Wi-Fi hits the open road and more
The 802.11b Wi-Fi wireless standard has rapidly grown into one of the most popular ways for business travelers to connect to the Internet. Wi-Fi hot spots — publicly accessible connection points for wireless broadband Internet service — can be found at increasing numbers of airports, hotels, convention centers, coffee shops and fast-food restaurants. Now, thanks to plunging equipment prices and security improvements, they’re beginning to pop up in unusual — and unexpected — places, creating new opportunities for some enterprises.
“The cheaper you make things, the more you will sell,” said Will Strauss, principle analyst at Forward Concepts, a market research firm in Tempe, Ariz. “Now that we’re getting better security, we’ll see it proliferate more and more. If we look at the shipments of Wi-Fi equipment, prices are going down while revenues are going up.”
The sector already is quite healthy, according to London-based ABI Research. “Worldwide there were roughly 35,000 Wi-Fi hot spots at the end of 2003, generating revenues of around $100 million,” said Phil Solis, senior analyst for the firm.
Recreational vehicle parks are adding to the total. For example, Linkspot, based in Reston, Va., offers Wi-Fi service in 60 RV campgrounds across the country, catering to both snowbirds who migrate south every year and seasonal vacation travelers. “One of the things that makes this business interesting is the seasonality of it,” said Alan Kobran, president of Linkspot. “There are two classes of RVers. The full timers move between the North and South during the year. Vacation travelers with a home use the winter to stay home and the summer to travel. The farther north you go, the shorter the [vacation] season, as a general rule. If you go to northern Minnesota, you might be open for only three to four months a year. You have the opposite problem in Florida — nobody wants to be in central Florida in the middle of the summer.”
Regardless of type, RVers represent a unique brand of Wi-Fi user, according to Kobran. “If you have to take the specifics of the RV and camping lifestyle, it’s different from, say, Starbucks,” he said. “The difference with us is that people don’t have a lot of choice, don’t have [fixed] phone lines, don’t want phone lines. They have cell phones. The best [Internet] alternative in many cases is a [centrally] located phone line.”
Setting up Wi-Fi hot spots in vacation wilderness areas isn’t a trivial pursuit. “RV parks can have anywhere from 20 to 3000 [camp] sites,” said Kobran, adding that establishing high-speed connectivity to the Internet is a significant challenge due to their remoteness and lack of broadband facilities. Linkspot uses digital subscriber line, cable modem and satellite service to get the job done.
The company receives a monthly fee from the RV parks it serves, and customers pay an access fee based on the amount of time they use the service, which the RV park owner often absorbs. “Some [RV parks] want to offer this as an amenity, others want to charge,” said Kobran, adding that park owners receive a cut of the access fees. A prepaid Linkspot subscription for the end user runs $35 per month, with plans available on a per-day or per-hour basis.
According to Kobran, RV parks represent a solid growth sector. “There are 16,000 RV parks in the U.S.,” said Kobran, “So nobody even has a fraction of a percentage of the base yet.”
Research from In-Stat affirms Kobran’s enthusiasm — according to the firm, only 125 RV parks had hot spots at the end of 2003; In-Stat projects that more than 1000 parks will offer Wi-Fi access by the end of 2007.
While RV parks fashioned with hot spots may newly symbolize the freedom of the open road, some Wi-Fi service providers are moving toward truly mobile solutions. “Right now, you are seeing a lot of stationary deployment,” said ABI Research’s Solis. “One of the newest trends is the deployment of access points in mobile platforms.”
TeleSea, headquartered in Reston, Va., offers Wi-Fi access along America’s shores. The TeleSea Gold service provides wireless high-speed Internet access within 30 miles of the coast for “a yacht, tugboat or whatever,” said Forest Wheat, TeleSea’s president.
“In ’95, we decided to build a wireless system, and by ’97 we started demonstrating it to the military,” he said. “The Navy had developed a requirement [for a shipboard] Wi-Fi type of network to move high volumes of data to troops on the shore. With 42 years of maritime experience, I realized the potential this had for the industry.”
For a one-time installation cost of $7500 and $500 per month, TeleSea installs an omnidirectional antenna and transmitter relay node onto a boat and provides Internet access via the company’s wireless network along the coast. The relay node turns the boat into a floating Wi-Fi hot spot, so no additional wiring is necessary. With an additional piece of hardware, Wheat’s system also has the capability to forward voice-over-IP (VoIP) phone calls onto the telephone network. “You have the ability to communicate without having to throw a wire behind you,” said Wheat. “A guy who is a day trader can run his office from a boat.”
Larger ships and agencies with deeper pockets can use a combination of the TeleSea Gold service supplemented with a gimbled Ku-band satellite antenna and uplink equipment to provide speeds up to 2 Mb/s downstream and up to 768 kb/s upstream for connectivity beyond 30 miles. Satellite-extended coverage providing global connectivity anywhere on the high seas costs $50,000 for installation and $3350 per month.
Currently, TeleSea has about 50 commercial ships using its service, and Wheat expects those numbers to grow. “What we’re finding [is] that it’s sort of like a cell phone. You don’t know you need it until you get it, then you won’t give it up.” TeleSea’s first customers were floating casinos, and the company demonstrated operations to the Navy and Coast Guard last summer around Norfolk, Va., including voice-over-Internet service and video delivery. While Wheat wouldn’t comment about specific agencies, he said TeleSea was getting ready to move into operations with “a few government customers” that had “direct Homeland Security applications.”
PointShot Wireless is targeting faster moving platforms for Wi-Fi hot spots — passenger trains. The Ottawa, Canada, company is using Wi-Fi to provide connectivity for rail commuters as well as to enable new business applications for rail operators including onboard communication, real-time ticketing and advanced security features. The Wi-Fi service is connected to the Internet with a cellular uplink and a satellite-delivered broadband downlink.
Currently, three trains along the Stockton to San Jose, Calif., route operated by Altamont Commuter Express are fully operational, with the University of Phoenix footing the undisclosed bill out of its marketing budget. Focusing on working adult students, the university views the Wi-Fi service as a unique way to enable more telecommuting students to take Phoenix’s online classes during the two hour and twenty minute ride.
Trials have also been held on VIA Rail Canada lines and Amtrak’s Capitol Corridor 170-mile intercity train service, which operates between the Sierra foothills and San Jose, and makes stops in Sacramento and Oakland/San Francisco.
PointShot and Icomera are planning other demonstrations in the United States and Europe. In Great Britain, a train Wi-Fi session costs from $7 to $10 per one-way trip.
Solis also pointed out that Wi-Fi hot spots literally are flying today. Lufthansa and Connexion by Boeing have teamed together to deliver high-speed Internet connectivity — up to 900 kb/s — on Lufthansa’s international flights. Boeing will charge a flat rate of $29.95 per flight or $9.95 for 30 minutes of Internet access with $0.25 per minute for additional minutes.
“People on a longer flight are stuck in one place and are willing to pay higher rates for [Internet access], compared to the cost of an international ticket,” Solis said.