwidth-intensive applications, like video streaming. Getting customers to shift that traffic from a wireless network to Wi-Fi could go a long ways toward helping carriers better manage their traffic.
“3G just can’t compete with Wi-Fi when it comes tobandwidth,” Dickson says. “You need it just to play the game.”