Subject: [NEXTEL-1] Public/Private Wi-Fi Goes Pervasive?

From: Marcel <[email-masked]>
Date: Mon, 13 Jan 2003 10:54:13 -0500

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       In This Issue:
       What’s Next? Pervasive Public/Private Wi-Fi Deployment
       Backward and Forward Migration Standards
       Blurring Public and Private Wi-Fi Service
       The Rise of Wi-Fi Operators
       Securing Wi-Fi Connections
       The Next Lippis Report
       IP Telephony Market and Vendor Report

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   What’s Next? Pervasive Public/Private Wi-Fi Deployment

   No matter what you call it, the wireless LAN, or WLAN or Wi-Fi standard;
   after more then ten years of development, project IEEE 802.11 is a major
   success. WLAN deployments span home networks, telecommuters, small offices,
   regional sites, headquarter facilities and public spaces. The typical office
   WLAN deployment sits within the workgroup network offering mobility to
   knowledge workers. Wireless access point pricing will plunge over the next
   twelve months propelling pervasive WLAN deployment. Wireless switches from
   companies such as 3Com, www.3com.com, and Symbol Technologies www.symbol.com
   will be offered this fall using wired infrastructure as a backhaul for
   wireless traffic flows. The Wi-Fi market is poised to boom and usher in a new
   way of providing computer network connectivity and voice services with:

   • Intel www.intel.com et al promising to bundle multi-function Wi-Fi cards
   into their laptop processors.
   • the availability of low cost access points,
   • wireless switches on the horizon
   • public massive Wi-Fi hotspot build outs

   While analyst market projections may vary, what is consistent is the general
   trend line. It’s up, up, up and away.

   IDC www.idc.com estimates there will be 4.2M homes equipped with WLAN by
   2004. In-Stat/MDR www.instat.com believes that there are 5 million devices
   worldwide with embedded WLAN ports today and this number will balloon to 91
   million over the next five years. There are over 2000 hotspots today.
   Hotspots are public places such as Starbucks, American Airlines lounges,
   hotels and parks that provide a public WLAN service. These hotspots are
   projected to grow to 41,000 by 2007 generating some $3Billion of revenue
   according to Analysys www.analysys.com . And this projection is low based
   upon resent events.

   There is a WLAN flash point occurring in the telecommuter, small business and
   conference rooms for medium to large business taking place. As the entry
   price falls from $340 to now $229 for a small installation an acceleration of
   WLAN use has resulted. In 2000 only 9% of telecommuters used WLAN, it is
   projected that this has accelerated to 25% by year-end 2002 according to
   In-Stat/MDR.

   Backward and Forward Migration Standards

   While the 802.11b standard has found market acceptance, the IEEE has finished
   work on the new 802.11a standard and is projected to complete the 802.11g
   standard soon. 802.11a network interface cards and base stations are
   available today. 802.11a is similar to 802.11g, in that they both deliver up
   to 54 Mbps of bandwidth, with extensions for even higher data rates. Radio
   frequency interference is much less likely in 802.11a because the
   less-crowded 5 GHz band is used for transport. The 5GHz band also reduces the
   range to approximately 80 feet which is less than lower frequency systems
   used in 802.11b and 802.11g. This will increase the cost of 802.11a systems
   because it requires a greater number of access points per network diameter.
   However, the shorter range enables a much greater capacity in smaller areas
   via a higher degree of channel reuse.

   The 802.11g standard is backward compatible with 802.11b while 802.11a is not
   unless multi-mode (802.11a, b, g) network interface cards are used. Expect
   them in May to June ’03 time frame. 802.11g is an extension to 802.11b.
   802.11g products are available now in limited supply ramping up during Q1
   ‘03. 802.11g broadens 802.11b's data rates to 54 Mbps within the 2.4 GHz band
   exploiting OFDM or orthogonal frequency division multiplexing access
   technology. The range at 54 Mbps will likely be less than existing 802.11b
   access points operating at 11 Mbps. 802.11b radio cards will interface
   directly with an 802.11g access point and vice versa at 11 Mbps or lower
   depending on range. For example, 3Com’s Access Point 8200/8500 products,
   available January 2003, support 802.11b/a/g, IP Voice, QoS, load balancing
   and extended roaming. Upgrades and backward compatibility will be dependent
   on vendor implementations, so choose your vendor wisely.

   The next question is which WLAN standard to use? The answer is, it depends.
   For high speed requirements in small areas with a dense supply of users
   802.11a may be best. For conference rooms where it’s unknown which WLAN NIC
   laptops are being used, waiting for 802.11g may be best. If there isn’t a
   high speed requirement, then stick with 802.11b. It seems like 802.11a
   products will satisfy niche markets while 802.11b/g will address the bulk of
   the market. In any case, the networking industry is delivering options for
   WLAN installations and the options are only going to increase.

   Blurring Public and Private Wi-Fi Service

   The future of WLANs will bring higher speed connections, multi-modal NICs and
   access points, wireless switches and new wireless devices. Pervasive WLAN
   access, driven by cost reductions in access point products, will enable
   roaming around a building without loosing a WLAN connection supporting both
   networked applications and VoIP services. Pervasive WLANs will deliver to IP
   phones what they currently don’t have; roaming. IP phones supporting Wi-Fi
   and bluetooth connections will be available by most vendors during mid 2003,
   completely untethering knowledge workers. The blurring of wire line and
   wireless services will take shape too as private WLANs are increasingly
   extended over public services via Wi-Fi and mobile operators. WLAN/WAN
   handsets supporting 802.11a/b/g, bluetooth and CDMA will become available
   during the first half of 2004. Extending this seamless wireless connectivity
   outside the office complex is being developed by the largest mobile and
   network equipment suppliers on the planet.

   Handoffs, roaming, service agreements and billing arrangements between
   wireless service providers are currently being developed for WLAN and CDMA
   network exchangeability. In fact, many cellular carriers are holding off
   their deployment of so called 2.5G and 3G systems for 802.11 hotspots linked
   to their mobile offerings.

   Many edge router vendors are now incorporating links between mobile and
   802.11 for billing, roaming and service interconnection. For example, Tahoe
   Networks www.tahoenetworks.com is provide routing, IP services (VPN,
   Firewall, content filtering) etc for CDMA based 2.5G, 3G and public Wi-Fi
   networks. Tahoe is partnering with Xacct www.xacct.com and Kabira
   www.kabira.com to provide detailed billing and personalization of wireless
   data services. Starent Network’s www.starentnetworks.com ST16 Intelligent
   Mobile Gateway supports subscriber aggregation, billing, QoS, services etc
   between 2G/2.5G/3G and 802.11 networks. Others providing the key
   interconnection between 802.11 and mobile networks are Lucent, www.lucent.com
   Watercove Networks, www.watercove.com 3Com www.3com.com and Cisco.

   The Rise of Wi-Fi Operators

   The public Wi-Fi service providers, I call them Wi-Fi operators, is taking
   shape with interest from a large number of service providers and consortium.
   On the Wi-Fi operators’ side there is T-Mobile, www.t-mobile.com HereUare,
   www.hereuare.com WIFI Metro, www.wifimetro.com Boingo, www.boingo.com Sprint
   www.sprint.com and iPass www.ipass.com. In December of 02, Cometa Networks
   www.cometanetworks.com was launched. Cometa is a new company backed by AT&T,
   IBM, Intel and two venture firms to build out Wi-Fi hotspots. Cometa plans to
   sell wholesale Wi-Fi access services to retail mobile, cable and DSL
   operators. If this model proves successful, operators will not have to build
   out their own Wi-Fi networks lowering the barrier of entry of public Wi-Fi
   service availability. Cometa plans to build out 20,000 hotspots by the end of
   2003 in the largest 50 metro locations. This would provide a seamless
   nationwide Wi-Fi service with services purchased through existing mobile,
   cable and dsl operators. Key to Cometa’s value is Intel’s plans to integrate
   Wi-Fi support within its processors to labtop suppliers and using AT&T’s data
   network as a backbone connecting the 20,000 hotspots.

   The Wi-Fi movement has its fair share of consortia as any standard does
   seeking quick adoption. There is Project Rainbow, which Cometa Networks came
   from. Project Rainbow is a consortium of AT&T Wireless, Cingular, IBM, Intel,
   Verizon and Microsoft to deploy a nationwide Wi-Fi based network. Pass-One is
   a non-profit consortium working towards global Wi-Fi standards including data
   access, roaming and unified billing.

   The key to Wi-Fi is that the technology straddles both the enterprise and
   public service provider markets. According to Kevin Kennedy, COO of Openwave,
   Wi-Fi emerged in verticals, and for applications that span a public/private
   interface the seeds were sewn surgically, such as Starbucks and American
   Airlines as a public service. At the same time it worked its way into
   Enterprise networks. The enterprise market has a much quicker adoption rate
   then service providers. If you have both enterprise and service providers
   adopting a technology at the same time, it has a very good probability of
   success.

   But Larry Lang points out that the current difficulty with public Wi-Fi is
   its small network diameter. With only a few hundred plus foot diameter, a
   service provider has to pick its hotspots wisely if they want to generate
   enough revenue to pay for the back-haul. And therein lies the rub. If a
   hotspot costs approximately $4K to deploy and the back-haul (the circuit
   providing internet connectivity to the hotspot) is $50/month you need at
   least 11 subscribers paying $20/month for the Wi-Fi service to breakeven.
   This assumes a two-year depreciation cycle on the $4K capital spend. The
   breakeven goes way up if the back-haul is a T1 circuit at $1000/month. But
   this too is an area of much innovation. Many start-ups are now focused on new
   methods to expand the network diameter spreading the cost over a larger area
   and more users/subscribers. In short, casting a bigger net over a larger
   number of potential users will improve the breakeven for Wi-Fi operators.

   The Wi-Fi Operator Channel: Cable & DSL Operators

   Another difficulty of public Wi-Fi is war driving, which is when people drive
   around town with laptops open looking for cost free internet access from
   unsecured hot spots. The cable and DSL operators aren't in business to give
   away free bandwidth. Securing and rate limiting services need to be layered
   on top of public and private hotspots. All five top cable operators are
   implementing rate limiting equipment from companies such as Ellacoya
   Networks. Ellacoya's 16000 series switch www.ellacoya.com limits the
   bandwidth consumed on a cable link assuring that cable internet access lines
   aren't being shared among non-subscribing Wi-Fi users. Without rate limiting,
   cable operators will in essence be giving away free internet access much like
   the early 80s when some homeowners tapped into cable TV free of charge. Rate
   limiting also ensures fairness of use among authorized subscribers on the
   same access point. Without fairness algorithms, one subscriber could be
   downloading music using a peer-to-peer application, making it impossible for
   his neighbor to surf the Internet at broadband speeds.

   The cable, DSL and mobile operators will figure out how best to offer public
   Wi-Fi services with a relatively new set of equipment suppliers. The bottom
   line, they are all engaged in making public Wi-Fi happen. An implication of
   the excitement and up tick in public Wi-Fi deployment is that 2.5G and 3G
   mobile technologies have waned. Most if not all mobile operators are
   re-thinking their infrastructure choice to deliver high speed internet
   access. The real losers here are those equipment suppliers that have tied
   their fortunes to those older 2.5G and 3G architectures. As stated in the
   Lippis Report Volume 9, www.lippis.com 3G is being delayed while public Wi-Fi
   is being deployed.

   Securing Wi-Fi Connections

   While the wireless industry put product shipment ahead of security concerns
   it’s now closing that gap. WEP or Wired Equivalent Privacy is widely reviewed
   as too porous a security protocol. The industry will make available 802.11i
   to secure wireless connections. Many networking vendors are extending their
   wireline based security services over wireless. In particular VPN tunnels
   with device authentication over wireless connections offer the same security
   found on wireline links. In the next few quarters Wi-Fi connections will
   support VPN tunnels with per-session, per-user encryption and authentication
   based on Kerberos or RADIUS to harden wireless connections.

   Its looking like the bell shaped heads are on the defensive again, as the
   computer networking companies and start-ups provide practical solutions to
   operators seeking to deploy high speed wireless internet access. Lower
   capital spend, hardened security, standards based, multiple technology
   options, big named suppliers and operators all bode well for public and
   private Wi-Fi services.