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  • Mark Middleton

Business model drivers for carrier-grade Wi-Fi offload deployment



Mobile network operators (MNOs) look to both cost-avoidance and value enhancement when justifying the business case for a carrier-grade Wi-Fi offload implementation.

We use the word implementation, because it may be that the MNO does not actually deploy its own carrier-grade metro Wi-Fi network. That would require the MNO to deploy, own and operate a Wi-Fi network over and above its cellular network. This may not suit all MNOs (from a capex, opex and focus perspective) – the number of Wi-Fi sites is significantly greater than the number of cell sites. For example, in a dense urban environment, 20-30 multi-radio wireless nodes per square km may be required. Instead, the MNO may chose to take advantage of an existing carrier-grade metro Wi-Fi deployment and license or lease an SSID on that network (in effect getting a virtual slice of that network). This can save the MNO the upfront deployment capex, as well as the ongoing network management obligations – the MNO simply pays a monthly fee to the network operator for the virtual slice of the network. Deployment and operation of the network is handled by the Wi-Fi network operator. The MNO becomes and Wi-Fi virtual network operator (WVNO).

From an WVNO subscriber and marketing/branding perspective, given that the WVNO has its own SSID, it appears like the its own network. With a VLAN from the Wi-Fi network edge into the mobile core, the MNO has full control over all authentication, authorisation and accounting on that MNO’s virtual Wi-Fi network. It is possible for the Wi-Fi network owner to lease a number of virtual slices of the same single set of network infrastructure. MVNOs are, today, completely familiar with this model.

The decision to offer Wi-Fi offload services to subscribers comes with a cost to the MNO. Whether it is the upfront capex and then network opex on an MNO’s own Wi-Fi network or simply the cost of leasing a virtual SSID on a third party network, a business case needs to be established and proven. Informa have identified 11 business models used to underpin broader investment into carrier grade Wi-Fi. These are set out in this diagram:


The mature, established and growing categories highlight the well-known drivers for metro Wi-Fi investment. These are standalone access, wholesale capacity and of coure Wi-Fi offload/enhanced fixed broadband proposition. Standalone and Wi-Fi Offload are generally cost-avoidance categories, whereas wholesale and enhanced fixed broadband propositions are generally value enhancing opportunities for the MNO. Cost-avoidance examples include the reduction in capacity-based network core licensing fees that vendors may charge a MNO. Offloading traffic onto the Wi-Fi network will result in reduced traffic going through the core.

This can reduce or slow down the growth in capacity license fees payable.


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