A controversy is whipping up over plans at Boston’s Logan airport to squeeze out free WiFi services (such as those in airline lounges) that compete with the paid service offered by the landlord. From the Boston Globe:
Logan International Airport officials’ ongoing quest to ban airline lounges from offering passengers free WiFi Internet services is angering a growing array of powerful Capitol Hill lobbying groups, who say Logan could set a dangerous nationwide precedent for squelching wireless services.
Already under fire from the biggest airline lobby, the Air Transport Association, and the manufacturer-backed Consumer Electronics Association, Logan officials are also coming under new criticism from the top US wireless lobby, CTIA-The Wireless Association. All three groups are siding with Continental Airlines Inc., which has asked the Federal Communications Commission to overturn a Logan order last year shutting off Continental’s WiFi service in its Presidents Club lounge in Logan’s Terminal C.
Soon after activating its own $8-a-day WiFi service in the summer of 2004, the Massachusetts Port Authority, which runs Logan, ordered Continental and American Airlines to shut down WiFi services in their Logan lounges. Massport also ordered Delta Air Lines Inc. not to turn on a planned WiFi service in its new $500 million Terminal A that opened last March.
The airport is pretending that its concern is preventing the unrestricted use of airwaves in airports, where the need for order in the use of radio spectrum is perhaps more acute, rather than profit (if so, why not allow all other comers provided they register their transmitters with a central authority and coordinate power output and use of channels? Why not force everyone onto MIMO, with its improved interference handling?). Several bloggers, including Fred Wilson and Rex Hammock, have ripped Logan for this. Rex notes:
I believe in free wifi for airport spaces primarily funded by taxpayers and by mandated fees (taxes) of those who fly. I believe we’re moving into an era where “free wifi” in airports should be expected, even demanded by passengers. I don’t think airport authorities — especially those who compete with other airports for connecting passenger traffic — should try to squeeze another $8 from a passenger who chooses a flight that originates or connects from that airport. And then, when the authority wants to keep a competitor (a coffee shop or an airline) from offering free wifi in its space, it’s outrageous.
and Fred alludes to the anti-competitive aspect of Logan’s actions.
The nub of the issue is of course the monopoly that the building landlord has on service within its premises – a monopoly created by the limited range of WiFi. Eventually, as longer range wireless becomes more common we will see less of this, but it’s hard to understand why we should tolerate the imposition of a monopoly – unless there are very good reasons for doing so – by any landlord that is significantly publicly funded, as I assume Logan is. If Logan wants to offer a paid service, it should find a way to make it a worthwhile investment for its customers, rather than seizing the market by shutting down the competition. Suggestion – the article suggests that airport WiFi is generally 802.11b. Why not offer 802.11g for the $8, and upgrade to MIMO as soon as standards converge? Why not set up a consortium with other national airports to offer a one logon service for frequent travellers? All of these service improvements, of course, would be unlikely to come from a provider who could simply take the market without competing for the customers.
Last point – this is as good an example as one could ask for as to why it’s so important to keep government and near-government out of the business of providing innovative services. It is simply unforgivable at this point that all major airports are not completely saturated with connectivity.
Update – Mathew Ingram covers the issue and points to several other posts on the topic