Silicon Valley has always had a liking for the revolutionary. Take the famous Apple ad during the Superbowl of 1984, featuring a lone runner, IBM as the embodiment of oppression and the liberating introduction of the new Macintosh. So it is no wonder that Silicon Valley has embraced a technology and business model that promises to provide high-speed internet in the air, turn every individual into a cell in a revolutionary grassroots network and undermine cable and telecom companies at the same time.
The basic technology behind this revolution is a standard called 802.11b - now redubbed Wi-Fi - which makes use of lightly regulated wireless frequency. New are a series of clever businesses, such as Joltage Networks, that use pyramid marketing techniques to recruit us. Think of Tupperware parties - for wireless internet.
Wi-Fi took off about three years ago as a way to connect a local network without cluttering up the office with blue Ethernet cables. The equipment - a network access point base station and a receiver card for each computer - became cheaper as sales increased. Soon, public-spirited individuals - OK, some San Francisco techno-hippies such as Brewster Kahle - placed these antennae in windows or on roofs, spilling internet access on to the surrounding streets for anyone with a laptop and a Wi-Fi card to enjoy.
As the cost of setting up a Wi-Fi access point fell - $150 for the box plus the cost of an internet connection - more than 10,000 access points have sprung up across the US and other countries. This wireless technology has come out of nowhere to challenge the wireless companies' 3G networks as conduits for high-speed net access. However, the networks are patchy. I crossed several states in the US recently without detecting an access point.
Companies such as Airwave and MobileStar, which tried to put Wi-Fi in cafes and airports, have gone bankrupt or undergone restructuring. A national Wi-Fi network has been a pipe-dream - until now. It is dangerous to get excited about a small company such as Joltage, which employs fewer than 20 people, enjoys no institutional funding and faces the hostility of the telecoms and cable industries. But Joltage, a New York company that made its debut at PC Forum, the elite annual tech industry event, produces a clever piece of software that turns any Wi-Fi access point into a node of a global network, and provides a financial incentive.
Wi-Fi has grown out of the West Coast idealistic belief that free internet access is a basic human right, and the failure of corporate IT departments to properly secure their wireless networks. But Wi-Fi needs to move beyond its hippy and hobbyist phase. Joltage charges users $2.95 per hour for access to the wider network. Half of the net revenues are to be distributed to the cells.
So, with just a few users a day, a contributor to the Joltage network can offset the cost of a DSL or cable internet subscription. A cafe, or someone with an apartment on a busy street, could make a substantial profit. And when you plug in a Wi-Fi card into a laptop you could stumble across the neighbour's node, and be prompted to sign up right there with your credit card. If this seems reminiscent of the viral marketing schemes of the 1990s, one ought not be surprised: Andrew Weinreich, founder of Joltage, was behind SixDegrees, the online service that tracked social networks. Whether or not Joltage succeeds, the scheme enjoys compelling economics, and will likely work in some shape. Most individuals in the US pay $50 per month for their high-speed internet connection, but use less than 1% of the bandwidth on offer. For a cost of $150 for the equipment and a few minutes setting up the software, they can have wireless access in the home, and offset the cost of their connection.
The vision: US cities and suburbs blanketed by a high-speed wireless network as soon as 2005; a massive infrastructure implemented not by the lumbering telecom giants but by hobbyists and small entrepreneurs. The only hitch: Wi-Fi cells require a fixed-line connection to the internet, and the telcos typically include a clause forbidding the sharing or resale of a connection.
Joltage requires contributors to its network to agree to the terms of use, but its growth depends on violation of those terms. To begin with, the telecom companies may turn a blind eye. The ability to recoup some of the cost of a DSL or cable connection might encourage sign-up rates. However, once every second house is a Wi-Fi cell, and an area is saturated in wireless internet, what is the point of a fixed-line connection?
And, just as the music industry went after companies such as Napster, the telecom industry is bound to attack Joltage as soon as it succeeds. Fortunately, by the time they try to shut down Joltage and other wireless internet networks, a new wireless technology will be ready to come to the rescue - mesh network technology. SkyPilot Network unveiled just such a system, also at the PC Forum, which allows data to bounce from roof to roof within a neighbourhood, at volumes that increase as the network becomes more dense. Mesh networks have evolved from efforts by the US military to build a communication system that will withstand a nuclear attack. This movement will be hard to suppress.
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