Tuesday, August 05, 2003

Hotspot Service Revs to Boom

The U.S. hot-spot service market will exceed revenues of $800 million by 2007, according to Public Hot Spots: Moving beyond Road Warriors, the latest report from Parks Associates. Based on consumer surveys and interviews with service providers, Parks Associates estimates the 2003 service revenues for hot spots will be $105 million. The compound annual growth rate (CAGR) between 2003 and 2007 is approximately 50%.

"Although these service revenues will be a very small portion of total telecommunications revenues, the intangible benefits hot spots can bring for both venue owners and service providers will still provide investment incentives," said Yuanzhe (Michael) Cai, research analyst with Parks Associates. "And as this market matures, different market segments will start to use these services."

Public Hot Spots: Moving beyond Road Warriors divides hot-spot users into three groups: business subscribers, broadband subscribers, and ad hoc users. According to the report, in order to move this market forward, service providers will have to develop different business models to accommodate the disparate usage habits and demands of these groups.

"The majority of early adopters are business travelers, and they will be a major part of the market for years to come. Companies with prime venues and strong enterprise focus may see some early success," Cai said. "For the market to move beyond road warriors, however, telecom carriers have to bundle hot spots with their other communications services and provide continuous support for this market. Most telecom carriers are likely to follow Verizon's suit and offer hot-spot services as a free amenity, but they may also provide tiered services based on location and quality of services."

On August 7, 2003 11:00 a.m. CST, Parks Associates will be hosting a one-hour webcast on the U.S. hot spot market. For additional information about the webcast and the report Public Hot Spots: Moving beyond Road Warriors, please contact sales@parksassociates.com or call 972-490-1113.

From the article "Hotspot Service Revs to Boom."

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