Martin Varsavsky, clearly, is not a man to let circumstances get the better of him. On a Parisian holiday in 2005, the 46-year-old Argentinean became frustrated with an inability to access any of the city’s WiFi networks. Varsavsky got mad, and is now attempting to get even — by rolling out a global wireless model that could yet take Asia by storm.
“My solution was to convince the French to share our respective WiFi networks in Spain and France, and gradually open up other WiFi networks globally,” Varsavsky explains.
This idea, now known as the business Fon, allows ‘Foneros’ to access free wireless across the globe by buying a special router. The more people that buy the router, the more access points become available. At last count, there were 40,000 worldwide, with Varsavsky expecting one million by the end of 2008.
Varsavsky’s vision is deceptively simple, but has already persuaded the likes of Google and eBay to cough up over US$20 million in funding. To date, Fon counts more than 4,000 users in Japan and 5,000 in Hong Kong, along with a growing presence in South Korea and Taiwan.
At the very least, serial entrepreneuer Varsavsky will be hoping that his latest venture avoids the fate of his German company Einstennet, which ended up losing up 35 million Euros in 2002, and was eventually sold off to safeguard employee jobs.
In that case, the technology “was too new” — but even now Varsavsky appears to welcome obstacles, as he attempts to create a truly global community of Foneros.
“Lots of my creativity has sprung out of frustration,” he says. “If I find something that does not work, I try to fix it.”
For Varsavsky, who was born in Argentina and spent 18 years in the US before settling in Spain, the emergence of Fon finally offers a way to leverage a lifetime of globetrotting. After moving from biotechnology into networking, Varsavsky founded Spanish telecom icons Jazztel and Ya.com, respectively — just two of the seven companies he has started in the past 20 years.
Varsavsky is also a significant player in the not-for-profit world, where he manages the Varsavsky Foundation, best known for its role in founding two large educational projects in Latin America. An ambassador-at-large for Argentina from 2001 to 2005, Varsavsky also sits on the Clinton Foundation’s board of trustees, and is a respected blogger in the business and international relations sphere.
“I think Fon crystallises my cosmopolitan background,” says Varsavsky. “It is important to balance all the cultural differences that exist in the world when running a global enterprise. In some ways, Fon is the opposite of McDonald’s, because it looks so different in every country.”
While Varsavsky often depicts Fon as an almost idealistic notion, analysts in Asia appear less than enamoured with the cold, hard business realities that the service will face, particularly in Asia’s densely populated cities.
“It’s a cool idea, but I wonder how relevant it is to the Hong Kong market,” says OneXeno general manager Ralph Szeto. “I wonder how urgent the need is for WiFi in Hong Kong.”
And while Varsavsky’s flair for branding is apparent, he sees little value in utilising conventional advertising strategies to promote Fon.
“We get our new customers mainly through word-of-mouth. My marketing philosophy is to build the best product in the world so it can sell itself. We do, however, team up with telecom operators, ADSL and cable companies as we add value to their services so they can sell more broadband connections,” Varsavsky says.
Foneros are split into three groups: ‘Linuses’ are those who share their WiFi at home and in return get free WiFi wherever they find a Fon access point. ‘Aliens’ do not share their WiFi yet, but pay a small fee for a day pass to access the Fon community.
‘Bills’, meanwhile, are businesses that receive a 50 per cent share of the revenue from Aliens, and can also advertise their business on their personalised Fon access point homepage.
And the telcos are listening. In Taiwan and Japan, Fon has partnered with SeedNet and Excite
respectively. In Hong Kong, meanwhile, PCCW offers the service as part of its broadband plan. Despite these alliances, Varsavsky is realistic enough to accept the threat that Fon poses to the much-hyped emergence of 3G technology.
“Our vision is to free WiFi for Foneras all over the world, especially to the 4.5 billion people on the planet who have yet to access the internet,” he says. “Right now, our biggest challenge is how to grow quickly in Hong Kong and China, so people find the Fon signal everywhere.”
Martin Varsavsky's CV
2005 Founded Fon
2001 Ambassador-at-large for Argentina
1999 Founded Ya.com
1998 Started Jazztel
1990 Set up Viatel
1986 Founded Medicorp Services
1985 MBA, Columbia University
1984 Founded Urban Capital Corporation, NY
