In this tutorial we aim to provide information on the various models used by Internet (WiFi) service providers and businesses (such as cafes, restaurants, hotels, airports etc) to monetize free WiFi zones.
Introduction
Starting a free WiFi zone can be expensive and it’s important to have an understanding on the different revenue streams by which you can monetize free WiFi service.
Before you plan or deploy your public/guest WiFi zone it is important to decide how do you plan on recovering your cost of providing WiFi.
The following image provides an overall understanding how companies monetize free WiFi service offered to users.
WiFi Monetization Models: How businesses monetize free WiFi?
With reference to the image above:
- ISPs – are Internet service providers or cable service operators that offer free WiFi as a business.
- Quasi ISPs – are places that offer free WiFi as a service such as cafes, restaurants, hotels, airports etc.
We made a large survey of 400 public WiFi zones in India to understand how WiFi providers were recovering costs (or making profits) by delivering free WiFi service to their guests. Our research question for this study was:
“If the users don’t pay for the free WiFi, who does?”
A classification of the surveyed businesses and their WiFi monetization models is present as follows:
Monetize Free WiFi as a Service
In this model there is no extra charge to the user for using free WiFi. Businesses monetize free WiFi by marking up the price of their service or product.
Example: Monetize WiFi as a Service
For instance; a hotel increases the price of booking a room for customers and includes the cost of offering free Wi-Fi as a part of customer service.
Integrating free WiFi as a part of the service offered leads to increase in customer satisfaction and customer experience. We explain the advantages of starting a wifi zone for customers in this post (Click here to read more).
Monetize free WiFi via Government Schemes
There are several schemes offered by many different governments around the world to support public Internet access.
For instance; The government of India has created special schemes to fund (partly or wholly) public Internet (WiFi) zones in areas with a large digital divide.
The cost of setting up and running the free WiFi service is borne partly or wholly by the government. Many state governments and non-governmental organizations also have special schemes to boost their public WiFi program.
Be sure to read such schemes and programs on your country/state ICT ministry’s website.
Monetize free WiFi via Premium Users
Some WiFi providers created special User Funded Models (UFM) to monetize free WiFi.
In this model, the WiFi providers creates two types of user plans:
- Free Plan Users: The free plan is usually slow, and limited by time and data download. For instance; free WiFi for first hour and later pay for additional access.
- Premium Plan Users: The premium plan is a paid plan for faster speeds and lesser limitations on time and downloads. The premium plan is usually sold with the help of special voucher codes:
Example: Monetize free WiFi via voucher codes for premium users
The revenue made on premium users is used to nullify the costs incurred to provide free WiFi service to users.
Monetize free WiFi with Advertising
WiFi Advertising is a promising new way to monetize free WiFi zones in India. In this model, the WiFi provider makes money by showing end-users a WiFi advertisement before granting them free Internet access.
Example: Monetize free WiFi with advertisements
WiFi Advertising is preferred by agencies and companies as it provides an avenue for:
- Excellent Brand Recall and Customer Experience – People remember brands when they offer free WiFi!
- HyperLocal Advertisement Targetting – is made possible as brands can choose the router they want place their ads on.
- Smart-Social Advertising – Instead of mindlessly spending money on spammy digital ads; brands like to spend their money on free Internet access to watch their customer loyalty grow.
In an article titled “Information on WiFi Advertising” we have mentioned many details on how to get started with creative WiFi Advertising. (Click here to read)
If you need information on WiFi monetization or need a WiFi Management software to monetize your free WiFi zone; get in touch with us on info [at] muftwifi.com or call on 022 69999025