Wi-Fi News Briefs

• Consumers Want Wi-Fi
• Opportunity Knocking
• Singapore Heats Up Hotzone Wars
• Yet Another Wireless Frequency

by Gerry Blackwell [August 20, 2002]

Consumers Want Wi-Fi
Sales of wireless local area network (WLAN) gear to small-office or home office (SOHO) and residential customers outstripped sales of enterprise equipment once again in the first quarter of 2002. According to a recent report from Phoenix Ariz.-based Synergy Research Group, SOHO/Home sales grew by 18 percent over last quarter, while enterprise sales actually dropped nearly 12 percent. The SOHO/Home segment represented 57 percent of total sales.

How can you take advantage of the trend? If you're a wireless Internet service provider (WISP) targeting residential subscribers, diversify into reselling home WLAN equipment and offer integration services as well. It's what WISPs such as San Francisco-based Vista Broadband Networks, CommSpeed of Prescott Valley, Ariz., and others are doing.

While overall, WLAN equipment sales were relatively flat quarter over quarter, they still grew by a healthy 60 percent over the same period in 2001, to a total of more than $460 million.

"Despite what can be viewed as a relatively modest quarter, the overall WLAN market continues to be a very exciting and fast-moving market," says Aaron Vance, a WLAN industry analyst at Synergy.

"802.11a is finally a reality, both Europe and Asia have made significant progress with regard to adopting the technology, the consumer market continues its unabated growth, and the enterprise will show growth by the end of the year in spite of a down first quarter."

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Opportunity Knocking
If they don't act quickly, mobile operators may miss a chance to get a critical head start in the burgeoning public Wireless LAN market, says high-tech market research firm In-Stat/MDR of Scottsdale, Ariz.

In-Stat argues that offering WLAN services today will enable mobile operators to experiment with broadband services, to combine them with their so-called 2.5G mobile offerings—general packet radio service (GPRS) and code-division multiple access (CDMA) 1x real-time technology (RTT)—and then migrate users to third generation (3G) mobile WCDMA systems when that technology becomes available.

If they delay in implementing WLAN technology, non-mobile competitors will get a head start. They'll grab all the best hotspot sites and be in a good position to compete head-on with the mobile carriers' future services.

"Public WLAN services will help educate users on WWAN [wireless wide area network] data usage, thus increasing their usage and adding to overall data ARPU [average revenue per unit] incrementally while helping to alleviate the decline in voice ARPU," says In-Stat/MDR analyst Donald Longueuil.

Mobile operators will be able to contain the potential revenue erosion from competitive WLAN providers by offering public WLAN services themselves.

"Entering this new market will not only provide them with a logical service line extension, but it will also allow them to defend their valuable future next-generation revenues," Longueuil says.

In addition, they will be able to address a demand that they currently do not meet, increasing their overall data cash flows. According to Longueuil, "Every mobile operator could achieve increased wireless data revenue if they implement a WLAN solution properly."

"But to do this, they must start now, either by growing organically or by purchasing a WLAN service provider. Delaying entry into the market will likely prove detrimental in the long run."

Will mobile carriers listen? Most already have WLAN hotspots on their radar. At least one, global system mobile (GSM) operator VoiceStream Wireless, is already offering a combined 2.5G/Wi-Fi service through its T-Mobile unit using the Wi-Fi hotspot network T-Mobile earlier purchased from defunct MobileStar.

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Singapore Heats Up Hotzone Wars
A Singapore Internet company, StarHub, recently unveiled what may be one of the world's biggest "hotzones," or areas of contiguous Wi-Fi hotspot coverage.

The StarHub hotzone, at the Asian city's Suntec Singapore International Convention & Exhibition Center (Suntec City), covers an area of 180,000 square meters, equivalent to 28 soccer fields. It uses Wi-Fi gear from Cisco.

The hotzone takes in all meeting rooms, exhibition halls, concourses and galleries on six floors of the giant facility, plus restaurants and other areas in adjacent terraces and gardens.

"We are very excited about the vast opportunities that the StarHub Wireless Broadband Hub will bring to companies and individuals at Suntec," said Kyong Yu, StarHub's senior vice president of IP and Multimedia. "It will change the way people work, allowing them to hub effectively and productively while on the move."

The Suntec City wireless hotzone will also "lay the foundation for us to develop value-added wireless applications and optimized multimedia content that will free users from the office environment to a more flexible working lifestyle," Yu said.

StarHub is offering an innovative data-based pricing plan. Subscription rates are about $6 for 2MB of downloading and $30 for 20MB, with additional usage charged at about two tenths of a cent per kilobyte. The company charges a one-time $6 sign-up fee and is offering existing customers the hotzone service at half price.

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Yet Another Wireless Frequency
Conterra LLC, a regional WISP in Columbia, S.C., has announced an agreement to co-own and use 39 GHz licensed spectrum currently owned by First Avenue Networks to develop wireless broadband services in Columbia, Charleston, Greenville and Spartanburg in South Carolina, as well as Augusta, Ga., and Charlotte, N.C.

First Avenue, of Charlottesville, Va., is the former Advanced Radio Telecom, which emerged from Chapter 11 bankruptcy protection earlier this year. The company says its licensed technology can deliver broadband speeds up to 622 Mbps.

"Our agreement with Conterra is very positive news for the telecommunications sector and an important endorsement of the efficiency of 39 GHz for wireless solutions to meet connectivity challenges," says First Avenue president and CEO Dean M. Johnson.

"First Avenue Networks believes that fixed wireless connectivity using 39 GHz spectrum is the most cost effective solution for a large percentage of 'last mile' and other types of telecommunication links."

The company holds over 750 licenses, issued by the Federal Communications Commision, for 39 GHz spectrum covering virtually the entire United States. In the top 50 metropolitan markets, it owns over 350 MHz of bandwidth.

"Joint ownership of this licensed spectrum marks a significant company milestone as we create a viable wireless broadband service model," says Mark Horinko, chairman and co-founder of Conterra.

"Adding 39 GHz licenses to our current wireless broadband service offerings gives our customers higher bandwidths, easy service migration and scalability from our present service offerings."

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