The number of Wi-Fi hotspots look set to keep to grow according to a recent report. However, European prices are still higher than those in the US, and users tend to find them more confusing to understand, though this will change in the next six months.

The report, ‘Public Access Wireless LANs – Pricing and Trends’, by consultancy BroadGroup, analysed marketing and pricing strategies across Europe, North America and Asia Pacific, covering 87 players in 23 countries.

Of the five UK-based hotspot providers surveyed, Megabeam was most expensive, with Broadreach UK the cheapest and BT in the middle.

The report found that some players were differentiating by offering two and four hour blocks, bundling this with GPRS. But European prices tended to be higher than the US, whereas the US had a more cohesive price range and was highly competitive.

"Pricing is broadly falling into classic time bands,” commented managing consultant Philip Low. “Although service providers would prefer to sell monthly subscriptions, more are now making available weekly, 24-hour and one-hour prepaid schemes."

BroadGroup's analysis is that international factors such as the Iraq war and SARS have slowed down business travel and therefore deployment, which in turn has retarded the development of a competitive market.

"The European market is not yet fully competitive for these types of services,” said Low, “but this will change by early in 2004 as customer awareness of the benefits of wireless LANs diffuses, and roaming capabilities play a greater part in their choice of provider."

The researcher said that TDC Denmark ($0.05) followed by Broadreach UK ($0.07) and Swisscom Eurospot ($0.07) offered the cheapest per-minute rates in Europe. The cheapest rate found in Asia (and globally) was $0.03, offered by ChungHwa Telecom Co Ltd.