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« SBC to Offer Hot Spots with Wayport | Main | Toshiba's Streaming Wi-Fi Camera »

August 6, 2003

Maturity

Hot spot market might finally take off in the next few months: Those of you who have read this Web log or met me might know that I've been saying for many many moons that the only way in which the hot spot market turns from a collection of small, independent firms pursuing niche business models that might or might not turn a profit into an actual industry with ubiquitous coverage was that the telecom firms, especially cell telcos, had to get involved.

The last few days have been a whirlwind of announcements and revealed plans that suggest that even if the revenue isn't there, the build-out money is not guaranteed: there are too many parties with too much at stake to not build the network, allow roaming, and see if users come.

This is an entirely separate question from whether there is money to be made in charging for hot spot service, which itself is a different question from whether there is money to be made building out Wi-Fi service.

Let's look at the promises made this year, many of them in recent interviews I've conducted with the operators:

Airpath (back-end only): 300 today, 900 by year's end, 4,500 in 12 months
Cometa: 5,000 in 12 months, 20,000 in 2 years (75 today)
STSN: 500 today, several thousand in two years (may include some or all of Marriott's 1,700 budget hotels with free access by end of 2004)
Surf and Sip: over 300 today, 200 in the next month and a half, at least several hundred more next year
Wayport: 500 today, 1,500 in two years (not including SBC's 6,000 managed locations)

Now let's look at the cell/telecom market:

AT&T Wireless: reselling Wayport, operating Denver airport
Cingular: partnership with SBC by end of 2004 for 3G/Wi-Fi roaming
SBC: hundreds by year's end, 6,000 locations within 3 years
Sprint PCS: 800 soon (Wayport/Airpath), 2,100 by end of year
T-Mobile: 2,700 today, at least 4,000 with current commitments within 12 months
Verizon Wireless: reselling Wayport (parent company predicts 10,000 DSL-subscriber-only hot spots in next year)

Somebody tell me again how the hot spot market is dead? Of all of those companies building service, none of them have an issue with burning cash. They either have the cash to burn or they are partnering with venues who will pay much of the capital cost.

We're about to see a domestic market of about 5,000 hot spots (which includes hotels with just public Wi-Fi) grow to 10,000 to 15,000 by year's end and 30,000 to 40,000 by the end of 2004. The commitments are now there. They just need to find the customers.

1 Comment

Glenn,

I'm doing some hot spot industry research. This post is golden! Thank you very much.

Steph