This morning, AT&T announced that it will buy Waypoint, Inc . to the tune of $275 million (all cash, baby) thereby expanding AT&T’s network of free WiFi hot spots across the US. A response to the increased number of WiFi enabled smart phones hitting the market and the continued cost burden to the 3G network, which is losing AT&T money
AT&T’s 3G network has been hit hard with loads of people using iPhones, Blackberries, and other smart phones for data and voice, as opposed to just voice. This inundation of data use (to browse Facebook, check email, Twitter, or upload photos and stream video) has forced AT&T to realize the value of opening a free WiFi networked infrastructure. AT&T customers carrying a WiFi enabled hand held can jump onto one of AT&T’s hot spots, which they just expanded by 10,000 locations by agreeing to purchase Waypoint, Inc., and surf the web at WiFi speeds which are much faster than 3G speeds. Hopefully, this will reduce the burden to the 3G network and save AT&T some money.
The major hindrance being that WiFi has a relatively limited range, so unless you’re sitting in the coffee house, at the McDonald’s, or near enough to any of the other now 20,000 US locations, you’re probably not going to offload too much of the 3G burden. Although, maybe a little less burden is just enough to keep 3G working for now. At least until 4G comes along.
The added Waypoint locations also benefit AT&T’s DSL subscribers, who can use their WiFi enabled laptops at any of these hot spots.