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Summary:

Carriers are increasingly looking to Wi-Fi to ease the strain on their cellular networks, and an army of companies is emerging with offloading solutions to help them. And they could help themselves immensely by making Wi-Fi easier for their subscribers to use.

Mobile World Congress in Barcelona this week has produced some eye-catching developments, from Microsoft’s unveiling of its new mobile OS to the Skype/Verizon partnership to increasing tension between Google and network operators. But the show’s overriding theme has been the ever-increasing data consumption across mobile networks — and the crush of companies looking to help carriers offload that traffic.

The surge in smartphone sales has fueled a dramatic increase in the demand for mobile data, which in turn has brought some networks to their knees. And as Stacey noted last week, that demand will increase exponentially over the next few years as phones become more sophisticated and connectivity comes to a wide range of devices. Which is why carriers are scrambling to find alternative ways to deliver data to users in ways that don’t bog down the network.

“Offloading is crucial for us,” Orange’s Olaf Swantee told Reuters earlier this week. “In many countries where we have a fixed network we try to offload directly.”

Swantee’s remarks were echoed this week by CEOs from both Vodafone and RIM, who used the event to warn that smartphone users will soon demand more data than networks can deliver. Of course, both companies have skin in the game: RIM is touting its gadgets as bandwidth misers that generate minimal traffic on the network, and Vodafone — like its competitors — is scrambling to find a way to get heavy data users to pay more. But that urgency explains why players such as Accuris Networks, BelAir Networks, Bridgewater Systems, picoChip and Tellabs unveiled hardware and software in the last few days designed to help network operators use non-cellular technologies to move data.

Many of the new products use gear designed for fixed mobile convergence (FMC)  through Wi-Fi and femtocells, and a few are beginning to include support for 4G technologies. Tellabs, like the 6-year-old startup Stoke, offers a gateway designed to offload Internet-bound traffic before it reaches the carrier’s first core gateway. And Kineto Wireless  markets a smartphone client that automatically routes traffic to Wi-Fi networks.

The need to offload data traffic has spurred a femtocell industry that until recently had seen lackluster activity. Wi-Fi’s massive worldwide footprint makes it the offloading technology of choice for carriers, and network operators can encourage their customers to ease network congestion by using voluntarily using Wi-Fi when it’s available. The carriers will have to do a better job of supporting Wi-Fi and creating a seamless experience for users, though, if they hope to fully leverage the technology, Informa analyst Thomas Wehmeier wrote this week:

“A key hurdle that we still see is the need to overcome the issues of authentication and providing a better user experience for the customer when switching between cellular and WiFi networks. The days of logging in and out of hotspots need to go if operators really want to offload greater proportions of traffic onto WiFi. That being said, it seems that even with today’s pretty average WiFi experience on a typical smartphone, consumers are favouring WiFi over cellular.”

That demand for Wi-Fi is something carriers must meet if they’re to keep their customers happy — and if they hope to keep their networks running smoothly — as femtocells and other alternatives gain traction in the market.

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Image courtesy Flickr user nick blick.

  1. Not even a mention for uma? One of my favorite features on T-mobile, uma must be the most transparent solutions available. No need for femtocells etc., simply using the existing WiFi infrastructure.

    Unfortunately, T-mob’s latest batch of smartphones (except for BB phones) haven’t had uma, but rumor has it they’ll be bringing it back as ‘WiFi calling’. I know I loved it when calling at US rates from Europe.

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  2. With EDGE running, I can use my Smartphone for about 5-6 hours of continuous usage… and with WiFi that number is down to about 2-2.5 at max. Also the time it takes to login/out (as also mentioned in the article) of hotspot, or hunting for hotspot connectivity, is a major reason why I prefer to continue using EDGE (for which I pay per KB), against WiFi (free at the airports). It is good enough for checking mails, and visiting mobile-enabled sites or other sites using Opera-Mini etc. Of course, this won’t work for a Youtube user as well.

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  3. Traffic offloading through Wifi or Femto cells? My guess is that most traffic occurs with FMS usage, people using a mobile connection instead of fixed broadband at home, downloading movies etc. Therefore there is no fixed line to actually offload the traffic to. Any research on this?

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    1. there is fms in some segments. college students in sydney were cited as an example to me by the operator there. in austria and singapore there are reports of single people canceling DSL and just moving to a 3G USB dongle on their netbook.

      However I think this is an aberration, there is wifi in so many CE devices now that most people will have it in their homes.

      ajay

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  4. The irony is that operators were blocking Wi-Fi initially for phones launched, and now they just can’t wait to get users off their network.

    Hopefully it would result in a consistency in data plans over landline and wireless.

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  5. It is interesting how WiFi is back in favor. While I have been following both the licensed spectrum offload (AKA Femto)and the unlicensed spectrum offload (read WiFi) – I clearly see the momentum shifting towards WiFi (I would not have said that this time last year). However, WiFi still has a lot of challenges. I have listed some of them in http://www.intellinet-tech.com/Media/PagePDF/Mobile%20Data%20Offload%20-%20Can%20Wi-Fi%20Deliver.pdf.

    However, I am convinced that if these challenges can be resolved – WiFi will be a very real option.

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  6. [...] an unnamed ISP for its Wi-Fi product. I will say that the company has certainly managed to straddle two large markets with its technology. Now we just need to see if it can sell into [...]

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  7. [...] an unnamed ISP for its Wi-Fi product. I will say that the company has certainly managed to straddle two large markets with its technology. Now we just need to see if it can sell into [...]

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  8. [...] and an ability to reuse their spectrum in congested areas, carriers lose their incentive for deploying Wi-Fi networks to offload data and will shunt customers back over to 3G networks (right now, these Picochip radios are for HSPA [...]

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  9. [...] extend coverage in home. But they’re aware that it won’t be enough, something that was very apparent at the Mobile World Congress in [...]

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