I have made the case of why FON is great for ISPs. We have signed our first agreement with Glocalnet, Sweden´s second largest ISP, an amazing competitor to Telia and we are in the process of negotiating with another 11 ISPs in the United States, Europe and Latin America. Now can we make a case that FON is great for mobile operators? This one is a harder case to make but let me try to make it.
First I would like to say that in Europe mobile rates and GSM ARPUs are much higher than in America. In Europe GSM operators are getting around 1000 euros per year per customer, in America around half of that. In America operators sell big buckets of minutes, in Europe operators charge customers very high per minute charges, incredibly high fixed to mobile rates that the mobile operators keep and extortionist roaming rates.
Still my prediction is that in the next 3 years there will be a huge price drop on mobile in Europe and ARPUs will fall to half of what they are now, say 500 euros per year.
Now when Europe goes to flat monthly pricing, a similar system to that of the States, FON will be a friend of GSM operators. Why? Very simple, once you collect a flat rate pricing rate what you want is less usage, so you have to invest less in the network. At that point Dual WiFi GSM phones go from being a curse to being a blessing as a lot of traffic would leave the network through WiFi simply cause phones would detect it and so users do not pass a theoretical high bucket limit set by the GSM operator. In this way GSM operators rely on WiFI to invest less. Moreover WiFi is great for many in building sections that are not reached by GSM operators.
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