By Robin Gareiss,
Nemertes' principal research officer

Despite appearances, Cometa Network’s demise last week does not translate into the demise of the WiFi hot spots business model. AT&T and IBM formed Cometa two years ago with financial backing from Intel Capital, Apax Partners, and 3i, with aggressive plans to install 20,000 hot spots by this year (It has about one-tenth of that amount now.). The business model: Cometa would build hot spots and sell wholesale service to restaurants, airports, coffee shops, and wireless providers, and carriers.

We do not believe that Cometa’s demise indicates an inherent problem with the Wifi hot-spot business model. In Nemertes’ research benchmark series, “WiFi: New Markets, Challenges, Opportunities,” we found that nearly one-third of companies use hot-spot services today, and 47% plan to in the coming year. Couple that with the growing number of consumers using hot-spot services, as well as the number of wireless-enabled devices available, and the market potential remains promising.

The complete Impact Analysis is available to Nemertes' clients. For more information, please contact Chris Zimmerman at chris@nemertes.com