Enid Burns for redOrbit.com — Your Universe Online
Cable providers often say they are feeling the pressure from consumers who increasingly find alternative methods, such as Internet content providers, to watch TV. Now the same cable and telecoms can make similar claims about the Internet.
FreedomPop, a hardware start-up, is offering a high-speed internet modem that will provide internet for free, or at low cost for high-volume users.
FreedomPop is offering its Hub Burst home modem, which the company is currently taking pre-orders for. The modem works using the Clearwire WiMax network. FreedomPop Hub Burst customers will be given a minimum of 1 GB of free data each month. Those needing more data will pay by usage, starting at an additional $10 per month.
“Major broadband providers, including Time Warner Cable, AT&T, Verizon and Comcast, are pillaging consumers, charging in excess of $500 per year for home internet,” said Stephen Stokols, CEO of FreedomPop, in a statement. “FreedomPop’s early success have validated consumers are looking for more convenient and affordable ways to consume data. We’ve already given away more than 15 million MBs of free data and are expanding our Beta to meet the increased demand this holiday season. The Hub Burst puts us in position to offer a compelling alternative for the massive home market much quicker than we initially planned.”
The modem and router will include wireless antennas, which boost speeds. The hardware also includes Ethernet jacks to connect up to 10 internet enabled devices, such as desktop computers, TVs and streaming music and video players.
Users who want more data, but would rather not pay, can earn free unlimited data. FreedomPop says users can earn such privileges by adding contacts to the network, and engaging in partner promotions. While the language is vague, it translates into referrals and interaction with advertisements.
“This is an interesting idea, but there is a lot more to a successful business than an interesting idea,” industry analyst Jeff Kagan told RedOrbit. “I really don’t know what they will look like and who they will compete against yet.”
While FreedomPop says it is taking pre-orders on its Hub Burst modem, consumers need to know that in order to get service, they will have to be in an area where the Clearwire WiMax network operates. Clearwire says it provides high-speed 4G mobile broadband service that covers over 130 million people in approximately 80 cities across the U.S. Actual areas where service is offered was not immediately available.
FreedomPop has had some experience with providing free, or low cost, internet. Earlier this fall it launched a portable hub that operates as a hotspot. The hardware included up to 500 MB free data each month, and additional data charges of $0.02 per 1MB. Higher usage plans start at $17.99 per month for 2GB data. The mobile, and now Hub Burst hardware are still in beta.
“FreedomPop is a new and small company with a new idea. While that is exciting, it is also unproven,” said Kagan. “How well will they market? That is one of the key questions to consider. Will they be strong or weak? It takes more than just a good idea these days.”
As with many startups, the details will take time to fall into place. “There are still plenty of questions about the business model and even after they are answered, new questions about how successful the idea will be [will continue to arise],” said Kagan.
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