Tuesday, 2 March 2010

Can a LTE-WiFi Business Model Work?

With most operators deciding to back LTE over WiMAX, the LTE versus WiMAX debate is over. WiMAX will have its place in the industry, but will not be the global mass market technology that it was touted as. But what about WiFi?

Over the past year WiFi has been the operator’s new best friend. WiFi offload has been an important part of traffic management for operators such as ATandT and Telefonica. Both operators have city-dwelling iPhone users that have had less than satisfactory 3G experience. In a recent interview with Fierce Wireless CEO of Telekom Austria, said that the company was prepared for the continued growth in mobile data traffic, but suggested that pushing data onto Wi-Fi made sense and CEO of Softbank said in recent interview that mobile networks would not be able to cope without WiFi. In Japan 50% of data traffic happens inside the home during peak hours, which makes it ideal to harness WiFi technology. He did also add that "3G and LTE is the way to provide blanket coverage, but WiFi helps to provide a richer experience."

Thousands of devices have been WiFi enabled, as Blackberry and Apple have turned Mobile WiFi into a prime time mobile technology. Even though it is not a technology that is likely to have huge levels of coverage, WiFi is still fast becoming a mainstream mobile technology.

By cellular standards WiFi is a crude technology. With no power control, no frequency awareness, limited mobility, handover capability and range the QoE simply doesn't match that of 3G, but WiFi’s simplicity and low cost has led to mass deployment of the technology.

Although some operators seem happy to offload some of their traffic onto WiFi, will this still be the case with LTE? Both LTE and WiMAX positioned themselves as WiFi killers and surely with the amount of investment that is going into or will be going into LTE, there shouldn't be a need to offload traffic onto WiFi?

Vendors are however looking to provide dual mode LTE-WiFi devices. This confuses the LTE business model slightly as consumer will have to pay a premium in order to connect to the high speed, low latency (etc etc) LTE network, but could potentially be bumped off onto a cheap, lower quality WiFi network. It is a model that seems to work for 3G, but can it work for LTE?


  1. The initial problem that LTE devices (or dongles) will face is poor reception in their homes (if using 2.6GHz frequency). The end users will in that case prefer to connect using WiFi. If they are outside, there is no WiFi and the reception using LTE should be better. So I would say LTE (or WiMAX) and WiFi can work together.

  2. I would agree with the author, Lte as a backhaul with Wi-fi being used by the users would be a big hit in the future. Already, the devices (laptops, phones) are Wifi enabled. The users would not want a switch from their existing devices.

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  4. The question also worth asking is will the user know the he/she is being bumped off onto a WiFi network? Surely there will be a noticeable different in performance. If the end user prefers to connect using WiFi, then presumably they will be happy with 3G as well. Why should the end user bother with LTE at all?

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  6. @Sabah: The user would already have a Wifi enabled device, so there is no question of user not knowing it. With the Wifi supporting b/g/n, with MIMO support, there is no problem with Lte being in the backhaul and Wifi as the front haul technology