In October, Internet access company Fon passed out free Wi-Fi routers in downtown San Francisco during an event it dubbed “Freedom Friday.” Such a deal: they usually charge a whopping 5 bucks for the devices! A “freedom” day in New York is next up for later this year.

Founded in Spain, Fon represents just the latest twist in grass-roots efforts to distribute free or low-cost Internet access to the masses to see what creative and interesting activities might result. The idea is that home users with wireless routers share their broadband Internet access connections with others.

Linuses, Bills and Aliens There are three categories of users. The biggest category consists of “Linuses” (presumably a tribute to open source icon Linus Torvalds). Linuses share the Wi-Fi connection they have at home with so-called “Foneros” (other Wi-Fi users who are part of the Fon community). In return, they get free Wi-Fi access wherever they find a Fon access point around the world.

Another category of users is called “Aliens.” These folks use a Fon router but haven’t been persuaded to share their Wi-Fi connection (yet). They get charged 3 bucks a day to use the Fon community’s grass-roots Wi-Fi network.

Finally, users called “Bills” want to make money from sharing their Wi-Fi connections. So, instead of free roaming, they get 50 percent share of the fees that Aliens pay to access the Fon community.

Fon’s wireless routers, called La Fonera, use separate Service Set Identifiers for the home user and the outside folks sharing the Internet connection to keep indoor connections secure.

Skewing the business models If Fon takes off, it could usurp (or create sources of interference in) muni/metro Wi-Fi networks being subsidised by city and county governments.

The muni Wi-Fi people are very touchy when people question their business models and whether Wi-Fi, initially intended as an indoor LAN technology, will continue to scale well across wide geographies. “Just come look at all the installations that are out there already working,” they challenge in a defensive tone of voice.

Indeed, there are something like 250 to 300 community Wi-Fi networks in operation today, though only a handful are densely populated cities. And the operations of most of these networks aren’t being challenged by a second, or third, or fourth provider entering the market (can you spell “competition?”). Additional providers could potentially cause interference in Wi-Fi's unlicensed spectrum, which offers equal access to all potential users of Wi-Fi's 2.4GHz and 5GHz spectrum. It would be up to the providers to work these issues out among themselves.

Perhaps most interesting is whether it’s actually legal for individuals to simply choose to share their Internet access connections with anyone off the street. ISPs liken the move to “stealing” video programs over cable, which we all know is the ultimate telecom sin.

Then again, you might have any number of people within your home wirelessly sharing your Internet access connection at any given time, whom you may or may not be related to. Your ISP doesn’t know who and how many of these wireless-device toting folks are in your house (and presumably doesn’t care, so long as it can limit your overall access rate to what you’ve contracted for). Is there a difference if the party doing the sharing is inside our outside your walls?

Time – and likely a court case or two – will tell.