With 85% of mobile traffic predicted to be transmitted via Wi-Fi by 2018 and the younger generation unwilling to entertain the idea of landlines, operators need to adapt to maintain their relevance. Wireless networks are undoubtedly the future but monetising them can prove troublesome. The Aptilo Service Management Platform, however, offers a solution.It's all about staying relevant to the subscriber. The telecoms landscape is changing. Wi-Fi has become the best insurance policy operators can get in order to stay relevant to their subscribers and to protect their core business.
Back in the day, cable multisystem operators (MSOs) delivered rich content such as TV over high-speed networks. Then came the first 4G mobile networks, launched as over-the-top (OTT) players such as Netflix and HBO started to grow. Suddenly, cable MSOs started being squeezed from two fronts: they were no longer the sole kings of content and mobile operators could start to compete with capacity from anywhere. This is the number-one reason why cable MSOs must go Wi-Fi - they need to provide a nomadic user experience.
Why fight it?
Voice and data traffic are increasingly going over Wi-Fi. By 2018, analysts predict that 85% of data traffic will go over Wi-Fi, leaving a paltry 15% to be carried by cellular networks. This is a game-changer for mobile operators: they risk going from mobile broadband provider to something used only between Wi-Fi hotspots. How relevant will they then be to subscribers if they only carry 15% of the traffic?
The younger generation does not care so much for landlines or being tied to a SIM-card identity. What they do care about, however, is having their multitude of devices connected to a high-capacity network so that they can connect with friends over OTT applications such as WhatsApp.
If they have a mobile subscription, it had better work in their homes, because the younger generation won't even consider paying for a landline. If, as an industry, we think this will change just because these users get a few years older, we are only fooling ourselves.
This is why mobile operators must embrace Wi-Fi and Wi-Fi calling - or risk drastically increased churn rates. A large hurdle however is that Wi-Fi is considered to be free or included in the subscription, so how do you monetise it?
Aptilo's Wi-Fi ISP customers are very creative on this front, with sponsored login or social media login combined with advertising adapted to the user's profile and their current location. For the company's large, tier-one-operator customers, direct monetisation of Wi-Fi may be a welcome extra revenue stream, but it is really just the tip of the iceberg.
What really makes up the Wi-Fi return on investment for operators is customer retention and, just as with an iceberg, the majority of the mass is hidden beneath the surface.
The cost of churn and churn prevention is typically around 15-20% of operator revenue according to analyst firm Tefficient. This means $1.5-2.0 billion for a $10.0-billion-revenue operator. What if a carrier-class Wi-Fi service could significantly reduce this cost? The Canadian Cable MSO Shaw Communications claims that active Wi-Fi customers have 35% lower churn rate compared with those who don't use the Wi-Fi service, and that 75% of surveyed customers would recommend or move to Shaw thanks to its Wi-Fi service.
The formula for success
Aptilo has found a very simple formula for service provider Wi-Fi success: sucess = all locations × all devices.
As a service provider, you must make sure to provide access at all locations where Wi-Fi is used and support all types of devices, including the ones without a SIM card. Aptilo Service Management Platform (SMP) adds a service-control layer on top of the Wi-Fi network and helps you to maximise these parameters. It turns the operator's Wi-Fi network into a Wi-Fi service for its subscribers. As a company, Aptilo has done this - and only this - since it was established in 2001.
Fundamentally, it's all about control - controlling access of users, their experience at the specific location and the monetisation of the Wi-Fi service. Aptilo SMP has integrated functionality for captive portals, SIM authentication, analytics and specific features that enable operators to sell B2B services to different verticals such as enterprises, healthcare facilities, hotels and stadiums.