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A FON way to challenge Starbucks

A European tech company called FON thinks it's only fair that you should be able to use your home Internet connection in places other than, well, your home. The company sells a special WiFi router that has two "channels" - a private one for your personal home use and a public one that other FON customers can use to get online when they come into range.

So, let's say, you're a FON customer who happens to duck into the Starbucks over on K Street for an afternoon latte. You fire up the laptop and see that there's two strong WiFi signals - a $10-a-day HotSpot signal offered by T-Mobile and Starbucks and a FON signal that you can tap into for free. There's no question which one you choose, right?

Now, let's say you're not a FON customer - but your laptop or WiFi mobile device sees that there are two WiFi connections inside that Starbucks. You could pay $10 to access Starbucks' T-Mobile HotSpot connection for the day. Or FON will gladly let you tap into that connection for $3 a day. Again, an easy decision, right?

The challenge for FON is to get that WiFi signal into Starbucks - which is where the FONbucks promotion comes into play. FON is looking for people who live above or next door to a Starbucks (or any coffee shop, for that matter). FON will not only give you one of its $30 wireless routers but also will make you a partner in a public WiFi business. For every non-FON Web surfer who pays $3 to connect to your FON connection instead of $10 for access to the Starbucks/T-Mobile connection, you'll earn $1. You - the entrepreneurial partner - even get a name: Fonero

And, with every Fonero who agrees to do this, the company has one more FON zone to add to its global coverage area map.

Going after a big name like Starbucks sounds like a smart way to get some publicity (hey, I'm writing about it, aren't I?) But there's some caveats to this rosy partnership that need to be disclosed.

To start, Foneros still need to provide the actual Internet connection. FON just provides the routers that allow outsiders to access them. That becomes problematic in the U.S., where most Internet Service Providers have strict rules about sharing the connection with outsiders. In addition, a growing number of coffee shops are starting to offer free WiFi as a way to lure customers to the non-Starbucks coffee shops.

Why would I go to Starbucks to connect to a $10 T-Mobile HotSpot or a $3 FON connection, when the coffee shop on the oppposite corner gives it away? Would you?

By Sam Diaz  |  February 22, 2007; 11:08 AM ET  | Category:  Sam Diaz
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Here in Kansas City, there's a chain of bakery/coffee shops called Panera that offers free WiFi. Despite the fact that I tend to like Starbuck's coffee a bit better, I'll go to Panera just for the free WiFi.

In fact, I think Starbuck's is about the only coffee shop in town (and they are on every corner!) that charges for a connection. Even the locally-owned cafe's and little coffee shops offer free WiFi!

Posted by: Elisa | February 22, 2007 4:28 PM

Coffee shops in Cleveland have offered free wireless access for years, as do most of the major Museums and the universities and many businesses in key areas. As a component to the Euclid corridor project most of midtown Cleveland will have wireless hots spots that have free access. We may not have much going for us but knowing you can go almost anywhere in the city and get online is immensely convenient. I have to say I was pretty disappointed during my recent trip to Chicago and I had to pay to get online. It was a real turnoff as a visitor to have to go through the hassle. Free access increases business, demand it from your local coffee shop today!

Posted by: Diane | February 23, 2007 12:02 PM

So who would be responsible for any illegal activity on those FON hosted hot-spots? I'd bet money that it wouldn't be FON; especially considering it is a European company and that the individuals hosting open routers would probably be breaking the terms of their ISPs to begin with.

And since I'm neither a techie nor a lawyer, I also wonder about the security of the hosts' data. Would this be like leaving your wireless network unsecured or unencrypted?

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