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Fixed Wireless Business

In the Shadow of the Giants

What will become of the pioneering fixed-wireless ISPs who took on the ILECs and the DSL providers to build their new-wave businesses when the really big guys get into the wireless access game?

[December 31, 2002]

On the ISP-Wireless discussion list in December, an interesting business-model question quickly raised the specter of how the wireless ISP landscape will look once the long-awaited and recently announced Cometa combine is up and running.

Speculating about how to turn competition from local wireless providers into a mutually beneficial relationship, VP asked:

"If you have neighboring WISPs that would like to create an agreement to cross-sell in each others' territories, what is the most equitable way of creating the agreement?

1) Simply resell the other WISPs product and get a 'finders fee' and maybe recurring income?

2) Strike up a 'transport only' agreement between all WISPs that for X dollars per month and a cross-connect (bring your own bandwidth) the WISPs could cross-sell. I like this idea but what could 'X' equal and who would own the end user? Who would be responsible for install and maintenance? I can see where each WISP might add some special value: maybe one has a great deal on bandwidth, maybe one is an existing dialup, maybe one is more expert in RF, etc.

Has this ever been done? If so successfully?"

D responded:

"We do a version of this.

In order to slow the propagation of new WISPs in our area, we partnered with the non-telco DSL companies and let them sell our system under their brand. This helps keep them disinterested in starting their own WISP.

So . . . I guess you could say we simply wholesale our services."

RS, however, jumped straight to a subject that was probably at the back of everyone's mind:

"This is what I imagine Cometa will do. They will put wireless stuff on all the towers they own, and build more too, and then backhaul all the traffic to colocation centers, and then it'll be the same deal as buying modem numbers from Focal. Just give it time; the big boys will screw us."

Alarmed, VP wondered:

"Don't you think we can stop that if we all decide to ban together, now?"

Several respondants jumped in with supportive comments. A spirited exchange ensued. Then RS answered in a much more sober—and foreboding—tone:

"Honestly? No, because we will never be one company—due to the fact that we're all competitors to start with. I don't see how AT&T / Verizon / SBC / etc., are going to take this stuff lying down. Once we all prove to them that no house anywhere needs a wire to it, (with the exception of power), they're going to be more than just competitors.

In New Jersey, there's one cell phone company left that's not run by 'them.' It's called Sussex County Cellular. They run their own network; they didn't (until recently) allow roaming, either. Every once in a while, they just stop allowing roaming for a few weeks until the big companies pay them more.

But even their days are numbered. On ridges surrounding their entire area, the big guys are building towers, and even colocating together on them, so they can cover the county and wipe out that little mom and pop cellular company.

I see that as evidence of what will happen to all of us in the future. Get the money while you can!"

— End