Wi-Fi hotspots, the once and future network king

Updated. Wi-Fi hotspots will continue to grow in terms of locations, the total number of connections and their importance to network operators who face growing data demand. In its latest report, In-Stat research provides some numbers to give some sense of scale for the hotspot trend, estimating that in 2015, wireless hotspots will account for nearly 120 billion connect sessions. Helping to grow the connection number will be improved, automatic log-ins and more hotspots to tap in to.

Around the globe, In-Stat expects one million hotspot locations available by 2013, and based on the number of publicly available new Wi-Fi networks I’m seeing in my rural backyard, I’m not surprised. Businesses of every size are turning to Wi-Fi not only as a convenience for customers but also as a way to expand foot traffic, advertising opportunities and engagement. Traditional brick-and-mortar stores don’t have the most people on their networks, however. That distinction belongs to transportation hubs and convention centers, where the large crowds account for 30 percent of all Wi-Fi hotspot connects.

Laptop computers are still the No. 1 device for Wi-Fi hotspot use, which makes sense as Wi-Fi radios are standard fare for notebooks. Smartphones and tablets are catching up, however, even though many have integrated 3G or 4G radios. Device owners are apt to take advantage of free or low-cost hotspots to reduce the risk of mobile broadband data overages as carriers migrate away from unlimited data plans. The Wi-Fi connections are often faster and can use less power, which can save battery life on these mobile devices.

Network operators see the benefits of Wi-Fi offload and are likely to aid in the expansion of hotspot locations by partnering with businesses directly or through existing hotspot networks, such as Boingo Wireless. In July, for example, Japanese network operator KDDI said it would build out 100,000 Wi-Fi hotspots by March 2012 that will seamlessly work with the carrier’s WiMAX network. A seamless network transition, in addition to automatic log-in software — similar to Boingo’s current application — essentially turns Wi-Fi into the “other” cell network in this case.

Update: By way of email, In-Stat analyst Amy Cravens offered me additional context to the prediction of one million hotspot locations by 2013, saying there were an estimated 420,000 hotspot venues in 2010 and figures 630,000 by the end of 2011.