A New Virtual WISP

By Gerry Blackwell

November 12, 2003

Trustive, a Netherlands-based start-up, is building a virtual hotspot network to rival the biggest anywhere. But will it come to North America?

Move over GRIC, move over Boingo, move over iPass.

Trustive B.V., a new "virtual WISP" (tranlation: hotspot aggregator) launched recently in the Netherlands with over 1,000 hotspots worldwide and an aggressive plan to build a much bigger network and market its services across Europe and Asia.

Will Trustive come to North America? It already has hotspots in both the U.S. and Canada, but won't market to subscribers here anytime soon.

"You've got GRIC and iPass and Boingo, which only sell in America," says managing director Gavin Dresselhuis. "So we started in Europe." (We didn't have the heart to tell him that all three have hotspot partners overseas.)

Trustive announced what Dresselhuis calls the firm's "soft launch" on October 15, initiating commercial service and unveiling the network of 1,100 hotspots. Most are in Europe, but Trustive also has hotspots in Indonesia, Maylasia, the Philippines and Singapore, as well as those in North America.

The firm spent the first eight months of its existence nailing down roaming agreements with 21 WISPs -- it does not operate any sites of its own. Dresselhuis expects the number of roaming agreements to grow to about 35 by the end of 2003, the number of sites to about 3,500.

He won't speculate on how the network will grow from there. "It's an unstable market."

He notes, however, that there are now about 350 WISPs worldwide -- so lots of scope for signing more roaming agreements.

Trustive is backed by two Netherlands-based venture capital firms. Dresselhuis won't name them. Nor will he say how much funding was provided. "But it's a lot -- a lot to us." It will fully fund the company until it breaks even, reckoned to be sometime in the third quarter of 2004.

Dresselhuis and his partner B.J. Streefland, the firm's technical director, came from Carphone Warehouse Group, Europe's largest cell phone retailer.

Their "hard launch" of Trustive will come in the first quarter of 2004 when they plan to deploy a sales force. With its Amsterdam-based account manager, the sales force will be the final step in Trustive's three-prong marketing strategy.

Starting immediately, the firm will promote the service online in Europe and Asia, advertising at sites such as Wificom 411, a hotspot directory service -- initially on a low-key, experimental basis.

It will also begin almost immediately advertising with marketing partners in Europe. The first is a major vendor of Wi-Fi WLAN equipment. "We're saying to their customers, if you've just bought a Wi-Fi product, now you should try the Trustive service."

Marketing partners might eventually include companies such as car rental agencies and others that cater to the same kind of customers -- business travelers -- that Trustive is targeting.

Where the online and partner marketing will address individual business travelers, the direct sales force will target enterprises, selling company-wide subscriptions. It will focus first on the Netherlands, then expand, first to Germany, then to the UK.

From a subscriber perspective, Dresselhuis admits, there isn't much to differentiate his service from those offered by aggregators such as GRIC, iPass and Boingo.

"It's a very new market," he notes. "Everybody is searching for a business [model]. In some cases, [the differentiator] could be locations -- you have some that the others don't. In most cases, there will be price differences. We're definitely at the low end on pricing."

Trustive customers can choose from one of six packages that include a monthly fee, a block of minutes and a per-minute fee for extra time. Packages range from about $5.90 base price plus 9 cents per minute, to about $59 for a block of 1,000 minutes and 6 cents per minute for extra time.

Subscribers are charged by the second, not each minute or part of a minute, Dresselhuis stresses. "If they're online for two seconds, they get a bill for two seconds." They also don't start paying until they're fully authenticated. [iPass contacted Wi-Fi Planet after this story was published to remind us that it has had per-minute pricing since November 2002, and that they do charge it on a per-second basis. An iPass spokesperson said, "Trustive is not bringing anything new to the party we haven't already been doing."]

Subscribers download a piece of client software, into which they enter their Trustive-supplied ID and password. With the current client software, they must go into Windows Network settings and select the local hotspots provider's access point, but a new version is coming with a built-in sniffer that will automatically select the network.

Once the network is selected, the subscriber logs in with a single mouse click -- he doesn't have to re-enter ID and password.

One important differentiator is Trustive's telephone customer care center, which is open 15 hours a day, 365 days a year. If a customer runs into problems -- as I did recently trying to log on to a GRIC partner's site in Italy -- he doesn't have to rely on the local provider for technical support.

(In my Italian experience, the local provider's tech support rep did not have enough English to be of any help, and I had no Italian. I ended up paying $7 for service.)

"That is one of the issues that distinguishes us from others," Dresselhuis says. "GRIC doesn't have that, and it's not good for subscribers."

He won't name current roaming partners. The largest has 370 sites, the smallest two. Trustive doesn't seek exclusive agreements. Some of its partners are also partnering with GRIC, for example -- including my Italian provider.

Providers must agree to log on subscribers authenticated by Trustive using its one-click client software. (That wasn't the case with my Italian provider in its agreement with GRIC.)

Trustive has a network operations center (NOC) in Amsterdam with RADIUS and other servers running back-end software from Wificom, a developer headquartered in Helsinki, Finland. "We're heavily invested in the back-end system -- that's very important," Dresselhuis says.

The NOC authenticates subscribers for its roaming partners and calculates monthly bills for customers -- and pay-outs to partners. Partners get 25 to 30 percent of the gross.

"Our core business is marketing and selling the Trustive service," Dresselhuis notes. "We create more awareness for their locations and send them more traffic [than they would otherwise get.] So if the WISP focuses on deploying hotspots, Trustive can look after the marketing."

That's the Wi-Fi hotspot aggregator's business raison d'etre in a nutshell. Can Trustive play the game with the big boys? With over 1,000 hotspots, it's arguably already doing that.

Wi-Fi Planet Conference Want to meet an aggregator? Join us at the Wi-Fi Planet Conference & Expo, December 2 - 5, 2003 at the McEnery Convention Center in San Jose, CA. iPass and GRIC will be among the 100 exhibitors on the show floor.



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