FON wants users to sign up to share their wireless broadband access with others, an idea that has netted the company some $21.7 million from Google, Skype, Sequoia Capital, and Index Ventures.
Is it a unique way to develop a wireless network around the world, or a clever concept doomed to fail should ISPs choose to ban it?
Whatever it is today can be called “funded” as FON took in $21.7 million in venture capital funding, the New York Times said.
FON’s concept has broadband home or business users with wireless routers becoming FON members and making their wireless access available to other FON users. The initial stage of membership, called a Linus, has members sharing their connections for free with other members while being entitled to use other free FON hotspots wherever they can be found.
A future membership option, called Bills, lets those users who provide FON access charge other FON members to use it. The Bills keep a percentage of the fees FON charges to non-members, which FON calles Aliens.
FON addressed the security aspect of their service on their blog:
We add security to your wireless network without encryption in two ways. The first is that when you install FON or buy a FON router it creates two segmented networks. One network is for people that connect over the wireless antennas (the visitor network) and the other network is for your personal computers that are connected locally (your home network). We separate the visitor and home networks using a firewall.
The second thing we do is we give you the ability to restrict access to your hotspot only to FON users and specific people you trust, of course you can leave it open to anyone, but our default policy is to limit it to Foneros, Aliens and your family. When someone connects to your network over the wireless antenna, we restrict their access and only allow them to visit the FON authentication page. If they are Foneros then we allow them to browse the Internet, but not connect to your personal home network.
Respected Wi-Fi Net News blogger Glenn Fleishman posted his thoughts on how FON might spend that VC money:
The investment capital they’ve raised signals that while their network might be extended on a peer-to-peer basis, they’ll be putting their money into seeding the network by putting nodes in well-trafficked areas, probably in the thousands.
He also noted the obvious problem facing FON is one that faces Skype: what if the Internet service providers choose to enforce terms of service that do not permit sharing connections outside the household? That could be the motivation for using that cash to install those nodes.
Divining Google’s plans from its investments can be maddening. Paul Kederosky summarizes the Google equity “strategy”:
Once again, as in all of Google recent financial transactions, search is conspicuous only by its absence. Put differently, if you tried to abstract what Google does from its acquisitions and investment — Picasa, Blogger, dmarc, FON, etc. — you’d have no frickin’ clue it was the Interweb’s leading search firm.
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David Utter is a staff writer for murdok covering technology and business.
