Zardon

NEW YORK (AP) — In a sure sign that the upstart wireless Internet technology called Wi-Fi is proving too powerful to ignore, Verizon Communications said Thursday that it will install such networks for small and medium-size businesses.

Because it allows people to share Internet access inexpensively and relatively easily, Wi-Fi is becoming increasingly popular in cafes, airports and hotels. Some stores offer it free for their customers as an incentive to sit there for hours sipping lattes while surfing the Web.

Wi-Fi has been seen as a threat to big phone companies like Verizon because the technology allows homegrown networks to spread outside their control. Some cable companies have asked customers to stop using Wi-Fi to share fast Internet access, calling it theft of service.

Verizon's new Wi-Fi initiative appears to be something of a toe in the water.

The company, which already sells Wi-Fi equipment that lets households share a broadband Internet connection, is offering to set up wireless networks for small and medium-size businesses in Boston as part of its plan to be an all-purpose "solutions provider." Service in other cities will follow.

But Verizon executives also say the company is looking at ways to begin offering access in stores and other public places — so-called wireless "hotspots" — and charging a fee to people who want to log on from their laptops or handheld computers.

"We're evaluating other opportunities," said Rahman Karriem, Verizon's executive director of data product management. "It's all geared toward driving increased mobility and flexibility for customers and using wireless to do that."

Wireless phone carrier T-Mobile, formerly VoiceStream, has already embraced that idea by creating Wi-Fi hotspots in more than 1,000 Starbucks, airport lounges and malls around the country. Unlimited use costs $30 a month.

Similarly, Boingo Wireless, a California-based startup launched by Earthlink founder Sky Dayton, has installed Wi-Fi connections in hundreds of places and offers downloadable software that lets users "sniff" whether wireless networks are available.

Several other big voice and data companies are also considering following suit, according to Yankee Group analyst Sarah Kim. A coalition that includes Intel and IBM is discussing a hotspot plan called Project Rainbow, but Karriem said it is premature to say whether Verizon might sign on.

The main hurdles for companies are assuring the security of Wi-Fi hotspots, how to charge for such a service and how to make sure people don't use it without paying.

Kim said Verizon is "arguably at the forefront" among the nation's phone giants when it comes to offering wireless networking services to businesses, but she added: "They should have done this a while ago."

Big phone companies in other countries, especially South Korea, the United Kingdom, Sweden and Japan, have been quicker to embrace Wi-Fi and offer public hotspots, said C. Brian Grimm, spokesman for the Wi-Fi Alliance, an organization of companies involved in wireless networking.

Driven in large part by those efforts, worldwide sales of Wi-Fi-related hardware are estimated to total $2.1 billion this year and more than $3 billion next year, according to research compiled by the Wi-Fi Alliance.

The technology could also get a big boost next year from a new Intel chip for laptops known as Banias, which includes wireless connectivity that now has to be plugged in separately. Intel also recently announced plans to invest $150 million in Wi-Fi companies.