The Wi5 Business Opportunity
Municipal Wi-Fi networks became a race to see which city could out do the others with accolades by becoming “the first Free Wi-Fi Network in Canada,” like Fredericton, NB. These networks were planed a few years ago, when cellular data was slow, expensive, and required a cable hooked up between your cellphone and laptop computer. Business models were based on monthly fees or advertising pop-ups. Today, cellular data rates have caught up with 3G and EVDO offering broadband data. Laptop cards and keys replaced cables, and data rates are around $45 per month. Why would someone pay $29.99 for Toronto One Zone’s limited downtown coverage, when cellular gives nationwide coverage? Furthermore, cellular data offers more security than open Wi-Fi.
Most of the Municipal Wi-Fi networks are on hold, such as San Francisco. Advertising models didn’t work, and cellular data has caught up. These networks are run as community co-ops. All my reading on municipal networks, none mentions Wi-Fi phones.
The Wi5 business opportunity is to offer a cheap cellular like Wi-Fi phone that is a hybrid of a home phone and a cellular phone. Sort of a cordless phone you can use in your house and take on the road. If you walk outside your house with a traditional cordless phone, you probably won’t be able to make or receive a call further than 300 meters away. That is because the cordless phone is communicating with a base station in your house that is connected to a telephone line. A wi5 phone will connect to any Internet hot-spot that is open in the world, and will allow you to make or receive a call.
If the cellular companies charge $45 for the lowest plan, we’d charge a third or $14.99 per month for a local telephone number, voice mail, caller ID, 3-way calls & unlimited long distance calls anywhere in Canada or the USA. What is unique is the universality of the wi5 phone. A Snowbird vacationing in Florida can keep in touch with a Toronto phone number and call back to Canada. A family can send the wi5 phone to India, where the cost is 6 cents per minute to call. They can dial a local Toronto number and talk to their family in India. A businessman travelling abroad can avoid expensive cellular “roaming” charges by logging into the Wi-Fi hot-spot at the hotels, airports, buses (Greyhound’s BoltBus, Eurolines), taxis, trains (Via Rail, Eurostar, Virgin Rail), and even some airlines offer Wi-Fi (American, Delta, Lufthansa, & Virgin America).
What would be the “cellphone killer” is the meshing of Wi-Fi so that you’d be able to walk downtown and keep the conversation, as you walk between Wi-Fi nodes. There is a company in California offering for $499 mobile Wi-Fi in the car. Basically, using a cellular card, data is sent to the car and then it is converted to the Wi-Fi router. Cars will become Wi-Fi enabled, 2 ton “BlackBerrys.” Allowing real-time gasoline prices for the next 100-500 miles; real-time road conditions; email reading; hotel room availability; intercom to home; Facebook on the seat back screens; Internet radio (watch out X-M Radio!); television; automatic payment of highway & city road tolls; emergency response, etc.
What needs to be done is that the wi5 phone is the saviour of the municipal Wi-Fi networks. A partnership needs to be established with the cities. They need the Wi-Fi network for security CCTV cameras, electronic parking meters, electronic parking tickets, delivering real time bus-stop information (when next bus arrives), and general data requirements. There is also a social obligation that no-one is left out of the “information age.”
Wi5 phones will be the low cost alternative to cellular phones. We will offer to promote the wi5 phone and the service on city Wi-Fi websites and offer a small fee for every sign-up. If we get 10,000 customers paying $2 per month, that would be $240,000 per year for the city. That is a sizable portion of an annual municipal Wi-Fi network’s budget.
Estimate 10,000 subscribers would achieve $1.5 million in sales and $150 per month in revenue. Valuation would be between $300 & $1,000 per subscriber, or $3 to $10 million.
