In the clouds over municipal Wi-Fi/ Hazlett

Thomas Hazlett | FT.com Financial Times | Published: January 13 2005 17:22

The fog of broadband policy has given way to frenzy over municipal Wi-Fi. Ignited by Philadelphia's consideration of a city-owned wireless broadband network, the concept appears to rock. The blogosphere trumpets "Philadelphia, the biggest WiFi hotspot in the world," while Mayor John Street is feted as a visionary. Newspaper features bulge with internet bubble-style pull quotes, such as this summation by Aaron Nutt, a consultant: "Wi-Fi is no longer a 'coffee house' technology and represents a potentially serious disruptive challenge to the current wireline-based broadband market."

In fact, scores of municipalities have embraced Wi-Fi. Bryant Park, adjacent to the New York Public Library, is a hotspot. A "wireless cloud" hangs over city streets in Portland, Oregon. Indeed, Philadelphia already offers free wireless internet access in Love Park and the Museum of Art. We trust that park and museum goers appreciate their tax dollars at work. But the real "disruption" will be diverting attention from reforms that could actually extend broadband networks to millions of mass market consumers.

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These "wide area clouds" would sweep the US - with still other technologies from ArrayComm, Navini, IP Wireless, BeamReach and Qualcomm - were prevailing political winds favourable. But licences are extremely scarce and their restrictions grim; regulatory obstacles have filled a graveyard with entrepreneurs who dared. The only new spectrum allocations suitable for broadband since the 1993 PCS rule making have been for unlicensed use. This month marks a re-auction of 2G (second generation) licences from that 1993 allocation - five years after Europeans auctioned their 3G permits.

The social value squandered by under-utilisation of radio spectrum is truly enormous. Business and residential users are willing to pay billions annually for mobile applications that are on the shelf, ready to roll. Oodles of prime bandwidth is today idle. Sprinkling downtown streets with Wi-Fi access points will do little to change that. Thinking that progressive policies have been adopted will make it worse.

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Cities look to the sky for broadband revolution
By Paul Taylor
Financial Times
Published: June 15 2005 08:32

Something is stirring in the radio airwaves above towns and cities in America, Europe and Asia.

Hundreds of local communities, municipalities and city councils are deploying broadband radio networks based on the 802.11 or ‘Wi-Fi’ radio standard using ‘mesh’ technology to link together multiple Wi-Fi cell sites or ‘hot-spots’.

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Tropos is one of a handful of private startups that have pioneered the emerging market for Wi-Fi mesh systems. These new large scale Wi-Fi mesh networks - dubbed ‘muni,’ ‘metro’ or ‘urban’ networks - are another factor helping to reshape the world’s telecommunications markets. Proponents argue that in many situations where it is difficult or impossible to rollout hard wired broadband networks, the economics of Wi-Fi mesh networks are compelling.

n the US, nearly 50 municipalities were already offering metro-scale broadband wireless by last autumn and the number is growing rapidly. According to some estimates, up to 750 towns and cities across the US plan to provide their citizens with wireless broadband access by the end of next year.

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While most early deployments have been in relatively small towns such as Chaska, a small town south of Minneapolis with a population of just 18,000 (see story below), the latest batch of cities to announce plans to deploy Wi-Fi mesh networks include giants such as New York, Boston and Chicago.

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Concerned about the potential impact on their broadband operations, the telecommunications and cable industries helped push through a Pennsylvania state law late last year that could prevent cities in the state deploying their own high-speed networks. The bill, which specifically exempted Philadelphia, has prompted similar legislation in at least 11 other states.

These bills have outraged municipal Wi-Fi proponents, who argue that cities must retain the right to enter the market in order to ensure ubiquitous cheap broadband access for their citizens. At a time when US regulators and legislators are growing increasingly concerned that the US could be falling behind Asia and Europe in broadband penetration, analysts suggest it is unlikely that Washington will intervene to stop cities such as Philadelphia providing alternative, affordable broadband.

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In Britain, Ontario-based BelAir Networks, another municipal Wi-Fi mesh network pioneer, and Citispace, the leading UK-based provider of urban digital networks, recently completed the ‘Technology Mile’ - an unbroken wireless ‘hot zone’ spanning the London Borough of Islington.

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Mobile working part one - enabling technologies
Pros and cons of 3G and WiFi
By Geoffrey Nairn
Financial Times
Published: January 26 2005 08:17

Forget the Ethernet cable in the hotel closet. The way to make flexible working a reality is to give users hassle-free access to their corporate network any time and from any location. And the best way to do that is with wireless.

The two high-speed wireless data technologies in general use today, 3G cellular and WiFi, are often presented as competitors, but the official line is that the two technologies are complementary.

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“WiFi is not a stand-alone business but it does work as an integral part of a broader communications portfolio,” says Chris Clark, CEO of BT Wireless Broadband, the wireless arm of the UK's incumbent wireline operator.

BT last year cut the prices of its WiFi service to just £5 a month for customers who also take BT's fixed-line broadband service. SBC Communications, the US regional operator, has an even cheaper WiFi deal, again for its broadband customers, which costs just $2 a month.

As well as pitching cheap WiFi to consumers, the telephone operators hope to conquer the suspicion that many enterprises still have about WiFi.

In the early days of WiFi, many businesses discovered their mobile workers where spending huge sums on WiFi services in hotels and the like. To discourage this “promiscuous” use of hotspots, some companies stopped their employees claiming the cost of WiFi scratch-cards on expenses.

To address this problem, BT recently introduced a corporate tariff plan that aims to control WiFi spending and ensure that a company's mobile workers use BT hotspots rather than those of its rivals.

The hotspot market was traditionally highly fragmented but is consolidating fast as the big operators swallow the smaller fry. BT now has 7,000 hotspots in hotels, airport lounges and railway stations spread across the UK. It also has an international roaming deal covering 20,000 hotspots.

While most telecoms operators now offer WiFi services, many remain wary of a technology that, as the Philadelphia example shows, can be used against them. That is particularly the case with mobile operators.

“They were caught off guard by the rise of WiFi and have since struggled to understand it,” says Niel Ransom, chief technology officer of Alcatel.

In the heyday of the WiFi boom, mobile operators that had spent billions of euros acquiring 3G licences looked with dismay at the rise of the WiFi startups, which seemed to have all the cards in their favour.

Unlike 3G, WiFi spectrum is unlicensed and therefore free. WiFi equipment costs are also much lower, while WiFi operators can cherry-pick the best locations for their hotspots – there are no universal coverage obligations.

But WiFi has its drawbacks when it comes to offering a “business-class” service. WiFi’s use of unlicensed spectrum means interference can be a big problem, for example.

Security is another weakness, although a new secure version of the WiFi standard, called 802.1x, aims to address IT managers' concerns about letting mobile workers access corporate networks via public WiFi hotspots.

T-Mobile, the big mobile operator, recently announced its 4,700 US hotspots would support the 802.1x standard.

Leading mobile operators like T-Mobile, Verizon and Vodafone all offer WiFi services but analysts say they face a difficult balancing act, because if they promote WiFi wrongly they risk cannibalising their cellular data business.

In the past this was not such an issue, because the low speeds and high cost of 2.5G services like GPRS limited take-up of cellular data. With the arrival of 3G, however, the mobile operators have a technology that can compete on speed and cost with WiFi.

To kick-start this fledgling market, some 3G operators are offering “all you can eat” data packages while others are attempting to replicate the pricing models of public WiFi hotspots.

Alastair Brydon, analyst at UK consultancy Analysys, warns that such strategies may damage the economic prospects for 3G at an early stage of its development.

“Head-to-head competition with WiFi could kill profitability,” he says. The operators risk filling their 3G networks with low-margin internet traffic, leaving no space for more profitable 3G services, such as voice and video.

Mobile operators are thus working on how to integrate their WiFi and 3G services to achieve the best of both worlds.

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