Cablevision Launches Wi-Fi-Only Mobile Service: How Big is the Market?

Cablevision Systems has launched Freewheel, its new Wi-Fi-only mobile service, providing a real-world test of a theory, speculated about for a couple of decades, that Wi-Fi can be a full substitute for a mobile network.

The "Wi-Fi only" approach to mobile device access will test the degree of demand for a service that mimics, in many ways, the way most tablet users gain Internet access.

In an era where the ability to make a phone call from anywhere was the primary and compelling value of a mobile phone, the Wi-Fi-only approach had fundamental limitations.

But the smartphone era is different, making a device a multi-function device. Whatever the remaining limitations of a voice service that only works sometimes, many use cases exist for Internet access available “sometimes.”

In that sense, Freewheel tests not only the value and viability of a Wi-Fi calling service, but also a Wi-Fi-only approach to Internet access, something many users have found works well enough for their tablets.

One potential issue is the market window for such an approach. As 4G networks increasingly move towards a “use the best access” approach, mixing mobile network with Wi-Fi access, the uniqueness and value of a Wi-Fi-only approach will be tested.

That is likely to be even more the case by the time fifth generation networks are commercialized, since the “use any access” approach is expected to be key for 5G.

One might well argue that the “Wi-Fi-only” approach will work best in a highly-urbanized, dense area such as the New York metro area that already has dense public hotspot coverage.

The value will be far less in sparsely-settled, lower density areas. But that is the reason Comcast is building a big network of public hotspots that piggyback on Comcast’s consumer high speed access business.

Freewheel costs $30 a month for customers who are not buying Cablevision high speed access, but only $10 a month for consumers who do buy Optimum Online broadband services.

That suggests the immediate success will be found among Cablevision high speed access customers who need additional low-cost mobile service, possibly for children. The hassle of sporadic voice access is likely to prove a bigger obstacle for potential mobile phone users who mostly want a mobile phone service featuring lower cost.

The advantage might be greater for users who primarily want to use more mobile data, are concerned about the cost and can put up with some spotty voice coverage.

Still, there might be much to be learned about such approaches. Some TV white spaces networks are likely to employ a “Wi-Fi-only” access approach as well, for smartphone and PC or tablet access.