Wireless LANs picking up speed in Asia/Pacific

SINGAPORE -- Public wireless LAN (WLAN) services are finally picking up speed in Asia/Pacific after two years of struggling to get off the ground, according to a new report by Dataquest, a unit of Gartner Inc. In at least six major markets, Australia, Hong Kong, Japan, Singapore, South Korea and Taiwan, there is a wider choice of operators, service coverage is improving rapidly, and pricing has come down to realistic levels. The service is currently led by incumbent carriers, even though most of them are not first movers in this sector.

"With big carriers getting into the game, they bring better service coverage and more affordable pricing, especially for the consumer market," said Alayne Wong, industry analyst for Gartner Dataquest's worldwide telecommunications group. "The downside is that some startups are already falling out of the market or scaling back their operations, leaving the field to carriers."

The main driver for service acceptance is the improving service coverage, especially in the major Asian cities of Seoul, Singapore, Hong Kong, Tokyo and Melbourne. Most operators offer reasonable service coverage in major public places, such as airports, commercial buildings, and food and beverage outlets, some with hundreds of hot spots. Of all the operators, KT is the most aggressive, with plans to roll out 16,000 hot spots by the end of 2003.

'A good start'

"However, none of the vendors provide truly ubiquitous coverage, even within a city, but it's a good start," said Wong. "In the long term, serious players need to be able to provide comprehensive coverage to stay in the game as they are up against very large carriers."

Pricing used to be high, as the service was initially aimed at corporate road warriors, but it has come down to affordable levels in many countries as the carriers are beginning to target the mass market. In Korea, there is a US$2.60 per hour low usage fee, capped at US$10.60 per day, cheap and predictable. In Singapore, it costs US$0.12 per minute per use, which makes it really attractive for random ad-hoc users.

Since the service is still in its early days, the subscriber numbers and revenue are still very small, and it is not clear whether it will become a major revenue generator in the near term. Already, some carriers are looking to WLAN as a strategy to boost other core services, such as broadband access and cellular, by offering this as a complementary value-added service at low rates. This will make it even harder for specialist WLAN players to stay in the game.

Additional information is available in the Gartner Dataquest report "Public WLAN Services Finally Picks Up Speed." This report provides an update of market developments and detailed analysis of the service issues faced by public WLAN operators in Australia, Hong Kong, Japan, Singapore, South Korea and Taiwan.

This analysis is provided by Gartner Dataquest's Worldwide Telecommunications and Networking group. This group provides an analysis for the full spectrum of telecom and networking issues. Gartner Dataquest provides the high-technology and financial communities with market intelligence for the semiconductor, computer systems and peripherals, communications, document management, software, and services sectors of the global information technology industry.

Founded in 1979, Gartner is headquartered in Stamford, Connecticut, and has 4,000 associates, including more than 1,000 research analysts and consultants, in more than 75 locations worldwide. Fiscal 2002 revenue totaled $907 million.