March 13th, 2005

Nextel’s Wireless Broadband Access – What Consumers Want – Almost

Nextel announced partnerships with Boingo and Wayport today that will give their wireless data subscribers access to Wi-Fi footprints nationwide. See release. For their customers accustomed to mid-range double digit Kbps, this is probably great news though I can’t quite reconcile the Wi-Fi footprint with their target customer base. Overall, I think it falls short on a number of points. With a Sprint merger looming, I’m surprised they don’t immediately latch on to Sprint’s higher speed network.

Wireless broadband services for those on the road still leaves consumers in the position of evaluating the quality of networks and services when they are making purchasing decisions. Not really where the carriers want to be, but announcements like these are certainly steps forward. When consumers are evaluating their options, a complex set of factors STILL must be taken into consideration – and that’s just around connectivity – not including security, device, etc. And, the carriers are not announcing in advance where they will be deploying 3G services … still waiting on EVDO in SF. It’s still a complex purchasing decision. The consumers still don’t know where they’ll have what coverage.

The options:

Verizon – $80/month for nationwide access. Best case scenario is EVDO – worst case 1x. Their client includes a scan for Wi-Fi networks and gives the user a choice. Card can cost $100+, but you already own the device – the PC. Sprint – similar, but without the EVDO network, yet. Nextel – a few Kbps nationwide plus access to 7,000 hotspots in North America. $55/month. Handhelds … many carriers … initial cost is several hundred dollars with service plans running $30 to $40+/month. No attachments, but access to messages.

There are other options and most of the carriers have plays at each of these price points. I think the wireless carriers with 3G networks are very well positioned in this market – I haven’t spoken to anyone yet who is using EVDO who doesn’t LOVE it.

But back to the question – how does a consumer choose? And, there is such a small pool of consumers to fight for at these prices points – low single digits according to our surveys.

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