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The telecom behemoth is also gigantic in giving away Wi-Fi to customers: AT&T's quarterly report on Wi-Fi usage finds the firm serving 121m sessions in the first six months of 2010; that compares to 86m sessions in all of 2009. Second quarter 2010 saw 68m sessions used, compared with 15m in the year-ago second quarter. Second quarter was also a 30-percent increase over first quarter.
That's great, but you'll note that the names McDonald's and Starbucks aren't mentioned anywhere in the press release. McDonald's and Starbucks represent about 19,000 of AT&T's "more than 20,000" locations.
In January, McDonald's opened its Wi-Fi network to everyone at no cost; previously, AT&T customers (wired, DSL, fiber, remote business, and laptop 3G) got access at no cost, and so did roaming network partners. One expects that McDonald's drove part (but not all) of the increase.
Likewise, on 1 July 2010, Starbucks shifted from its modestly complicated free two hours' offer, where you needed a Starbucks stored-value card, to unlimited free service for everyone. I expect we'll see a big jolt as a response, because it removes friction for short, casual use, as opposed to longer use in which anyone who figured it out would already have been using Starbucks' Wi-Fi at no cost.
You can't disregard other factors, however. AT&T continues to add wireless, laptop 3G, and fiber customers (although I believe DSL and landline markets are static or shrinking). Those users gain free service on subscribing. And existing users rely more on using free service as available.
The couple of million iPads that AT&T sold as part of the 3m+ worldwide totally likely are part of that jump in usage. A single iPad user could consume dozens of sessions a day, either on the AT&T free locations (with a Wi-Fi only unit or a 3G iPad without an active 3G subscription), or across AT&T's network with a 3G iPad and an active 3G data plan. (The active data plan gives you access to hotels, airports, and other otherwise for-fee locations, and some roaming locations on reciprocal networks.)
Finally, AT&T switch a few weeks ago from unlimited service plans to cheaper, limited plans for new customers or those that opt to switch away from unlimited will likely mean bargain hunters like yours truly will work harder to find free Wi-Fi instead of consuming expensive 3G juice.
Starbucks switch on July 1st to all-free service in the US leaves paltry few American users to pay at a dwindling number of fee-based destinations: Starbucks is the latest entry to the free party, deciding the Wi-Fi is an expected amenity to attract customers, rather than an exceptional service for which the coffee chain should be expected to receive some benefit.
Although free Wi-Fi took a long time to ignite, the drop in price for 3G cellular data along with cheaper smartphones and the 3G model of the iPad likely mean free will ultimately trump fee. AT&T's been a big help in that direction, both in decreasing 3G costs and in making Wi-Fi freely available to its customers.
That trend really started in 2008, when Starbucks moved to AT&T's network, and started offering limited free service with a Starbucks Card. That represented a significant expansion of AT&T hotspot network. AT&T purchased Wayport, which operated McDonald's network and well over 1,000 hotel properties and a few airports, in late 2008.
AT&T has over 32 million qualifying broadband, business, and smartphone subscribers who get free access. But with about 20,000 of AT&T 21,000 locations now free with the Starbucks transition--Starbucks 6,700 locations joining McDonald's roughly 12,000 and Barnes & Noble's 700-plus--what value does AT&T still offer?
The value is in AT&T's seamless integration on smartphones and laptops. It's in AT&T's interest to move 3G subscribers to Wi-Fi hotspots to offload use from the cell network--even when 3G users are paying by the megabyte or gigabyte. An uncongested network is worth more than the overage revenue. AT&T's experiment with a Times Square hotspot network solely for its own subscribers is part of that offload effort.
Beyond AT&T, who is left paying? There is still plenty of for-fee Wi-Fi if you look for it--or are caught in the wrong place. Most premium hotels still charge for Internet service, whether wired or Wi-Fi, while budget and mid-range hotels went free years ago. Yes: pay less for a hotel, and you get a $10-$15/night service at a luxury inn thrown in for free. (In Europe, hotels may charge remarkable amounts, such as $30 to $40 per day for access.)
It's not universal, of course. My family stayed at an Embassy Suites in Portland, Ore., a few weeks ago that wanted $10/night for Wi-Fi. I had brought my 3G iPad, and my wife and I had iPhones, so, no thank 'ee.
Convention centers and hotel conference centers also typically charge for Wi-Fi unless a conference organizer has paid truly insane amounts of money (often thousands of dollars per day for T-1-like--1.5 Mbps--access) to provide it free to attendees.
Airports used to be a reliable place in which you would have no choice but to pay for Wi-Fi unless you had a service plan, but several of the nation's largest airports have now switched to a free-with-ads model, with many second-tier but still bustling airports leading the way over the last few years. Seattle's Seatac went free in January after a holiday promotion by Google that provided free Wi-Fi at dozens of airports; Denver's been free for years.
Atlanta and some other larger airports have considered removing the fees, too, although most are trying to figure out how to pay for the cost. The biggest airports won't see an increase in passengers choosing them as a hub, but having happier passengers promotes more flying, I'm sure, as well as more spending at concessionaires who pay percentages to the airport authority.
I would imagine that all regular business travelers with the least bit of savvy have a 3G laptop modem, or rely on tethering or mobile hotspot service from a 3G phone.
Hotels saw exorbitant call, fax, and Internet fees dry up when guests began carrying cell phones and then cell data cards and 3G phones. The same pattern is likely to emerge in other venues.
Rather than give up a relationship with the customer or passenger altogether, opening up free service lets a restaurant, hotel, airport, or convention center engage with that person by providing captive portal information and advertising.
AT&T's recent switch away from unlimited iPhone and iPad plans means travelers will be more likely to want to offload data usage, and thus willing to accept advertising as a necessary component when on the road.
Starbucks is also trying to provide a specific value beyond free: this fall, when it launches its content network, you'll be able to read the Wall Street Journal for free (along with unspecified other downloads and services from other firms) when you're at a Starbucks.
In the not-too-distant future, the only place you need to pay for access will be in the friendly skies: there's little chance airborne Wi-Fi will go free, because it's the last captive venue.
I don't blame the MiFi: At Apple's flagship Worldwide Developers Conference (WWDC) keynote this morning, Steve Jobs had to more or less demand that attendees disable their MiFis and similar devices, because the sheer volume of unique Wi-Fi networks was preventing the proper functioning of the iPhone 4 for demonstration purposes.
The new iPhone 4 has dual-band 802.11n, so it's beyond me why Apple didn't prepare to use a 5 GHz network channel, since the MiFi and similar devices nearly all only create a 2.4 GHz base station either by design or default.
Update! The iPhone 4 specs are posted, and it's 802.11n in 2.4 GHz only. There apparently wasn't room for a chip with two bands and the necessary antenna. (Thanks to Micheal in the comments.)
InfoWorld has the count: 527 Wi-Fi hotspots were in operation in the keynote address, most of them MiFi, and over 1,100 devices connected among those and other shared Wi-Fi networks.
A few weeks ago, Google suffered a similar embarrassment in demonstrating Android 2.2, a new release of its smartphone software, in which the audience's heavy use of the Wi-Fi network required presenters to ask (more nicely) for people to stop using the Google-provided network.
At the iPad launch in January, Apple offered its own Wi-Fi network, which worked just fine for me, and likely reduced the use of 3G cards and MiFis. [Update! Apple did have its own public Wi-Fi network at the keynote, but everyone I spoke to did not trust it (they thought it might be a spoof network) and did not use it.]
Clearly, Apple needs to make its iPhone OS (renamed iOS this morning for its next release) better able to handle a truly ridiculous RF environment.
I am compelled to write this story simply to say it does not matter: Reports came out a few days ago that all the iPhone OS applications that sniff out Wi-Fi, scanning the vicinity for signals and other information, have been removed from the App Store, the only authorized place from which iPhone and iPod touch owners can download apps, free or fee.
It doesn't matter, despite all the yelling about it. The sniffers were dropped because they use a private framework, hooks in the operating system that are not documented nor allowed for third-party developers to use. Apple scans and checks for these kinds of uses, and rejects programs that employ them. The sniffers got a pass for some reason, but someone at Apple woke up and kicked them out. It's a shame for the developers who put time into them, but using private frameworks is a completely well-known risk.
This dumping of sniffing apps is entirely distinct from Apple's arbitrary and capricious acts related to other programs and categories of programs, in which developers acting in good faith and according to guidelines find themselves on the wrong side of a shifting line. That happened to "sexy" programs, all of which not made by major firms like Playboy and Sports Illustrated, were dropped without warning.
It's been suggested that Apple should have an open and closed mode on the iPhone, letting people choose to run apps that haven't been reviewed and filtered by the company, but making no guarantees about those; in the closed mode, only Apple-approved apps would run. Apple seems to have no motivation to make that change, however, with its closed system working just fine for it, if not developers.
Portland, Ore., will get Comcast-branded WiMax courtesy of Clearwire's network: The cable companies have had increasingly strong ties with Sprint Nextel over the years in order to deliver a quadruple play (video, voice, data via coax plus wireless via Sprint). Comcast and others invested heavily in the new Clearwire; Comcast's share so far is $1b. Comcast's data speeds aren't challenged by what Clearwire has, but Comcast can't offer mobile high-speed data, especially with national roaming, and that's what Clearwire + Sprint can do.
The Oregonian reports that Comcast's COO made the announcement in a Portland visit this morning. Comcast will likely offer a multiple-play bundle. For Clearwire it's a win, even though it'll only get a wholesale price for service Comcast sells, because the company doesn't have to spend the money marketing and retaining the customer, nor presenting a bill to the household, nor dealing with collections. Further, Clearwire benefits by every additional customer in spreading out its overhead, even if it only recoups cost plus a bit off the wholesale price.
Comcast is testing some limited Wi-Fi in the Northeast in conjunction with Cablevision, which has is spending $300m to bring Wi-Fi to its tri-state customers with cable broadband subscriptions.
Let's look back and forward: It's traditional to wrap up the year, during a quiet news period, by looking at what just went by. This is the one time of year that I also prognosticate, and I got lucky: My forecast for 2008 made a year ago turns out to be weirdly accurate. I don't mean to take too much credit, though: I was expecting big news from things in 2008 that were much quieter affairs.
In-flight Internet (over Wi-Fi). It took almost until the end of the year, but this expectation finally became fulfilled not quite in the form or extent I envisioned. Several companies are separately pursuing offering in-flight Internet, but only Aircell managed to put the service into planes. American Airlines, Virgin America, and Delta Airlines all lofted flights in 2008 with broadband on board.
Of course, the expectation was that between 300 and 500 planes would be equipped with one vendor or another's flavor of in-flight Internet in 2008. Instead, the total is about 25 to 30 across those three airlines. Ryan Air's multi-year promise to put OnAir service on its European routes hasn't yet gone into public trials. Southwest and Alaska's promised tests of Wi-Fi appear to be invisible.
Still, Alaska and JetBlue both told me that there's work ahead in 2009, and Delta said it would equip over 300 planes in 2009 in its fleet, and start equipping its merger partner Northwestern Airlines with Internet service in 2009 as well.
We can count 2008 as the year in-flight Internet taxied down the runway; 2009 will likely be the year that it takes off. Whether it's financially viable is a different story; but it appears that service will be available on perhaps 20 to 30 percent of wide-body jetsfor routes within the U.S. in 2009.
Wi-Fi in every smartphone. Here, I feel I nailed it. It wasn't too much to call this, but Research in Motion and other established phone makers still seemed to have a slight resistence to including Wi-Fi. Now, it's de rigeur. The iPhone 3G and first Android phone, the T-Mobile G1, shipped in 2009 with Wi-Fi along with Bluetooth, 2G and 3G radios, and GPS. Wireless all around. The BlackBerry Storm was widely criticized for being an iPhone me-too without the quality, but also because it lacked Wi-Fi; most other new BlackBerrys are fully Wi-Fi'd.
Tens of millions of smartphones now have Wi-Fi built in--about 10 million of those are iPhones alone. I'm not sure if the industry tracks this, but the mark of 100 million Wi-Fi equipped smartphones will certainly hit in the first quarter of 2009.
The new trend I call for 2009 is the inclusion of Wi-Fi in so-called feature phones, the inexpensive phones that offer far more limited capabilities than smartphones. Talking to chipmakers and handset makers in 2008 made it clear that Wi-Fi chips will be available in early 2009 with low-enough power at an inexpensive price with better integration for multiple wireless standards. This makes it affordable and keeps batteries from being drained.
Carriers want Wi-Fi as a way to offload usage from celluar networks, especially in people's home, and putting Wi-Fi into feature phones gives carriers an advantage in stretching scarce spectrum even further.
Wi-Fi everywhere. With municipal Wi-Fi in its 2004-2006 form dead in 2007 and buried in the first half of 2008, we've seen a resurgence in efforts to put a plan in place first (why do we need Wi-Fi or some other wireless technology?) and then build a network.
In a round-up for Ars Technica six weeks ago, I highlighted several cities that have working large-scale networks all built for slightly different purposes. These networks are all successful in the sense that they have been built and appear to be working for the purpose for which they were intended. Only time will tell--another year or even two--as to whether the long-term benefits or sustainability are there.
I also said a year ago that 2008 would be the year of hotspot saturation. I think I was right on that. It's hard to find any venue in North America and Europe that lacks Wi-Fi. Boingo's acquisition of Opti-Fi airports and Parsons's Washington State Ferry operations, along with AT&T's purchase of Wayport demonstrated that consolidation had arrived, too. (Wayport operated Wi-Fi in U.S. McDonald's locations, and managed AT&T's Wi-Fi hotspots.)
Starbucks switching to AT&T and offering loyalty-based free service to customers, as well as AT&T radically expanding free access to its hotspot network, dramatically expanded the ability to get Wi-Fi for nothing.
Years ago, I was somewhat excoriated for saying that Wi-Fi hotspot access will either be free or cost you $20. Some people insisted Wi-Fi would trend to zero--some even cite Starbucks 2-hours-a-day loyalty reward as proof, even though you need to make a regular purchase to get the "free" service. Others insisted that you would need several subscriptions, each at $20 to $40 per month, to have a national or international personal footprint.
I wasn't too far off, in the end. If you want, there are now extensive networks in the U.S. and Europe of free hotspots and AT&T gives free Wi-Fi to about 15 to 20 million customers. The Fon network, however you count it, seemingly offers reciprocal free Wi-Fi to as many as hundreds of thousands of its Foneros.
If you want a larger pool of access at premium venues, especially airports and hotels, you can pay a bit more than $20 per month--maybe I should give myself the benefit of inflation, since I've been saying $20 for a few years? Boingo offers unlimited Wi-Fi for North America for $21.95 per month; iPass includes dial-up and Ethernet service as well for $29.95 per month. (Internationally, aggregators meter service because of the exceedingly high cost in some markets. You can get a few thousand minutes a month for about $45 with iPass or $60 with Boingo.)
WiMax arrives. Again, slipping in towards the 11th hour, my prediction that WiMax would be deployed widely enough to see whether it works wasn't precisely what happened. WiMax is commercially available in one market--Baltimore--although reports from reviewers and residents seem to all be positive.
The new Clearwire, a product of the old Clearwire firm and the WiMax division and spectrum portfolio of Sprint Nextel, will launch its first market under the Clear product name in Portland, Ore., on Jan. 6 (badly timed before CES and Macworld Expo). Then they'll start rolling out cities on a regular basis.
Gadget-Fi a go-go. I'm now going on about 3 years of saying that next year, Wi-Fi will be in everything. It's getting there. I'm still waiting for a good implementation of Wi-Fi in a camera, but at least the Eye-Fi adapter--which debuted in 2007 and expanded options in 2008--provides a good substitute.
Apple apparently shipped a jillion iPod touch players; they don't reveal specific model unit shipments, but it's possible that several million iPod touch models are in people's hands.
What's Coming in 2009?
A real security meltdown for some version of WPA. I hate to say this, because it sounds like fear mongering, but after the clever but not significant WPA exploit revealed a few weeks ago, it's clear to me that worse is to come. We will likely see the death of the TKIP (Temporal Key Integrity Protocol) flavor of 802.11i (supported in WAP and WPA2), at least in the pre-shared key/Personal flavor in 2009 due to additional weaknesses that relate to backwards compatibility with the long-depreated WEP.
Whatever attack results, it will likely still require a lot of effort on the part of the attacker, but will have a chilling effect, and move more people to the AES-CCMP flavor of encryption available only in WPA2.
LTE. Long Term Evolution, the GSM-evolved fourth-generation (4G) cell data standard, should appear in commercial form in 2010, but we're going to hear a lot about it in 2009. We may even see some test markets. Verizon sounds like they promised at least one production market for regular use.
LTE and WiMax convergence. There's apparently enough interest in converging the mismatched elements of LTE and WiMax that we may see a full-fledged convergence effort in 2009. This would mean that nearly all 4G efforts worldwide could come together around two intercompatible standards.
Train Fi. Yes, I've been writing about Internet access in trains for a few years. It's finally arrived. The faster cellular data speeds, the brief huge spike in oil prices, and lengthy tests that have concluded successfully are finally leading to Wi-Fi-based access being installed on commuter and long-haul trains worldwide. In the U.S., the BART system in the San Francisco Bay Area could wind up being the largest such deployment in 2009. But train-Fi has broken out all over.
SMS Fi. Twitter or a firm like it will move to supplant the ridiculous cost of SMS, especially for smartphone owners with unlimited data plans, by offering an SMS-like service for a pittance with gateway service to existing SMS offerings. Wi-Fi and 3G will be the preferred method. With carriers pursuing predatory pricing on SMS, the only universal messaging format, an alternative will be formed out of the pressure. Coal becomes diamond.
Very high speed Wi-Fi's first steps. In 2008, representatives most from chipmakers worked through the formation of two new 802.11 task groups for Very High Throughput wireless LANs: one, formed late in the year, 802.11ac will cover frequencies below 6 GHz; the other, likely to be 802.11ad, will cover the 60 GHz band, used for millimeter-band radar and with SiBeam's video streaming approach. The goal is for 1 Gbps or faster raw throughput rates. A timeline isn't yet set; given how the group and manufacturers work, it might be 2010 before we see 802.11ac devices and longer for 802.11ad.
What Was Hot in 2008?
The top stories by page views for 2008 were mostly stories from years before. While readers were most interested in T-Mobile losing its Starbucks contract to AT&T (February), they also looked at a pair of 2003 items on WPA passphrase weakness (my introduction and a paper on the topic), perused my outdated 2006 essay on not buying into early Draft N gear, and followed a dead link from an item about installing a free WPA client (no longer available) for Windows 2000.
Also in 2008, readers were equally interested in a third-quarter 2008 review of Linksys's WRT610 router--but more people read the 2007 review of the preceding WRT600 model. And apparently people still aren't changing their WRT54G's admin password, given that it's the No. 4 story for 2008, but published in 2004.
Perversely, a top story in 2008 was a review I wrote in 2004 of an early Wi-Fi signal finder, a category of product that now seems tediously useless. Showing that people are interesting in what Wi-Fi means (literally), a 2005 story on the origins of the choice of the Wi-Fi name still gets a lot of attention.
Of the top 15 or so stories, all but 2 were from before 2008, and three-quarters were about security.
RFID tags were supposed to be cheap and easy to use by now for logistics: But even with Walmart requiring top suppliers to use the radio tags, and equipping several warehouses for scanning, the effort is still nascent. Suppliers don't want to criticize Walmart, but it's clear that there's no return on investment due to a lack of full integration of RFID into existing software systems for handling inventory, shipping, and tracking, and to the continued high per-tag cost. RFID tags used in this fashion are disposable.
As with Bluetooth, the hype preceded the utility. With a bazillion Bluetooth devices on the market, automotive integration, and audio use, you can't find anyone now declaring Bluetooth dead, as was the case even a year or two ago. (Bluetooth still needs to evolve, of course.) Likewise, it's not that RFID has failed, but rather that Walmart's efforts have outstripped the pieces necessary to provide a real return on investment for either the retail giant or its suppliers.
Impressive number: The 200m estimate of Wi-Fi units shipped in 2006 is due, in part, to the increasing prevalence of Wi-Fi as a prebuilt option--nay, necessity--in laptops, music devices, and gaming systems. The Wi-Fi Alliance noted today that the Zune, Wii, and PlayStation 3 all feature Wi-Fi built in. Odd that the Xbox 360 does not; Wi-Fi is a $100 add-on that might cost $10 if integrated. (Consumer electronics are often cost times 10 for separately sold items.)
New measurement firm joins two others that aim to audit performance of metropolitan-scale Wi-Fi networks: Wi-Fi veterans Phil Belanger and Ken Biba today launch Novarum, a firm that will produce 10 reports per quarter on how Wi-Fi networks that span cities and counties measure up. Novarum joins a field that's not yet crowded, but has at least two competitors I spoke with that make measurement part of larger businesses. Each of the three firms has a distinct approach to taking stock of these new networks.
For some time, I've been banging the drum of network performance audits for muni-Fi, because it makes little sense for a city or civic group to ask the same group that they paid or allowed to design, build, and operate the network to also provide guidelines for evaluating that network's performance. A disinterested third party with no financial stake in the outcome of a deployment should look at tests, pilot projects, and production rollouts to determine whether coverage and performance meets the contracted specifications.
I spoke with Belanger of Novarum, and the heads of Unplugged Cities and Uptown Services to learn about their methodology in measuring Wi-Fi networks of a scale that only came into being in the last year.
(Follow the link below for the rest of the article.)