David Sifry, CTO of Sputnik and creator of Technorati, contributes the Point-Man perspective to the Subsidized Wi-Fi AP idea.  It turns out that Sputnik's original business model had subsidization element to it!

"It's like a blast of deja vu to 2001, back when Sputnik was getting started, and our original business model.  […] But we decided that we were pursuing the wrong business model, and changed our plans." – David Sifry

He then identifies and explains in detail the four factors that forced them to change their business model.

1. Revenue split
2. Legal issues
3. Customer Service headaches
4. The rise of "free" networks

Please read my original post, Tim Oren's post, my response, and then David Sifry's post so you can:

get high on fume,  cool under a tree, get tickled by a breeze, and then finally taste the earth.

PS: This sort of interaction across blogs is what I had in mind in my Linking Blogs and Wikis post.  I could have created a Wiki page somewhere with original post as a composite category to which Tim and David could have contributed their perspectives via their blogs.