Future of Wi-Fi according to Ken Denman


A few weeks ago I had a chance to chat with Ken Denman, chief executive officer of I-Pass, a company that has provided on-the-road access to many American mobile workers.

We chatted about a whole bunch of issues, including Wi-Fi. I tried to pin him down on the Wi-Fi usage, at least on the I-Pass network, but to no avail. Like others, he managed to skirt the issue. Here are excerpts from an interview that I did not really get around to transcribing till today. (This interview took place before the I-Pass & T-Mobile deal was announced. Click on the headline to read the entire interview.)

OM: What is the total number of Wi-Fi users do you have as part of the I-Pass network? Is it contributing to your revenues in any meaningful manner?
Ken Denman: We like others are not disclosing the actual number of users. The growth rate is quite impressive on a monthly basis. Nearly 90 percent of our revenues are coming from the dial-up users. It will have an impact on the way we live and work. The infrastructure is inexpensive and is going to spread.

We have invested a lot of money in wireless broadband. When the Wi-Fi wave comes, we want to be waiting for it. That is the logical thing for us to do. We are ahead of the curve. We have not seen the huge mass of usage as yet – but we are seeing it grow monthly but from a low usage base.

OM: So you are still essentially a remote dial-up access company? What about remote broadband access?
KD: About 80 percent of IP access is still dial-up and the broadband has to be (available at the) right price. Our business is based on selling to enterprises and we have contracts for enterprises to give them connections and that includes Wi-Fi based. We are ready for it. We have made these investments and a lot of customers are turning it on right now. We are not giving out specific numbers. Beyond that we have done business development work with biz-owners like the airports, and hotels and other establishments.

OM: So Wi-Fi is a bet for the future?
KD: We are clearly spending money on the future – we are aggressively partnering with other people – 3500 venues and 2500 hotspots. We have thousands more in our pipeline, which are enterprise ready. We are viscerally focused on the enterprise and we don’t incorporate freenets or venues, which are not aligned to the business users. We are a team of people who are looking at footprint. This (I assume he meant Wi-Fi) is bit of a land rush, and we are focused on biz-users.

OM: Give me a sense of your business model.
KD: Typically the wireless Internet service providers bear the hardware cost, or the venue operators pay that cost. We just partner with them and integrate it into our software infrastructure. We are trying to be like the cell-phone roaming. Auto-authenticate and usage is the key for our business. Typically we structure a deal where we get some discount from the service provider. Our end users will authenticate from any node and we manage the authentication process.

OM: When can we expect a clear sense of what is the Wi-Fi adoption rate?
KD: The critical mass of Wi-Fi enabled devices is the key. You will see harder numbers next summer, but I think there are couples of things, which need to occur. The economics of Wi-Fi/ the enterprise will drive that. Secondly, we need a business oriented broadband footprint and that is developing rapidly.

Related links
* San Jose Mercury News
* UnStrung

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