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Study: Wi-Fi services to bring in the bucks

The pace of growth will drop in the short term, In-Stat said, but by 2009, worldwide revenue may top $3 billion.

Worldwide revenue from wireless network services will more than triple over the next four years, according to a report released Tuesday by In-Stat.

The market researcher says revenue will rise to $3.46 billion in 2009, up from the $969 million expected in 2005.

The growth is being fueled by an increasing number of hot spots, the researcher said, predicting that the number of hot-spot locations will double in the next four years from the present 100,000.

The pace of growth, however, will drop in the short term, In-Stat said, particularly in the beginning of 2006, as the market begins to mature.

Also, over time, the average price-per-connection figure will fall, because of declining pay-as-you-go pricing, increasing service subscriptions and the increased presence of free hot spots, In-Stat analyst Amy Cravens said in a statement.

According to In-Stat, the most growth in the sector will come from the cafe segment. The segment--which includes coffee shops, fast food and restaurants--will grow 2.5 times from 40,000 venues now to just less than 100,000 hot spots by 2009, In-Stat said.

"Much of the growth in the cafe/restaurant market will be characterized by branded deployments such as the Starbucks, McDonald's and Panera Bread hot-spot networks," Cravens said.

Significantly, just about a month ago, Intel, with the help of many others, such as IBM, Dell and Cisco, launched a program for rolling out municipalitywide wireless networks in 13 cities. The cities that join the initiative, dubbed Digital Communities, are meant to have a broadband wireless infrastructure that lets the public better connect with police and fire personnel, as well as with public-works employees.