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7/13/2006
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AnchorFree's Growth Strategy: Make Wi-Fi Free, Secure

The company plans to charge for a secure VPN connection, but offer the Wi-Fi service free.

David Gorodyansky believes he has found a perfect recipe for his AnchorFree Wi-Fi company to continue growing: offer consumers connection to a virtual private network (VPN) connection and set the price of the Wi-Fi service at free.

Gorodyansky, president and co-founder of AnchorFree, said in an interview Wednesday that the firm's hot spot members number nearly 11,000 and he attributes much of the recent growth to the company's offering of its version of a secure virtual private network (VPN).

"We think we have the world's largest global Wi-Fi network," Gorodyansky said. "We're getting hundreds of downloads a day." AnchorFree's network is a combination of company-owned hot spots and hot zones and business relationships with operators of Wi-Fi hotspots around the world.

AnchorFree placed paid Wi-Fi hotspots like T-Mobile's paid Wi-Fi network in its cross hairs. "We think Wi-Fi should be free," he said. "People often don't now that there's a free alternative to paid Wi-Fi. For practically all paid Wi-Fi hotspots, you can go around the corner and find a free hotspot."

Gorodyansky said users can download the AnchorFree VPN once and use it on any of the hotspots listed on the firm's Wi-Fi directory. He adds that business and professional users tend to be downloading the VPN feature in great numbers because of its security functions; students usually don't care whether their connections are secure or not. A new AnchorFree feature enables users to download addresses of its Wi-Fi hotspots onto their iPods.

Founded in 2003, AnchorFree built a hot zone in Palo Alto, then added five more hot zones in San Francisco. The company recently added to its roster of hot spots by its acquisition of MetroFreeFi.com. AnchorFree's business model calls for advertising-supported Wi-Fi hotspots with revenue to be shared with its independent partners.

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