WiFi market information and statistics

February, 2003

Wireless Forecast
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WLAN worldwide service revenues by 2007 will be reaching $9.5 billion. 80 % of all public WLANs will be deployed in cafes, bars and restaurants these domains will only generate a small portion of the projected public WLANs service revenues. The majority of WLAN service revenues will come from business users in airports, business hotels and exhibition centers. In fact, use of WLANs in cafes, bars and restaurants will begin to decline, leaving dead spots in revenue and service.

Source: Alexander Resources, Stand: February, 2003

Wireless Forecast
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Customer ownership: the expectation is that in all scenarios revenues will be largely driven by business customers in none are business customers expected to contribute less than of 80 % of total revenues by 2005. There is an expectation that in the WLAN rules scenario the contribution made by residential customers can substantially increase in latter years as consumer devices (PDAs, phones) and hotspots (cafes, restaurants) proliferate. The initial strategy for customer ownership needs to focus on the business customer.

Source: Analysys Research, Stand: February, 2003

Revenue contribution in 2005

Source: Analysys Research, Stand: February, 2003

Public Wireless LAN access

Source: Analysys Research, Stand: Research, 2001

Which costs less to deliver than other wireless products

Source: Analysys Research, Stand: Research, 2001

WLAN device penetration

Source: Analysys Research, Stand: Research, 2001

Hotspot operators are crucial to establish a wide footprint

Source: 802.11 Planet, Stand: June 12, 2002

A few players have occupied key positions in the value chain

Source: 802.11 Planet, Stand: June 12, 2002

They are starting to address operational challenges

Source: 802.11 Planet, Stand: June 12, 2002

Who will win?

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Wide availability of access and roaming agreements are key to success From a commercial standpoint: - mobile operators have an advantage but they will need to move fast - independent WISPs have a clear focus and can move quickly - system integrators have an opportunity to enable the market for users that value a dependable and wide-footprint service

Source: 802.11 Planet, Stand: June 12, 2002

WLAN opportunity for wireless service providers

In the US the public WLAN market is forecast to include 21 million users and to generate US$3 billion in annual revenues by 2007
Source: Analysys Research, Stand: May, 2002

How Hot will Public Wireless Hot Spots become?

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802.11b technology is the foundation for todays hot spots, but this will change through 2004 to 2007 as vendors switch to 802.11a based products to increase bandwidth and to avoid interference issues. As enterprises begin to adopt 802.11a, hot-spot operators must consider when to deploy dual-mode access points. By 2007, most networking and access point vendors, as well as PC and PDA manufactures will include 802.11a, 802.11b, or 802.11g in their offerings, thus creating a broad base of both consumers and enterprise users that can take advantage of hot-spot deployments.

Source: Gartner Research, Stand: October 5, 2002

The hot-spot value chain

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The hot-spot value chain is evolving different paces and in different directions worldwide. Factors affecting this include: -The higher proportion of laptop PC users

in North America. -The amount of investment by wireless and wire line service providers, as well as the emergence of nontraditional providers such as franchises. - Disparities in regional networks of competing and complementary 2.5G and 3G technologies. - Regulatory issues in Europe at both 2.4GHz and 5GHz Source: Gartner Research, Stand: October 10, 2002

Wireless Statistics
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Based on the current rate of consumer acceptance to wireless technology, the Boston Consulting Group estimates global mobile commerce will generate revenues of $ 100 billion by 2003. According to a new report from IDC, by 2005, an estimated 35 billion e-mail messages will be sent daily-thats roughly six daily messages for each person on the planet. (Its hard to imagine each one being composed on a desktop).

Source: Cahners In-Stat Group., Stand: October 18, 2000

Notebooks computers in use to date

Source: Cahners In-Stat Group and Nokia 2001, Stand: April, 2001

Wireless and Laptop Statistics

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Annually there are 43 million business travelers in the US, of which 70% carry laptops. On a daily average 15 million North Americans work on the road. Usage statistics show that 19% use their laptops for an hour or less, whereas 31% of business travelers use their laptops for 3 hours or more. Laptop computer use in the USA was 20+ million in the year 2000; worldwide use totaled 40+ million. By 2005 laptop computer use in USA will grow to 60 million while world wide usage is predicted at 150+ million. Forecast for wireless connectivity, regular users in 2002 is expected around 2 million and predicted to grow to 20+ million by 2006 in USA alone. Shipment of wireless enabled laptop computers, is expected to grow 15+ million in 2005, compared to 2.9 million in 2001.

Source: Cahners In-Stat Group, Nokia and Gartner Dataquest Stand: 2001

Laptop Applications used while traveling

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Check e-mail 86% Prepare documents 85% Log on to Internet 74% Log into corporate network 59% Scheduling 48% Presentations 45% Entertainment 36% Hours of use while traveling Less than 1 hr. 19% 1 - 2 hours 31% or 2 < 3 hours 19% 3+ hours 31%

Source: Cahners In-Stat Group, Stand: June, 2000

Methods used by internet users worldwide to arrive at web sites, 2001 - 2003

Source: WebSideStory, Stand: February, 2003

Wireless Public Access over the next several years

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The number of locations available for public access is estimated to grow worldwide from 2,000 in 2001 to 42,000 in 2006 with service revenues experiencing a corresponding growth, reaching $642.6 million in 2006, up from $11.3 million in 2001. However, as the concept for public broadband access booms, new issues of complexity and sustainability arise. said Amy Cravens, an analyst with In-Stat/MDR. Providers must still find the delicate balance between the pioneer mentality of expanding footprint and the reality of subscription levels. Business models must be formulated to support the multiple layers that are feeding the hotspot market, from equipment vendors, to network providers, to roaming providers,, to venue owners. Finally, marketing and branding efforts must be brought to the forefront as the amount and caliber of competition in this market escalates.

Source: In-Stat/MDR reports, Stand: June, 2002

Hotspot facts from In-Stat/MDR

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The principal wireless public area markets to have emerged focus primarily on delivering services to the business traveler. Thus, the arenas in which this type of connectivity has surfaced are those locations that business travelers frequent most. Service providers are attempting to create a footprint that touches on multiple locations including, airports, hotels, train stations, and cafes. The hotspot market in the United States and North America will continue to dominate the market through 2006. However, as a percentage of deployments, the North American market is expected to decline between 2001 and 2004. During this period, other regions are expected to outpace North America in growth of footprint. 90% of public access revenue will be derived from pay-per use access in 2002, largely due to the relatively undeveloped state of the market. However, beginning in 2003, subscriptions will begin to account for a growing percent of the end-user market. In 2006 almost 50% of individuals public access connectivity will be subscribers to one or more services.

Source: In-Stat/MDR reports, Stand: June, 2002

Worldwide Wireless Public Access Service Revenues

Wireless public area access service revenue is expected to grow from $3.9 million in 2001 to $224.7 million in 2005.
Source: In-Stat/MDR reports, Stand: June, 2002

Bridgewater Systems Wi-Fi Market Model

Bridgewater Systems believes that there will be many players in the Wi-Fi market, but that the market champions are still to be determined. Today, there are a number of players already offering 802.11 Internet services. Many are exiting suppliers and Service Providers, others are new, and yet others will take on additional roles to capitalize on Source: Bridegewater Systems, Stand: January, 2003 opportunities.