How to Start a WiFi Hotspot Business
You can start a WiFi hotspot business from almost anywhere including your home, this might be the best place to start as you won't need to get permission to install the equipment and you won't have to share any of the income with anyone else. Also people are more likely to pay for Internet access at home in residential areas than when just having a coffee in a cafe. This does not mean that if you are a coffee shop owner you cannot charge customers for WiFi access.
Many commercial/shopping areas now have free WiFi so it is unlikely that people will pay for something that they can get for free.
In the past few years the cost of equipment and technical knowledge required has fallen significantly making starting this type of business very simple.
You can charge people to use it on a hourly, daily, weekly, monthly or yearly basis.
The first thing you will need is an Internet connection, you must make sure it is one which allows resale so you will most likely need a business Internet connection. As it will be shared you should get the fastest connection available and ensure that it comes with an unlimited download allowance. You will not be using the WiFi signal from the router supplied by your ISP so you should based your choice of ISP on cost, speed & standard of the service provided, not on reviews of the router's WiFi performance.
When choosing an Internet provider to support your WiFi hotspot you should choose the best service you can afford, not all services are the same. You might be tempted to choose the first cheap Internet service you find but it always pays to do your research first. Just a quick Google search for reviews of the service you are considering using will provide invaluable information and save you a whole lot of trouble later down the line.
Something few cheap Internet service providers fail to mention is 'contention ratio', put simply this is the number of properties who will be sharing the advertised bandwidth. Contention ratios are usually 20:1 or 50:1, this means there will be between 20 and 50 people sharing that 'Up To 8Mb download speed' advertised.
Yes I'll say it again just in case you missed it or thought you misunderstood it, up to 50 people will be sharing a 8Mb Internet connection!
This is why you almost never get the download speed advertised, because all your neighbours are hogging the bandwidth.
So you must keep this in mind when shopping around for an Internet connection for your WiFi hotspot.
There are lots of different types of Internet service but I will list the most common types available.
- ADSL - This is the service which uses the old copper telephone wires, most are old and if you are more than a few miles from the telephone exchange the service and speed is going to be pretty poor.
- Fibre - Maximum speeds can be very good but only if fiber is used from one end to the other, often the 'last mile' will still use old copper wires so a lot of the speed is lost. Only Fibre to the home (FTTH) or Fibre-to-the-Premises (FTTP) where no copper cabling is used will achieve true Fibre speeds but services are expensive and limited.
- Leased Line - This is the best option and is what most businesses will use, it is however very expensive and usually subject to a hefty monthly fee. It is an 'Uncontented' or 'Dedicated' line which means the contention ratio will be 1:1, i.e. if the advertised speed is 8Mb, you will get 8Mb and it will not be shared with anyone else.
To keep this as simple as possible and allow anyone, regardless of technical knowledge to start a WiFi business I suggest using the free Open-Mesh/Cloudtrax system. In order to set up a paid for WiFi network you will need a special WiFi router (pictured), they only cost $79.99 so setup is really low.
You simply purchase the Open-Mesh router, add a few details from the back of the router in to the Cloudtrax central WiFi network management dashboard (free), plug in the Open-Mesh router to your Internet router and the WiFi network is up and running.
Open-Mesh WiFi Router
WiFi Management System - CloudTrax
In order to charge customers for access you will need a central WiFi network management system. There are many available (free & paid for) but I suggest you use the free one provided by CloudTrax, you will need to open an account and enter a few simple set up details such as the network name (SSID) which customers will see when they connect to your network. You will also need to open a PayPal account (free) if you don't already have one to accept payments for access from customers. The Cloudtrax system includes free splash/landing pages which can be customised and full Paypal integration.
Using the CloudTrax dashboard you can access, monitor and control your WiFi network from anywhere in the world with an Internet connection, including from a smart phone.
To use you WiFi service the customer will connect to your WiFi network and when they open a webpage they will be redirected to your splash/landing page. Here you can put some information about the service, instructions, TOS or even advertising. On the splash/landing page the customer can select the amount of access time they require which you can set at anything from 1 hour to one year.
I would suggest offering a range of access packages such as;
- 1 Hour
- 1 Day
- 2 Days
- 1 Week
- 1 Month
- 3 Months
- 1 Year
After the customer selects their chosen access package they will be taken to Paypal to pay and issued with an access voucher. Everything is automated and once set up requires very little input on your part. You can also create access vouchers if the customer wants to pay in cash or over the phone (if you have card processing facilities such as the new Paypal Card reader for iphone/Android phones)
CloudTrax WiFi Network Controller
How To Set Up a CloudTrax/Open-Mesh WiFi Network
Positioning of Equipment
When starting a WiFi business you want to provide coverage to the widest possible area in order to reach as many potential customers as possible. WiFi signals only have a range of about 100ft indoors and 300ft outdoors so you must place/install your routers where you think they will provide the best coverage. In a cafe or coffee shop this will probably be on a wall or ceiling. In a residential area I would suggest roof mounted or window mounted where they will get the best clear line of sight (LoS). This means the signal can travel directly to users without having to pass through solid objects like walls, floors and ceilings.
If you have a balcony or window overlooking many other properties this would be the best place to put the WiFi router.
Power Over Etherent
The Open-Mesh router supports 'Power over Ethernet' (PoE) which means the data and power for the unit travels over the same Ethernet cable at just 12 volts so there is no risk of electrical shock from outdoor installations and a qualified electrician is not needed to install outdoor units.
The maximum length of the Ethernet cable with PoE support is 300ft so your Internet router can be installed near the phone line and the WiFi units can be installed in other rooms or on rooftops up to 300ft away to create a much larger coverage area. You can also connect another unit to the first one with another 300ft cable and so on in a daisy chain formation. Weatherproof Ethernet cable can be used for outdoor installations.
This business is highly scalable as you can start with just one unit and as demand or funding grows you can just add more units to the system to increase coverage and reach more potential customers.
The meshing capabilities of the Open-Mesh routers allow you to simply plug in another unit in to a power outlet and it will connect to the other units creating a much larger coverage area and reach even more customers.
I have created a more in depth page on the CloudTrax system and meshing capabilities here.
Are You Ready To Start a WiFi Hotspot Business?
Do you Think You Can Start a WiFi Business?
Open-Mesh MR900 Performance WiFi Hotspot Router
Open-Mesh have just created a new product, the MR900, a high performance router designed for high usage areas and installations. It supports the common 2.4Ghz range and the less congested 5Ghz range to give optimum performance and speed, up to 900Mbps.
Just like the OM2P routers, the MAC address only needs to be added to your Cloudtrax dashboard and the network/hotspot is up and running. It can also be added to existing networks and will mesh with OM2 routers.
- Supports 50 - 100 Simultaneous Users
- AR9558 700mhz Processor
- 182MB DRAM
- Backwards Compatible with OM2P
I have not tested this unit yet but taking into account the performance of other Open-Mesh equipment I expect it should be very good. It is more expensive that the OM2P routers but it is a much more powerful router and can support more users, the 5Ghz support is a big advantage as 5Ghz is being incorporated into more devices such as laptops and smartphones.
You can see a full list of the specifications on Amazon.
Other WiFi Equipment To Consider
Although the Open-Mesh OM2 routers have been mentioned throughout this page it does not mean that they are the only WiFi router that can be used to create a paid for WiFi hotspot. Another popular manufacture of WISP (Wireless Internet Service Provider) equipment is Ubiquiti, their products fall in to the same price range with similar functionality and can be used with the Cloudtrax WiFi hotspot management system.
© 2013 SpaceShanty
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