Both the Toronto Star and the Globe and Mail are carrying articles today on Bell Canada's new hotspot offering, AccessZone. (Here's the press release). This is certainly the first major hotspot announcement in Canada, and it is also unusual in that it comes from a cellular carrier.
The idea of WiFi hotspots is gathering considerable momentum, although key items - such as charges - remain unresolved. But that's ok, for now. A three-month trial will help Bell determine just how many people want this as a service, which is a critical factor for future business decisions for them.
But a far more interesting question surrounds the effects that WiFi may have on 3G - the high speed cellular services. It's often claimed that 3G will offer drastically improved bandwidth, and it's left as an implication that this will resolve all problems.
But connectivity has never been that simple...
The first constraint on 3G is going to be handsets, accessories, and data package prices. By the time a consumer has outfitted themselves for high-speed services, they are spending some major cash, both upfront and per-month. For the same cash, they can get themselves a high-speed home hookup, wireless gateway, and WiFi cards for both the laptop and the handheld - and still have some money left over for POCS (Plain Old Cellular Service), which will work just about everywhere. Add in hotspots, and suddenly the WiFi option looks like a really good deal. It even delivers home networking as part of the bargain.
The second constraint is that 3G only works where carriers set it up. This is fine in urban areas, but rural areas are likely to be poorly served at first. If history is anything to go by, they could be still on analog for some time. Unfortunately, your phone is still expensive even when the data coverage isn't there.
Of course, WiFi isn't everywhere either - but that fits users' expectations. Cellular users expect their phone to work everywhere, while WiFi users - even when they are the same people - understand that coverage is not automatic. This could be seen as a real problem for the perception of 3G services. So why would a cellular provider like Bell actively promote WiFi, and even provide services?
Money. Money-money-money. Setting up a few WiFi hotspots in important places is no where near as costly as rolling out widespread 3G coverage. More importantly, WiFi looks to be a far more cost-effective way to meet the customers' expectations with regard to data services, speed, and coverage. Meanwhile, Bell can concentrate on ensuring that its cellular network delivers voice calls over as broad a region as possible - possibly even without 3G.
This isn't going to be a rosy forecast for those who want a one-device does all Treo-or-Blackberry-like solution. But it looks like an effective way to get more services to more people for less money, and that is always nice.