With mobile data traffic growing, and revenue per gigabyte falling, operators need to reduce network carriage costs by 50 per cent or else face an eightfold increase in the costs of RAN (Radio Access Network) equipment, according to a report from Analysys Mason.

The Case for Wi-Fi Offload report predicts that if operators in Western Europe simply try to meet the growing demand for data traffic by deploying more base stations, RAN costs could rise to $40bn per year by 2016, compared to $5bn in 2011.
“Operators can’t afford to spend that sort of money,” says Terry Norman, lead analyst for Analysys Mason’s Wireless Networks research programme. “Therefore, operators will either accept network congestion or use pricing to control demand – neither are good business practice. In Western Europe, operators need to save $30 billion in mobile access network costs between now and 2016. Wi-fi would go a long way towards making up that deficit, because it costs only about 20 per cent of an equivalent macro deployment.”