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Can Wi-Fi kiosks make the cut?
An emerging breed of pay-per-use Internet kiosks not only gives access at the terminal, but also broadcasts Wi-Fi to the surrounding area. But as more destinations offer free Wi-Fi as a loss leader, will there be a market?
October 2, 2005 by James Bickers — Editor, Networld Alliance
Just a few short years ago, the potential audience for Wi-Fi Internet access was pretty small - roving bands of technophiles in search of a hot spot, the occasional business traveler who couldn't come unglued from his laptop. It was there, and it worked, but it was nowhere near the social and business phenomenon it is today.
With more devices Internet-enabled - and more of them sold - with each passing day, the number of potential Wi-Fi users is soaring. Statistics are fuzzy given the newness of the topic, but according to a directory of hotspots maintained by JiWire, there are almost 80,000 Wi-Fi locations worldwide, the vast majority of which (more than 30,000) are in the United States. Dataquest, a research firm located in India, estimates that the total number worldwide will grow to 200,000 by 2008.
Several kiosk companies are positioning themselves to take a chunk of this growing market. Since Internet kiosks have been successful, it's a natural progression to enable those kiosks with the ability to broadcast access to users in their area.
What's inside the boxes
Chicago-based Hotpoint Wireless deploys its kiosks to places like coffee shops, hotels, marinas and retail. According to chief executive officer Mike Kravitz, the company has approximately 500 Wi-Fi hotspots in place.
"Coffee shops do a huge amount of revenue, a lot more than people would think," he said. Customers purchase one of the company's various rate plans - $19.95 for a month's unlimited access, $7.95 for a day-pass - and can then access any of the hotspots in the network. "Most companies go after the low-hanging fruit like hotels and airports."
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Kravitz said that the kiosk's security system is integrated with that of the Internet access component. The firewall and anti-virus software work hand-in-hand with the VPN that allows customers to surf securely.
Another company jockeying for position is Plantation, Fla.-based Transnet Wireless. President Brad Cartwright said the Transnet program takes a two-pronged approach - a unit that allows Wi-Fi in addition to access at the kiosk itself, and a non-kiosk Wi-Fi access point that can be hung on a wall in a retail location. The Transnet machines can handle up to 100 users simultaneously, and have a broadcast range of 300 feet.
Cartwright was particularly pleased to announce his company's recent deal with TBC Corporation, which operates the Tire Kingdom, National Tire and Battery, and Merchant's Tire and Auto chains. TBC's 65 stores will be equipped with Transnet machines, allowing patrons to turn time at the mechanic - once a dreaded bit of downtime - into a useful chance to catch up on work. Cartwright said that putting the machines chain-wide is much more useful than placing them here and there in various locations, because the chain can advertise that patrons can purchase one Internet access account and use it at any of the branded locations.
If you build it, will they surf?
Leaping the technical hurdles involved in deploying Wi-Fi access through kiosks is only half of the story. In the bigger picture, a debate remains over whether there is enough of a customer base to make such devices worthwhile.
David Brake, a technology journalist and founder of blog.org, has his doubts. He sees Wi-Fi access becoming more widespread, but as a no-charge courtesy for users.
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"I think free Wi-Fi seems likely to increase as an incentive to use spaces like coffee shops, etc., especially as costs of provision continue to decline," he said.
Brake also points to the rise of government-sponsored Wi-Fi in places like parks and libraries, which use the "carrot not the stick" method to get people to read more, live and work in depressed areas, or use other government services.
He also notes that as wireless access becomes more long-range, companies wanting to generate revenue from selling access will have to make sure their service areas don't overlap with sources of free access. They will also need to watch their pricing.
"I think it is possible consumers will be willing to pay for Internet access in public," he said, "but rates would have to be comparable to those charged by cyber cafés and areas served would have to be away from the competing sources of free wireless access. Tourists seem likely to make up quite a bit of this market."
And there may be a backlash growing against pay-per-use Internet access in the travel space. In a recent commentary in The New York Times, travel columnist Joe Sharkey decried the $9.95 per day fee he has to pay to surf the Web at a hotel he frequents. That fee is a drop in the bucket to the $300-per-night room rate, he acknowledges, but he's bothered by it on principle.
"Â… for travel - trade conventions and other big-city events, and for leisure travel, I'm sometimes in a four-star hotel paying top-shelf rates," he writes. "And like a good number of the rest of you, I'm starting to balk at being banged for an extra $9.95 on a room that costs more than my first car did in 1967."
His response? He heads to a nearby park, where the Wi-Fi access is as free as the birds singing overhead.
But even if the owners of the kiosks charge little or nothing, they can still be worthwhile. Kravitz said that many of his customers foot the cost of the access bill and offer the service at no charge, simply to get people in - or near - the door.
About James Bickers
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