Feature Article

February 07, 2013

In Spite of Many Concerns, Mobile Hotspot Usage is on the Rise

Smith Micro Software, Inc. was founded by William W. Smith in 1983. The company is a developer and marketer of both enterprise and consumer level software solutions and services. Recently they had United Sample, or as it is known, uSamp a leader in online market research, conduct a nationwide survey to see how people feel about using hotspots for Wi-Fi connections.

When you consider that to keep the cost down most tablets that are sold in the U.S. are Wi-Fi only devices. Since the beauty of owning a tablet is to be able to take it anywhere and more importantly, use it anywhere, you can see how useful a personal Wi-Fi hotspot can be.

According to the survey, 62 percent of smartphone users leverage their devices' hotspot capabilities – an increase of 9 percent since May 2012. More than 700 mobile users were part of the survey. Even though the numbers show an increase in users, there are still several concerns. The main concern of course is with the cost, but another major concern is the usability of the hotspot.

The survey shows that carriers are missing key opportunities to monetize personal hotspots.

It seems that 71 percent of the people who took the survey said they either used a dedicated hotspot, their smartphone as a hotspot, or both. These were used to connect their Wi-Fi devices to the Internet.

As high a percentage number as this is, most of these people are not frequent users.

The survey shows that a majority of hotspot users are heavy data users. These tend to be more professional than personal users. In the survey a professional user has their device and the hotspot paid for by the employer.

In this group, 59 percent of professional users are concerned with hotspot performance. This is in comparison to only 16 percent of recreational users who were concerned about performance. 

Sunil Marolia, VP of product management at Smith Micro said, “Our survey results highlight some concerns preventing broader adoption, and significant revenue leakage associated with hotspot service. By making mobile hotspots easier to use, with more flexible business models behind them, operators can better capitalize on the revenue potential of these devices.”

The survey scrutinized the difference between frequent hotspot users and the occasional ones. Both groups listed expense, battery life and limited plan options as their top concerns. The occasional users had other concerns. Since they only need to use the hotspot areas sometimes, 54 percent want easier, one-step access to connect a device to a personal hotspot and 49 percent want self-care diagnostics to help debug connectivity issues. These are both easy to understand since they use the personal hotspot so infrequently.

What I find surprising is that 43 percent prefer ad-sponsored hotspot service, even if usage limits were applied. I can assume this is something that would keep the cost down.

Some of the other results from the survey are:

  • 71 percent of respondents have used a dedicated hotspot device, a smartphone hotspot, or both to connect Wi-Fi devices to the mobile Internet:
  • Almost half are not-frequent users
  • More than 25 percent do not pay their carrier for hotspot service, but instead use over-the-top applications to access this feature on their smartphones.
  • For nearly one-third of respondents who do not use any form of personal hotspot, privacy concerns (27 percent) and the desire to avoid another wireless contract (21 percent) were major contributors to non-usage.

Basically the survey found that data hungry hotspot users are more concerned with the usability, privacy and lack of plan options available with smartphone hotspots. The report also shows a significant opportunity for carriers to capitalize on consumers' desire for a better Wi-Fi experience.

Even with these concerns – and they’re not minor ones – more people are using personal hotspots. This leads back to the idea that so many people want to stay connected everywhere.

Edited by Braden Becker

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