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« Wi-Fi Hotspot Irrelevance: Give Me Whatever Ericsson's CMO Is Smoking | Main | Mobile Post: Future of Hotspots, Backhaul of Cellular »

March 11, 2008

Latest iPass Usage Stats Show Trends in Business Usage

iPass has released its latest semi-annual statistics: The company is looking for a little attention, of course, but they provide a relatively huge amount of data (relative to everyone else in the industry) that helps highlight trends in Wi-Fi hotspot and, new this time around, 3G usage worldwide. Their user base is largely corporations that integrate iPass into their networks to allow worldwide roaming at set or metered rates on Wi-Fi, mobile broadband (via laptop), and dial-up with a single corporate login and end-point policy enforcement. This gives them numbers that reflect usage among the mainstream corporate business traveler.

The company found that European usage is accelerating, with Europe now accounting for 40 percent of their sessions worldwide in the second half of 2007, up from 31 percent in the second half of 2006. (All contemporary numbers are from 2007's second half.) North American usage dropped from 60 to 51 percent during that period as a percentage of the whole. As an increase, European usage jumped almost 150 percent while North American usage doubled: iPass saw nearly 2m sessions worldwide at Wi-Fi hotspots, up from just over 1m in the same period a year ago. Worldwide growth in total sessions year over year was 89 percent.

Rick Bilodeau, vice president of corporate and channel marketing, said that growth in Wi-Fi usage represented in part frustration with high 3G roaming costs in Europe. He said that European regulation has already forced a price drop for 3G roaming, however. It's "coming down from the stratosphere; they're going to drop into the 50,000-foot range. These drops still don't make 3G roaming affordable. Your break-even is now 5 emails instead of 2," he said, referring to the potential for emails to carry megabytes of attachments and 3G plans charging per-megabyte roaming fees.

European Wi-Fi prices still outpace North America's, and Bilodeau said a drop in 3G roaming might "start to apply pressure to European Wi-Fi prices."

iPass found big jumps in usage at venues outside of hotels (29 percent) and airport (45 percent): cafes, restaurants, transit, and other categories. Cafe usage grew modestly, from roughly 175,000 sessions to nearly 250,000 sessions, but restaurant usage jumped from 25,000 to about 80,000 sessions. "The restaurant growth is really driven by McDonald's around the world," Bilodeau said. The fast-food giant started marketing their Wi-Fi service more broadly in 2007. The service has been in place in some restaurants for three or more years in the U.S. iPass includes not just domestic McDonald's stores, but has a total of 10,000 outlets worldwide in their roaming network.

London tops city usage, and experienced 156 percent year-over-year usage growth exclusive of London hotels and airports. Only 8 countries saw more usage than the metropolis of London.

With 2.5G and 3G usage, the company tracks just laptop users which have roaming and service agreements handled by iPass. The firm found that as users become more accustomed to mobile broadband, they start using more data, with established users (those with accounts before 2007) using significantly more data than users who started service in 2007. Both categories of users increased their monthly average usage by about 25 percent across the year, which comes in part from larger, more compelling downloadable content. (Read: YouTube.)

A stat that jumped out at me from their report was the breakdown of exclusive 2.5G, exclusive 3G, and mixed 2.5G/3G usage within a given month by their customers. Only 3 percent of users only used 2.5G, which isn't unusual, as iPass is selling 3G service. But just 38 percent used 3G exclusively; 59 percent used a combination of 2.5G and 3G.

What interested me was that there was a group that was able to use just 3G--that's tricky even in excellent coverage areas, as even a minor hiccup could downshift a user to a slower network offering. Bilodeau said that users adapt to where bandwidth is best, and that many users are "bumblebees," an industry term referring to those who roam, but with predictable pattern.

"Where I work may be dictated by where I get a 2.5G or 3G connection," he said. "You adapt your habits to fit your technology."

iPass also found that just a tiny percentage of its 3G users were extremely heavy downloaders: just 0.5 percent topped 2 GB in a month, while 32 percent used 50 MB or less per month. Their 3G users are also regulars: more than 90 percent of 3G subscribers used the service in any given month. This makes sense, as the cost of 3G remains high enough that there's little point in subscribing if you're not making use of it; and using it justifies continuing to subscribe.

iPass makes available a variety of tables of this data on their Web site.