In developed markets where the foundation of a high-capacity data transmission network exists, WiFi overlays are likely to be very effective. In emerging economies, where the foundation is yet being built, the same solutions may not as effective. But it is worth following the action, described in the NYT article below.
“Google has deployed 380 lamppost-mounted Wi-Fi transceivers in Mountain View to make wireless Internet service available to anyone who has registered for a Google account, which is free. The company has invested a significant amount in promoting the benefits of wireless Internet access. It has held a series of tutorials, one of them drawing 750 residents.
Users will be limited to one-megabit data rates for both uploading and downloading information, somewhat slower than digital subscriber line (D.S.L.) service offered by phone companies. But Google has experimented with data rates above eight megabits, and Mr. Sacca said the company would consider increasing bandwidth after it had more experience with customer demand.
Making use of the service within a home in Mountain View typically requires a device called a Wi-Fi repeater, which costs $30 to $170. The repeater amplifies the wireless signal and relays it to individual computers equipped with a Wi-Fi card or Ethernet connection.
The installation, in a city of 72,000 residents, cost roughly $1 million, an amount that Mr. Sacca said demonstrated the low barriers to deploying such a service.”
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Divakar Goswami
Google’s ad-driven model may not scale-up to a nationwide WiFi based service that is financially viable. As Google itself clarified, it has no plans to provide nationwide coverage. So leave alone developing countries, even in developed country such a model may not be sustainable outside a few lucrative regions, over the long-term. During the late 1990s, a number of ISPs provided ad-supported dial-up Internet service for “free” with a monthly cap on number of hours. Most of those companies do not exist anymore. Google has a more diversified business and may not bleed much financially even if this small scale deployment in MountainView fails. Google is probably just testing its business model and the economics of the service. Any other company would be foolhardy to assume that because Google has gotten into the business of ad-supported WiFi service, such a model is the way to go.
But there are lessons in this for developing countries. The low-cost of deploying WiFi based Internet service to reach customer homes should demonstrate to ISPs in developing countries that they can bypass the local loop of the historical incumbent and provide services in urban areas (at least where the underlying infrastructure exists) in a cost effective manner and in competition with broadband services. Of course, this calls for the regulator/government to unlicense the frequencies necessary to use WiFi.