Kubi Wireless (B)

July 15th 2005 was a red-letter day in the short history of KubiWireless. The WiFi service at Madrid Barajas and Barcelona El Prat airports had finally been launched. It was a big victory for Kubi, and the management team (see Exhibit 1 for the organizational chart) had reasons to be satisfied. It was the culmination of four years of hard work and perseverance. Revenues had grown at a fair clip over the previous year, and profitability was even closer with the service launch at the airports. Kubi had achieved a tremendous amount in its four years of existence. It had correctly focused on business travelers, building a network of hotspots (see Exhibit 2 for definitions of technical terms and network architecture) along their work-based travel routes. This focus was reinforced with products, pricing and user experience tailored to their needs. It pioneered the demand for hotspot services in Spain, focusing on quality of service to the hotspot owners and the end-user. Kubi had successfully raised capital during a phase in the industry in which accessing seed and early stage capital had been very complicated, and it seemed to have got the timing just right to make the most of the hotspot access market. In spite of achieving so much in so little time, the company was still burning cash, although at a much lower rate. Reaching breakeven was the management team's number one priority. With that in mind, the immediate challenges facing the company were: To close remaining national and international wholesale agreements, to ensure the promotion of the service by all the "WiFi Ecosystem" players, particularly the big telecommunications operators, promotion of national roaming and to complete its network of hostpots wieth the few remaining "strategic" hotspots.