The rise of unlimited data plans in the US has caused much speculation about the “end of Wi-Fi”. However, given the current pricing of unlimited data services, anyone who thinks that Wi-Fi will be usurped by mobile data fundamentally misunderstands the industry and the challenges facing mobile providers. It simply won’t happen.
When you look at current data demands and trends, you begin to understand what a colossal challenge replacing Wi-Fi would be. The numbers speak for themselves. According to ONS, in 2016, 82% of adults in the UK used the internet almost every day, with 71% using mobile devices. Today, more than half of mobile data is carried over Wi-Fi and is expected to reach 178 million terabytes worldwide in 2018, according to Gartner. At the same time, consumers are demanding increasingly lower prices for data, which has led to extreme price competition. This brings significant pressures to the mobile market, which is already struggling to bring mobile data to its existing subscribers, who continue to clamour for lots more. In short, this means that no matter how much data capacity is increased, that capacity is immediately consumed.
Mobile users aren’t the only ones vying for this capacity either. Emerging trends such as the Internet of Things, robotics and AI are all increasing our reliance on the internet even further, which in turn drives up data usage, As these products, services and applications continue to become more mainstream, it’s not surprising that consumers are becoming ‘digitally dependent’ and unable to imagine life without access to the internet.
Similarly, with the rise of smart cities, our roads, transport networks, buildings and infrastructure are becoming more sophisticated in how they connect and interact with us and each other. As this ecosystem transforms, the amount of data being consumed is likely to vastly increase, putting increased pressure on a mobile industry already at breaking point. We’re already predicting that 26 to 50 billion devices will be connected by 2020 – so imagine the levels of connectivity we will reach in the next 20 years.
Far from signalling the end of Wi-Fi, unlimited data plans and exponential growth in data demands may be the best thing that ever happened to the Wi-Fi industry. As mobile operators struggle to meet current demands, let alone those of the future, Wi-Fi will be critical to the success of new data-dependent technologies, such as IoT applications – which require consistent internet connectivity in order to function.
The notion of Wi-Fi offload has been around for years. It is now emerging, not as a viable alternative, but as a strategic necessity for every mobile operator. The margin equation for mobile data – unlimited or otherwise – does not change unless a significant proportion of the data load can be transferred to Wi-Fi. Likewise, it is easy to imagine IoT and smart city manufacturers opting for Wi-Fi compatibility as they create their latest products and services, with it being a cheaper and more reliable alternative to mobile, even as 5G services come to market and continue to evolve.
Fundamentally, it shouldn’t matter which connectivity technology is used, both now or in the future. Consumers certainly don’t care, so long as the experience is reliable and fast. However, rumours of Wi-Fi’s demise have been greatly exaggerated. Despite having been around the block for many years, expect Wi-Fi to continue to play a huge role in connecting the devices and services shaping our future. Perhaps more so than ever.