BT on Thursday took a stake in Spanish startup FON that gives the telecommunications giant a blast in access to Wi-Fi coverage across the UK.
The deal promises to give BT’s 3 million Total Broadband customers access at no additional charge to FON’s network of roughly 190,000 Wi-fi access points. The move gives the UK telecom company a quick jump in its public access Wi-Fi coverage at a minimal cost, Ovum analyst Mark Main said.
Google, Skype, Index Ventures, and Sequoia Capital are early investors in Madrid, Spain-based FON, which grabbed $21 million in its first round of funding. Formed in April 2006, FON is a network of private Wi-Fi access points that have agreed to join together in exchange for access to each others’ Wi-Fi hot spots.
Those contributing Wi-Fi to the FON network, dubbed FONeros, pay nothing but outside non-contributing users are charged a fee for access. The Wi-Fi startup says that is has so far brought in over 500,000 users of its service who share access to 190,000 Wi-Fi hot spots worldwide.
Financial terms of BT’s investment in FON were not disclosed.
BT already operates 12 municipal city-wide Wi-Fi access zones in the UK and a number of public access coverage areas in restaurants such as McDonald’s as well as public transportation areas dotted around the country. It also has a number of roaming agreements with other public Wi-Fi networks in the UK and abroad.
BT’s battle for Wi-Fi supremacy won’t be easy. Rivals include T-Mobile and Vodafone as well as a growing army of those from mobile network-based 3G Internet access. In recent months Hutchison 3, T-Mobile and Vodafone have all announced 3G mobile broadband services in the UK aimed at users of portable computers.
WiMAX, heavily backed by Intel Capital, is seen as another next-generation wireless access competitor, promising yet another form of wireless public access to the Internet.