The Wi-Fi Boat

By Adam Stone

September 27, 2004

Come aboard, they're expecting you... to go online while on a gigantic cruise ship. Wireless connections on the big luxury liners is quickly becoming the norm.

Ah, the cruising life. Beachesbuffetsbroadband?

Those who vacation on the big boats increasingly are finding themselves able to access the Internet from stem to stern, thanks to Wi-Fi deployments rigged with signal backhaul through satellite connections. Who needs Wi-Fi on vacation? You'd be surprised.

"You come out of Grand Cayman, you just did 'Stingray City.' Now wouldn't it be nice to take those digital photos, upload them that evening and send them to grandma?" asked Kevin Jaskolka, marketing manager at Nomadix, a maker of public-access gateways. "Or maybe you would use it to research the next port."

Nomadix is putting that theory to the test. Together with the Maritime Telecommunications Network (MTN), the firm has outfitted Wi-Fi networks in about 50 cruise ships. The ocean liners charge various rates for the service: Some get $55 for 100 minutes, others charge a flat rate for the day or the week, and so on.

Vacationers are not the only ones expected to access the networks. Crewmembers too could find multiple uses for onboard broadband. "They sign up for a six-month hitch, and this is a nice way for them to send e-mail, exchange photos and just keep up relationships," Jaskolka said.

While the idea of checking e-mail on vacation may make some folks blanch, analysts say there may indeed be a market for these services.

"The bottom line is that more than 50 percent of the population seems to be traveling as a family with at least one laptop with them," noted Bob Eagan, president of the market analyst firm Mobile Competency.

In fact, cruise-industry officials have estimated that at least 15 percent of passengers already access the Internet while on board using Ethernet, and some of the major lines have begun putting Wi-Fi in place. All Norwegian Cruise Lines ships have hotspots, and the line rents wireless cards and laptops for about $10 a day. This summer the luxury Seabourn line also created hot zones within its ships.

"While they are vacationing with us, their Blackberries and laptops are a part of their lifestyle that they'd rather not leave behind," Seabourne's senior vice president Richard D. Meadows said in a press release announcing the Wi-Fi rollout.

For Wi-Fi equipment vendors and integrators, the cruise ship space offers an unusual opportunity to get into the hospitality market without the kind of intensive physical infrastructure overhaul needed in a large hotel. In fact, some see the Wi-Fi addition as something that can be overlaid on top of the existing data structure, without having to replace any existing components.

"If you consider a combination of a wired and wireless infrastructure, this is really a kind of shared network model," Jaskolka said. "They may already have a data infrastructure on the ship, but you can put in a gateway into that environment that is logically separate from the IT infrastructure, while still making physical use of that network." In this way, the Wi-Fi vendor can leverage the existing network investment while keeping down the cost of the overall rollout.

In this scenario, the ability to provide and deploy technology will hardly be a differentiating factor among competing Wi-Fi vendors. This is off-the-shelf stuff, deployed in a relatively unchallenging environment. What, then, will determine the winners in the effort to capture the cruise ship market?

It may be the sales pitch, according to Craig Mathias, principal with the Farpoint Group consulting firm in Ashland, Mass.

"It's the marketing and sales that matter most, rather than the technology. You have to know who to call and you have to know what to tell them," he said. That story should include a financial component in terms of both installation and future income; it needs to talk about the ease of future upgrades as technology evolves, and perhaps most importantly, it needs to talk about reliability. "These people tend to be pretty conservative. They can't afford to disappoint their customers, so whatever you put in has to work well."

All that being said, Mathias cautions that the cruise ship Wi-Fi market may not be nearly so exciting as its proponents suggest. "There are only so many cruise ships out there, after all, and not all of them are going to have Wi-Fi."

That does not bother Nomadix president and CEO Kurt Bauer, who argues that the cruise ship market is only the tip of the, um, iceberg.

With cruise ships implementing Wi-Fi, "it tells us that public access in general is beginning to take off," he said. "This year we are seeing movement, with agreements being struck and coverage developing, where in 2003 there was much more talk than action."



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