Public Wi-Fi must learn to roam, claims Broadreach
A fine technology but a pretty shabby business model
Wireless won't work on its own - the key to making a success of public Internet access is having a physical presence. So says Magnus McEwen-King, chief exec of Broadreach Networks, which operates net cafés in place such as Virgin Megastores, bagel shops and various railway stations under the ReadytoSurf brand.
According to McEwen-King, the specialist Wi-Fi operators have triply shot themselves in the feet: once by focusing only on wireless, again by spending too much on infrastructure, and a third time by trying to tie users into exclusive relationships.
"Our business model is public Internet access, not just Wi-Fi, so there's three to five fixed terminals per location as well," he says. "We're not taking a punt on Wi-Fi, we'll still make money if it doesn't happen. The key is return on capital employed - our mantra is 'economically viable and technically adequate'."
This means that where other companies might put in carrier-grade backhaul and multiple wireless access points - EuroSpot has some half a dozen APs at Paddington Station, for instance - Broadreach makes do with one. "Full coverage is very nice," McEwen-King says, "but where are people going to use it? We cover the café area where people sit, we don't cover the ticket hall as well."
He adds: "The major telcos are not really listening to the customers. At the moment the T-Mobile relationship means that only T-Mobile customers can access Starbucks Wi-Fi, say. What are they protecting? The other operators have only a handful of sites, but they're still being stubborn, and we're seeing a number of exclusive deals with premises owners being undone or asked to be undone."
The difference with his business model is that, like GSM, it is intended to allow seamless roaming. ReadytoSurf customers can buy vouchers on-site, and usefully, if they register then unused connection time can be banked for later, but McEwen-King puts greater emphasis on its deals with BTopenworld and VirginNet which allow and encourage those ISPs' subscribers to roam onto its net cafés.
"When we launched Openworld roaming we got more registrations in a day than in months of direct registrations," he says.
And he sees opportunities ahead for wireless, if only the industry can be patient enough to let it grow naturally. For example, he turns the recent Mori poll around, saying that the amazing thing is not that 70 per cent of the people surveyed didn't know what a WiiFi hotspot was, but that 30 per cent did.
"It took years to get that sort of recognition for mobile phones," he exclaims. "This is where public Wi-Fi should be after one year - investment hasn't run ahead of demand, there's been consolidation, we've had one of the Americans coming over. There's good dynamics in the industry. And 95 per cent of new laptops will have it as standard next year, so the capability will be there ahead of 3G ubiquity."
Broadreach has just inked deals with two Heathrow hotels and is looking to put mobile net cafés on Virgin trains, presumably allowing delayed travellers to file their compensation claims en route. The company's investors include Intel, BT and (amazingly enough) Virgin. ®