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August 5, 2020

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Tutela: US Cable MVNOs Find Extraordinary Value in Wi-Fi Offload 

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Chances are, if you’re not intimately entangled with the mobility industry, you haven’t been paying too much attention to the continued rise of the Mobile Virtual Network Operator (MVNO).

Indeed, aside from such things as the Huawei ban, Net Neutrality, the state of 5G and Wi-Fi 6, and FCC Chairman Ajit Pai’s affinity for NBC’s ‘Parks and Recreation,’ you probably don’t spend too much time contemplating anything but your monthly cellular and Wi-Fi bills.

That’s fine. Look, we get it. We’re pros, but even our eyes begin to cross when we see terms like C-V2X, IEEE 802.1X, and DSRC 5.9GHz Safety Spectrum. It’s a lot of jargon, a lot to keep track of, and unless you’re in the business, it’s probably not worth your time.

In any case, we would like to bring to your attention one trend in the MVNO space with potentially astronomic implications for consumer mobility solutions.
Specifically: the extraordinary value of Wi-Fi offload.


Tutela and the State of MVNOs

According to a recent study by the Canadian mobile analytics company, Tutela, US cable MVNOs are quietly extracting remarkable benefits from using their own Wi-Fi networks to facilitate smartphone traffic.

Telco shops like Comcast are leveraging their extensive public and private Wi-Fi infrastructure to reduce their dependence on cellular connectivity. This means they’re able to substantially reduce operating costs and deliver far-above-average service quality.

Now, it’s old news that the lion’s share of phone traffic across the globe is carried by Wi-Fi. Indeed, as Claus Hetting, Wi-Fi NOW CEO & Chairman, notes: “(Tutela’s) report says that Verizon subscribers use Wi-Fi for about 61% of traffic while Xfinity Mobile subs use Wi-Fi for nearly 20% more at 78.3%. Some 6% of the traffic is delivered by Comcast’s public Xfinity Wi-Fi network of hotspots, of which Comcast claims there exists some 18 million (including so-called ‘homespots’ or shared residential Wi-Fi).”

Nevertheless, the question is, how much benefit can MVNOs expect to derive from Wi-Fi offload? According to Tutela, quite a bit: “Tests over the Wi-Fi network of Altice, Comcast, and Charter all recorded Excellent and Core Consistent Quality percentages well in excess of the average for Verizon’s network — the best in the United States.”

Claus Hetting also noted that, while the comparative Quality of Experience (QoE) results are remarkable, data from other countries indicate a similar trend regarding speeds: On average Wi-Fi networks tend to be faster than mobile.

Moreover, Hetting points out that high Wi-Fi traffic rates are valuable to MVNOs because they generally mean less cellular traffic and hence reduced traffic fees paid out to the host cellular network. For instance, both Spectrum Mobile and Xfinity Mobile rely on Verizon’s 4G network for cellular services. By maximizing the duties of their own Wi-Fi infrastructure, their users will ultimately consume less cellular data, meaning Comcast and Spectrum can more efficiently allocate company resources.

Tutela did, however, offer a few words of caution for those in danger of inferring from their report too much about the delta in Wi-Fi usage rates between MVNOs and Verizon. According to Chris Mills, Head of Industry Analysis at Tutela, “Other factors, such as the mix of plans chosen by MVNO subscribers compared to Verizon’s subscriber base, also contribute to the difference in cellular data usage.”


The Future of MVNOs

In writing about Tutela’s findings and the state of Wi-Fi offload generally, Claus Hetting openly laments that, while carrier-initiated Wi-Fi offload has been intermittently touted as a capital-efficient boost to the MVNO or MNO business case, few service providers actively employ it. Hetting said, “Sources knowledgeable on the matter suggest less than 30 mobile operators actively use offload the world over.”

Still, there is the impossible-to-ignore fact that Wi-Fi offload is relatively new. Until recently, it’s not clear Wi-Fi was even capable of providing a QoE close to that of cellular. As more vindicating research is done on the quality of Wi-Fi networks, as Wi-Fi 6 matures, and as entrepreneurial-minded companies look to leverage wireless connectivity in new and creative business models, mobile operators will surely take heed. Indeed, in a free market, the best technologies will prevail.

Of course, we at Pareteum believe that Wi-Fi is one path to the future — for MVNOs, MNOs, IoT, Enterprise, Loyalty, you name it. We maintain the world’s largest aggregated Wi-Fi network, with footprint at high demand locations and venues in more than 200 countries and territories. This includes tens of thousands of hotels, over 5,000 aircraft, nearly 700 airports, and tens of millions of business and leisure venues all over the globe.

If you’re interested in learning more about Pareteum Experience Cloud, or how you can use our Wi-Fi solution to offset mobility costs, give us a buzz. In the meantime, feel free to peruse the product pages on our site.