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AT&T Buys Wayport to Keep iPhone Users
Happy
GigaOm
By Stacey Higginbotham
November 6, 2008
Today AT&T said it would buy Wi-Fi hotspots operator Wayport
for $275 million in cash. Not only is this an exit for the 12-year-old
Irving, Texas-based company that raised more than $130 million,
but it also gives AT&T 80,000 Wi-Fi hotspots all over the country.
As AT&T brings in more WiFi-enabled phones that encourage a
rich web experience, those hotspots will help offload bandwidth-clogging
traffic from its 3G network.
AT&T already requires iPhone users to use their Wi-Fi connection
to download files from iTunes and prohibits bandwidth-intensive
applications such as P2P sharing. Part of the reason for this is
the limitations of its HSPA network. While fast, it isn’t designed
to handle the continuous streams of data a song download or video
upload requires. 3G is still designed for voice traffic, which
is intermittent and much less bandwidth intensive. The network
has a data overlay, but that, too, is designed for bursts of data
rather than continuous streams. If too many people that require
continuous streams of data get on, it clogs the network, leaving
other subscribers unable to access it.
Buying Wayport and adding 20,000 hot spots (including in airports
and McDonald’s restaurants) allows AT&T to provide its customers
with more places to do their bandwidth-sucking applications. Already,
AT&T is willing to let iPhone and BlackBerry users access its
Wi-Fi hotspots free at Starbucks. It also means AT&T can hold
out a bit longer before deploying its 4G LTE network, which is
designed for data.
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