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Singapore abandons Wi-Fi for 3G

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The smart money doesn't have the Wi-Fi bubble bursting until next year, but early indicators from Asia suggest we could be hearing an ear-bursting "Pop!" sooner than anyone had expected.

Why? Well, when the world looks to wireless, it looks to Asia. And the news this week isn't good for Wi-Fi utopians who dream of the technology supplanting international cellular standards used by billions of people.

Singapore operator MobileOne invested heavily in 802.11 last year, but this week it announced that it had abandoned its Wi-Fi experiment and decided to put its money behind 3G instead.

Neil Montefiore, MobileOne's CEO, cited a couple of reasons. First, laptop and PDA users account for "only three or four per cent" of the market. Everyone else has phones. Second, and this bolsters the 'Rabbit' theory, people want blanket coverage.

'Rabbit' was a pre-GSM Hutchison gambit that required the caller to stand within a few yards of a Rabbit "hotspot". It didn't take off because people, quite reasonably, refused to make the trade-off. People actually don't want to think about such steps. They just want stuff that works, and they don't want to thinks where they need to be before making a call. Ubiquity, and blanket coverage, were the great drivers of 2G cellphone adoption.

The number of PDA or PowerBook-toting Wi-Fi users has proved to be embarrassingly small. "By definition, road warriors are not a captive market," we pointed out only yesterday.

"M1 says its customers did not like the Wi-Fi service because it is not really mobile since users must stay within a coverage area 50-100 metres of the hotspot," we learn. MobileOne will instead invest $150 million on 3G next year.

Beset as it is by technical problems, and suffering from dot.com-sized expectations, 3G has a compelling reason to roll into the market because it gives the operators fourfold efficiencies over the 2G digital networks. They can close off the old transmitters, and save themselves a lot of money. In the UK, the 3 network is branding itself by offering the cheapest calls of all.

No blog, or Pringle Can, can counter the harsh economics: public Wi-Fi doesn't pay. ®

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