Verizon announced yesterday the availability of Apple’s iPhone 4 on its network. While this was good news for those in America waiting for an alternative to the pain of using AT&T’s network, for most of the rest of the world, it had little impact: the Verizon iPhone uses CDMA, a different technology to the GSM that is common in most of the world.

Looking at the screenshots reveals a setting for creating a WiFi hotspot.

Switching on the hotspot lets you share an internet connection with up to 5 devices, allowing you to connect any WiFi devices such as laptops and iPads to the internet.

The real hidden nugget here is that this new feature is not specific to the Verizon iPhone, but is part of the iOS operating system that runs Apple’s portable devices.

This means that when the Verizon iPhone is released, on February 10, there will be an update to iOS for all iPhone users, that in theory will enable the hotspot feature on their iPhones. Now, i can’t predict that this will happen exactly at the same time as the Verizon launch, but it is coming. Likewise, i can’t promise that all carriers will support it (particularly those of you lucky enough to be on AT&T). But, i will predict that there will be carriers around the world who will enable this, perhaps only a few at first, but over time more and more.

What does this mean for hotels and travellers?
For one thing, it’s going to be next to impossible for hotels to charge for WiFi when a large number of users have the option of using their phones to take advantage of fast 3G and CDMA networks to create a hotspot for all their devices. Where Apple leads with their iPhone, the other phone manufacturers follow, and at some point all smartphones will have this feature. I foresee that hotels will continue to need to provide WiFI, but the process of charging for it will be increasingly pointless — they aren’t going to get enough revenue to make a paid system worthwhile, with the transaction costs involved. This will, sooner rather than later, mean that WiFi will be free for all.

The death of hotel WiFi fees is finally upon us.

Anthony Green — January 2011