Perhaps struggling municipal WiFi networks in the U.S. should take a lesson from Singapore. Thanks to an initiative by the government's InfoComm Development Authority in conjunction with operators iCell, QMax and the incumbent SingTel, the country has blanketed its population with 7,200 hotspots. The initiative, called Wireless@SG, was developed in 2006 and now has about 850,000 users who access the network for at least three hours per month to surf the net, send and receive email and access social networking sites.
Of course, key to Wireless@SG is that the operators provide the service (which is interoperable among all three carriers) to consumers for free for three years. The goal is to build usage and interest. After the three-year period, the operators may charge a minimal fee for the service or generate revenue from value-added applications.
But the Wireless@SG network isn't just being used by consumers. Enterprises and small businesses are also using the network for advanced applications such as wireless surveillance and wireless point of sale.
At the CommunicAsia 2008 conference in Singapore this week I spoke with iCell CEO Ken Chua about the program. Chua says that his firm is generating some revenue from advertising but it's not a core to the business strategy. Instead, after the three-year period is up, he may start charging consumers a very minimal fee for the service (in the range of $1.50 per month). But the real value will come from applications such as mobile VOIP. iCell just inked a deal with white-label mobile VOIP provider Challenger Mobile. The two firms plan to deliver end-to-end mobile VOIP solutions throughout Asia-Pacific.
Chua says that his firm is working on a mobile device in conjunction with Nokia and Microsoft that will provide mobile VOIP service and he plans to charge customers $3.60 per month for unlimited mobile VOIP calling. "We hope to get a sizable percentage of the market," Chua says. And perhaps give the incumbent cellular operators a run for their money.
Meanwhile, QMax, which is also a landline ISP, is bundling its WiFi service with its landline Internet. The company makes money by charging more for priority access and for higher bandwidth than the basic 512 Kbps. For example, for 1 Mbps of speed, customers are charged about $7.20 per month.
The IDA is pleased with its Wireless@SG initiative and is currently working on guidelines for the next-generation of the project. Whether that will be WiMAX or another technology remains to be seen. -Sue [1]
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[1] mailto:sue@fiercemarkets.com