FON to provide a P2P wifi sharing network

February 8th, 2006

FON (Wikipedia article) is “a global community of people who share WiFi.” The idea is intriguing and has potential, so much so that the Madrid-based startup behind just raised $22M from investors that include Google, Skype and eBay. Here’s how it is supposed to work.

“In order to become a Fonero, you go to FON, to download software that you install in your router, you place your antenna by a window and you share bandwidth with other Foneros from anywhere in the world. You can also buy the FON Ready router from our web site, plug and play. FON creates a free WiFi roaming environment for those who contribute WiFi signals, namely those who have already signed up with a local ISP and downloaded our software into their WiFi routers.”

FON currently provides software for the Linksys WRT54G/GL/GS routers. Since launching three months ago, they have added 3,000 Foneros to the network, but US coverage is still quite sparse (and nothing in the Baltimore DC area!).

Like all VC funded startups, there has to be a business plan, so what is it? If you are not a Fonero you pay to use a hotspot, probably with some kind of prepaid scheme like Skype’s. Foneros will come in two varieties: Linus’s who benefit by getting free access via any FON node and Bill’s, who don’t get free access but do get half of the payment for the users who go through their routers.

It remains to be seen how ISPs will react to this if it catches on. Most ISPs prohibit bandwidth sharing in their service agreement. Speakeasy is the only ISP who is listed as welcoming FON.