‘Femto Foneros’ – a curious marriage of WiFi and Femto communities
Posted Tue, 15 Sep 2009 09:23:46 EDT by Aditya Kaul
FON, which is one of the largest community of WiFi users that share their WiFi connections has announced a partnership with Ubiquisys, one of the largest femtocell vendors. The hope is to create communities based on the use of high-speed mobile data using a new generation of “femto fonera” devices that allow spare 3G capacity in the femtocell to be shared securely.
This is a unique experiment into convincing operators to offload some of their 3G traffic onto femtocells. Recently news about AT&T IPhone customers facing capacity and coverage issues especially in cities has been highlighted most prominently in this NYT article. However, it’s surprising that although they clearly outline the problem and build a case for femtocells, the article fails to mention anything about how femtocells could be the solution (or even WiFi for that matter!)
The fact that this new femto initiative is being done in conjunction with one of the largest WiFi user communities is important to note. FON has around 1.5 million registered users (known as Foneros) who can use hotspots around the world that are FON registered, provided they share their own WiFi access point with other users. FON users need to buy a FON WiFi access point which then gives them free access to FON hotspots worldwide. Similarly for Femto Foneros, the expectation is that operators provide their users with a FON activated femtocell, which will allow the user to have access to FON Femto hotspots across the world.
However, unlike the WiFi hotspot community, which doesn’t require the permission or involvement of a third-party like an operator or ISP - for the Femto Fonera community to grow, the mobile operator would need to be involved. Operators would need to know where these femtocells are deployed, and would most probably control the access lists of these femtocells.
Most residential femtocells being shipped today are closed access femtocells, which restrict the number of users that can use the femtocell. This access list is typically fed in through the operator, either at point of sale, by calling the operator, or in many cases through a web-interface. For Femto Foneros, a separate management application will likely control these access lists which will most likely sit on the femto device, but will be controlled centrally by the operator.
Operators will be most concerned about security issues when using this model. Although FON has built security for its WiFi access point known as La Fonera - security for the femto device is a different ball game, with higher stakes at play.
Another critical difference between the WiFi FON community and the Femto Fonero community will be that this will be restricted to one operator. Femtocells are single-operator controlled devices and therefore Femto Foneros will all need to be customers of a particular operator for this to work. I cannot imagine multiple operators signing up as this will segregate the femto hotspots and users instead of organically growing it.
Ubiquisys and FON hope to convince operators to work on a new revenue model, where hundreds or thousands of these devices are deployed in public spaces, most probably in the metro and enterprise femto form factors, allowing operators to offload their 3G traffic from the macro onto these Femto Fonera femtocells. The extended Femto Fonera network will drive additional revenues for operators through increased traffic. There could be a one-time Femto Fonera access fee when the user buys a Femto Fonera device from the operator. This revenue could then be shared with FON.This could also become an alternate distribution channel for femtocells, of course in partnership with a mobile operator. In this model, FON could sell femto-WiFi integrated devices which would then take advantage of their expansive WiFi hotspot network as well as providing 3G coverage when needed. The suggestion in the announcement is that a next-generation device will be provided, which will allow to use spare capacity on the femtocell. It will be interesting to see whether this new device has WiFi integrated or not. There is also the suggestion of developing unique femtozone applications that could then make the revenue model even more compelling for the Femto Fonera concept.
There are many possibilities that could emerge in terms of the business case. One positive outcome from this is that the WiFi and Femto communities are talking to each other, collaborating and discussing how they could join hands, instead of compete with each other. My guess is that a mixed WiFi-Femto usage model will most likely develop, taking advantage of FONs already existing WiFi footprint, which can then be complemented with femtocells. This could then be tied with existing WiFi footprint of the operator to give a compelling service to the end user, giving access to an extended 3G network which is then complemented with WiFi hotspots.