FON raises more money...

But is it good news?
FON the Spanish company that wants all of us to share our broadband connection through wifi announced last week that they raised another $9.5 million in a C round.
Now while this might sound like good news I have my doubts.
Look at these facts:

- In February 2006 Google Inc., Index Ventures, Sequoia Capital and Skype Technologies SA invested $21.5 million in FON.
- Last year the same investors coughed up another $13 million.
- Now they announce an additional investment of $9.5 million led by Coral Capital Management, a Minneapolis-based venture capital arm of Sistema, Russia´s leading telecommunications company, and strategic partner British Telecom PLC.
- FON's CEO Martin Varsavsky announces this news in the same blog-post that mentions
tough markets, bad market conditions and having to spend less money.
- FON has reduced their burn rate from an innitial $1.5 million p/m but still manage to accumulate losses of $800K per month in the last half year.
- A lot of people that bought FON's cheap routers reflashed and put them to a different use or just unplugged them.

It has also become clear to me, through discussions with "Foneras", that the amount of traffic going through FON's voluntary network is relatively low. So that's a lot of routers shipped, hard cash spent on their back-end but relative low return (by the looks of it). I wonder if their progress is measured by revenue or profit?
Another point is why in this third round of funding has not been less interesting for Google Inc., Index Ventures, Sequoia Capital and Skype? Surely if their previous funding had led to favourable results they would not allow a number of outside investors to come in and get a slice of the pie. Especially seeing that this C round funding came at a premium to previous investment as stated here.
Now I can see why BT invested. BT recently entered in a big partnership with FON and that would end as a fiasco if FON would run out of funding. The other main investor is Coral Capital Management, a Minneapolis-based venture capital arm of Sistema (Russia´s leading telecommunications company). I just wonder if FON's announcment of an expansion into Russia is a condition for this investment...
They also announce the launch of the Fonera 2.0 (the fonera that uploads and downloads stuff to and from the internet while you are doing something else with your laptop). I just wonder what this "stuff" is and how happy Foneras are to have this happen...
Would it be that they are building a P2P network and will use spare capacity on your laptop or networks hard drives to store data?

Looks like the PSP will get even better.

I am a great believer in Sony's PSP.
Not as a gaming console, because quite honestly gaming just bores the hell out of me.
However it is a handgeld console that has one of the best screens that I have seen in any device of it's size, it has built in WiFi, a memory slot, an excellent control interface, a browser and lots more.
See it as a PDA on steroids.
Add a decent PIM, email, and a whole range of web based applications to currently multi-media players and it's an almost unbeatable combination.
What is also important is that it costs less than half of a high end PDA.
Since it's release snippets of code have shown up in the firmware updates that indicate what Sony is working on.
It now seems that they are working on incorporating VOIP and that it will most likely be a cooperation with Skype.
More info can be found here...

E.

Are download caps capping development?

I came across an interesting post on OUT-LAW.com recently.
It discussed how using the much praised "Venice project" could result in exceeding your ISP's download cap/limit within as little as 20 hours.
For those of you that do not know what the "Venice project" is; The Venice Project is the new system being developed by Janus Friis and Niklas Zennström, the Scandinavian entrepreneurs behind the revolutionary services Kazaa and Skype. It is currently being used by 6,000 beta testers and is due to be launched next year. It basically bring online video-streaming to the masses. Think YouTube for grown-ups..

Anyway, the article explains that the service generate such a download & upload volume that it is easy to exceed the limits imposed by your ISP. A lot of us already know of the network demands imposed by using Skype. This just ups the ante some more. There is no point using a service if it bleeds your connection dry within a day.

This again illustrates that most ISP's are behind the facts on what their users want/need. Imposing download & upload caps as well as port blocking, bandwidth throthling and blocking various services (such as P2P) are still the standard with most (if not all ISP's). This is just indicative of the "old fashioned" approach to Internet usage that stems from the Telco industry of old. Most Telco's came from a monopoly or semi-monopoly position and were abusing this to dictate the way consumers could use their service.
This approach to the market is outdated and will hopefully lead those companies imposing such restrictions losing out to ISP's that will provide customers with a service that meets their demands..

E.