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The number of Wi-Fi hotspots is growing rapidly and while many of them are working as a free hotspot (customers don't have to pay for the internet access), a lot of hotspots are working on a pay-per-use basis. I'll explain how to make money of operating Wi-Fi hotspot in hotels, cafes, campgrounds, airports, tourist attractions, residential areas or any busy venues, even if you don't own any.

 

Who can operate a Wi-Fi hotspot? 

Basically anybody. As you will see, you don't have to own a hotel or cafe (but it's better if you do of course). You can set up a hotspot in a busy neighborhood and offer lower prices then your ISP offers. Or you can find locations where wireless internet access is not available yet, or you can offer an alternative to the existing ones.



Which places are ideal for hotspots?



The best ones are: airports, campgrounds, hotels, cafes, tourist attractions, marinas. The more tourists a place has, the better.

 

 

How much money can I make? 

Type of location

A Business Lounge in a large Airport can make more transactions than a small motel in a small town. They can also sell the accesses for more. Let's see some real examples (amounts mean gross income):

Business Lounge in an Airport: about $2000/month

Apartment Complex: about $2000/month
Average Campground Site: about $800/month
20 Room Hotel: about $500/month
Internet Cafe (where the same system is used for desktop computers): $1000/month

 

This is a location's gross income. From this you have to pay for the internet connection, operation costs and your captive portal.

Competitors

You always have to look after your competitors before you set the prices for the hotspot. If you open a laptop in a location and can see various open hotspots, you won't be able to sell the access for a high price.

Are you the owner or you live near the place or you are just the operator?

If you are the owner, you can keep most of the money that your hotspot generates. If you are not the owner, you have to make a deal with the owner and share the income. Or you can keep all the income and offer the place to pay for the internet connection and the hardware, and do the support. With a minimal technical knowledge, you can easily setup a hotspot for a location that belongs to someone else.

 

The Basics - How Wi-Fi Hotspots Work? 

Wi-Fi hotspots broadcast open (unencrypted) wireless signals, so anyone can connect to them without knowing any passwords. But when they open a browser and type their favorite web address, they are forwarded to the location's hotspot start page (called as 'Splash Page' or “captive portal”). This contains basic information about the place and about how to gain access to the internet. Usually there are access packages/plans, which you can choose, for example 1 hour for $1.95, 24 hours for $9.95, etc. Prices may vary by each location. You can pay for the access by credit cards or Pre-Paid cards (if the system supports it). After you buy a plan, you can use the internet for a limited time.

When you log in to a hotspot, your username and password is verified by a radius server which can be located anywhere in the world. This server sends back the answer to the router, whether you are allowed to log in to the hotspot or not. This is the same way that your ISP does, when checking your ADSL account.

 

What do you need to Start a Hotspot Service, what are the Investments? 

To setup a Wi-Fi hotspot service you will need a broadband internet connection (this is the internet connection you will share) and a $59 wireless router minimally for one location. In my opinion the best low-cost router for this purpose is the OM1P from www.open-mesh.com  which comes with a custom firmware.


Default range of the Wi-Fi router is about 150-500 feet, depending on the location's characteristics (walls, trees, etc). But you can easily extend this range to a mile or more by replacing the built-in antenna with a stronger one gain antenna.

Routers do not come with a hotspot billing software. You have to use a centralized server to verify the accesses to a hotspot. You can operate a server on your own, but then you'll also have to solve how you charge credit cards and any other technical issues that come up with billing and running a full linux server.

The most easiest and hassle-free way to do all this is called hosted hotspot solution. GigaNetworking.com uses radius servers and has their own custom paypal plugin (this is required to be able to charge credit cards) so you don't even need one.   They are dedicated to taking care of your authentication and credit card process so you will get a professional, reliable and easy-to-use system.


What Tools do you have to Manage Your Hotspot Business? 

HotSpot Management can be done via an easy to use web interface so you can manage your hotspot locations remotely. From there you can do the following:

- Add unlimited locations to your account. If you have partners, like hotels or cafes, you can add those locations to your account.

- In the locations list you can see which hotspot is operating (routers are sending life signals in every five minutes), how many users are connected and what are the system loads on the routers.

- You can set access packages for each locations. For example you can set a 1 hour plan for $2.95, a 24 hour plan for $9.95, a monthly plan for $24.95. You can even charge users in your own local currency (we support 144 world currencies). This means your users will be charged in your local currency without any conversions. That's great, isn't it? Furthermore, you can set different prices for each of your locations.

- You can set bandwidth and traffic limits to a package. You can even sell a low-bandwidth package cheaper and a high-bandwidth package for more.

- You can see transactions in real time.

- You can see the usage by each hotspot users.

- You can create purchase reports by locations or by payment types.

- You can create charts to see which location generates the most income, which countries your hotspot users are from, etc

- Create Secondary Logins to your partners (if you are not owing the place but makes a deal with the hotel owner for example), so they can check their hotspots and transactions (but only those which they have access to).
 

Final Words: Working Business Models 

If you own a location where you can setup a hotspot, you just need a few steps to start.

If you are willing to partner with locations, you will need a business model.

Most operators give the router for the location for free, or they even pay for the internet connection, but keep most of the income.

The preferred way is to offer some share to the owner, to have a win/win partnership. It is up to you how many locations (partners) you can get and how much share you keep. The more locations you have the more money you will earn.
 

 




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