Boingo Expansion Strategies
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It takes all kinds to make a wireless roaming world.
We already have the Wayports and Mobilestars, pioneering public access wireless network operators.
We also have a slew of local and regional johnny-come-latelies and free-wireless peaceniks adding to the public access footprint a few hotspots at a time.
We have iPass and GRIC, carry-overs from the dial-up roaming era, feverishly adding high-speed Wi-Fi hotspots to their rosters.
And now we have a new breed of roaming access player: the wireless-only hotspot aggregator. Meet Boingo Wireless Inc.
Boing, boing, boing
Founded by EarthLink Chairman Sky Dayton, the new company's chief executive officer and chairman, Boingo is based in Santa Monica, CA with about 35 employees. Day-to-day operations are handled by President David Hagan.
So why do we need a Boingo if we already have all those other players?
Before we try to answer that question more fully, consider this response from the marketplace.
Even though at the time of writing it was still officially in beta modethe commercial launch is later in JanuaryBoingo already had 750 wireless hotspots across he U.S.
According to Hagan, this represents 96 percent of the available wireless POPs in the country. In other words, Boingo has managed to make partners of almost all of the public access wireless network operators out there.
Neither iPass nor GRIC can match these totals, especially not in North Americatheir Wi-Fi power bases are mainly in Asia Pacific.
How did Boingo manage this feat? How did it out-aggregate the big-time aggregators even before its commercial launch?
No doubt, the heavy-weight EarthLink presence had something to do with it. But Boingo also has some interesting differentiators.
Unlike iPass and GRIC, it is targeting individual business travelers first rather than enterprises. What it's offering is extreme ease of use.
"We're trying to bring wireless roaming to the masses," Hagan says.
"Our target is the road warrior who feels the pain of not being able to get high-speed access. We're making it really easy for him to authorize and authenticate. We offer one bill, online invoicing. It's really very simple to use."
One of the things Boingo spent its seed money on was developing dead simple client software that incorporates a wireless access point "sniffer." It can detect any available hotspot within range and associate with it automaticallyincluding where footprints overlap, and including free hotspots.
The program also lets users search for a particular hotspot by location in its table of sites.
The sniffer technology is essentially what Microsoft incorporated in Windows XPBoingo has simply ported it down to Win98 and ME. But it does raise the alarming specter of Boingo subscribers using the company's software for war drivingsniffing out unprotected corporate WLANs.
Hagan dismisses this.
"It's really the network operator's business and responsibility to make sure they're protecting their network," he says. "Whether it's a corporate or public access network. Most of the networks our software locates are protected."
Boingo and its partners use a variety of methods to authenticate subscribers, explains director of product management Christian Gunning.
"We use existing authentication methods, plus we hand key [network operator partners] some additional information so they recognize the subscriber as one of ours," Gunning says. "They pass it to us, we authenticate and pass it back to them."
"Partners don't have a whole lot to do [in terms of technology integration.] We're using industry standard protocols, existing authentication techniques. It's just minor tweaks here and there."
Hagan believes the corporate market will eventually emergeBoingo is already working on an enterprise offering. But he sees public access Wi-Fi evolving more like the cellular market.
"Enterprises will become interested," he says, "once they realize there are quite a few individuals in their companies who have bought our service."
Phase 1 of the Boingo strategy was developing the client and billing and authentication back-end software. It was really the only capital-intensive part.
"Our capital requirements are actually pretty small," Hagan notes. "We've got our fixed cost base done. It's really just a question of scaling up now." And that can be done as the company brings on customers.
Phase 2, concurrent, was signing up wireless network operator partners in North America. Boingo continues to talk to potential partners, including international players. Plus, existing partners will grow their footprints internally.
Bottom line: by end of year, the company expects to have 5,000 hotspots in the network worldwide.
"Right now there is serious discussion with and analysis of several major franchise [wireless access] operations," Hagan says.
"It doesn't take very many of those to sign on before you get really big numbers. I think we'll get to 5,000 pretty quickly."
Phase 3 is going after target end customers. That will start in earnest later this month. (A beta version of the client software, meanwhile, is already available at the Boingo site.)
Phase 4 is finding reseller partners. Which is where wireline ISPs and other carriers come in. Boingo hopes to work with service providers in a couple of ways.
"We want to have the Boingo brand as a retail offering, but we also want to do co-branding with major ISPs and cellular companies," Hagan explains.
The process of lining up ISP partners has begun, although Boingo has yet to cut its first distribution deal.
It is naturally targeting big ISPs first, but is also interested in Tier 2 and 3 companies, Hagan says. Although it doesn't have time and resources yet to call on smaller ISPs, it would welcome approaches from them, he says.
Boingo claims not to see many competitive challenges on the horizon.
"We've been a big believer in the notion that as an industry we all need to work together to get to critical mass, to get real velocity in the build-out of Wi-Fi," Hagan says. "We don't view ourselves as competitive with anyone. We view everyone as potential partners."
That includes iPass and GRIC, which most observers would have guessed were Boingo's natural enemies.
Boingo doesn't ever see itself providing dial-up roaming services like iPass and GRICat least not directly. Nor does it believe this will put it at a competitive disadvantage.
"We're not interested in low-speed access," Hagan says, "because we don't think the market is interested. Using low-speed after you have a taste for high-speed is too hard."
He concedes, however, that low-speed is better than no-speed. After all, Boingo subscribers may occasionally find themselves in places where the company can't provide Wi-Fi access. What do they do then?
Simple: Boingo will partner with iPass or GRIC to provide dial-up access indirectly. "We actually see them as potential partners," Hagan insists.
We're not sure if Boingo is actually living in the real world here. But hey, what do we know?
This company already has 750 Wi-Fi hotspots across the countrythanks entirely to its ability to partner with othersand is confidently predicting it will have 5,000 by year end.
It must be doing something right.