December 08, 2004
Moving from dial-up to international Wi-Fi access has been the plan as this provider grows its business to take on the big remote access aggregators with low pricing and personalized service.
Doug Bonestroo doesn't think of it as selling Wi-Fi. He is selling connectivity, in all its forms and facets.
"Because wireless started growing so quickly, we decided to develop a complete local and global access solution," said Bonestroo, the CEO of RemotePipes. Corporate clients don't want to have to choose their means of Internet access, he said, "they just want maximum coverage, with as few holes as possible, and they want to be able to choose the right tool at the right time."
Founded in February 2000, RemotePipes initially provided low-cost, toll-free dialup access for customers worldwide. More recently the firm has been assembling a broad international Wi-Fi footprint in an effort to provide its customers with a single-vendor solution for their mobile connectivity needs.
Recent deals with Airpath Wireless and FatPort have helped the company establish its Wi-Fi presence. As of mid-November, RemotePipes offered 25,000 dial-up access opportunities worldwide and 3,000 Wi-Fi access points. Bonestroo predicted he would have 7,000 more Wi-Fi points of contact in 40 countries by year's end, most of them located in the typical business-traveler locations: restaurants, hotels, airports and the like.
At research firm In-Stat/MDR , wireless industry analyst Ken Hyers sees promise in RemotePipes' business model. Such a combined Wi-Fi/dialup offering "could be the future of telecommunications," he said. "Companies are insisting that their workers be more accessible all the time, and that doesn't mean they just carry a Blackberry. They need to be able to get onto the Internet, and that means corporations need to offer a wider array of access options for their mobile workers."
Of course, corporations could wait just a little while in anticipation of Wi-Fi becoming ubiquitous, or nearly so. However, Bonestroo sees a financial incentive for companies to tap into the dual-access model, even after Wi-Fi becomes a universal phenomenon.
Sometimes workers need a fast connection to grab the e-mail and go. Sometimes they can make do with something slower (and less expensive) as they while away their hours in the departure lounge. Why pay for fast and pricey, when something slower will do just as well?
"In a business that has thousands of employees, if you take 1,000-times the dial-up prices versus 1,000-times the Wi-Fi prices, it can be a lot more expensive to give everyone access to Wi-Fi," Bonestroo said.RemotePipes helps facilitate these savings not just through offering both means of connecting, but also through its own back-end reporting systems. For example, a corporate user can configure the employees' access by group, so that entire classes or worker who do not need Wi-Fi will be not able to get to it.
This business proposition has already proven attractive to a range of users. Bonestroo claims over 11,000 accounts, each of which may have anywhere from one to 500 users. Clients include Motorola, the USC Marshall School of Business and various governmental and corporate entities.
In a novel proposition, RemotePipes has teamed with three of the largest cable providers in North America: Adelphia, Shaw Communications and Rogers. For cable broadband subscribers RemotePipes offers the opportunity to achieve travel connectivity branded under their cable providers' name. "They bring the customers, we bring the service and then we do a revenue split," Bonestroo explained.
By delivering a range of connectivity options under a single umbrella, RemotePipes may be particularly attractive to corporate users looking to consolidate the number of telecommunications vendors with whom they do business. "The ability to go to one company as opposed to going to multiple service providers is really critical to corporations," Hyers said. "They don't want to have to manage three or four different accounts with three or four different service providers."
All the more so for smaller businesses, he added. "They don't have the IT resources to do this sort of thing themselves, so they are going to look for a company that can handle this for them."
All that being said, Bonestroo says the goal of building out a mixed dial-up/Wi-Fi network is not so easily achieved.
He needs to tap into the existing networks of major aggregators, "but the people that own the networks know they are sitting on the crown jewels, and they are very demanding," he said. High up-front access fees and high monthly usage rates all can be barriers to entrance—and it's not just the expense that blocks the door.
"Even if you have a lot of money, if someone like Yahoo! is asking for access and we are too, who is going to get their ear first? You can have all the money in the world, but if you don't have the right brand name, you are not going to be very high up on the list," he said.
That's where things like the relationships with the cable providers come in especially handy. "The bigger the brand names I bring to the table, the greater the access I can get to the networks."