Cablevision, the fifth largest cable operator in the United States, on Thursday said it completed the first phase of what it claims is already the largest free mesh Wi-Fi network in the country.
The Bethpage, New York-based company is spending $300 million on a mesh Wi-Fi network that will eventually cover commercial and other high traffic areas in its region, which extends across large parts of New York, New Jersey, and Connecticut. (see Cablevision to Spend $300M on Free WiFi)
Optimum Wi-Fi, as the service is called, is now available to customers in Nassau County and parts of Suffolk County Long Island. The network, which is expected to be completed in less than two years, will be available for free to Cablevision's 2.4 million Internet service customers.
In choosing to invest in Wi-Fi, Cablevision is cementing its maverick reputation since its rivals Comcast, Time Warner, and Bright House have invested about $2.7 billion in Clearwire, a WiMax wireless network operator. (see Tech Consortium Bids $14.5B on WiMAX)
The cable operators' investments in both WiFi and WiMax underscore the companies' urgent need to embrace wireless connectivity at a time when not just their voice and data businesses but their core TV products are under assault by mobile operators.
And while WiMax remains relatively untested nationally, Wi-Fi has one significant drawback.
“The main failure of Wi-Fi is its inability to insure in-building coverage because of power limitations, and that is where most people spend their time. Most people don't use their PCs sitting on park benches,” said Tim Farrar, president of Telecom Media and Finance Associates.
Cablevision's Wi-Fi service is more of a complement to its main business, and at a relatively low cost of $300 million, it could provide the New York-based firm insight into its customers wireless usage patterns and whether it needs to upgrade to something more.
“I am surprised that Cablevision has not yet bought licensed spectrum for New York, but I suspect that option is very much still on the table. If Clearwire proves to be successful, Cablevision will be forced to follow suit,” Mr. Farrar said.
Citywide Wi-Fi, provided by municipalities in partnership with technology firms, has gained little traction in the United States. But cable operators, with their direct access to millions of customers, could be a strong anchor for municipal broadband networks, according to industry analyst Craig Settles.
“The cable companies are in a great position to offer to the general public Wi-Fi as a free or low-cost extension to their indoor service,” said Mr. Settles, president of Successful.com. “The cost per sale to close 'new' customers is insanely low because they can easily push their current customers into the service, and sell it as part of a cable/wireless package to totally new customers.”
Cablevision first announced its Wi-Fi plans back in May.