Wi-Fi experiment has customers asking 'why?'
BY DARCY EVON
SUN-TIMES COLUMNIST
November 18, 2002
Broadband wireless networks, mobile commerce and wirelessly enabled mission-critical enterprise applications (huh?) were the hot buzz words at the tail-end of the Internet and telecom boom in 2000.
Market pundits, artful entrepreneurs and hungry investment bankers already had exhausted the hype value of portals, consumer e-commerce, business-to-business e-commerce and streaming media, and were on the prowl for a new "next big thing."
A McKinsey & Co. study completed for the city of Chicago even concluded that wireless broadband access and applications would become so pervasive on the global landscape that Chicago entrepreneurs and VCs should focus their resources on this area for the biggest bang for the buck. Shortly thereafter, in March 2001, FirstTuesday organizer David Jacobson initiated Mobile Wednesday to garner attention on this hot, new growth arena.
Then, nothing much happened. Except that a majority of over-funded and underperforming Chicago startups from eWireless, cyberPIXIE, Novarra and a multitude of others including stalwarts like SprintPCS burned through millions of dollars only to discover customers were hard to find.
No matter, Deutsche Telecom's wireless subsidiary, T-Mobile, is betting the shop on wireless broadband access, and launched a major initiative in a small niche market in Chicago. In partnership with Hewlett-Packard, T-Mobile is offering wireless broadband service in most Starbucks coffeeshops throughout the city.
That means you can take your laptop or PDA to a Starbucks and surf the Web, check e-mail or do anything else you would use your computer for at home or in the office. But first you have to buy a Wi-Fi card for your laptop ($60 to $278 from various places I checked, including rebate, although most new laptops come with a Wi-Fi card) and then sign up for monthly service ($40 to $100 a month).
Customers aren't exactly flocking to the new service, however, underscoring a common fatal flaw of the Internet boom: Do customers need this service, and are they willing to pay for it?
I walked Michigan Avenue to the Near North Side last week searching in Starbucks for a T-Mobile user. Some of the coffeehouses didn't think their service was live yet, while others said they were looking for users, too.
"Personally, I haven't seen anyone use it," said Grant Tallard, barista for the Starbucks at 444 N. Michigan Ave. "I would like to try it myself, but I don't have a computer."
After admitting he didn't see anyone using it, Marty O'Brien, assistant store manager for the Starbucks on Rush Street, one of the most popular in Chicago, predicted, "It's one of those things that's going to catch on, but right now I think people are just becoming aware of how to set up and sign up for it."
Morningstar analyst Jeremy Lopez argued, "It may never take off. By and large, the average person isn't going to pay for wireless. Business travelers will be interested in it, and that might be a nice niche market. Now if Starbucks were paying for the T-Mobile service, then I think there would be a big incentive for people to go to Starbucks."
Finally, on the second day of my quest and the 10th Starbucks, I found a Wi-Fi customer.
"I just signed up for it this morning," said Mike Thompson of Chicago.
He bought a Wi-Fi card at Best Buy for $60 after rebate, and started surfing early Friday morning, before work. He already was familiar with T-Mobile since he used the service for his phone and PDA.
"This is just great, and it works really well," Thompson said of his two-hour-old service. "This is the easiest plug-and-play system I have adopted. It's been fantastic."
Thompson has yet to spot a fellow user, but as an early adopter, he claims it will become ubiquitous--someday.
"I think this will become the norm in public places. I think this is a small start for a big movement. Maybe McDonald's isn't too far away, L stations, public parks."
Morningstar's Lopez is dubious: "I am basically a gadget geek myself, but adoption comes down to price."
Darcy Evon is editor of the i-Street Reporter, an independent free Internet newsletter and i-Street magazine. She can be reached at istreet@i-street.com. |
