Comcast is turning homes into public Wi-Fi hotspots

by Kevin Fitchard, Bloomberg BusinessWeek

Comcast and its cable partners have revealed that the company already has the largest Wi-Fi hotspot in the U.S., but the cable provider has plans to make that Wi-Fi network far bigger.

On Monday, at the National Cable and Telecommunications Association conference in Washington, Comcast said it has begun shipping residential broadband customers a new version of its wireless gateway that pulls double duty as a private Wi-Fi router and a public hotspot. Basically the Cisco Systems gateway transmits two signals’both with separate SSIDs’each functioning as a separate network. The family that owns or rents the router can access the first network; the second is open to any Comcast broadband customer.

This kind of crowdsourced broadband isn’t new. It was pioneered by Spain’s Fon years ago but has recently gained traction among traditional telecom services providers looking for a cheap way to expand broadband capabilities to customers outside their homes. The biggest worldwide practitioner is France’s Free Mobile, whose parent company Iliad is a residential broadband provider, like Comcast.

Iliad opened up its 4 million home wireless home gateways to all of Free’s mobile phone customers with the idea that Wi-Fi could carry the bulk of its mobile data traffic and allow it to offer much cheaper mobile service. Whether the economics of Iliad’s plan work is debatable, but there’s no question it’s cheap. Its rock-bottom mobile plans set off a pricing war in France.

Where Free and Fon both fall flat is in the inconsistency of their networks. As you’d expect with home broadband, those networks are centered in residential neighborhoods. Where most people need Wi-Fi connectivity, however, is in densely trafficked public and business areas. Comcast seems to have solved that problem’at least in some key major cities’with a two-pronged Wi-Fi approach. It and its CableWiFi partners have built outdoor public hotspot networks in dense urban areas where traffic is highest.

Comcast subscribers can move between those public and private hotspots seamlessly. If the company does wind up installing these gateways in its 20 million broadband customers’ homes, it will have quite the Wi-Fi network indeed: a network by the masses, for the masses.

Many Comcast customers might bristle at the idea of letting other people use their broadband connections, even if their traffic is kept separate and their own connections are secure. I would argue that those customers should keep an open mind. Such crowdsourced broadband arrangements are ultimately in everyone’s interest. What most people face today is plentiful and cheap bandwidth at home and at work’but expensive limited bandwidth everywhere else. If the public teamed to share broadband, everyone would start getting solid connections wherever they go. It might sound a bit utopian, but it can easily be managed with technology.

That said, Comcast has to keep itself in check if it is to keep this social contract equitable. Comcast can’t apply a stranger’s data usage against your data cap; if tried to do so, it would have a mighty big class action lawsuit on its hands. And if Comcast were to try to sell access to this residential hotspot network to other providers’for instance, its new comrade in mobile, Verizon Wireless’it would violate the social contract with its customers.

Comcast has every right to ask its customers to give up a little to gain a lot. But it can’t pimp its customers’ broadband connections out for its own financial benefit’not without compensating them, at least.