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« Open Devices, Not Just Handsets in Swath of 700 MHz | Main | Future of Houston's EarthLink Network Unclear »

August 17, 2007

Counterpoint to Muni-Fail: Outside Out, Not Outside In

Just an FYI for those who think that my and others coverage of problems in the municipal build-out means that metro-scale networks aren't going to be built: On the contrary. I expect that while networks in cities of 500,000 or greater will find fewer bidders and less interest due to political pressures and the difficulty in moving money from one budget line item to another, medium-sized cities and small towns will continue to build networks at perhaps just a slightly slower pace as the service provider market adjusts itself to the new realities. We'll see ever more networks that are dedicated initially to specific purposes. Once those purposes' goals are met--such as providing live video feeds for public safety and remote connections for municipal workers in a few departments, say--then the cities and their network partners will expand into other arenas. Public access may not be the first cited purpose of future networks, or at least not residential access.

I see a short-term dramatic decrease of interest in the consumer user and consumer market. It's pretty clear that reaching people in their homes is not the best or easiest first route to finding revenue. I've written for many, many months that if you build a network thinking that consumer, residential revenue will drive the network to break even, you're smoking Cat5 cable insulation. All that's happened in 2007 is that service providers have stopped hemorrhaging cash, and are re-establishing the focus.

Wi-Fi works very well as an outside coverage standard with current generation hardware of all kinds. This covers the vast majority of municipal and public safety purposes. Broadband wireless, as a broad category, works very well as wired T-1 and DSL replacement service. (That's Canopy, pre-WiMax, Proxim's MP gear, "real" WiMax in 5.8 GHz, etc., along with all the metro-scale vendors point-to-multipoint stuff.)

That is outside to inside doesn't work very well right now. What works? Outside to outside. (Also, Wi-Fi works quite well as an inside to inside technology.)

What's vital to understanding my viewpoint that Wi-Fi networks will be built over more and more cities, even if at a slower pace, is that gadgets, not residential usage, will drive consumers onto networks. The iPhone, T-Mobile's HotSpot@Home unlicensed mobile access, the huge number of cell phones and tablet PCs and handhelds with Wi-Fi built in, the coming tsunami of digital cameras with Wi-Fi built in, the coming-soon eyeFi camera adapter--this isn't a fad.

Just like Bluetooth, gadget Wi-Fi is multiplying without a lot of big picture attention. About Bluetooth, many people said the complexity, battery drain, and lack of consistent support would doom the standard. Then, seemingly all of a sudden, Bluetooth was in millions then hundreds of millions of devices. Utility outweighs the minor problems in getting it to work. (This is the inverse of Douglas Adams' description of products made by the Sirius Cybernetics Corporation in Hitchhiker's Guide to the Galaxy: the products' "fundamental design flaws are completely hidden by their superficial design flaws.")

Now, while Wi-Fi is found in tens of millions of devices, laptops, and desktop computers, it's still incorrectly seen as a host-based, computer-oriented protocol. New crazy stuff like Nabaztag and Chumby should put the lie to that, as well as the tidal wave of products in the pipeline that we'll see at Christmas and in 2008. Every kind of device is going to have Wi-Fi. And every consumer will be walking around with one or more Wi-Fi devices needing access. And they'll be outdoors. And they'll be happy to pay a few dollars a month per device.

That's my vision of the way the market shapes out. Tune in to this Wi-Fi channel to see how my prognostication pans out.

A digression on indoor bridges: To reach indoors is an expensive problem for consumers and service providers. Consumers have to buy $100 to $300 Wi-Fi bridges or service providers have to subsidize that cost. I recall back in 2005, talking to Tropos and asking what kind of customer premises equipment (CPE) they sold. They said, we don't offer that gear. We let the service provider or city figure that out. We recommend high-gain Senao gateways. I was baffled. I thought I must be missing something. In fact, it wasn't me, it was the whole industry.

Now, a sub-section of the industry has evolved to sell bridges, but those bridges are still expensive, because higher-gain radios (200 milliwatt/mW and 400 mW radios) cost substantially more than 30 mW and 100 mW radios more typically found. The folks at Meraki Networks say they spend about $5 in parts for their $49 Indoor units. Tropos et al don't reveal their raw-cost prices, but they're all using Atheros chips. It's more likely that for a 2.4 GHz radio of the up-to-the-legal-limit power that all the metro-scale vendors offer, they're spending $200 to $400 in raw parts before assembly. (hField just released their latest Wi-Fire model, a 500 mW EIRP USB adapter/antenna combo for Mac and Windows that could be an interesting option for indoor laptop users; I haven't tested it.)

Recently, Phil Belanger of Novarum gave me some good news. His firm tests metro-scale networks using a variety of clients and hardware, selling reports to service providers and cities, and providing independent evaluations. Belanger said that after adding an 802.11n adapter to their test bed, they were very surprised at how usable some networks suddenly became. "The consumer clients, the crappiest pre-N consumer clients, work really well on a metro-Wi-Fi network. In fact, as well as or better than a high-powered PepLink or Ruckus device. That was astonishing to us," he said. (Of course, Ruckus and PepLink are certainly working on 802.11n products, too; both companies' current range of adapters use higher power to reach further, although Ruckus also beamforms with multiple antennas.)

Which means there's some relief coming for service providers who are wrestling with the CPE issue. Instead of wrestling with bridges, their cost, and the messaging to consumers, they can rely on a new generation of 802.11n that's already shipping with equipment from Apple, Dell, and others, and that Belkin and other firms are making available as USB, ExpressCard, and PC Card add-ons.

It's not a guarantee of coverage, but it certainly increases the odds of a good connection, reduces cost, and eliminates most of the wonkiness and complexity.

1 Comment

I design, deploy and manage wireless networks for MTU properties where I use both the Ruckus (2211) and hField (wi-fire) units.

At about $120 a piece (list), I am as well baffled by the CPE issue.

Is it that they do not know about them? Are required to use the higher end gear as a result of some contract? Never got around to testing CPE in proof of concept deployments?

Are the latest adapters so new that they were not an option within the last few years?