Wi-Fi service provider Boingo Wireless is adapting its business model to the rise of free access, acquiring ad-supported hotspot firm Cloud Nine Media to sweeten its appeal to non-business users.
No financial details were revealed, but Boingo gets 6,000 locations, including 4,500 hotels, 475 restaurants and eight airports in the US and Canada. Under Cloud Nine’s system, users gain free access to these hotspots, in return for viewing a sponsor page and advert before they start surfing. Ad campaigns can be targeted by the type of venue, the location or the audience profile, and customer brands include Google, Amazon and Symantec.
Boingo had put its toe in the water of sponsored Wi-Fi when it announced a deal in New York in June, allowing free access to its network via a partnership with Google Offers, and similar trials in a few airports with American Express.
Its standard services cost $9.95 a month in the Americas, for unlimited access to an aggregated network of about 500,000 hotspots, owned by various partners, round the world. Boingo also sells subscriptions in many other markets and has alliances with corporate access providers like iPass.
But ad-supported Wi-Fi is increasingly in demand, says the firm, especially in locations like shopping malls, which are consumer focused, rather than places such as airports, with high business traffic. VP of corporate communications, Christian Gunning, told GigaOM: ‘We’ve historically outsourced this capability. As our consumer segment growth continued (and along with it the need for more sponsored access), it became evident that having this capability inhouse would be beneficial.’
Not only does the acquirer gain expertise and readymade partnerships, but Cloud Nine has a proprietary sponsorship platform which will allow its new parent to create its own sponsorship propositions and added value services, as well as delivering customer data to its customers.
The company is likely to run its subscription and free models in parallel, targeting the former at business users and frequent surfers. Its huge subscription network already includes hotspots which are usually available free to consumers, so the firm is used to a certain ambiguity in its model, but the paid-for offering does have benefits, notably that it treats all the locations as a single network with the same sign-in (and often no need to keep re-registering).