There are practical reasons why many service providers believe in the value of “Wi-Fi first” business strategies.
Telenet, 57 percent owned by Liberty Global, has nearly one million customers and over 20 percent cash flow ( EBITDA) margins as a mobile virtual network operator.
As the dominant cable operator in Flanders, Telenet deployed over 2,000 carrier grade Wi-Fi hotspots, allowing Telenet to offload half of its mobile usage to the network of public hotspots.
That strategy likely works for several reasons. Flanders is a densely-populated area, and users arguably consume most of their data while stationary, not moving and therefore relying on the mobile network.
Telenet also has extraordinarily high customer adoption, which means it has a dense public Wi-Fi capability. Telenet has 80 percent video penetration in Flanders, of which 65 percent also buy high speed access services.
That means 52 percent of all homes are Wi-Fi hotspot locations. Rarely, if ever, will any fixed network operator in the U.S. market have customer adoption that high. In most major U.S. markets, it would be rare for any ISP to have more than 50 percent high speed access share, representing about 40 percent of all homes.
So not only is the U.S. market significantly less dense, it also will tend to feature less extensive public hotspot footprint opportunities. That makes the Wi-Fi first strategy more difficult.
But some ISPs, especially cable TV operators, may see multiple revenue opportunities beyond support for owned mobile operations. The small cell network can be used to support backhaul for third party customers, or wholesale support for retail public hotspot access also supplied by third parties.