MetroFi's Ad-Supported Wi-Fi - Page 2

By Gerry Blackwell

November 08, 2006

MetroFi uses dual-radio mesh networking gear from SkyPilot Networks Inc. to build its networks. The SkyPilot access points include a dedicated 2.4 GHz 802.11b or g radio for client access and WiMAX-like 5 GHz radios for the mesh backhaul network. The company is installing 25 to 30 APs per square mile, fewer where population is less dense. Traffic is aggregated at gateways, typically located on a rooftop, and carried from there to a local Internet point of presence (PoP) by fiber or licensed microwave. MetroFi manages the networks from a central network operations center (NOC) in Mountain View.

In communities where the municipality is making extensive use of MetroFi network services, the network typically covers the entire city. Where the city is not using network services or using fewer services, the company is focusing mainly on residential areas.

The networks are easily accessible by typical laptop users outside and inside near outer walls. The problem with indoor coverage is not so much the network infrastructure, it's the low power of laptop radios, Haas says. In residential areas, users may need a Wi-Fi bridge with a good antenna ($50 to $100) to make an optimum connection indoors, and home owners in areas where trees or tall buildings interfere with reception may need to pay MetroFi $130 to mount a rooftop antenna. Even with that one-time cost, users still save about $500 a year over cable modem service, he points out.

The company hasn't disclosed what its capital costs are for building the networks. But Haas says, "Our cost per square mile—both [capital expenditure] and [operating expenses]—is a fraction of what a wired network costs. The low capital and operating cost is what allows us to make money with the free model—that and the fact the wireless networks are unlicensed so we don't have high license fees for spectrum that need to get repaid."

He says industry estimates of the capital cost per square mile for muni Wi-Fi networks range from $50,000 to $100,000. "We have been honing our economies for the last four years," Haas says. "MetroFi is the most economical of any of the [muni Wi-Fi] networks. Our numbers are at the very low end of that range."

MetroFi believes its current technology will take it a long way, and isn't planning to migrate anytime soon to higher-speed wireless technology. "Wi-Fi is the next generation Ethernet," Haas says. "We believe that going forward most devices will have a Wi-Fi capability and it's going to have a very long life."

The technology can deliver 1 to 5 Mbps over the same infrastructure, he points out. The current 1 Mbps downstream and 256 Kbps upstream are constraints imposed for marketing reasons. The company has no plans at the moment to branch out into offering voice over Internet protocol (VoIP) or IPTV service, Haas says. IPTV would certainly require more bandwidth than MetroFi's current networks can deliver.

The company appears to be well funded. Haas says it has raised $15 million to date (but see MetroFi's Mo Money in GigaOM), much of it from the venture capital firms August Capital, Sevin Rosen Funds, and Western Technology. It will need more to continue its roll-out, though nothing like the $2.2 billion his last company, Covad, raised, and not for another year or so.

Haas, guarded as always about anything relating to company numbers, declines to say how quickly MetroFi expects to reach profitability. "Let's just say it's definitely a viable, fund-able model," he says. "Otherwise I wouldn't be doing this, and we wouldn't have raised $15 million to date."


Story courtesy of ISP Planet.

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