Do we really want the wireless Web?

If you believe everything you read, you may think the wireless Web is everywhere. But despite all the hype, the service is just not that popular. And according to a study released this week, the number of people interested in the technology is actually waning.

Only about six percent of confirmed Internet users connect wirelessly, according to a report from research firm Solomon-Wolff Associates. More surprising: The number of persons interested in the wireless Internet dropped from 39 percent of Internet users in January 2001 to just 22 percent of users in January of this year.

The survey, conducted in January 2002, polled 7200 Internet users from a pool of more than 250,000 in the firm's US database. (Solomon-Wolff also conducted a survey in June 2002, but the results are not yet available.) The company has conducted an Internet survey twice a year for four years; it began asking questions about the wireless Internet in January 2001.

Perception vs. Reality

"The media seems to think everybody is using it," says Doug Solomon, a partner at Solomon-Wolff, pointing to extensive coverage of the wireless Internet in technology publications as well as the mainstream press. But it really hasn't taken off the way industry watchers thought it would, he notes.

"We had expected that this would take off like PCs and the Internet and wireless phones," he says. Instead, it seems to be going nowhere, with the percentage of users staying at about six percent through 18 months and three surveys.

If the wireless Internet is going to catch on, service providers have to find or create an application that gets people interested again, Solomon says. "There just isn't a killer application for this yet."

Wireless Internet providers, while hesitant to admit slow growth, do say they expect to again grab people's interest with new technologies they're rolling out today and in coming months.

Chief among those new technologies is the transition to next-generation networks that will improve data transfer speeds from today's sluggish 14.4 kbps to as high as 144 kbps.

Better, Faster Content

US carrier AT&T Corp.'s move to 2.5G and 3G networks will offer users considerably faster throughput, says Ritch Blasi, spokesperson for AT&T Wireless Services Inc. "It's going to be just like wire line."

And faster speeds will lead to better, more graphical applications. So, for example, you'll be able to see pictures on your phone's color screen to go along with the news story you're reading. And when you check your local weather, you'll be able to see the radar map.

AT&T's mMode service already offers users access to some 150 content providers, and the company's goal is to have upward of 600 providers by the end of the year, he says.

New applications from AT&T also include interactive games that let you play against others around the country, and a service that lets you track down the location of people on your buddy list based on their proximity to the nearest cell site.

Service Overhyped

The wireless industry did itself a disservice several years ago when it started promoting this "Internet in your pocket" concept, says Blasi.

"People were pushing wireless so hard they were almost doomed to failure," he says. "It was over hyped for years, and people expected the same experience on their phone as on their PC."

Early services could serve up decent content--from weather to news to stocks--but it was in a text-based, unattractive way.

Today's wireless Internet is where the Internet was six or seven years ago, Blasi says. The applications that are driving people to use their PCs haven't ported to wireless devices yet and the experience is different.

Higher speed networks will help change all that, he says. As companies roll out their third-generation networks, and new services and applications follow, people will become curious again, he says.

"The reports says it hasn't caught on, but now is when it will start to catch on," Blasi says.

Too Little, Too Late

Despite the plethora of new services on the way, analyst Solomon isn't convinced that third-generation technology will be enough to win over skeptical consumers.

Between the demise of the dot-coms and the downturn in the economy, people's interest seems to have died off, he says. Plus, as the new technologies draw near it seems many people think the incremental improvements they offer just aren't worth the price.

Most current users connect to the wireless Internet primarily for sending and receiving e-mail, he says. The vast majority of people can live without e-mail for short periods of time.

"Do you really need your e-mail that much?" he says. "Can't you wait until you get home from work?"

Since many folks see the improvements as merely incremental, few are willing to pay what service providers are asking, he explains. While the average wireless Internet user pays about $30 a month, many of the survey respondents say they wouldn't pay more than about $10 a month to get the service, he says.

AT&T charges customers by the amount of data they send and receive, Blasi says. The company offers packages for consumers who tend to use small amounts, and for business users who tend to use higher amounts. Overall customers seem pleased with the packages the company offers, he says.

AT&T does hope to bring the cost of wireless Internet service down in time, but it needs more subscribers first, he says.

"It's early in the market," Blasi says, and prices reflect that. "As more people use [the service] that will drive prices down."

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Tom Mainelli

PC World
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