I would just like to introduce myself… My name is Tom Dolan, I am the President and CEO of RovAir, we are small organization that is apparently creating a bit of a stir in the travel industry blogs over the last few days. To begin, I would like to come out and thank everyone for all the comments, we will use them to devise better ways to service our customers. As I sit here and write this, I am on an Amtrak Acela Express from Boston to Philadelphia, which by the way is not Wi-Fi enabled; although, my Sprint 595U works great. I would also like to start by adding that this is not going to be an advertisement for RovAir, I will present all options the best that I can.

A little background…The concept for RovAir was born while my family and I were vacationing last summer in Cape Cod, the house we rented did not have Wi-Fi. As an executive with a mid sized consulting firm, it was important for me to stay connected while away from my office in order to best service my clients. Knowing that my company was not going to reimburse the monthly cost, I struggled with whether I should pay the monthly fees. I ended up buying the card for $80 after the rebate (it is now $50 after rebate), but figured I had 30 days to return it, if I didn’t like. Anyone can do this, ONCE, and the return process is not a pleasurable one, I can assure you that as we tested it in our RovAir research.

Now, I cannot live without my data card even though it does not make financial sense for me to have one full time. I love like the convenience and security of knowing I can connect anytime anywhere. The idea of renting a data card came about when I was on that cape cod vacation and rented a stroller for my 1 year old. I thought to myself, why didn’t I just rent the card for the week? I researched it a bit while on vacation and found very few companies that rent the cards, the problem was their prices were very high. I thought we could do it for less, and provide a great service to those that wanted or needed it, and did not want to get the contract.

I preface, that we fully understand that our service is not for everyone, particularly the frugal traveler that would prefer to find a café or other location where they can get it for free. You can get free internet in just about any limited service (i.e. Hampton Inn, Fairfield Inn, Comfort Inn) or Select Service (i.e. Courtyard, Hilton Garden Inn, Residence Inn, Homewood Suites, etc.), it is a brand standard. There are 26,300 branded hotels in this country and 21,200 Independent hotels. Only about 1,600 of the branded hotels are full-service and required by the brand to charge for the internet, the majority of others offer free internet. You may prefer to pay for the “fixed” internet connection in your hotel room, and if so great. We are not trying to change your minds, we are just trying to give you another option to paying the hotel rates, a better, more “Mobile” option in our opinion.

Let me give you an everyday scenario as a business traveler… a typical hotel guest checks in between 3pm and 8pm, they get to their room and connect to the internet (for $9.95 – $19.99, or for free), they use it for a couple hours maybe, go to dinner, come back, read email, and go to bed. The next morning, the guest leaves the room, and does his/her business. The internet price rolls over at noon. So they have used the internet for a total of maybe four hours for whatever price they paid or didn’t pay. RovAir charges on a 24 hour basis, you can use it whenever. As far as reliability, both have their disadvantages. 92% of all hotels in the US were built prior to 2000, that means they were all retrofitted with internet solutions, which leads to problems. I was typically on with tech support about 10-20% of the time when connecting in hotels. Wireless Mobile broadband (WMB is based on cell networks, we all know about dropped calls. While wireless mobile broadband does experience dropped connections, it is less frequent than voice calls.

We are not looking to compete with the hotel market, but rather complement it. For example, some business travelers like to be connected from point A to point B, we make this happen. Often times, users pay for a connection in the airport or a cafe in a pinch.

Of course you can get a free connection just about anywhere as long as you know where to find it, but it is tough to find without internet access to begin with. In addition, there are numerous other “hotspot” services that may work for you as well, if you want to pay a monthly subscription. They advertising anywhere from 8,000 to 20,000 hotspots in the United States. With WMB, there are essentially millions of hotspots. I would recommend looking for the free internet connection rather than waste your money. I must also further this by saying that the security of Wi-Fi is much lower than with Wireless Mobile Broadband. An issue for government workers, but not for everyone.

Chris Elliott is a very respected journalist, and he simply made a recommendation to his users, and asked you to do the math. We are sorry that this caused confusion, or if anyone thought that it was misleading, certainly not our intention. Our goal is to dedliver the highest level of customer service combined with unparalleled mobility. Anyway, we decided to do the math for you, here it is…

Cost of Using Mobile Broadband Providers And Signing a 2 Year Contract

Monthly Fee Months One Year Total Length Total
$60 x 12 = $720 2yr. Contract = $1,440
* Plus the cost of the data card, taxes, and activation fee; note these vary from month to month

RovAir Breakeven Analysis for 3-6 day Rates
Shipping
Days Daily fee Length Total 24 times total
36 x $14.95 = $ 538 x 2 years = $1,076 + 360 = $1,436
*inlcudes the cost of the data card

This equates to roughly 12 three day rentals per year over the course of two years

RovAir Breakeven Analysis for 7 day Rates
Shipping
Days Daily fee Length Total 14 times total
48 x $12.95 = $ 622 x 2 years = $1,243 + 210 = $1,453
*inlcudes the cost of the data card and sales tax

This equates to roughly 7 one week rentals per year over the course of two years.

RovAir Breakeven Analysis for 14 day Rates
Shipping
Days Daily fee Length Total 9 times total
63 x $10.33 = $ 651 x 2 years = $1,302 + 135 = $1,437
*inlcudes the cost of the data card and sales tax

This equates to 4.5 two week rentals per year over the course of two years

RovAir Breakeven Analysis for 30+ day Rates
Shipping
Days Daily fee Length Total 8 times RovAir
112 x $5.95 = $ 666 x 2 years = $1,333 + 105 = $1,438
*inlcudes the cost of the data card and sales tax

This equates to roughly 3.7 months per year over the course of two years

Forgive me if there is an error its not intentional, but I think everyone sees the point. I should preface this by saying that as we move forward, we hope to streamline our distribution model so that the cards would be made available at numerous retail outlets thereby eliminating the shipping costs. Furthermore, if the user has their own card, we hope to “soon” be able to “light up” that card at will with our account, thereby lowering the over all cost to the consumer. If you would like to compare this to “paid” hotel internet access, there is no comparison based on the mobility that we are able to offer versus the hotel’s “fixed” connection. As far as free internet and subscription services, I encourage those users that don’t want to pay for internet to continue their search for the “free” hotspot. It is certainly better than all the options if you are able to find it. When compared to one year contracts the economics get even better as the equipment charges and activation fees go up.

Going forward, we will be practicing yield management techniques that you are all too familiar with in hotels, car rentals, and airlines, which means, as demand increases, prices will go up, as demand decreases prices will go down. But for now, they remain as stable!

My take on tethering… Tethering is an option for those individuals that have a 3G device, and the speeds are comparable. One downside to tethering, you cannot talk on the phone as the same time. Nevertheless this is an option in a pinch, IF you have paid for the service. I know with Verizon it is an extra $15 on top of your data plan. I think Sprint costs the same. We do not work with AT&T as coverage and download speeds are inferior. As for the famous generation one iphone user, tethering is not an option, it does not have the capability. Newer verions will have this option.

My comments on Citywide Wi-Fi… I am certainly not an expert in the “fixed” internet, however, I have stayed in a Holiday Inn Express… just a little hotel humor. My opinion, they are costly to the cities, and many of you mentioned the coverage can be sketchy. My understanding is that they will be phasing out as new and much better technologies enter the marketplace. Things such as Wimax, also deemed as the last mile internet. The leader in the technology is Sprint operating under an entitiy called Xohm (www.xohm.com). Verizon is coming out with their LTE technology, still unnamed, and AT&T with UMTS. These technologies are expected to be significantly faster than anything out therir today and will make citwide Wi-Fi obsolete. Xohm was supposed to have launched in Chicago and DC earlier this month, but to my understanding it has been delayed. To further the citywide wifi argument, it is not available in every city, and people want to stay connected everywhere they go, Point A to Point B!

The last thing I would like to say… the Service Providers costs are actually becoming more expensive, not less, as Verizon, in particular, has pulled back from their “unlimited” plan. They now limit you to 5GB per month, although a user would have to be streaming video to reach this limitation, still a price increase. I note that RovAir allows its users up to 1GB of download per week, prorated on a daily basis, and as long as we do not hit our 5GB limit with Verizon, we will not likely charge you.

Your comments have been extremely helpful, and we have heard all these arguments over the last 6-8 months as we researched our business model. The answer is… whatever is right for you! Just like when purchasing a hotel room, a car, a house, or anything else in this world.

As for Chris Elliott’s recommendation, we greatly appreciate his comments, and do not believe he should criticized for a service that “does” make economic sense for many travelers. As we move forward, we hope the economics get even better for the consumer. To be honest, you best option is to convince your employer to pay the monthly fees. Finally, I am happy to discuss or debate (depending on your position) this issue with anyone, I can be reached at my email address tdolan@rovair.com. Sorry for the lengthy reply, but I thought it all needed to be said.

Shel Horowitz, author of the 280-page ebook, The Penny-Pinching Hedonist: How to Live Like Royalty with a Peasant’s Pocketbook, available at frugalfun.com

I would like to thank everyone for their postings over the last several days.

We will use these comments in a constructive way to continue to find the most economical way to serve our customers and provide unparalleled wireless mobility for the business and leisure traveler.

We realize that RoVair is not for everyone. If it was, I assure you that I would be retired and living on a private island in the Caribbean!

We do not intend to mislead anyone regarding our rental prices or our shipping costs. We feel we have figured out the most economical way to provide access to wireless mobile broadband users while avoiding costly/long term contracts.

I assure you that our pricing will come down in the future as we are figuring out more efficient shipping methods.

Thank You,
Matt Walsh

And Finally on a patriotic note, we all live in a free capitalistic society, where competition is good. everyone can attached their own mark up on their product or service, and usually, its much higher than you even know. Take the cost of liquor, beer, or wine in a restaurant, they charge what the market will bear. Geoff, would you rather live in a sociiety of price fixing or a socialistic/communistic society. Sounds that way! If RovAir, or any other company for that matter, is not meeting the needs and demands of the market, then they will weed themselves out.

God Bless America!

In answer to your pricing question, as I said I own a card, and love the convenience of connectivity. However, if a customer wants a one year contract, they pay $80 per month, so lets get your facts straight. That means its $960 for the year PLUS the cost of the card and taxes and you lose the rebates. the Two year contract is $60 which equates to $1,440, PLUS the cost of the card and taxes, not all of them are free. Now the $600 doesn’t sound so bad if you only need it once a month. So Geoff, who is misleading people now! what do you work for one of the carriers?

In terms of the 30 day plan, how about all those people that rent or have homes for extended periods of time in the summer.

What about people that travel in RVs for a month at a time once a year.

I agree with you in the scenarios provided, except for one problem the cost comes out of my pocket, not my company’s. I already pay for internet in my home and have it in my office. So now I have to pay for two connections. In Theory, i could eliminate my hard line, but I don’t get good cell reception in my home. If I stay in a hotel, and use the internet, I can charge it back to my company or client, which I could also do for the Data card rental, but not a two year contract

Joe, all carriers have USB cards now, so the PCMCIA thing is a non-issue, plus you can get htem built into your laptop. In answer to your claim about paying for your data connection already, you still have to pay additional to tether to your computer, and you still cannot talk on the phone at the same time. FYI, there are ways around this, but they are not legal! its like stealing cable. Only reason I know is because I called the carrier to find out! Not a chance I want to take.

If the hotel charges $9.95/ day (most seem to charge this rate) then to get an average price below it, you’ve got to rent from RovAir for 18 days. If the hotel charges $20/day then you’re breaking even at the minimum of 3 days rental, plus as several people mentioned, you’re able to use it everywhere, more or less. Frankly, most of the hotels I stay in (Hiltons, Marriotts and Hyatts) only charge $9.95/day.

If you travel regularly for a week per month, then an air card at $60 month is a better deal than the hotel or RovAir.

I use an air card (express card style) from ATT. It works great and traveling about 7 days per month or more is the least expensive way to get the Internet while traveling. It has better coverage than Sprint, and by the end of the year, ATT 3G coverage is supposed to be more extensive than Verizon’s EVDO. We’ll see about that, but the ATT coverage is already extensive.