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AT&T Strikes WiFi Deal With Fon

Sarah Thomas
9/24/2013

Fon's growing international WiFi-sharing community is coming to the US courtesy of a partnership with AT&T that will give its "Foneros" access to the wireless operator's 30,000-strong network of hotspots across the country.

Or, to look at it another way, AT&T Inc. (NYSE: T)'s customer base now gets access to 12 million hotspots outside the US. [Update: AT&T says the deal only applies to hotspots in Poland and Portugal. Fon has 400,000 in both countries.]

This is Fon 's first deal with a US wireless operator, but the Madrid-based company suggests it won't be the last. In a blog post announcing the deal, Fon's Adolfo Arias writes that entering the US market is Fon's latest move to further grow its 12 million-strong hotspot footprint and that Fon fans should "stay tuned for more exciting developments in the near future."

The partnership is advantageous for AT&T, too. Both companies' customers can now roam on the other's WiFi network, albeit only in Poland and Portugal for AT&T. Its customers that download the AT&T WiFi International App and pay for additional international mobile data access will get a Gbyte of monthly WiFi download data for free.

For Fon, AT&T is its best bet to break into the US market, since the carrier has been the most aggressive in building out a national network of WiFi access hotspots. The company's business model is to encourage its users, called Foneros, to share (securely) each other's WiFi connections, as well as to partner with wireless operators for access to their footprints. (For more on Fon's operational and business model, see Smartphone Revolution Helps FON Find Acceptance.)

Earlier this year, Fon inked a similar deal with Deutsche Telekom AG (NYSE: DT) in Germany and also counts KPN Mobile and BT Group plc (NYSE: BT; London: BTA) as partners. (See DT Preps Wi-Fi Push With FON, KPN Teams With FON for Wi-Fi, and BT Rebrands Wi-Fi Services.)

Why this matters
AT&T suffered a blow to its WiFi ego when its flagship Wifi partner Starbucks announced it would drop AT&T as a partner in favor of Google (Nasdaq: GOOG), reducing by 7,000 the number of hotspots AT&T customers could access. The Fon deal strengthens AT&T's Wifi offer and gives it a broader international reach. (See Is Google the New WiFi of Coffee Snobs? and Google, Starbucks Start AT&T Router Swap.)

This partnership will be important to AT&T as it looks to offer a value-added service to its customers who travel, as well as to off-load traffic from its cellular network. The carrier will likely continue to look to partners for access to more hotspots. At the same time it's building out its own WiFi hotspots, integrating them with mobile small cells to bolster network capacity. (See CTIA: AT&T Works on Wi-Fi Integration.)

For more

— Sarah Reedy, Senior Editor, Light Reading

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Sarah Thomas
Sarah Thomas
10/23/2013 | 11:33:40 AM
Fon in the US
AT&T was just the first step. Fon launched its direct-to-consumer play in the US today. GigaOm has the story: http://gigaom.com/2013/10/23/fon-finally-launches-in-the-u-s-inviting-consumers-to-share-their-wi-fi/
Sarah Thomas
Sarah Thomas
9/26/2013 | 5:09:30 PM
Re: AT&T's reach
Um okay, AT&T says its customers only get access to hotspots in Portugal and Poland. Both have 400,000, but still, that makes this deal a lot less impressive. I've made a note updating the story.

 

 

Sarah Thomas
Sarah Thomas
9/26/2013 | 4:57:39 PM
AT&T's reach
I need to update the story as AT&T's release actually said it will get access to "hundreds of thousands" of Fon's APs, not the entire footprint. I've reached out to AT&T to clarify which hotspots are excluded. I'm guessing it's the Foneros, the personally owned ones, but it could also be certain geographies...I'll update when I hear back.
DanJones
DanJones
9/24/2013 | 5:00:06 PM
Congestion, interference
I'm wondering how much more congestion in the 2.4GHz band is going to be created by all these new public/private WiFi projects. Already pretty damn busy in that band.
Sarah Thomas
Sarah Thomas
9/24/2013 | 4:52:22 PM
Re: Future Network
Makes sense, Ritch. We're definitely seeing some very heterogenous networks emerging. Policy, backhaul, SDN will all become so much more important.
RitchBlasi
RitchBlasi
9/24/2013 | 1:28:19 PM
Future Network
Sorry, I should have been more specific.  Yes, you are correct, the Fon stuff won't be part of it.  As someone with roots based with carriers, everything is aboutn QoS - enhancing, managing, measuring.  I was talking about the air-interface technologies in general.  You also have to consider the addition of small cells - whenever they really see the lite of day -- into how much play WiFi will actually have in the agnostic network.  Carriers can better manage capacity and coverage with their own hotspots, or small cells, than relying on someone else.  But I do think that each is an ingredient in making a great batch of soup...a.k.a. an exceptional mobile/wireless experience for customers.
Sarah Thomas
Sarah Thomas
9/24/2013 | 1:20:47 PM
Re: The Future Air-Agnostic Network
Ritch, I agree that that's the future most operators, including AT&T, are working towards. But, I don't think partnerships like this one with Fon will be included there. Carrier WiFi strategies involve owning the WiFi APs so they can integrate them into their hetnets. One potential issue with Fon is that AT&T can't guarantee the quality of the connections, and I'm not sure how easy it will be to use policy to improve authentication and handoff. Maybe if they're all Hotspot 2.0 compliant?
MordyK
MordyK
9/24/2013 | 1:19:29 PM
Re: Impact
You're probably right
RitchBlasi
RitchBlasi
9/24/2013 | 1:16:32 PM
The Future Air-Agnostic Network
I believe AT&T already has a deal with Boingo, but it might just be to use Wi-Fi in international airports.  I believe the bigger picture is the evolution of mobile and wireless networks into a single "air-agnostic" network (that will also include TV white space spectrum in the future) that seamlessly hands-off voice, text and data services back-n-forth between celluar and Wi-Fi.  With VoLTE on the horizon (albeit a longer horizon than what was originally projected due to QoS and other issues), the move to all-IP, from device through the core networks, will take OTT voice services like Skype, Bria, Truphone, etc. and take them mainstream.  You won't need to find a WiFi hotspot to use the app anymore as calls should simply flow between LTE and WiFi.   
Sarah Thomas
Sarah Thomas
9/24/2013 | 1:12:43 PM
Re: Impact
In that respect, the deal may benefit Fon a lot more than AT&T. Although, I'm not sure how its APs break down between residential and commercial. 12 million is nothing to sneeze at.

AT&T has a global WiFi roaming deal with Boingo too. I think it's all a numbers game for it.
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