Metro, Business

AirFox Hopes to Revolutionize Telecommunication

According to Victor Santos, co-founder and CEO of AirFox, it is time for wireless carriers to enter the 21st century. And AirFox is just the startup to help them.

Santos and Sara Choi, co-founder and COO, explained how smartphones have transformed the telecommunications industry, and all of its carriers. Cell phone and data plans, however, have been relatively constant and slow-paced since the rise of smartphones. Carriers have begun to sell data plans similarly to how they used to sell talk and text plans pre-smartphone era. Choi and Santos aim to transform the telecom carrier industry, and help wireless carriers become digital and agile by launching different types of data plans that are not as rigid.

The idea for AirFox blossomed as Santos and Choi watched many challenges unfold in the telecom industry. After graduating from the University of California, Berkeley, with concentrations in business and economics, Santos worked as the co-founder and COO of Ciao Telecom. That was where he saw the industry as a slow-moving dinosaur. Despite widespread innovation to the mobile department of the industry, Santos believed the telecom sphere lacked modernization.

After working at Ciao, a telecom company, Santos moved to Google’s marketing department—that was where he met Choi, who was also working as a marketing manager on the same project. Choi, who graduated from Harvard University in 2010 with a concentration in biology, entered the advertising world. After leaving Google in the summer 2016, Choi and Santos seized the opportunity to transform the telecom industry.

Choi and Santos decided to move to Boston to begin their startup. Santos explained how Massachusetts was a hub for telecom companies and they believed that their adtech venture would thrive in it.

“For what we are doing, Boston is better [than San Francisco or Silicon Valley] because there’s a lot of telecel influence and enterprise focus,” Santos said.

Moreover, Boston allowed Santos and Choi to hire a veteran in the telecom industry—Dan Powdermaker, their current executive vice president. Powdermaker had worked with both iBasis and AT&T. In addition, Choi’s mentor from her alma mater was a local venture capitalist, Wan Li Zhu, of Fairhaven Capital. While speaking to Bostinno, Choi explained that Zhu emphasized the Boston tech world’s strong network of mentors and advisors.

So after setting up their operation in Boston, Santos and Choi began finessing the Airfox technology, which works by integrating itself with a carrier’s network. On a fundamental level, AirFox intervenes between the carrier’s network and the 3G, 4G, or LTE on the user’s phone—  and places its software in between the network. By putting its software in the middle, AirFox can examine a subscriber’s, usage and pinpoint which applications are used most. On the technical level, AirFox operates in between with deep-packet inspections (DPIs), which unpack each section of data used, and determines what it is.

Utilizing its technology, AirFox has devised three innovative types of plans. The first is application plans. Most smartphone owners predominantly spend their time within a few apps in their phone. With this plan, Santos and Choi aim to provide carriers with the ability to target subscribers with the right app plan to flexibly purchase data for any app in the Google Play store. Essentially, these app plans compress data, and prevent data consumption by background services in different apps, other advertisements, or caching activities. For instance, these app-specific data plans tailor to the subscribers—users could purchase an hour of Snapchat or Facebook data usage.

Sponsored plans are another type AirFox offers to carriers and subscribers. These plans enable brands to pay the carrier and its subscribers through data sponsorship. Santos noted the benefits of sponsored plans, explaining that advertisers receive engagement, subscribers pay less, and carriers earn extra revenue. Santos detailed the sponsorship plans as either non-incentivized or incentivized. The non-incentivized sponsorship assumes that the advertising will be paid for regardless of user engagement, whereas incentivized sponsorship presents incentive-based offers that hinge on user action.

The final plan is a zero-rate plan, which allows carriers or third parties sourced by AirFox to sponsor an application’s data usage for a specific period of time. Some suggested forms of this plan are a $30 2GB plan with WhatsApp zero-rated.

Through these three plans, the creators of AirFox intend to enable the right plan for every smartphone subscriber through transforming wireless carriers into more agile service providers. With AirFox, Santos and Choi envision carriers to have data sponsorship, control, efficiency, and personalization. Santos explained how 85 percent of the world is under the umbrella of a restrictive pay-as-you-go plan. He also detailed how 2.5 billion people are unbanked and that 4.4 billion have yet to come online.

 Currently, AirFox is headquartered in the Harvard Innovation Launch Lab, and its core team comprises of nine individuals, ranging across different disciplines from engineering and software to business and economics. But as the group’s looks toward the future, Santos and Choi envision AirFox as the enabler of mobile data access for all in the future.

Featured Image Courtesy of AirFox

March 15, 2017