Verizon's Bold Wi-Fi Push

By Colin C. Haley

May 21, 2003

Verizon is rolling out thousands of WiFi hotspots in New York City before the end of the year -- including the upgrade of many public pay phones to support WiFi. Will it be enough for the company to differentiate itself from its broadband competitors? Experts from the business community will address this issue in Boston.

Verizon (Quote, Company Info) this morning activated 150 Wi-Fi (define) hotspots (define) in New York, part of a plan to bring wireless Internet access to its subscribers throughout the Big Apple and differentiate itself from cable broadband rivals.

In all, the telecom plans to have 1,000 access spots in the city by year's end. Users can access the Internet through Wi-Fi compatible laptops, PDAs or pocket PCs within 300 feet of the hotspots.

The first hotspots (which will costs Verizon about $5,000 each to deploy) are in busy neighborhoods, including: the Upper East and Upper West Sides, Columbia University, Midtown, Union Square, Gramercy Park, Greenwich Village/NYU, Wall Street and Battery Park.

The company's Web site has a complete list. In addition, Verizon Wi-Fi-enabled public phones are identified with hotspot signs in red and black.

"Free access to our data network through emerging Wi-Fi technologies gives our customers benefits they can get from no other provider and makes our broadband service uniquely competitive," said James A. Otterbeck, a Verizon senior vice president.

"Uniquely competitive" is a subtle swipe at cable companies, who vie with Verizon for home and small business broadband services. By offering complementary Wi-Fi access to its DSL customers, Verizon believes it will have an edge over Comcast and others.

During a conference call with reporters, Verizon executives said they will use New York as a model for deployments in its other major markets. The company, which serves most of the East Coast, will wait to gather feedback before committing to a schedule.

"We're going to learn and we're going to grow." said Verizon executive Larry Babbio.

He added that Verizon is confident the investment will pay off by reducing customer churn and attracting new users.

Verizon said its Wi-Fi service in New York will be the largest run by any carrier in a major city. It will however compete with several public hotspots. New York's Downtown Alliance recently launched three such sites in Manhattan and four more are expected to go live later this month.

Can Verizon change the economics of public WiFi? This topic will be addressed at the panel discussion, "Emerging Hotspot Business Models" at the 80211Planet Conference and Expo, June 25-27, in Boston. In addition, Verizon will be exhibiting in booth 408 at the show.

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