A growing number of colleges and universities around the country are grappling with how to communicate with and provide services for students who are part of a mobile generation, often have their own cellular phones and likely aren’t going to sign up for landline service in their dorm rooms.
The high wireless penetration rate among college students has led to radical changes in the past few years, as college try to figure out how to communicate with students and face the loss of revenue from the private exchange telephone infrastructure that they installed.
“The revenue basically dropped off a cliff face over the past several years, because of the 90- to 95-percent penetration of cell phones,” said Raju Rishi, chief operating officer for Rave Wireless. The company, which launched last year, helps provide campuses with wireless service through relationships with the four national carriers, as well as offering software applications designed for use specifically at universities.
The company has received a decent chunk of venture capital, most recently closing on a $12 million Series B round of funding in April. And Rave has seen a great deal of interest in its products for a venture so young. Rave expects to have its services running on 18 campuses this fall and is in negotiations with another 100 campuses, Rishi said.
Although Rave is not a mobile virtual network operator, Tower Group analyst Bob Egan says that in some ways, targeting college students through their universities is the perfect execution of what many MVNOs are trying to do: serve a large, defined audience with applications that are important to them and that appeal to them through a brand they can relate to.
“It is striking at the heart of something that’s important to a society that is big, that has sources of income and is valuable,” Egan said.
In many ways, college campuses are a microcosm for the rest of the wireless world. Colleges are eager to offer services such as Wi-Fi access to students, and their buying power gives them leverage with carriers to get good deals for students. Some campuses are even going so far to rip out their wireline infrastructure. Montclair State University in New Jersey is issuing mandatory cell phones for students.
Collegians are a highly desired demographic for the data services network operators are pushing-but the competition for their attention is fiercer than ever. Several mobile virtual network operators are targeting tech-savvy consumers who fall into the traditional college-age group. Helio L.L.C., for example, is making its handsets and services available in some college bookstores. Xero Mobile, which plans to launch this fall, hopes to target the college demographic with free handsets and wireless bills subsidized by mobile advertising.
The University of Cincinnati last month started offering a voluntary wireless service in partnership with Cincinnati Bell Wireless. The service has been introduced to UC’s 4,000 incoming freshmen, who will be able to sign up for service this week.
“We have 14,000 landlines here at the university, but they’re buggy-whips,” said Fred Siff, the UC’s vice president and chief information officer. “People don’t want them; they want cell phones.”
The contract requires Cincinnati Bell to build out infrastructure on campus to provide at least “three-bar” coverage on 90 percent of the campus, plus provide 50 Wi-Fi public access points on the campus borders. Eventually, they hope to roll out applications such as a shuttle bus alert, a tie-in to a service that provides local directions, text-messaging alerts about classes and provide a caller’s general location to campus security during a call for help.
However, many college students with their own wireless plans for the first time may run into trouble getting approved by traditional wireless carriers because of their lack of credit history. International students in particular face hurdles in getting wireless service-especially since the Sept. 11 terrorist attacks and subsequent tightening of rules about obtaining a Social Security number, which is essential for postpaid service.
Purdue University, for example, has about 5,000 international students-the third-largest college community of such students in the nation, according to Michael Brzezinski, Purdue’s assistant dean for international programs and director of international students and scholars. Brzezinski said that several hundred students are involved in a program that offers them international long-distance service from MobileSphere and the opportunity to sign up for prepaid service, which doesn’t require a Social Security number.
“I think it’s working well,” Brzezinski said. “Students need to be in touch with their families, and many do it by e-mail or phone. There’s much more of an emotional element or a closer tie … when you can talk to the person.”
Companies focusing on the space often work with multiple carriers, since coverage varies from campus to campus. MobileSphere, for example, has partnered with two MVNOs to offer international long-distance to college students, along with its own direct service for consumers. One is Liberty Wireless, a Sprint Nextel Corp. MVNO, and the other is XE Mobile, which runs on Cingular Wireless L.L.C.’s network.
“We chose to have two options in there, so between Cingular and Sprint we think we can provide coverage pretty much to any university nationwide,” said Gavin Macomber, executive vice president of MobileSphere. The company entered the college marketplace in 2003 and now works with 22 schools to provide both domestic and international long-distance calling to students through landlines and wireless phones.
