The new company, called Sputnik, so far has about 200 working "hot spots," the name for the 300-foot high-speed wireless zones created by using networking equipment based on the 802.11b standard, said Sputnik Chief Technology Officer David L. Sifry.
The leading makers of 802.11b kits include Cisco System, 3Com, Proxim, Intel and Agere Systems. The leading makers of the silicon chips powering the equipment are Intersil and Atheros.
Sputnik is now the third company created in the last few months trying to capitalize on the growingof Wi-Fi, a relatively inexpensive wireless network equipment standard that has found its way into homes and offices throughout the country. But unlike the other two companies, Sputnik offers its service for free. It earns money by selling high-end Wi-Fi equipment to businesses.
The companies all want to lift Wi-Fi from a home networking staple to a possible substitute for cable modems or digital subscriber lines, which are the more popular methods of delivering high-speed Internet access to homes and businesses. But analysts aren't so sure it will succeed.
"The price of this equipment has declined enough so it can compete against DSL or cable modem," said Navin Sabharwal, an analyst with ABI Research. "Whether this can really be used as a broadband substitute remains to be seen."
While growing in popularity, Wi-Fi has some drawbacks, which include notoriously porous security. The Wi-Fi signal is also in a crowded bandwidth subject to interference. Just recently, satellite radio company Sirius Satellite Radio claimed that transmissions from these networks will interfere with their own signals.
Sputnik's competitors include Joltage. All three companies are trying to create a nationwide 802.11 network without building anything., founded by EarthLink founder Sky Dayton, and
Boingo and Joltage are reaching agreements with existing wireless providers, or finding a hotel or caf? that doesn't have a wireless network for customers and trying to persuade them to come on board. Each gets a share of the profits.
Sifry said Sputnik makes available a free software download that people put on their laptops. With nothing more than an 802.11 modem card, an Internet connection and an Ethernet port, the laptop not only can access an 802.11 network, it can actually create its own network for others to use. Access to the network is free. About 5,000 people have downloaded the software, he said.
Sputnik has also opened up its software for anyone to use. It has 175 developers building applications such as software to broadcast telephone calls, intrusion detection software or virtual private networks.