Telstra has moved to shut down its national wireless hotspot service from next year, continuing the trend away from the technology as an offload service from mobile networks in Australia.
The nation's largest telco has begun shutting down some hotspot sites in anticipation of full closure of the service by the end of February 2012.
The move will affect the remaining 35 hotspot sites Telstra operates around the country, primarily located in Telstra offices, Qantas lounges and at capital city airports.
The service had been offered for free to subscribers of Telstra's fixed iPhone plans and at a rate of 20c per minute for other users.
The closure marks the end of a service which in 2005 counted more than 400 hotspots.
The telco had once aimed to have 1000 hotspot sites deployed across Australia.
A spokesman acknowledged the lack of profit in the service as a motive behind its closure.
"Over time we've found that our customers prefer the convenience of taking their own internet connectivity with them through the use of mobile broadband," the spokesman said.
"This transition away from wireless hotspot usage has also been driven by the availability of fast 3G mobile coverage and more affordable data pricing.
"We will use our new 4G LTE [Long Term Evolution] investment to support the growing demands of users on our network."
Though telcos pushed for city-wide Wi-Fi networks earlier last decade, demand for the service declined in Australia as 3G mobile services were rolled out and smaller wireless hotspots became more prevalent.
By contrast, European telcos have continued to emphasise the service as a viable alternative to the core mobile network, providing the opportunity to 'offload' customers from base stations to nearby hotspots.
Yet the business model has largely been seen by telcos and analysts alike as failing to provide any real profit.
Optus has largely pulled out of the business, while Internode has remained a supporter of the business model, particularly in its home state of South Australia.
Vodafone Hutchison Australia and Optus have begun exploring femtocell technologies as a replacement offload method.
Testra executive director of networks, Mike Wright, told Telecom Asia earlier this year that Wi-Fi isn't a cure-all for offloading network capacity.
"It becomes popular belief that the answer for everything is we'll just push it to Wi-Fi," he said. "That's part of the answer but if we ignore that Wi-Fi has limited spectrum and limited capability, we ignore some of the challenges in front of us and maybe we don't face them early enough.
"Don't forget this data is still coming, don't forget we should figure out how to carry it with the technologies available to us as well."