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ISPs must fight for their place in the home

Posted by Todd Mersch on 15 August 2016

Walk into your local Best Buy and another device is fighting for space alongside the 4K televisions and ever-thinner laptops: routers.

It was once the case that these devices were mostly to found in more specialist electronic stores, alongside internal PC components and soldering irons. But now they’re of interest to the more mainstream consumer, and roundups of the best router to buy are creeping out of the specialist technology press and into more mainstream outlets.

It’s easy to understand why we’re interested in the newest gadgets, but Wi-Fi routers don’t seem to fit the mold – plastic boxes with a few LEDs, and possibly an antenna or two. Plus, a lot of the jargon is even harder to grasp than usual. So why has this changed?

The simple answer is that customers are getting smarter about their Wi-Fi. They’ve realized that Wi-Fi is the performance driver for their home network – a network that increasingly must cope with not only multiple devices per resident, but also new uses such as video streaming and Internet of Things (IoT) applications.

So when customers have an unreliable and frustrating Wi-Fi connection, they are looking to replace their router to solve the problem – ditching the bog-standard router bundled with their internet connection and instead installing a more expensive device with more antennae and more LEDs. There are also new companies providing direct-to-consumer smart Wi-Fi equipment. Eero and Luma launched with the very aim of fixing Wi-Fi in the home – in Eero’s case this comes with a $500 price tag.

Why should the ISP care about this? The customer, after all, remains connected to the network and is still paying a regular monthly fee for this connection. Service providers should, however, have a longer-term view of their relationship with the customer. This isn’t just a consumer buying an upgraded piece of technology, it’s the service provider quietly losing the most critical component of the customer relationship and relegating it to a mere bit-pipe.

Service providers should instead be seizing the opportunity to not only save this relationship, but solving the customer’s Wi-Fi woes.

Existing solutions for better home Wi-Fi usually retrench either a “stronger” signal or multiple access points. These are not necessarily the best solution to Wi-Fi issues. If the service provider can identify what is driving the coverage issue – which could be router placement, the size of the area the AP is trying to cover, or interference from nearby access points – they have the opportunity to proactively solve the problem. This can happen during installation as well as under operation.

Our research has shown that current use of Wi-Fi is woefully inefficient. In an average area, the capacity unavailable thanks to these inefficiencies was enough to stream another 25 high-definition videos. Customer buying new routers won’t solve this problem of inefficiency, but service providers can. Through intelligent and automated use of unlicensed spectrum, service providers can tap into the latent capacity and deliver better, more reliable performance – and deliver exciting revenue generating services, to boot.

But this won’t be possible if consumers are using their own router. Instead, the promise of ‘Better Wi-Fi in the home’ – and the money consumers are willing to pay – will belong to instead to those selling more powerful routers and new entrants with multi-access point solutions.

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