Mi-Fi-enabled handsets are starting to gain traction in the market, but rather than see them as a threat to their mobile broadband business, two Singapore-based carriers believe such devices can boost mobile data traffic.
Ivan Lim, deputy director of corporate communications and investor relations at M1, said Mi-Fi support on mobile handsets will provide consumers an "added alternative" to access wireless broadband via their mobile devices.
Ng Long Shyang, head of marketing and sales at StarHub, agreed and added that the carrier has no plans to disable handsets with Mi-Fi capabilities.
He explained that from a business perspective, growing mobile data traffic and in turn, revenues, are "important considerations" for operators and it does not make sense to clamp down on mobile handsets because they help drive mobile data usage among consumers.
With Mi-Fi devices, users can create mobile hotspots that allow multiple devices to connect to a 3G cellular Internet service--also called tethering. Some smartphones are also equipped with Mi-Fi capabilities, including those powered by Google's Android 2.2, known as Froyo such as Dell's Streak and HTC's Desire devices.
Apple is also reportedly looking to include Mi-Fi support in its next iOS 4.3 software update. According to technology Web site, Ars Technica, iPhones sold by U.S.-based Verizon Wireless already come with a mobile hotspot feature which will be rolled out to all compatible handsets in the upcoming OS update.
In a previous ZDNet Asia report, Springboard Research analyst Bryan Wang said some telcos may ban smartphone tethering and encourage consumers to buy multiple data SIM cards for every device they want to Web-enable.
Mi-Fi solves broadband congestion?
Revenues aside, Mi-Fi-enabled handsets can also help alleviate 3G broadband traffic congestion.
Nitin Bhat, partner at research house Frost & Sullivan Asia-Pacific, had earlier predicted that Mi-Fi devices such as smartphones will have a "robust business case" as their ability to offload data traffic will ease the strain on existing 3G networks. Bhat added that consumers can do without multiple data plans and SIM cards with Mi-Fi, utilizing one plan for multiple devices instead.
Lim agreed, noting that because Mi-Fi supports multiple users or devices on one network source, the network operator will only identify the primary user accessing the network and not its accompanying users.
That said, he acknowledged that this method of easing wireless broadband congestion is not ideal. "Sharing of data among several devices or parties will subsequently lead to a lag in connectivity as oppose to the connection quality of one dedicated source. The user experience will thus be affected," he explained.
Ng, however, did not believe Mi-Fi-enabled handsets would alleviate 3G broadband traffic, given that such devices would still tap on the existing broadband infrastructure to support multiple devices.
Ovum's senior analyst, Nicole McCormick, shared his sentiments. She said in her e-mail that Mi-Fi-enabled handsets and devices will likely increase the amount of traffic on 3G broadband connections. This, though, will generate additional revenue opportunities for carriers, McCormick said.
The analyst instead pointed to femtocells as a better solution to alleviate network congestion. She said femtocells, which provide a local mobile 3G hotspot with fixed network backhaul, would be more attractive to operators looking to address rising demand for bandwidth.
As femtocells are managed by users, carriers have no way of ensuring its wireless coverage quality can be adequately maintained from the consumer end. Furthermore, the lack of operator buy-in means the device remains pricey, which is another barrier for adoption.
Meanwhile, operators are already looking at other options to improve mobile broadband coverage quality.
StarHub, for instance, upgraded its network on two levels, Ng revealed. First, it implemented HSPA+ dual carriage technology, which could potentially double mobile broadband speeds to 42.2 Mbps, he said. Second, the carrier is working with Huawei Technologies on a smartphone signaling offering that optimizes the way handsets communicate with the network.
Ng said: "This signaling technology effectively halves redundant signaling loads, hence improving mobile broadband connectivity and overall smartphone performance." He added that StarHub is looking at long-term evolution (LTE) in its next phase of mobile network development projects.
M1 is also looking to LTE to improve its mobile broadband business in the future.
Lim said: "The adoption and upgrade of our network to LTE is an area that we'll be placing much focus on as we anticipate a strong growth in mobile data, and LTE would be an efficient mode in supporting this growth."