WiFi Becomes a Threat for Phone-Carrier Companies

Phone Carriers – taken from http://www.simplecellphoneapp.com/images/carriers.jpg.

The world has changed since the past decade. Nowadays, people use smartphones everywhere they go, where surfing the internet has become easier and more convenient. David Goldman’s post on CNNMoney talks about how people may not need a mobile carrier by 2020 as WiFi is becoming more and more available, even in airplanes. Nowadays, people try to maximize the use of WiFi everywhere they go in order to minimize their data costs. Furthermore, phone calls and texts now can also be received through WiFi.

This could be a threat for phone carriers if people stop using phone carriers and substitute into using WiFi, especially since WiFi has a cost-advantage for consumers rather than using phone carriers. I found this article interesting and surprising because I have never thought that WiFi could be a threat for phone companies, especially acting as a substitute for phone carriers.

In the long run, in order to avoid this substitute,¬†several phone companies can work together with commercial companies or restaurants for example to provide WiFi. This, in return, will change the company’s business model by adding another revenue stream and adding several key partners. Not only this, but they can also avoid the substitute by being more cost-advantage (not charging consumers with high prices of phone bills).

Source: http://money.cnn.com/2014/11/07/technology/mobile/wifi-mobile-carrier/index.html?iid=HP_LN

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