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Report: Hot spots to spark little profit

The pace of installation of hot spots, or public places with wireless access, will continue to grow, but lower-than-expected usage levels will force telecommunications companies to re-evaluate their business models, according to a report released Monday by research firm Forward Concepts. The report estimated that the number of hot spots in the United States will reach about 46,000 in 2003 and hold steady the year after that.

But growth will pick up again in 2005, and by 2007 there will be 530,000 hot spots in the United States, it predicted. Four years from now, the hot-spot total is expected to reach almost 800,000 in Europe and from 1 to 4 million in Asia. Revenue from wireless hot-spot service in the United States is projected to reach $8 billion, or about $15,000 per hot spot, in 2007, which may force telecommunications companies to rethink their plans.