Sunday, October 02, 2005

Free Wi-Fi access from Google

Free Wi-Fi from Google? If you're like me, you might have asked yourself why they would do such a thing. After all, Google isn't in the Wi-Fi it?

Well, the key is advertising. Think of the power that Google that will have by knowing your profile--in combination with your location. Local ads (and maybe even ones that you do not mind seeing) will flow to your laptop. Let's say, for instance, that you're out with the kids at the Mall of America and you're thinking of buying a new Rolex. You fire up your Wi-Fi-enabled PDA to check your e-mail via Google's free service and bang, there's an ad for a Rolex sale and at jewelry store across the mall. Or, better yet, you're at a bar and the waitress informs you happy hour is ending. But thanks to Google's Wi-Fi service, you get a tip that you can still get two-for-ones a couple of doors down. Is this a great country or what?

Recently, Google and a dozen other ISPs submitted a proposal to the city of San Francisco to offer free Wi-Fi access across the city. The mayor is planning to have the service in place by the end of 2006. Google’s proposal will provide service to 95% of the outdoor locations and 90% of residences with EV-DO speeds of 300 kb/sec.

If I was in the telecom or cable business, I would be very nervous about this proposal, since the majority of my profit will be in competition with a free service.

Only time will tell how companies like Verizon, SBC, and Comcast will react. I am not planning on buying any stock in these companies in the short term (or long term). And this is not the only challenge these companies have – Podcasts and VoIP are starting to exert pressure, too.

I think Google's strategy, although risky and expensive, is a sound one--and the price of providing this sort of Wi-Fi access is minimal compared to the opportunity. Frankly, I am looking forward to having free access everywhere--even if it means that I have to view the occasional ad for local products and services.


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