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April 14, 2004

Wayport's CEO Says New Model on the Horizon

Wayport's CEO Dave Vucina said that the company will unveil a new business model for roaming partners in the near future that will be "the voice of reason": In an interview today with hotspot and managed services provider Wayport, CEO Dave Vucina explained that the McDonald's deal announced this week to unwire all 13,000 of the chain's U.S. locations will rewrite the basis of roaming with existing and new partners.

While Vucina was short on specifics about the upcoming change in roaming terms, he did say that it would be unique and encourage more companies to roam with Wayport. "The way we have put our program together it will be good for all parties with some balance," he said. "One of the things you see when we release our model, is that you'll see some new direction and some new ways to package the service."

Vucina said that by the end of the year, between the McDonald's stores and The UPS Store outlets that they are building as a managed services provider for telecommunications giant SBC, Wayport would install from 8,000 to 9,000 new locations. (The UPS Store has over 3,000 locations today, and expects to have over 5,000 by the time all the stores have Wi-Fi service installed.)

The McDonald's partnership came about through trials among Wayport, Cometa Networks, and Toshiba over the last year. Vucina said that nearly 450 locations in large and small cities alike were tried, from Manhattan to Boise, Idaho. He said, "Part of the exercise of the pilot was to gather data on what people were thinking about this connectivity experience."

They were able to garner statistics on average session, food purchases made, what percentage came to McDonald's specifically for the Wi-Fi service, and other factors. Food sales were more important than earlier reports may indicate. "At the end of the day for McDonald's, it's about selling hamburgers," Vucina said.

McDonald's sees 24 million customers per day through one of their 13,000 U.S. locations, or over 1,800 people on average per store, Vucina said. "That's about as much traffic as you'll get anywhere."

Statistics provided last year by a McDonald's executive at the Wi-Fi Planet conference showed that about 75 percent of customers used the drive-through or ordered take-away food from the counter, which would leave an average of over 450 customers eating in-store each day.

Still, McDonald's stores have peak times during meals. "Their pipe's not full most of the time during the day," Vucina said. "Hopefully, this initiative will maxmize that. Accessing email doesn't have any time limits on it." Vucina drew a parallel between dining and downloading, as well. "My appetite for email is greater than food these days. I've got to have it or I'm just not feeling very good."

Wayport's arrangement with McDonald's spans beyond the public side of Wi-Fi. As reported elsewhere, the company will process McDonald's cashless credit and debit card transactions over their network. Vucina also described the excitement at the food chain over distribution of interactive and video training materials during non-peak hours to server computer in the stores providing more up-to-date and readily accessible means of educating staff and managers.

When asked about the potential for future music and video downloads in Wayport locations including McDonald's, Vucina said, "No doubt about it. That's part of the plan."

Vucina sees both The UPS Store arrangement and the McDonald's service as feeding into what he expected the ultimate audience to be for Wi-Fi as it matured through the business traveler and frequent airport traveler stages: the windshield warrior, or someone who spends his or her day behind the wheel of a car. Vucina said the windshield warrior needs ubiquity, predictability, simplicity, and uniformity. Elements like knowing that every McDonald's has air conditioning counts, he said.

McDonald's does a better job of ensuring uniformity than anyone else, Vucina said. "This venue does this--with no disrespect to any other venue--better than any other venue, and this could be an overriding factor in why people go there," he said. Vucina expects that some windshield warriors will use the service from the parking lot.

On the hotel front, Vucina said that about 75 percent of all new hotel installations are entirely wireless, and that with the new infusion of funds from the latest deals, the company will proceed to convert about 60 to 100 existing hotel properties from in-room wired and Wi-Fi in public spaces to entirely wireless. Although the company founded its business on high-speed wired Internet access, Vucina said the time is right to finally cut the wired Ethernet cord.

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Good news for mobile warriors...Wayport’s CEO Dave Vucina said that the company will unveil a new business model for roaming partners in the near future that will be “the voice of reason”: In an interview today with hotspot and manage... Read More