Start-up pushing wireless 'Net access

Boingo Wireless is spreading its wings across the U.S. to offer business travelers high-speed wireless Internet access.

The recently launched start-up is offering Boingo Wireless service in 440 locations. The service features a shared 11M bit/sec wireless LAN connection.

Boingo has teamed with seven wireless LAN service providers that have built standards-based 802.11b networks, also called Wi-Fi, in public areas such as airports, hotels and cafes. Instead of developing its own nationwide network, Boingo has built a network operations center in California that integrates its partners' networks.

Customers who sign up for the service must install a Boingo client on their laptops, which lets a wireless modem "sniff out" available wireless LAN signals.

"It's an attractive offer for business users that spend much time on the road," says Amy Cravens, an analyst at Cahners In-Stat Group. Because so many regional wireless LAN ISPs offer limited coverage, users will appreciate one service that covers most of the country, she says.

Customers receive one bill from Boingo, regardless of how many wireless ISP networks they traverse.

Customers can choose from three service plans: Boingo Unlimited, Boingo Pro and Boingo As-You-Go. The Unlimited version is $75 per month. The Pro version is $25 per month and includes 10 days of service. Additional days cost $5 per day. The As-You-Go version lets customers pay $8 for each 24-hour period they use the service.

There are positives and negatives with Boingo's business model, according to one industry analyst.

"The company's business model has its partners assuming a lot of the risk because they are taking on the expense of building out their networks," says Jason Smolek, an analyst at IDC. "If all the risk falls on Boingo's partners and they fail, then Boingo doesn't have a service."

With 21 ISPs failing in 2001, there are doubts about the longevity of all wireless LAN providers, he says.

While analysts agree that public wireless LAN services will catch on, most are not expecting a surge in use until next year or 2004. This forecast calls for a slower adoption rate than previously predicted, with the delay attributable to the fall of wireless LAN ISPs such as MobileStar and the high cost of national offerings.

The wireless LAN ISP service market will gain strength as companies such as VoiceStream, which is trying to buy MobileStar's assets, start offering services, Cravens says.

Traditional voice wireless service providers, such as AT&T, Cingular Wireless and Sprint PCS, have shown interest in this market. The public wireless LAN market will thrive once these players enter because they will validate the service and drive down monthly rates, analysts say.

"Business users don't want to pay more than $20 per month for another ISP service," Smolek says.

While public wireless LAN services offer users more flexibility when on the road, many will hesitate to add another ISP fee on top of their landline broadband connections. This may be a bigger concern for users who already pay $50 per month for a DSL or cable modem connection, he says.

Boingo isn't alone in the roaming public wireless LAN ISP market. IPass Communications and Gric Communications offer a similar service.

Both have focused on offering local-number dial-up Internet access in hundreds of countries, but IPass and Gric are now rolling out international wireless LAN support. Boingo's service initially is focused on the U.S.

Boingo's wireless LAN ISP partners include WayPort, Surf and Sip, Nomadix, RoomLinx, Air2LAN, Pacific Direct Connect, HereUAre and AirPath. The company says it is in talks with several other service providers that it plans to add to its network throughout the year.