Sky Dayton is smarter than you, richer than you and younger than you. (But he's very sorry about that.)

Though not even old enough to run for president, EarthLink founder Sky Dayton may be the great emancipator of wireless technology. His newest venture, Boingo Wireless, is poised to unite a growing number of independent Wi-Fi networks across the country. Dayton isn't just the biggest thing to hit wireless since 3G--he's also building the industry's first new empire since the early days of McCaw Cellular.

Sky Dayton is not given to bold statements, so let's make one for him: This guy's a whiz kid. The thing is, he doesn't even seem to know it. Modest, unhurried and friendly, Dayton's public persona is dominated by his sense of humor rather than the aggressiveness and hard-charging characteristics common to most CEOs.

Case in point: He let enthusiasm and wit rather than corporate proselytizing for his latest venture — Boingo Wireless, an integrator of wireless LANs based on the 802.11b Wi-Fi standard — rule his appearance at last month's Wireless 2002 trade show. During the opening day's keynote session, the perennially starched and well-coiffed Tom Wheeler, president and CEO of the Cellular Telecommunications & Internet Association, said to the rumpled, sandals-clad Dayton, “Sky, you're a California surfer kind of guy.” Dayton's interjection: “Is that because I'm not wearing a tie?”

Later, Dayton played a hilarious video of a friend running around Los Angeles using Boingo's Wi-Fi service in locales that included the lobby of a Best Western motel, an IHOP restaurant (where a waitress said “That's incredible. I can't believe Gates didn't do this.”) and even in a public bathroom at the Four Seasons.

As an industry celebrity who directs attention away from himself, Dayton is reminiscent of another wireless entrepreneur, McCaw Cellular founder Craig McCaw. Though Dayton isn't nearly as reclusive as McCaw, he is a somewhat eccentric multimillionaire (so was McCaw, at least before he became a somewhat eccentric BILLIONAIRE). For example, Dayton has confessed a love of snowboarding so strong that he sponsors the U.S. Olympic snowboarding team. He also named his son Finnius, he has posted his personal writings on the Web and he proclaimed that he'll be a novelist one day.

But the fact that Dayton sometimes appears as interested in the punchline as he does the profit line hasn't kept him from successfully launching three companies in the last seven years, a pace also reminiscent of McCaw, who started satellite firm Teledesic and CLEC Nextlink (now XO) Communications within just a few years of selling McCaw Cellular to AT&T. Dayton started Santa Monica-based Boingo last year amid a flurry of buzz and expectations just seven years after he founded EarthLink, which outlined the hugely successful model for aggregated national Internet services. In between, he also co-founded the star-crossed Internet incubator eCompanies, which, like much of its ilk, is now a smoldering husk of its former self — it's still in business as a holding company but no longer looking toward $100 million dotcom IPOs.

But in his most obvious and telling nod to McCaw, by aggregating far-flung Wi-Fi hot spots, Dayton is creating a national network mosaic similar to how McCaw Cellular assembled the country's first national cellular network. In the process, he may very well do for wireless data what McCaw did for wireless voice.

Keep in mind that Dayton is still only 30 years old, roughly half the age of many telecom industry CEOs. And if the buzz about Boingo — and Wi-Fi in general — is any indication, Dayton is in for more good times.

“Things are moving about a hundred miles per hour right now,” Dayton said. And he still didn't sound a bit frazzled.

Wi-Fi is currently the province of a growing number of independent, grassroots user groups sprouting up across the country. But the technology is not a threat to the primacy of carriers and their plans for 3G services — rather, it is widely considered to complement those efforts. With its high data speeds and truly boundless penetration capacities, Wi-Fi operates on levels and in places that existing mobile networks can't.

Further, the big wireless carrier entities themselves already show more than a passing interest in Wi-Fi, and Dayton is one of many who believe there is a bright future in integrating the nation's once private and primitive wireless LAN hot spots and interconnecting them with mainstream wireless networks. At the Wireless 2002 show he was joined on stage by John Stanton, chairman of mobile giant VoiceStream Wireless, which last November acquired the assets of defunct Wi-Fi operator MobileStar for its own Wi-Fi play.

Stanton himself came up through the McCaw ranks, so he knows what it's like to be an industry usurper, making bets and winning in areas where others have yet to even think of going. (Now that VoiceStream is owned by Germany's Deustche Telekom, Stanton admitted at CTIA that he's starting to feel like a member of the old guard: “It's almost uncomfortable to be part of the establishment now, having spent so many years as an insurgent.”

Stanton said he sees Wi-Fi and efforts of outfits like Boingo as a test bed, a threat and an opportunity to the next-generation — and wireless LAN integration — goals of the traditional wireless service providers.

“I view Wi-Fi to be 3G with training wheels,” Stanton said. “It's so early that it's still hard to see how relationships between carriers — and I'll use that term loosely, but I think it needs to be more broadly defined — are going to evolve.”

Dayton displayed innocence, graciousness and boyish charm as he talked with Stanton about the need to integrate mobile carrier networks and Wi-Fi networks.

“I think John's totally right,” he said. “At some point, it's going to be, ‘Your chocolate fell into my peanut butter,’ and we'll have the ideal network for everyone.”

There's no question that wireless LANs need to be incorporated into wireless networks, said Greg Collins, director for the Dell'Oro Group. “The trouble is there are so many wireless LANs and operators,” he said. “Cellular carriers are much more worried about getting 2.5G right now than they are about Wi-Fi hot spots and who runs them.

Boingo may be on to something in that it is trying to be a unifying factor presenting wireless LANs as a unified front. The more unifying factors there are to make this less a bunch of dispersed independent operators with proprietary software, the better.”

There are plenty more signs of carrier interest in both Boingo and Wi-Fi in general. One of the primary investors Boingo names on its Web site is Sprint PCS, although a Sprint PCS spokeswoman said the company only put up seed money and does not publicly discuss its investments. Christine Loredo, senior analyst of mobile wireless research for The Strategis Group, said the deal exemplifies carriers' increasing interest in Wi-Fi networking.

Another analyst who requested anonymity said Sprint probably has not yet decided whether it views Boingo as a threat. “It may have floated this investment to get a better look at Wi-Fi,” the analyst said, adding that more than one Sprint official has privately begin referring to Boingo as a competitor. “They may be thinking that Boingo will have some competitive impact on their plans for 3G.”

To be sure, there are points of great tension between traditional mobile carriers and organized Wi-Fi network operators. At up to 11 Mb/s, wireless LANs offer data speeds and access to Internet content greater than 3G can hope to offer, serving places many mobile networks can't reach. No less significant, it is also available in thousands of locations right here and now.

“Mainstream saturation for this service will take several years, but millions of people are using it now,” said Dayton. “It's here now in places where millions of people go everyday.” Still, he said Wi-Fi and 3G are starkly different and not truly competitive. “It's important not to think of Wi-Fi networks as mobile networks. They provide a flat price to access the Internet over a fixed area, in most cases no more than about 500 square feet.”

Dell'Oro's Collins agreed. “People will tend to use their 3G devices when they are on the move and in places that don't have Wi-Fi coverage,” he said. “They may use Wi-Fi when they are some place that doesn't have mobile coverage.”

Laredo said she believes carriers are gradually beginning to incorporate Wi-Fi into their data strategies. “A lot of carriers were interested in Wi-Fi before Dayton was doing it. They have been looking to combine Wi-Fi and mobile but have not been sure of how to do it,” she said. “The mobile carriers know that wireless data networking has to be seamless so that users don't feel more than a slight twitch in their service if they are on the Internet and crossing from a mobile network to a Wi-Fi network. They probably need a little more time to make it come together.”

Dayton concedes that it is still unclear what role carriers and other companies will play in Wi-Fi and how they will be viewed competitively. “It's very early in the development of the space, and everybody is new to it. One of the first things companies do is identify their competitors.”

Only months after his new company's formal launch, Dayton is busy cutting partnership deals of all kinds. Deals with hotel owners, airlines, convention centers and others who control the public spaces where Boingo's potential business traveler users are expected to proliferate; deals with the independent operators of thousands of Wi-Fi hot spots around the country; and deals with the new crop of regional and super-regional Wi-Fi-based ISPs, such as Austin-based Wayport, that have popped up in recent years.

The standard for Wi-Fi has allowed the deployment of these networks to reach such a critical mass that there is nothing stopping people and companies of all backgrounds from hopping on the bandwagon. Much of that growth — all told, there are about 4700 Wi-Fi hot spots around the country — has come at the low end of the market, with small businesses such as coffee-houses and bars deploying their own wireless LAN equipment, or end users setting up wireless LANs at home. Dayton himself had a wireless LAN in his home near Los Angeles months before the business plan for Boingo came together.

The nature of this business plan — and Boingo's blooming partnerships — will sound familiar to anyone who recalls Dayton's earlier work at EarthLink. Boingo is basically a next-generation wireless take on EarthLink's business model: The company is attempting to form logic from a chaotic array of wireless LAN hot spots across the country — most of them started as simple, private high-bandwidth access ramps to the Internet — by providing common front-end services, access technology and customer care.

“There are dozens of companies out there doing Wi-Fi, and there are many more coming, but it is kind of a patchwork quilt of different kinds of providers,” said Dayton. “What's hard is technically integrating all those networks so users don't have a different kind of service experience on each one. The stitching of those networks is what we do, and it's not a trivial thing.”

“[Dayton's] educating everyone else on the market right now,” said The Strategis Group's Laredo. “He's educating the other potential players about pricing and marketing.”

Dayton learned many lessons about service rates when the ISP industry moved to flat-fee pricing while he was in charge at EarthLink. “Pricing for Internet services is not a linear thing like for voice services. When people are on the Internet, they want to be working and going places and not counting minutes because [that is how] they are getting charged.” Like EarthLink, Boingo offers unlimited usage for a flat monthly fee — $74.95 in Boingo's case. Although ISPs have used this kind of pricing model for years, some early entrants into Wi-Fi networking tried to go the per-minute route, with little success.

Given their similarities, it is a wonder that Dayton didn't start Boingo as part of EarthLink, where he still holds the position of chairman. The new company certainly would have benefited from EarthLink's well-known brand and other resources.

“I haven't been a part of the day-to-day operations at EarthLink for several years,” said Dayton. “This is not really what EarthLink does anyway. It's much more about Internet access from the home with a PC rather than a customer who wants to work with wireless Internet access from laptops and other kinds of devices.”

Yet the business ties between EarthLink and Boingo (and even Dayton's lesser-known eCompanies, where he is no longer on the management team) are clear. Dayton remains chairman at EarthLink while serving as chairman and CEO of Boingo. Evercore Ventures invested in Boingo and is affiliated with eCompanies as an investment partner, and counts John Sidgmore, a former EarthLink board member, as a general partner. Evercore co-founder Austin Beutner is on the boards of both Boingo and EarthLink. Stewart Alsop, business columnist and general partner at venture firm New Enterprise Associates, invested in Boingo and has known Dayton since his EarthLink days. Also, Boingo actually started as an idea incubated by eCompanies before Dayton went looking for other investors.

So while Dayton said Evercore and NEA were “a pretty shrewd group [who had] already seen Wi-Fi coming as the next big thing,” they likely were betting as much on the jockey as the horse itself.

It remains unclear how many competitors a Wi-Fi nation will support. Community wireless user groups and their so-called free networks account for a healthy portion of today's Wi-Fi access points, and although many commercial providers have entered the game, one of the biggest — MobileStar — already went bankrupt. Wayport, one of the leading commercial providers and one of Boingo's biggest partners, still gets about 80% of its revenues from the wireline Internet access facilities it has installed in the guest areas of hotels, where it offers Wi-Fi service in lobbies, lounges and other public spots. “It is tough to make this work, but we are not really wary of what happened to MobileStar,” Dayton said. “That company's problems were in the way it approached the business.” Laredo agreed, saying MobileStar's partnerships with big names such as Starbucks were contingent on MobileStar paying all network construction costs and sharing a large portion of revenues.

Many observers also have suggested that hopes for broad Wi-Fi integration and usage may be too ambitious because the technology can't offer guaranteed security for data networking. Therefore, users will not work with sensitive corporate e-mail and documents. But Dayton said he doesn't promote the idea that users should work with sensitive materials on public Wi-Fi networks anyway: “You should really use a corporate VPN for that.”

Security is certainly an issue, Dell'Oro's Collins agreed, “but DSL is not a secure high-speed access medium for everything, either.”

Dayton said he feels Boingo is coming around at just the right time, when the prices for Wi-Fi access points and modem cards are dropping in a staggering fashion. “Wi-Fi access points used to be thousands of dollars, and now they are hundreds. Wireless Ethernet cards used to be $700 each, and now they are $70, and eventually they will be standard equipment when you buy a laptop.” He also expects network expansion to be alarmingly quick. Though Boingo currently has just more than 500 access points in its system, Dayton insisted that there will be 5000 by the end of this year. (So, he DOES make a bold statement once in a while.)

But another analyst who also requested anonymity said convincing small independent operators to join the Boingo system may be more difficult than Dayton thinks. “A lot of them don't really see the benefit of being part of a national system, and Sky Dayton's geek chic vibe isn't going to mean much to them either.”

But Dayton said money will do the talking. “We are another revenue channel for these companies building the networks, and it is hard to ignore that.”

Ultimately, one of the things that may make Dayton so laid-back and likable (not to mention wildly successful) is that he is a prolific user of everything he sells. He wants to access the Internet wherever he goes, and more than anything, he believes that the same impulses that drove him to put a Wi-Fi access point in his home will convert other users to Wi-Fi fanatics.

“When you're sitting in an airport without an Internet connection, it's like someone cut off your oxygen supply,” he said “We're here to bring the oxygen back.”