UK's Wi-Fi market may not match the hype

Although Wi-Fi is one of the hottest issues in the IT sector at present, there are worrying signs that both rollout and take-up of the technology are undershooting industry targets.

The Wireless LAN Event, held at London Olympia last week, heard there is a significant gap between the number of Wi-Fi hot spots that have been set up so far in the UK and earlier forecasts.

"Rollout of Wi-Fi in the UK is accelerating, but it is still slower than operators had previously suggested," said Ross Pow, managing director of Analysys Research, warning that operators risk losing credibility if they fail to hit their own targets. "The industry needs to prove it can meet the projections that it has forecast over the last few years."

It is difficult to say exactly how many Wi-Fi hot spots are now operational in the UK, as operators tend to only announce new sites every few months. For example, BT Openzone's Web site only lists 76 sites that are open to the public -- even though its target is to reach 400 by this summer -- but a company spokesman insisted last week that the true figure is closer to 200.

If so, it can be estimated that there are between 300 and 330 commercial hot spots in the UK today, run by firms such as Openzone, Megabeam, Internet Exchange and STSN. In addition, a number of venues have begun offering free Wi-Fi to customers. In Korea, Pow pointed out, there are 8,500 commercial hot spots and 115,000 subscribers.

Given the nascent nature of Wi-Fi in the UK -- it was only legalised as a commercial venture last year -- operators have a ready defence to the claim that they are rolling out their services too slowly.

A major concern, though, is the extent to which their networks are actually being used by customers.

Last week, Openzone said that it has now reached "over 90,000 minutes of access per week" -- which works out at around two hours per day per hot spot for a network that includes valuable sites such as Earls Court and Olympia, part of Gatwick Airport, the Bluewater shopping centre and the Hilton chain of hotels.

Earls Court and Olympia were among the first places to be Wi-Fi enabled by Openzone, but The Wireless LAN Event heard that customer demand has been less then exceptional.

Rohan Paulas, IT Director for the Earls Court Olympia Group, told the conference that even at an IT-related show only 10 to 15 percent of the delegates were using the Wi-Fi network.

"Wi-Fi demand does not look that great, based on our experiences and on conversations with the industry," Paulas said.

According to a senior executive from a leisure company that has embraced Wi-Fi, demand is also extremely volatile -- surging dramatically one week if there is a technology-related event taking place near a hot spot, and falling back to much lower levels at other times.

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