I understand Technorati, for example, when it gives me real time searches of what people are saying about the Fonera 2.0. I understand the fact that a blog search engine should find what people who are blogging say about our new router, the Fonera 2.0. And, that information is very useful to us at Fon (disclosure I am an investor in Technorati). But, what blows my mind is that I can now see what people on Twitter are saying about the Fonera as well. Because a blogger, well she/he wants to be heard. But a person communicating to his friends in Twitter, is she/he aware that whatever one says is public and searchable? I wonder to what extent all users know that whatever they say to their friends the whole world can read (unless they set Twitter only to communicate with their friends but few do so)? And if they do understand this, then Twitter is one more proof that most people don´t give a damn about privacy. Now for businesses, Technorati and Twitter are an amazing combination for gaging popular sentiment after a product launch and for reacting immediately to any problem that may arise. We at Fon are constantly following early sentiment on the Fonera 2.0. Fortunately, so far as you can see doing your searches, it is extremely positive.

Andorra is the country with the highest life expectancy in the world. I did not know this when I recently had dinner with the country´s Prime Minister, Albert Pintat. Andorra is small but it´s not the Vatican. It has 80,000 very well off people with a GDP of close to $3bn. It is a beautiful mountain country between France and Spain. During our dinner we spoke about creating a regime attractive to IT companies and we were talking about how to promote Andorra in the world. Longevity though was not part of our conversation. I think it´s a nice record to have.

As you can see in these 62 different articles gathered by Google News, BT, Fon´s exclusive partner in the UK, won access to all Starbucks locations (more than 650 Starbucks coffeehouses in the UK and Ireland). Unfortunately this does not mean free access to all foneros around the world for wifi at Starbucks UK, but it does mean free access for Foneros who are also BT Broadband customers. And for the rest, we are working on a lower Fonero discount. We will keep you informed. We also wanted UK foneros to know that we are trying to see how we can legally sell the Fonera 2.0 in the UK.

I would like to share what’s been said in blogs and media since we announced the Fonera 2.0 launch. The reviews are very positive and early sales are strong. But selling a lot of hardware without advertising is close to a miracle. Especially in the midst of a global crisis. So let´s hope the word of mouth after our first deliveries is enough to sustain the sales. The articles are in the languages I understand.

Wired, boing boing, PR News, Gearlog, dv-depot, pc mag, Endgadget, Gizmologia, Gizmología again, Zdnet, Canard WiFi, Hoy Teconología, Oss Blog, UNIVERS FREEBOX, Mac4Ever, Harakiwi, Planet Sansfil, Francofon, Minitosh, MacBidouille, Presence-PC, LordPhoenix’s Blog, i974, Infracom Online, ICWS, keneto.net, Perfil.com, Frageek, Clubic, Francofon, Harakiwi, mrboo, Fredzone, Brico-WiFi, Couleur Geek, Gonzague, GreenIT, Zicmama’s Blog, Netbook 3G, Webtuga, yebo blog, TooLinux, Soy Plastic, Il Bloggatore, BandaAncha, Xataca, País Cambiante

msi-whiteDuring our last trip to Morocco which resulted in our engagement, Nina and I both took Netbooks. She took her fancy MacBookAir. I took the MSI Wind that my friends had turned into an amazing triple combo of Mac, plus Ubuntu, plus Windows XP.

Yes, I know it sounds crazy, but thanks to a special install by some friends, this 400 euros machine runs all three operating systems. And on top of that the battery lasted over twice as much as the MacBook Air, it has 3 USB ports instead of one and for pictures it had a great SD slot that of course Apple would never install because it would ruin its hardware aesthetics. In the desert climate, with a rare connection to electricity, frequent dust and sand, the MSI Wind performed like a star. Why am I telling you this?

fonera-20Because when I shared my enthusiasm with Jordi Vallejo, from Fon, he told me that the managers at MSI Wind loved Fon and it turned out that this was the case cause they loved the idea of doing a Fonera 2.0 / MSI Wind bundle which we launched today in France, Italy and Spain with more countries coming soon.

Basically, we are selling both the MSI Wind and the Fonera 2.0 for only 379 euros introductory price. I hope you like the MSI Wind as much as I do, because it has become my portable computer of choice beating not only the MacBook Air, but all the other netbooks I tested including the Dell Mini and the Asus EeePC. Here´s the link to order the bundle in Spain.

I would also like to share with you what the blogs say about the Fonera. And for technical questions I recommend you read this.

Wired, boing boing, PR News, Gearlog, dv-depot, pc mag, Endgadget

My Spanish blog is more active than my English blog but this does not mean that I don´t praise, criticism and trolls in my English blog as well. Throughout Fon´s short history, unfortunately, critics and trolls have been partly right when they say that Fon has not delivered on its promise to build a global WiFi network. Yes, we do have 360K Fonspots now but other than in Japan which is the only country in the world in which we have succeeded without installing our software inside the wifi router of telecom operators in other countries where we have been very successful, like UK or France we did this together with BT, Neuf in France, Zon in Portugal.

Why were we not able to grow at a rhythm higher than 4000 Foneras a month more solely on the premise of “share a little wifi at home and roam the world for free”? I would say it was a chicken and egg problem. With BT we truly were able to say that you share a little WiFi at home and roam the UK for free as with them we deployed so many fonspots at once that coverage in that promise and delivery were very well linked. Especially because if you are both a BT customer and a Fonero you get to roam for free in BT OpenZone as well, BT´s commercial offer available at airports, train stations, etc. But in other countries, like Spain where we don´t have an operator we exist thanks to the altruism of some (Linuses) and the desire to amortize the cost of a DSL connection (Bills) but coverage is spotty. Same in Germany were we are still the largest WiFi network but that is not enough to speak of having a real presence in which you can predictably find Fon as you can in Japan or UK.

So what we did to make it more attractive for Foneros to buy a Fonera is to make the Fonera itself very appealing. We greatly improve the Fonera 1.0 and the result is the Fonera 2.0 which goes for sale in Europe tomorrow. The Fonera 1.0 is a great router to share WiFi and to make money selling passes to the Fon community. But the Fonera 2.0 does that and much more. Examples? It downloads your torrents without your computer being on (ONLY DOWNLOAD CONTENT WHOSE RIGHTS PLEASE). It downloads files from Rapidshare and Megaupload. It uploads your videos to Youtube without your computer being on. It uploads pictures to Facebook, Picasa, Flickr. It converts your many times useless 3G signal into WiFi so you can use game consoles and other devices that need internet but don´t come with 3G. It connects your printers via WiFi, or your webcam, and there is more coming.

With the Fonera 2.0 we are convinced that our deployment rate will accelerate and with a combination of Foneras and telco routers we will deliver on the coverage.

In this video I compare the Fonera to the Time Capsule of Apple and show that in a sense, the Fonera is to the Time Capsule what the iPhone is to a mobile phone.

What I like about Joshua Cooper Ramo’s book, The Age of The Unthinkable is that it it starts with the premise that complexity in world affairs is here to stay. Maybe it is Joshua’s background in physics that has made him see foreign policy as an area where Heisenberg’s uncertainty principle also applies. That in human affairs also we can never know where things stand that we can only speak in terms of probability. That when we oversimplify, our policies backfire and we end up in the “Age of the Unthinkable” where financial markets, world peace, the environment all blow up in our face. So who are the winners in this era? A minority of unlikely candidates that range from Sergey and Larry at Google to China as a nation, to Hezbollah as an organization. The losers however seem to be mostly in the USA, Europe and elsewhere and are those who stick to simplistic models (i.e. Bush Cheney Middle East approach) and fail to tackle the diversity of inputs that may lead to a certain outcome. A good example of Ramo’s challenge of the status quo is criticism of Joseph Nye´s soft power theory. Soft Power theory says that if the “enemy” likes our culture he will stop being our enemy. As Ramo shows it is possible for terrorists to listen to our music, watch our movies, dress like us and still….want to blow us up. And what makes the book more interesting is that Ramo’s past as the Foreign Editor of Time Magazine made him meet many “despicable” characters such as the head of information of Hezbollah and, surprisingly, learn from them. In a style similar to that of President Obama, he shows us how talking to the enemy and learning from the enemy can be a better strategy than spending trillions trying and failing to destroy it. But before getting carried away here is my advice: Buy the book and come up with your own opinion. It’s worth it.

When I bought my Lexus RX400 in Spain in 2005, I thought that I would pay a high price for a car but both help the environment and save on maintenance and gas. After all, I was getting a hybrid, a car that is both an electric and gasoline car. But after some years of ownership, I have come to the conclusion that hybrids are neither so environmental nor economical. As for gasoline consumption, my Lexus uses 14 liters every 100 km. That is more liters than my other car, an Audi Q7 3.0 TDI albeit a diesel. And in terms of overall economy, whatever you supposedly save on gas you spend on service. Lexus has a super expensive service program because of some parts that must be replaced related to the way the car recharges the car batteries when braking. My calculation is that each km that you do in a Lexus costs 10c in terms of service costs alone.

disappointment
disappointment

Read this from CNET. Now see how the stock is doing right now.

We are now facing the toughest environment that I have ever seen for start ups. We have gone from financial markets and VCs willing to finance dreams to a “show me the money” reality that will force start ups to close their doors if they can´t delivere. Fearing this new scenario and warned ahead of time by our investors at Allen and Co, I started cutting costs at Fon during early 08. The cutting was severe, we let go around half of our people, we shrank from around 90 employees around the world to 40 now. Moreover we stopped subsidizing our hardware. But surprisingly the combination of employee reductions with subsidy ends was still accompanied with tremendous revenue growth and now it is almost sure that Fon will start making money this year.

Fon earns margin out of two different sources, telecom sales, meaning people who are not WiFi donors but require WiFi and pay per hour, day or 5 days, and buyers of our hardware, the Fon WiFi routers, our social routers known as La Fonera or Foneras in plural.

In terms of telco sales last week was FON’s best week ever. After a tough winter in which both hardware and telco sales were shrinking, telco sales turned around and grew from 30K to 47K euros per week in the last 4 weeks alone: this is 50% revenue growth over the average winter week. Revenues and hotspot growth is mainly coming from BT and Zon in Portugal but it is also coming from many countries around the world. Our best countries are UK, France, Japan, Portugal, and Germany. Why was the winter so bad for us? I think that the global crisis “froze” people for a while and now they are relaxing their spending again. Also WiFi is partly an outdoor product and the winter is bad for us in general. We were also hit by the pound´s collapse against the euro which fortunately is now reversing.

On the hardware side FON’s outlook is bright. We have over 3000 pre ordered Fonera 2.0. We will start selling the Fonera 2.0 in Europe on April 21st. Due to cash conservation we have been very cautious in ordering stocks of the Fonera 2.0, but now it looks like we have been overly cautious. If you google Fonera 2.0 you will see that we are getting a lot of pre release reviews and that not a single one is negative. Tech bloggers and journalists appreciates a router that not only has the basic Fon functionality of free WiFi roaming and allowing its owner to make money from it but the more advance functionality of taking care of your uploading and downloading while your computer is off. They also like the 3G to WiFi conversion capability as many gadgets, especially gaming gadgets come with WiFi but not with 3G.

So now that we have shrank our monthly expenditures from 700K in Jan 08 to 210K euros per month now and are growing revenues so fast, it looks like we will break even this summer. If we do we will be a sustainable, profitable company which is the only guarantee of survival in an environment of cash starvation.

Bottom line is that we are not out of the desert yet, but we are getting close.

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