In August of 2014, something new started showing up in the markets of Shenzhen, the hi-tech area of China where the majority of the world’s electronics components are made. This is the ESP8266, a WiFi SoC (System on a Chip) that can connect to 802.11b/g/n networks on the 2.4GHz band. It can be addressed with SPI or a serial connection, and has an AT command set that makes it behave rather like an old-style modem. Basically, it has everything you would need to connect a device to a WiFi network, with the ESP8266 chip itself handling the complicated business of finding, joining and transmitting/receiving over a WiFi network.
That’s nothing particularly new in itself: WiFi connection devices like the TI CC3000 have been around for longer, and do much the same thing. The difference was the price. While the TI solution costs about $10 if you buy several thousand of them, the ESP8266 costs less than $7 for an individual board that can plug straight into an Arduino or similar. Buy the chip in bulk, and you can get it for less than $2.
The ESP8266 is more than just a WiFi dongle, though: it is a fully fledged computer in itself, with a megabyte of flash memory and a 32-bit processor that uses a RISC architecture. This can run applications, turning the ESP8266 into a standalone module that can collect and send data over the Internet. And it can do this while drawing a reasonably low amount of power: while receiving data, it typically uses just 60mA, and sending data over an 802.11n connection uses just 145mA. That means you can drive it from a small battery or other small power source, and it will keep running for a long time.
It wasn’t an easy ship to write applications for in the early days, though: it was poorly documented and required a dedicated toolchain to work with. This made it more of a challenge than many hackers were comfortable with. That changed earlier this year, though, when the Arduino IDE (Integrated Development Environment) was ported to the chip. This meant that you could use the much easier to write Arduino functions and libraries to write code for the chip, bringing it within reach of even the most casual hacker.
The specs I’m quoting come from the LG Optimus Exceed 2, which is currently available from Amazon in the USA for $20. The same package has been available for as little as $10 from retail stores in recent weeks. The Exceed 2 is just one of several low-cost Android prepaid phones on the market now, and undoubtedly the list will change. How to keep up with the current deals? We found an unlikely place. Perk farmers. Perk is one of those “We pay you to watch advertisements” companies. We’re sure some people actually watch the ads, but most set up “farms” of drone phones which churn through the videos. The drones earn the farmer points which can be converted to cash. How does this all help us? In order to handle streaming video, Perk farmers want the most powerful phones they can get for the lowest investment. Subreddits like 
