From Sydney Morning Herald, Australia


New York
May 19 2003

Limited at first to hotels, coffee shops and airports, wireless internet access is finding a home on New York streets.

Verizon Communications Inc will bathe parts of the Big Apple, chiefly Manhattan, in wireless internet coverage and let its internet customers use it for no additional charge.

In another sign that Wi-Fi, or wireless fidelity, technology is going mainstream, the nation's largest phone company said it would spend $US5 million ($A7.62 million) to add wireless equipment to 1,000 of its pay phones, creating the biggest single-city network of its kind.

Until now, public Wi-Fi "hot spots" have largely been installed and operated by wireless companies, technology start-ups, small-business owners and community groups. Experts say Verizon's move could well be the tipping point that spurs the technology to new heights.

"This is one of the most innovative broadband initiatives I've seen to date," said Jeffrey Kagan, an independent telecommunications analyst. "Using pay phones as Wi-Fi hot spots to blanket a city is a stroke of genius."

Verizon's stated goal for Wi-Fi: to woo and keep customers for its digital subscriber line and dial-up internet services.

The company already has wireless equipment that beams wireless internet coverage in a 300-square-foot radius on 150 pay phones today. Altogether that would cover about seven acres. To be sure, that's still a small area, considering Central Park alone has 843 acres. Manhattan has 14,210 acres.

Verizon Online customers will be able to jump on the New York Wi-Fi network for free using their existing DSL or dial-up account usernames and passwords. To check for locations, go here.

Executives said they may decide to roll out similar networks in other big cities after evaluating the success of the New York system. But they conceded that the technology remains so young that the company can't make long-term predictions.

"The Wi-Fi industry is so early in its deployment cycle that I am not sure where its going to wind up," said Larry Babbio, Verizon's vice chairman and president.

Not to be left behind, San Antonio-based SBC Communications Inc revealed that it too was studying Wi-Fi and has conducted technical trials at Dallas Love Field. It plans to make a deployment announcement in a couple of months, said spokesman Michael Coe.

SBC, the nation's second-biggest phone company, envisions offering Wi-Fi to its DSL customers for a small additional fee. It will probably also use pay phones, but may also attach Wi-Fi equipment to other phone company installations.

"Right now we are looking at what's the best way to go out there and get the biggest footprint as efficiently and as quickly as possible," Coe said.

Verizon's and SBC's interest in Wi-Fi bodes well for them in their ongoing chase to catch cable companies, which have two-thirds of the nation's broadband customers, said Imran Khan, an analyst with Frost & Sullivan.

Already the phone companies have gained ground by cutting DSL prices down to $US35 ($A55) a month, whereas cable companies still charge $US43 ($A65).

"DSL is becoming a very, very attractive proposition," Khan said.

Verizon's foray will also pose challenges and opportunities for wireless companies that have been selling Wi-Fi. Among them:


Austin-based WayPort Inc provides service in hotels and airports, including Dallas/Fort Worth International.
T-Mobile USA, the cellular company owned by Germany' Deutsche Telekom, provides service in Starbucks, Borders and Kinko's stores.

While Verizon and SBC have greater resources, they may well cut deals with WayPort and T-Mobile to divvy up lucrative Wi-Fi locations, rather than building competing systems, Khan said. Like in the early days of cellular, customers of one company would be allowed to "roam" onto another network.

Verizon Wireless, the cellular firm that Verizon owns 55 per cent off, already has such a deal with WayPort.

"There are certainly opportunities for existing Wi-Fi players to strike alliances," Khan said.