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« Pledge Break | Main | MobileStar Returns? »

November 6, 2001

Roundup for 11/6 and Special Hotel Report


Reports are coming across the transom that parts of MobileStar's Starbucks network is nonfunctional. Members of a free wireless networking newsletter report that some outlets appear to be working but others, which worked until recently, are now out.

A variety of sources have indicated, including the CEO (currently still the CEO?) of MobileStar, that a deal is imminent between MobileStar and another firm. Suggestions of this buyer or money-infuser include several voice cell carriers looking towards next-generation (3G and other) data networking.

Surfacing for AirWave

In a mailing today, AirWave stated that it has transferred its remaining outlets to WiFi Metro. The note state that WiFi Metro is the "preeminent wireless Internet service provider." The sobriquet is perhaps not the mot juste: the list of its locations appears to be the just over two dozen locations still served by AirWave.

AirWave was poised in early 2001 to attack the restaurant and coffee shop market as an aggressive deployer, funded in part by idealab. Within months, however, the firm scaled back and then refocused their model towards offering businesses roaming accounts and facilitating on-the-road corporate data connections.

WiFi Metro looks like the brainchild of the folks behind, which started life as a wireless network back-office firm, offering billing, accounting, and cross-network roaming in various combinations. They hoped to be the glue that offered cell-network-like roaming to wireless users.

They face increasing stiff competition from iPass, a long-established international company that works primarily with corporations to offer a single-login to dial-up and broadband connections worldwide. (Sort of like what AirWave repurposed themselves towards.) iPass has arrangements already with Wayport and Concourse Communications. (Concourse launches its first airport service in the next few weeks in Minneapolis/St. Paul's.)

By launching WiFi Metro,'s backers may be taking advantage of their existing partnerships with MobileStar (again, see previous item above) and what looks like about 40-odd other locations. It possible that WiFi Metro got a great deal on buying out AirWave's infrastructure and obligations to outlets in which service was offered. (The same leverage bought Wayport nine Laptop Lanes outlets.)

The name had me wondering: Wi-Fi (spelled with a dash) is a trademark. The statement from the WECA site (link at left) says, "Special Note: The Wi-Fi(tm) logo is a registered trademark of WECA and may not be used unless WECA Board Authorization is received." I contacted a spokeperson for WECA who said that the industry group is encouraging people to use Wi-Fi as a generic term, especially as opposed to the clunky IEEE 802.11b. (This begs the question of what to call 802.11a, e, g, and i, of course.)

WiFi Metro's real competition remaining, dependent on MobileStar's final status, is Surf and Sip, which has been slowly growing across the same market that AirWave abandoned months ago.

The current strategy of slow, steady growth coupled with acquisition of abandoned markets may mark the emergence into a mature, sustainable marketplace for wireless ISPs.

Hotels and Wi-Fi

I had the opportunity a few days to interview Giles Goodhead, chairman of Pyramid Research (formerly known as Executive Insight), for the New York Times article I wrote about airports and wireless ISPs continuing their deployment of Wi-Fi at a more moderate pace.

Goodhead's firm has just released a mammoth and expensive report (about $5,000) on the future of broadband in hotels - worth every penny to the folks actually in the industry who are considering the multi-billion dollar deployment of all manner of high-speed access, not just 802.11b.

I wasn't able to fit Goodhead's insights into the Times article, but he's worth heeding at some length. Goodhead talked to me about airports a bit, although that was just a tangential part of his report, which focused on hotel operators.

Goodhead is fairly pessimistic for the next year about both wireless ISPs and the overall market in airports. “There’s a lot of instability amongst the operator companies, and the airports are very aware of that," he said. “The decline in business travel, means both airport and operator financial projections don’t look as good as they used to look.”

He also noted that the post-Sept. 11 concerns affect deployment. There is "a very high degree of skittishness that’s going to last a while at airports, that’s going to make it a very tough environment to carry a lot of electronics around," Goodhead said.

Long term, Goodhead is bullish: “I absolutely think it will happen, but it’s going to take a while.”

From the hotel side, Goodhead has definitely seen a wireless backlash after the failure and refocusing of several national and regional firms. Hotels and ISPs may focus more on wireline (i.e., Ethernet and copper-based networking) than wireless.

To date, Goodhead said, hotels have not been satisfied with the revenue they receive from broadband overall, so the sell to continue deployment has been tougher, even before the tightened travel market and cuts in expense budgets.

Goodhead does expect most hotels to offer some form of broadband in the next few years, though, partly because it will simply become an expected part of a hotel's kit. And, he noted, in the overall scheme of things, installing a broadband system, wireless or not, pales next to routine expenses. “It’s not really a huge investment” relative to changing the wallpaper every few years or the carpet, he said. Broadband will become “an amenity on a long list of guest amenities.”

When broadband becomes more prevalent, it may sway business travellers to stay in hotels they otherwise wouldn't. “The economics (of broadband) only work if you look at the indirect effects, and getting an extra person in a room is huge, and it comes through to marketing," Goodhead said.