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FON shared wireless broadband - exactly what's in it for the sharers?

by Bob Crabtree on 27 June 2006, 14:14

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You may not yet have heard of FON but this self-proclaimed "largest WiFi community in the world" is likely to gain huge visibility (and generate a lot of opposition from some ISPs) with its tempting proposition - share your broadband connection wirelessly and either gain free wireless internet connection worldwide or payment for doing so.

Would-be sharers (FONeros in FON-speak) who don't already have a broadband wireless router suitable for accepting FON's dedicated firmware can still join in and at virtually no cost.

FON is offering routers at a knock-down subsidised price of just  €5 or US$5 (excluding shipping and VAT) on condition that connections are shared for at least one year. Buyers who don't stick to the agreement will have to pay out a further €45 or $45.

The router provided is said to carry dedicated FON firmware in 10-plus languages (though, oddly, FON access-point registration is only in English, Spanish, German or  French) and be either a Linksys WRT54GL or a Buffalo WHRG54S. It will be accompanied by stickers to put in windows or by the front gate to show passers-by that they're near an access point. 

Significantly, the scheme is likely to appeal even to broadband users who don't need or want roaming wireless internet access. That's because they get paid for sharing with others who don't share their connections but do pay FON €3/$3 for 24-hour passes that let them access the internet wirelessly.

Such sharers will split with FON 50 per cent of the net revenues generated from daily passes sold through their own access points. Oh, and just so we get this out of the way, FON calls each of these paid-sharers a "Bill", while labelling each connection-sharing wireless roamer a "Linus" and deeming those who pay as being Aliens! 

But the scheme, run from a Spanish base, could meet massive resistance from internet service providers despite enjoying the financial backing of Skype, Google and two venture-capital firms - Sequoia Capital and Index Ventures.

ISPs are already worried by the way that media-sharing and the streaming of video, audio and games-play are massively increasing bandwidth usage and, almost without exception, have terms and conditions that forbid connection-sharing and include the right to cut off those discovered to be sharing.

However, a brief telephone interview with Robert Lang, head of European business development for FON, makes us think that this side of things is being taken care of.


Robert Lang - FON's head of European business developmentRobert Lang

FON is in negotiations with ISPs worldwide and is offering them a substantial portion of the income remaining from daily passes after paid sharers get their cuts. Deals have already been struck in France, Sweden and Spain, according to Robert Lang, who says that ISPs stand to gain more revenue the greater their support for FON.

He instanced what looks to be FON's best win - neuf cegetel, an ISP that has come on board big time.

What's significant is that this company claims to be the No.1 alternative operator in France when it comes to residential users (3 million customers, 1.3 million of them on broadband) and the business market (118,000 corporate sites connected to its network) and the wholesale market, too (200 carrier customers). Alternative, in this instance, means a company that is not the biggest operator in the country - France Telecom.

The French alternative ISP is putting FON on all the boxes it delivers to new customers and has a rolling replacement plan for this year to give existing customers FON-equipped boxes as well. So all neuf cegetel customers will, if they want to, be able to join FON and share their connections, for money or the right to world-wide wireless roaming.

Some ISPs might be brought on side by the argument that sharers gaining internet access on the road are using no more bandwidth than they would do if they stayed at home - and, clearly, there is some truth in that.

However, cash in hand is a far more compelling reason for ISPs to allow their subscribers to share and those that, like neuf cegetel, adopt the scheme whole-heartedly will, Robert Lang says, get a lot more of the available daily-passes income than will those that simply allow FON-sharing without objection.

The deal with neuf cegetel means that its subscribers won't get charged a premium for making their connections available via FON - and that's also the minimum that FON needs to agree with a whole lot of other ISPs.

It's already done that and a whole lot more with Jazztel in Spain, and two ISPs in Sweden - labs2 and Glocalnet. All three, Lang says, are solidly behind FON, and that's reflected in the revenue they'll potentially earn. 

FON is still in its infancy and the number of wireless access points it provides remains tiny - still in the tens of thousands. Check this map page to see the totals for different countries and to zoom in to check specific locations.

Even so, growth is said to be fast - you can check the total of all three types of FON member from a running tally on FON's home page. On June 27, at 11:35GMT, there were precisely 60,000 users of all types and when we checked back an hour later, the figure had grown to 60,205. Click on the pic below to get an updated tally but know that you need to analyse the map page to see the current total number of access points.

FONeros tally on FON home pageClick for updated membership total

Clearly, 200 new members an hour shows that things are happening at quite a rate but isn't truly massive. However, we can envisage growth increasing very much faster if FON is able to win over a majority of big-name ISPs, generate enough awareness and also ensure that would-be sharers have no reason to worry about joining up.

Broadband users need to know they won't be cut off or hit in the pocket if they share their connections and have to be convinced of two other things - that the security of their home PCs isn't being compromised and that they won't loose so much bandwidth that their own use of the net is noticeably slower.

Naturally, FON claims that its technology offers an ultra-safe way to share an internet connection. We're not yet in a position to judge that in any way but, knowing that  many home wireless routers are set up without any security at all, it seems likely to us that being a FON sharer might actually boost most people's wireless security rather than put their systems at increased risk!

FON also claims that sharers can control how much bandwidth they dole out but, seemingly, this is something for the future. FON says that, "With the upcoming versions of FON [router] software, which will be available for download from our website, you can choose the bandwidth you want to share".

We'd be surprised if that regulating firmware wasn't delivered sooner rather than later and now await further announcements from FON and from a whole lot of ISPs about what deals have been struck to allow home broadband users to share their connections without penalty.

But what do you think? Is FON a super-smart idea whose time has come? Or is it, perhaps, just a way to flog off a massive job-lot of routers? Tell us you views in the HEXUS.community.

UPDATE - June 27, 2006, 22:53
We spotted one error in our original story and have now corrected that. We had wrongly assumed that the constantly-updating figure on FON's home page showed the total number of FON wireless access points but have now realised that this figure is for all three types of FON member. We checked the map page a few minutes ago (at roughly 22:45) and, from figures shown there, came up with a total of 35,022 FON access points.

HEXUS.links

HEXUS.community - forum thread about this article
FON - map page
FON - investors
FON - home page (with running tally of FONeros)
neuf cegetel - home page
Jazztel - home page
labs2 - home page
Glocalent - home page
Index Ventures - home page
Sequoia Capital - home page



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UPDATE

We spotted one error in our original story and have now corrected that.

We had wrongly assumed that the constantly-updating figure on FON's home page showed the total number of FON wireless access points but have now realised that this figure is for all three types of FON member.

We checked the map page a few minutes ago (at roughly 22:45) and, from figures shown there, came up with a total of 35,022 FON access points.