Roaming Comes to Starbucks

By Eric Griffith

December 16, 2003

After months of speculation and waiting, T-Mobile has announced a partnership with hotspot aggregator iPass to let subscribing mobile professionals get full access to the T-Mobile network in the US.

After months of speculation and waiting, T-Mobile has announced a partnership to let outsiders roam on its public Wi-Fi network.

The Bellevue, Wash.-based company has struck a deal with hotspot aggregator iPass to allow mobile professionals who use the iPassConnect software full access to the T-Mobile network throughout the United States, without going through a Web interface or paying extra.

"This is a huge day, and a great way to end 2003," says Jon Russo, the vice president of marketing at iPass.

"The motivation for [T-Mobile to enter this agreement] was our [iPassConnect] 3.0 platform," says Russo. "That caused T-Mobile to pause and see that it made it easy for the enterprise to use Wi-Fi."

T-Mobile runs the public Wi-Fi access found at Starbucks Coffee Shops, Borders Books & Music, Kinko's, and 52 airport clubs and lounges for American, Delta, and United airlines. The number of locations is currently 3,900 in just the United States, making it the biggest provider in the country of public access Wi-Fi. They also have sites overseas that are not part of this agreement.

iPass provides services to around 1,000 enterprise customers so their employees can use Wi-Fi and Ethernet connections on the road. iPass does not have a network of its own, but instead works with providers to create a virtual network. Hotspots on this Global Broadband Roaming virtual network must qualify as "enterprise-ready" under iPass testing.

This deal will push iPass's footprint from 1,551 U.S. locations to 5,441, an instant growth of 350 percent. The service also has 1200 Ethernet-only venues, usually found in hotels. The company currently has contracts with a number of providers and expects to have a full 10,000 hotspots worldwide by the end of the year.

The initial push by T-Mobile -- the mobile arm of Deutsche Telekom -- into Starbucks shops in August 2002 seemed to herald the coming of consumers to mobile Wi-Fi. That hasn't been the case. T-Mobile says its own internal research shows that 88 percent of its hotspot users are online for business purposes. This plays directly into the iPass model, which focuses on enterprise customers with a large number of "road warrior" employees.

T-Mobile recently announced plans to make extra security available at all of its locations for users who want it, in the form of 802.1X authentication. They plan to have this in place by mid-2004. The current version of the iPassConnect client software, version 3.0, has 802.1X capabilities built in, so users won't need additional software.

This deal with iPass is T-Mobile's first inbound roaming agreement. The company still has no plans to let their subscribers do outbound roaming onto other Wi-Fi hotspots. Russo says they were a tough nut to crack, but that companies who used Wi-Fi via the iPass client kept at them.

"The more that join [our virtual network], the more and more valuable it becomes to customers," says Russo.

Russo could not disclose any further terms of the deal, such as whether it is exclusive or not. It's unlikely, as T-Mobile announced that it was working with hotspot aggregator Boingo Wireless last March; Boingo is working on software to manage both T-Mobile hotspot and GPRS cellular networks.

The T-Mobile network should be fully available to iPass subscribers sometime in the first quarter of 2004.



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