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Last Updated: Tuesday, 7 February 2006, 08:52 GMT
Global wi-fi plan gets $22m boost
Wireless internet
Fon aims to create a global community of wi-fi users
Heavyweight firms such as Google and internet telephony outfit Skype are to invest in an embryonic plan to share wi-fi access around the world.

They have joined with venture capital firms to plough $22m (12.6m) into Fon, a three-month-old Spanish start-up.

Fon, which has already attracted 3,000 subscribers, aims to build a network of broadband users to share connections wirelessly when away from home.

A recent survey showed that few laptop owners use wi-fi outside their homes.

According to a survey by electronics firm Toshiba, about 20% of laptop owners did not know how to use wireless functions, while 25% thought wireless existing "hotspots" were too expensive.

Befriending ISPs

Fon hopes to use the new cash and high-level backing to fund its efforts to convince internet service providers (ISPs) of the benefits of its business plan.

It's an awesome idea just like Napster was, with all the consequences that come with it
Roger Entner, Ovum

Most ISPs ban the public sharing of wireless internet connections.

But Fon founder Martin Varsavsky said his business model was compatible with the ISPs' priorities.

"You first have to become a customer of an ISP," he told the Reuters news agency. "We befriend the ISPs by sharing revenue."

Action plan

The company, which put its service live in November, envisages a three-tiered system of shared wi-fi use.

Full members, each known as a "Linus", have full access to a global network of Fon-enabled wi-fi connections.

Woman using a wi-fi hotspot at a station
Business users were early adopters of wi-fi technology

In return each Linus offers their own connection for others to share.

Fon users are required to install Fon software onto their wireless router that demands a unique ID and password from everyone trying to log onto the hotspot.

The amount of bandwidth reserved for communal connections can be limited by the primary account holder.

Other tiers envisage a more casual pay-as-you-go type of access, divided between "Bills", who charge for access to their networks, and "Aliens", who pay to use them.

Neither of these levels are active at the moment.

Foneros unite

Mr Varsavsky has described his ambitions in terms of a social movement.

Toshiba notebook
Many laptop users are put off by high hotspot prices
"As 'Foneros' continue to join, and there are more and more Fonero hotspots, the dream of a unified global broadband wireless signal becomes a reality," he wrote on his website.

"The Fon movement, as we call it, can achieve what 3G or EVDO [a mobile internet standard] has not - a truly broadband wireless internet everywhere.

"3G/EVDO are great for coverage, but their throughput is pitiful compared to wi-fi and they are way too expensive."

Roger Entner, an analyst with market research firm Ovum, said the idea could be revolutionary - in terms of both its potential and its possible pitfalls.

"It's an awesome idea just like Napster was, with all the consequences that come with it," he said.

"It's a great idea, but you are breaking the law. It is treating wi-fi as communal property when it is not."

In its terms and conditions, Fon says users should check with their internet provider to ensure they have permission to share a connection.

It also stresses that users should comply with all national rules regarding online conduct and acceptable content.

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