July 24, 2002

HereUare almost gone

News.com's Ben Charney reports on HereUare's inability to raise more funding, and it's openly frank executive team discussing the sale of the company. Unless a miracle occurs, this probably spells the end of HereUare (and subsidiary WiFiMetro) from an investor point-of-view. When you have two weeks of cash left and your current investors have shut their wallets, you don't have much leverage to negotiate with potential buyers. My prediction: expect a sale of HereUare's assets, somewhere in the $10-20 million (aka fire sale) range.

In the end, this is about business models; HereUare's assumed a strong thriving market where:

  • People were willing to pay for hotspot wireless access
  • People wanted to do this from multiple locations (roaming)
  • People were willing to pay enough to support multiple revenue shares (cafe owner, WISP, HereUare, roaming WISP)
In the end, hotspot access isn't compelling enough for this large a value chain, and it will collapse as carriers move in and offer WiFi public access, probably as part of a mobile voice/data plan. Another option is that smart location owners will use WiFi as a way to pull people into their location by offering it for free. Bandwidth will become a location amenity similar to electricity or bathroom access; Know anyone selling pay toilets any more?

"WiFi for customer use only" Posted by dsifry at July 24, 2002 08:20 AM | View blog reactions