Cloud Looms Over UK Hotspots
The network, dubbed "The Cloud," will have 250 live access points by the end of April and 1,000 by the end of June, says managing director of Inspired's wireless LAN business, George Polk. "We are going to offer wholesale wireless access to service providers, such as fixed and mobile operators, that primarily will have business users as their customers," he says. Openzone, the WLAN access business of U.K. operator British Telecommunications plc (BT) (NYSE: BTY; London: BTA), will be the first customer of the wholesale business (see BT Pitches WLAN vs 3G).
Inspired Broadcast Networks (IBS), which has dotcom has-been Luke Alvarez as its co-CEO (more of Luke later), believes it can meet its ambitious targets because "we already have the locations and the connections in place," says Polk. "All we have to do is add the access points. We have 11 deployment teams that will do between three and five installations a day, starting very soon." [Ed. note: Clearly not British labor, then.] Those existing locations come from a major part of IBS's current business -- providing networked entertainment terminals in pubs.
LM Ericsson (Nasdaq: ERICY) has emerged as the supplier of the network edge equipment that will link those terminals to DSL lines from BT (see Ericsson Bags UK WLAN Deal). The Swedish vendor is to supply 3,000 units that combine an 802.11b access point and a DSL modem. The same type of combo unit has already been supplied to Telecom Italia SpA (NYSE: TI) and other as yet unnamed European service providers.
The value of the IBS deal has not been revealed, says Ericsson's senior manager of wireless strategies, Filip Lindell.
Likewise, IBS's Polk says he cannot reveal how much is being invested in the core network, platforms, and access points, nor the details of revenue share agreements with Openzone. "[The upfront capital investment] is a significant amount, because to have customers such as Openzone, we have to have a carrier-grade network. But it is all funded internally – we have no external backers."
And Polk is convinced that pubs are a suitable place for attracting business users. Well, they like the odd drink, don't they? "Outside big cities such as London, pubs are very often used by business people for meetings and for working lunches. Pubs are good places to work during the day." Unstrung's U.K. staff will put that theory to the test immediately.
Intel Corp. (Nasdaq: INTC) is also along for the ride, having a six-month deal with IBS to "provide support and raise the profile of broadband wireless access as part of its Centrino campaign," says Polk (see Yes, We Have No Banias! and Intel Denies Dualmode Delay).
So we'll be keeping an eye on "The Cloud" in the coming months, but we are intrigued by the management of IBS – particularly the aforementioned Mr. Alvarez, who has an unenviable record in the online business sector. He was a member of the senior management team at failed online fashion retailer boo.com, one of the early casualties of the dotcom crash that burned tens of millions of dollars for almost no return. He then emerged on the management team of Emap Digital, a business division of publisher Emap PLC. This business also flopped, having spent tens of millions of dollars with little to show for it.
The Alvarez biography makes for interesting reading. He is a product of the "Boston Consulting Group, where he focused on brand positioning, new product development, and Internet strategy for retail and consumer goods clients. In his spare time, he rock climbs, buys avant garde British art, and is a director of Daniel Margolin Hommes, a startup designer label which makes premium menswear for an upscale urban consumer."
Are those the same "upscale urban consumers" who may buy a Centrino laptop and work during the day from country pubs? Mine's a pint, by the way…
Attempts to have a chat with Alvarez were unsuccessful. Maybe we'll find him in the Dog And Duck one afternoon, once the access points are installed, and catch up on his progress.
— Ray Le Maistre, European Editor, Unstrung