It's official. Cutting the price of Wi-Fi will not encourage more people to use it. That was the opinion of BT's new head of Wi-Fi, Chris Clark, formerly president of BT Global Services.
"The elasticity of price in Wi-Fi is still not proven," Clark told journalists at the Wireless LAN Event in London's Olympia today. "Reducing the price does not increase usage."
The comment was particularly surprising as with his previous breath, he had been praising the success of BT Openzone's Wireless Broadband Week, which apparently more than doubled the traffic on BT's Wi-Fi network by - you guessed it - cutting prices.
Clark, you will be surprised to hear, has moved into the job because it is time to move Wi-Fi onto a commercial footing. "We are at an inflection point," he said. "Wi-Fi was a technology play, now it is a business play."
His predecessor, Dave Hughes, has become chief technical officer for BT Retail, in a general shake-up of BT's upper echelons. "Dave will focus on new technologies such as WiMax," said Clark.
To be fair, Clark's full argument is that Wi-Fi is a business service, not a consumer service, and the main barrier to usage is concerns about security, not cost. "It is now about building user awareness," he said. "Large companies take longer to make decisions." They also need more detail on the "value proposition" than they are getting so far.
"The US marketplace is exceptional," said Clark (presumably in needing neither of these things). He said he doubted that US operators were getting a lot more business by running at lower prices. Unfortunately, US operators don't appear to agree with him. Just this week, Californian wireless research company ON World concluded that Europe was missing out on a massive Wi-Fi boom by having prices too high. European hotspot service prices were more than double the average price in the US and four times the average in the Asia Pacific region - where Wi-Fi thrives - the report stated.
And Mr Clarke's own company appears to have joined the conspiracy. BT's Wireless Broadband Week promotion drove more users onto Wi-Fi hotspots by offering free connection. "Traffic went up by 133 percent in one week," Clarke said. However, it was not just because it was free. "It has continued to rise," he added, confusing even himself with the variety of Wi-Fi "messages".
As head of wireless broadband Clarke intends to make it easier for corporations to get hold of Wi-Fi centrally, for instance by finding ways to package it with other access technologies, including GPRS and 3G. Roaming between technologies might be nice in future, he implied, but for now the big thing was merging the bills. "3G and Wi-Fi are complementary, not competing," he said.
BT has no targets for Wi-Fi business, he said, although a previous promise to make £300 million revenue by 2005 is still in place, he said. Presumably it will be easier to reach that target if Wi-Fi prices are kept high rather than reducing them in an apparently pointless effort to attract the sort of customers that BT is not looking for at the moment anyway. And which don't exist. Despite the figures.
While IT users are uncertain about Wi-Fi, Clark expects steady growth rather than an explosion. "Usage is light, but that is not an issue. This is maturing market, at the front of the curve."
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