[MLB-WIRELESS] RE: Payphones

[Dean Collins]

The Media Beagle [Click here to subscribe to this newsletter] 	January 28,
2003


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Payphones: The Next Hotspot Wave?[NL]Ed Sutherland [PARA]
Remember payphones? Once a vital link for people away from the home or
office, payphones now languish in the shadows of cell phone users,
collecting dust and graffiti. But in one of those technological ironies, the
very cause of the death of the payphone may inspire a new revival.[PARA]In a
pilot program that's now testing public reaction, a Canadian telephone
company and Californian wireless think tank are breathing life into unused
products by converting traditional public phones into 802.11 hotspots.
Hotspots create an area where wireless users within a 300-foot radius can
connect to the Internet using laptops or other portable devices equipped
with an 802.11 network interface card.[PARA]Don Blair, a spokesman for Bell
Canada, says wireless local area networks (WLANs) "are a natural extension"
of its wireline business. Bell Canada worked with inCode Telecomm, a San
Diego, CA-based wireless consultancy to design AccessZone, a Wi-Fi hotspot
device with a physical footprint matching already existing payphones.
[PARA]While Blair says payphones are actually still profitable in Canada,
sleek 802.11b access points about the same size as a public phone have
replaced twelve payphones in high traffic areas. Each unit contains a Cisco
1200 AP, an Alcatel ADSL modem and a 3Mbps DSL Internet connection using
already existing wires. During the three-month pilot, which began in
December of 2002, access is free, says Blair.[PARA]AccessZone Takes to the
Rails, Airports[PARA]AccessZone is available in Toronto, Ontario's Union
Station and several Air Canada lounges, among other spots. Although Bell
Canada has not done much marketing for the program, Blair says feedback from
users has been favorable. During the test period, Bell Canada will look at
options for billing and deciding on a subscription or pay-per-use
model.[PARA]Eric Carr, a senior manager at inCode, says the firm has worked
with Bell Canada for more than a year to jointly develop AccessZone. Using
the already existing payphone infrastructure "was the most cost effective
and compelling method of conducting a pilot," says Carr.[PARA]There are
other reasons for using payphones as a platform for Wi-Fi hotspots. There
were no hassles arranging right-of-way to install the access point, sales
channels already exist for the payphone locations and installation is less
expensive, says Carr. Also, the time it takes for a hotspot to reach the
market is quick because of reduced negotiating headaches.[PARA]From Concept
to Reality[PARA]"There were technical hurdles to overcome," says Carr, but
inCode and Bell Canada "were able to take the concept from drawing board to
reality very quickly."[PARA]Although the payphone hotspots are different
from an access point and some cables, "payphones are very similar to other
hotspot models," says Carr. Bell Canada, which entered the wireless market
in October 2002, will also deploy traditional hotspots, Carr
says.[PARA]InCode CEO John Donovan said payphone hotspots "can help wireline
carriers grab wireless market share, leverage their existing payphone
infrastructure."[PARA]Carriers Express Interest[PARA]Carr believes U.S.
carriers will soon follow Bell Canada's first step. Carr says he has
received many inquiries "and even visits by folks" interested in inCode's
payphone concept.[PARA]"We feel it is a beneficial model of deployment and
expect others to follow suit," Carr says.[PARA]"Payphone businesses are
competing with cellular for mobile minute usage on the voice side," Carr
says. Adapting payphones to include wireless data is "an attractive
potential revenue stream."[PARA]Allen Nogee, analyst with In-Stat/MDR, says
in the United Kingdom, old payphones are already used to house cellular
gear.[PARA]"In the U.S., I'm not sure it converts over as smoothly as in the
UK," Nogee says. He points to airports, which host many payphones, but are
still grappling with how WLAN can outperform the longer-range cell
calls.[PARA]Will public phones pay off as the next venue for 802.11? "It
can't hurt, but payphones are probably only one solution of many," says
Nogee.



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