According to latest news, Zapp now offers wireless internet access in 100 Fly Taxi cars. The first thing that comes into my mind is “how much does this cost, and what is their ROI”? Interestingly enough, according to an article in Cotidianul, Zapp refused to comment on the costs. But I’m curios, and I’ve searched around to find out. First info – WirelessIsFun.com says:
Nevertheless cost per cab is:
- router – ASUS WL-500G w. USB port ~$40
- Z010 EvDo modem ~$20
- unlimited in-network airtime
Hmm… 60$ per cab? But let’s inspect the components:
- Are they using Z010? AFAIK, those modems are junks (very bad connectors) and Zapp has recently given up on them – they must be using Z020. And from what I see, the price is 39$ for Z010, 49$ for Z020. Are they really buying them at half the price? I doubt that, but its not completely unlikely.
- Are they actually using an ASUS WL-500G router? Well, yes, most likely. But doing a quick “google product search”, I see that the cost is approx 70$, not 40$
- The big missing cost in this analysis is the power supply & the casing. The Asus WL-500G is designed to work on AC power, or on 5V (do they simply use an inverter, or a DC-to-DC converter?). A good adapter can be 50$ (on large quantity orders), but they may have used a cheaper one, who knows?
- How about the environment factors? The case plays a big role here. This is not a home environment, it is closer to an industrial environment. How does an Asus WL-500G work at 60 degrees? (assume the driver left the car in the sun … it will take a while until the AC brings the temperature to a normal level). Does this router handle well frequent reboots? Does it work well in the winter, if the driver starts the engine in the morning at -20 degrees (yes, it does not need to work correctly; but if it was not designed to work at that temperature, and it is mounted inside a non-heated case, the MTBF will decrease dramatically). How about vibrations? (hmm… no moving parts; maybe they got lucky on this chapter). Well, it may be the case that they simply haven’t thought about this… but then, they will have high costs with replacements.
Anyway, I have to agree with the conclusion from wirelessisfun.com: they probably did it for the publicity, not for the generated business. At a cost of 150$, they probably need to sell approx 100 2$ pre-paid cards just to cover out the costs. At 10 trips/day (from the airport? this is not very pessimistic…), assuming that 10% of the passengers buy the prepaid card, they need 100 days to cover the costs. It’s not too much, but my figures are a little bit optimistic…. if only 2% buy the prepaid cards, they may be replacing equipment prior to fully covering its cost.
Nevertheless, these are pure speculations, I would be very interested to find out how many customers actually purchase ZAPP prepaid internet cards 
[later edit] hmm…. in an image from zapp.ro, the ASUS router is depicted together with a Z010 modem.. the guys from wirelessisfun.com may be right after all…
6 responses so far ↓
Dan // June 27, 2007 at 7:10 pm |
I was probably a little too generous and assumed Zapp got bulk discounts. The Asuses are around that price and the new modem doesn’t really work with them. So I also guessed they could be using refurbished z010’s. All for the sake of the argument, of course.
We did our own share of WiFi with cfree.ro so we know a thing or two about costs
Thanx for the comment.
Dan
wirelessisfun.com
yottablogger // June 28, 2007 at 6:33 am |
I considered discounts, I just didn’t think that it can go significantly lower than the price I mentioned… these are already fairly low prices. Look for instance on mini-box.com, a WRAP 1A1E WiFi box is 55$/piece, and 44$/100+ pieces… an this is in fact a rather illustrative policy for volume discounts. I would be quite surprised if Zapp gets the router for less than 55$.
However, the price is not really relevant; even in my analysis, they could make up the costs in 3-4 months… maybe 6 months considering installation & operation costs. Even 1 year wouldn’t be so bad, after all; the question is whether they can make it work reasonably good – otherwise all the publicity that they are hoping for will turn into bad publicity (people using the service, and who are not already familiar with the Zapp network, will not think “they made a really bad implementation of car WiFi”, but instead will think “oh, so this is how the Zapp network works…. no thanks, I don’t want to use this for any other purpose, I will avoid Zapp in the future”).
Dan // June 28, 2007 at 6:45 am |
Or worse even: “WiFi sucks!”
That, I’m more worried about!
It will work and luckily there will be few people to actually use it to load the network beyond usability.
wireless is fun dot com » Blog Archive » Zapp WiFi Cabs // June 28, 2007 at 6:52 am |
[...] edit: Virgil of yottablog goes further with the analysis here. Go read with confidence! [...]
yottablogger // June 28, 2007 at 6:54 am |
It can’t be a load problem… there are too few people in-range while the router is working (it can’t be “always on”, it would drain the battery overnight). So the only potential users are the passengers.. the limitation is not on the wireless in-car network, the limitation is on the Zapp network. And from my past experience, the Zapp network is actually the best at data transmition, it outperforms Vodafone’s “3G broadband” service, and it does so by a relatively wide margin.
I just realized: I’m using mostly the uplink, so the comparison that I made between Zapp and Vodafone may not be 100% fair…. 3G+ is oriented towards download, AFAIK; and most customers probably use the internet to download stuff.
Gerdwin Lammers // December 24, 2007 at 6:52 pm |
Hi!
As a Zapper myself (no Astral/UPS or RDS in my residential area) i must say that the network is stable. Also when i take my Z020 on tour i have no complaints or failures. Not in Mamaia at the beach in summer or in Predeal/Brasov in the winter. The hardware and the net are pretty confident i must sat. If all will work in a Fly taxi i dont know. The average driving skills of the driver are not really making laptop working an option. But as there is this monopoly for Fly taxi’s from Otopeni and as transfer times to the centre of the city are up to between 1,5 and 2 hours it becomes more and more an option to get to work in the taxi. Another problem is though that most drivers refuse to switch the airco on in summer (It is bad for my health, sir. I get sick of it) and that temperatures like in last summer make taxi-zapping not really a pleasure. Anyway, i will try to connect next time i am forced to use Fly again and i will keep you posted.
Rgds
G