Cable companies believe the convenience of the WiFi network in public places is attractive to customers who would like Internet access outside their home. WiFI also could limit data downloads on a traditional wireless plan offered by Verizon or AT&T, officials say.
The downside is huge gaps in coverage areas as the WiFi hot spots are installed in high-traffic public spaces such as train stations, restaurants, beaches, malls and parks.
Mark Hung, research director at the Gartner Inc. technology research firm, said he did not believe the cable companies would challenge the wireless telephone companies with the WiFi network. But he said, “It’s definitely a positive for the consumers. They will get more network resources” from the cable companies they are already paying for broadband services.
“We’ve built an extensive WiFi network in our own service area and see real value and potential in other leading providers joining with us to extend that connectivity to major markets across the country,” said Kristin Dolan, senior executive vice president of product management and marketing.
Cablevision, a leader among cable companies with WiFi, says that the number of WiFi sessions by its broadband customers soared to 187 million in 2011 from 50 million in 2010. It expects 350 million sessions this year.
The company says 250,000 Cablevision Internet customers, who are clustered in Connecticut, New Jersey and New York, use the Optimum WiFi network daily.
Time Warner Cable has 3,000 hot spots in the Los Angeles area with plans for 10,000 by year end. The company, the nation’s second-largest cable provider, could expand to other large Time Warner Cable markets, among them Charlotte, Dallas, Cleveland and Kansas City. Bright House Networks has hot spots in Orlando and Tampa.
The stitched-together WiFi network is the latest attempt by the cable companies to find a solution to what many perceive as a vexing weakness — the lack of a national wireless service.
Cable companies announced the plan at the annual cable industry show in Boston. Cathy Avgiris, Comcast executive vice president, said the plan amounts to a “nationwide roaming agreement between cable companies.”
Comcast’s Smit called it an “alliance” and that the cable industry would develop standards so that roaming experience was smooth.
Craig Moffett, senior analyst with Sanford C. Bernstein & Co. L.L.C., said on Monday the service could be “potentially very disruptive” for traditional wireless companies. In a report in November, Moffett said that a cable Internet customer could use WiFi hot spots and avoid more expensive telephone wireless services with data plans.
In late 2011, several cable companies sold spectrum for $3.6 billion to Verizon Wireless. The cable companies said at the time that operating and building-out their own traditional wireless service would be too expensive. Some estimates put the cost at $10 billion. The WiFi plan allows each cable company to individually add WiFi hot spots and focus on its own urban markets.
The service outside of an individual cable company’s footprint will be marketed as “CableWiFi” and the service has a website, www.cablewifi.com. Internet subscribers from the five companies will have to authenticate themselves on the WiFi network with credentials. A Comcast subscriber needs a Comcast.net e-mail address for authentication.
Contact Bob Fernandez at 215-854-5897 or firstname.lastname@example.org.