Why Not Try Wi-Fi?

I'm sitting on the terrace of the Best Western Gateway Hotel in Santa Monica, Calif., with my laptop open, about to embark on a little adventure. I've been hearing a lot about Wi-Fi lately, and not just from my geekier friends. Everyone who has tried the new high-speed wireless technology loves it--from homeowners who use it to network all their computers, to road warriors who can now go online from airport boarding lounges. And it's spreading to more public places like coffee shops and, not far from my home, this very hotel, where I have decided to try it and am now drawing suspicious glances from the staff.

The Best Western Gateway is one of two public "hot spots" listed for Santa Monica in the directory of Boingo Wireless, which offers Wi-Fi access in locations scattered across the country. I have already talked to a preternaturally cheerful customer-service rep and signed up for Boingo, which has a wireless transmitter in the hotel lobby. So I'm ready for action.

I insert my credit card-size Wi-Fi receiver into the PC-card slot of my laptop. The "sniffer" software then checks the air for wireless signals, and a message pops up: "The Boingo Wireless signal is available. Would you like to connect?" A click on the trackpad and I'm online. As my home page loads, I'm tempted to pass my hands over my computer like a magician's assistant: Look, no wires! I access a website that lets me benchmark my download speed; it clocks in at 2,920 kbps, comparable to my home cable-modem connection and 55 times as fast as the standard 56K dial-up modem. This is impressive. Heartened, I head off to my next destination: Pasadena and two free NANS (neighborhood access networks) operated by private users for the public good. I am filled with good cheer and the promise of a wireless future.

Most people who use Wi-Fi today do so in institutional settings such as schools and businesses and via a handful of pay networks that serve hotels, cafes, airports and convention centers. The benefits are obvious to the traveling exec who logs on to his corporate network from an airport lounge, downloads the latest revision of a huge PowerPoint file and arrives fresh and unmussed at his presentation.

Wi-Fi is handy around the hometown as well. Tim Bajarin, president of the tech consultancy Creative Strategies, frequently finds himself strapped for time, unable to get back to the office between meetings. "So when I know I've got a 45-minute break, I head to Starbucks," he says. "I log on, check my e-mail, come up to speed on information that I need and head off to my next meeting."

Capabilities like this have driven the Wi-Fi equipment market to staggering growth, with unit shipments of home and business hardware climbing 319% in 2001, according to the research firm In-Stat/MDR. More than 19 million Americans are expected to use Wi-Fi by 2006. That growth, real and projected, has moved techies to imagine a magic, seamless, nationwide carpet of high-speed wireless access, available to all and as ubiquitous as air.

Anyone who buys into that vision today, however, quickly smacks into some rude realities. Wi-Fi transmitters have a practical range of about 300 feet. This is usually plenty for a homeowner setting up a network, but it creates a practical nightmare for anyone wanting to establish a wide-ranging infrastructure of access points for Wi-Fi, or 802.11b, as it's known among the wireless priesthood. "It's a financial and technical impossibility," says Glenn Fleishman, who runs the 802.11b Networking News website.

For travelers, there has also been a bewildering lack of coherence to commercial Wi-Fi access. Sky Dayton, founder of EarthLink, the giant ISP, says connecting to a Wi-Fi provider on the road is like belonging to some secret society. "You have to know the password, which in this case is the ssid, the name that identifies each wireless network. Then you've got to go in and basically hack your card to get it to connect. Then you go to a gateway page for a local provider, and you have to set up an account. It has to get a lot easier."

Dayton's latest venture is founded on that notion. Launched in January, Boingo Wireless, based in Santa Monica, Calif., aggregates existing Wi-Fi service from microcarriers like Surf and Sip, Wayport and RoomLinx, branding the product with its own software, handling back-office chores like authentication and billing, and splitting the revenue with providers. If this sounds familiar, it should: it's the same thing Dayton did with EarthLink in the early days of the Internet, selling ease of use and a unified pricing structure to businesspeople and the managers who approve their expenses.

Dayton says Boingo offers access at more than 500 hot spots now and aims for 5,000 by the end of the year. It hopes to nudge the buildout along by offering what it calls WISP (wireless Internet service provider) in a Box, a turnkey solution allowing retailers to set up Wi-Fi access points that are preconfigured for the Boingo network quickly and easily. (Two other start-ups, Joltage and Sputnik, provide a similar service by offering software that enables users with existing broadband service to become revenue-sharing micro-WISPS.)

Some analysts, as much as they admire Dayton's business model, find his 5,000-hot-spot projection optimistic. What is clear is that Boingo, by avoiding the high costs of building big infrastructure, avoids the trap that doomed wireless predecessors like Ricochet and MobileStar. Boingo looks poised to be one of the few entities to make money in Wi-Fi. At the moment, the only companies doing so in any serious way are the hardware manufacturers. Their revenues rose 169% last year, to $1.8 billion; In-Stat/MDR projects that revenues will hit $5 billion by 2005. But even their profit margins are being pinched by steeply declining retail prices: a wireless-access point sells for about $150, down from about $2,000 a couple of years ago, and Wi-Fi receivers have dropped well below $100.

Waiting in the wings, though, are the big wireless-phone companies. The telcos have been pushing their own upcoming wireless-data services, generically known as 3G (third generation) and--perhaps more realistically in the near term--2.5G. Such services already are popular in Europe and Japan. The smart money has the national wireless infrastructure shaping up as a hybrid of Wi-Fi and 2.5G or 3G, with Wi-Fi offering high speeds at low or no cost over very small areas and the Gs covering wide areas at lower speeds and relatively high cost. Hardware is catching up to this hybrid model; Nokia recently announced a PC card offering both Wi-Fi and cellular connectivity.

But Charles Golvin of Forrester Research says the driving force behind the Wi-Fi nation will not be hardware: "The more important part is, What is the service provider offering you? Can you get one bill that encompasses all the services you use, no matter where you go?" Ease of use and ubiquity, in other words--or something close to it--are the grails of the wireless world, just as they were in the early days of the Internet. "I always had this view as I was building EarthLink," Dayton says. "Why should I have to be near a plug? Why shouldn't the Internet just be present at all times where you are?"

NAN No. 1 is at an address in the hills above Pasadena. I take five freeways, three major thoroughfares and a spiderweb of smaller and smaller streets to get there. But I never do, because the turnoff listed on my map as Country Lane--two turns from my destination in a cul-de-sac--is plastered with signs reading PRIVATE DRIVE DO NOT ENTER NO TRESPASSING ARMED RESPONSE. I seem to be about half a mile from my goal, well beyond the range of a wireless-access point, and--communitarian spirit notwithstanding--I am not feeling encouraged to go the rest of the way. This seems like the kind of neighborhood in which home defense is enthusiastically practiced. The glow of good feeling fading, I wind down the hill to NAN No. 2, at an intersection in the leafy neighborhood of East Washington Village. I pull up to the southeast corner and unleash my laptop's sniffer. Nothing. Feeling increasingly foolish, I wheel my car to the three other corners, which yield nothing, nothing and nothing. I look at my odometer. I have driven 52 miles. I head for home.

A few days later, I get an e-mail from Frank Keeney, who operates NAN No. 2. He asks if I was able to find it. Nope, I write back. He sends a reply that says a lot about the state of Wi-Fi today: "If you'd gone about 100 feet down the road, you would have."