Wi-Fi and fries?
Published: 12 Mar 2004 15:25 GMT
McDonald's representatives declined to comment for this story, citing a quiet period as they look over business proposals from operators.
Although it does not plan to install the service in all its locations, McDonald's would be the largest potential partner for a hot spot operator in the United States. The chain is using an @ with an M in the middle as a logo to help hot-spot subscribers identify locations that offer the service.
"McDonald's has potential for operators because it has 13,000 locations and an All-American sort of audience," said John Yunker, analyst with research firm Pyramid Research.
Wi-Fi with your fries?
Hot spots are public areas where individuals can wirelessly access resources -- such as a broadband Internet connection -- available on a network established using Wi-Fi gear. They were initially set up haphazardly in a grassroots manner to give communities free access to the Internet. Although this continues to happen in cities like Portland and San Jose, more and more companies have been installing secure networks and charging for the service.
Last year, 15 million units of Wi-Fi equipped consumer devices such as laptops were shipped -- up 95 percent compared with 2002, according to research firm Synergy Research Group. And the thinking goes that as more devices are sold with built-in Wi-Fi connections, more device owners will want hot-spot service.
"We need to build the scale of usage as quickly as possible," said Gary Weis, chief executive of Cometa Networks. The more locations an operator has access to, the greater the amount of traffic on their networks and the more attractive the operator becomes as a potential partner for cell and cable companies.
Analysts have been sceptical of the hot-spot market and whether businesses, not to mention an entire industry, can be sustained selling the service. Providers have been offering the service on a daily and monthly basis. T-Mobile USA, for example, which partners with Starbucks, has the most hot spots installed in the United States and charges a daily fee of $9.99 (£5.56) and a monthly fee of $39.99. The monthly fee drops to $29.99 if a customer signs on to a yearlong deal. Monthly subscribers are more valuable to providers because they tend to mean a longer commitment and recurring revenue, but analysts argue that at this point, monthly charges are too high to encourage subscriptions.
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