[CAnet - news] The economics of WiFi

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[I have always been skeptical of WiFi being a facilities based competitive
technology to DSL or cable.  I suspect that many of these municipal WiFi
projects will be underutilized for some time as evidenced by the experience
in Taipei.  However where WiFi networks may soon gain significant traction
is as a low cost alternative to 3G.  The new 3G phone like the Nokia E
series will automatically switch to less expensive (and more throughput)
WiFi whenever they detect the WiFi signal. FON's business strategy makes a
lot of sense in that case (as I suspect as well with Google and Earthlink)
to build open access Wifi networks. The revenue potential of 3G is
significantly greater than with simple broadband Internet access. How the 3G
operators will respond will be interesting as many of them also own the DSL
and cable networks  which FON's business strategy depends upon. Some
excerpts from various articles-- BSA]


Changing The Economics Of Wi-Fi

LONDON - FON, a Spanish start-up on an ambitious crusade to turn home Wi-Fi
connections into wireless "hotspots" for nearby users, is set to unveil
Monday a plan to hand out 1 million wireless routers for just $5 apiece.

FON, which aims to create a network of home users and small businesses to
resell wireless access to passersby, said Sunday it will subsidize $60 Cisco
Linksys or Buffalo routers for $5 in the United States or 5 euros in Europe.
....
http://internetweek.cmp.com/189601305?cid=rssfeed_pl_inw





>From the NY Times, June 26, 2006
What if They Built an Urban Wireless Network and Hardly Anyone Used It? By
KEN BELSON

http://select.nytimes.com/mem/tnt.html?emc=tnt&tntget=2006/06/26/technology/
26taipei.html&tntemail1=y


With 4,100 hot spot access points reaching 90 percent of the 
population - just 40,000 of Taipei's 2.6 million residents have agreed to
pay for the service since January. Q-Ware, the local Internet provider that
built and runs the network, once expected to have 250,000 subscribers by the
end of the year, but it has lowered that target to 200,000.

Initially, Q-Ware gave away subscriptions and about 60,000 people signed up.
But once Q- Ware started charging for its service in January, only a few
thousand subscribers remained.

That such a vast and reasonably priced wireless network has attracted so few
users in an otherwise tech-hungry metropolis should give pause to civic
leaders in Chicago, Philadelphia and dozens of other American cities that
are building wireless networks of their own.

"There is a lot of hype about public access," said Craig J. Settles, a
technology consultant in Oakland, Calif., and author of "Fighting the Good
Fight for Municipal Wireless." "What's missing from a lot of these
discussions is what people are willing to pay for."



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These news items and comments are mine alone and do not necessarily reflect
those  of the CANARIE board or management.

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