Experts torn over mobile carriers' zeal for public Wi-Fi

By Joanie Wexler
Network World Wireless in the Enterprise Newsletter, 04/22/02

I've often hinted in this space that the big mobile carriers should someday soon be stepping up to the plate to offer public wireless LAN services as an optional add-on to your overall 2/2.5/3G mobility service. However, I moderated a panel of experts representing the wireless industry earlier this month here in Silicon Valley where this issue was kicked around. The upshot was murky.

At the event, sponsored by IBDNetwork, an organization for business development executives, representatives from Proxim, a wireless LAN vendor; Nextel, a nationwide mobile carrier; and Qualcomm, the Code Division Multiple Access technology maker, along with an equity research analyst from Rutberg & Co., basically agreed on a few things:

* The wireless business traveler, rather than the consumer, will drive the uptake of public LAN services, also called Wi-Fi hot spots.

* The volume of business users using wireless LANs is not large enough today to make Wi-Fi hot spot services profitable in the near term to the big guys, who would be responsible for building these public hot spots. The number of enterprise wireless LAN users has not yet reached mass adoption, and only a percentage of those users are on the road enough on a regular basis to subscribe to a service.

* In order for wireless LAN installations to increase significantly in enterprises, an industry education process - particularly on the issue of security - needs to become widespread and successful.

It was suggested by Rajeev Chand, the Rutberg analyst, that the mobile operators might bite the bullet and get into the Wi-Fi hot spot market for competitive reasons anyway, knowing that it might not be profitable for several years. The director of business development for Nextel, for example, seemed resolute that the time was not ripe because the profit potential was not there - yet seemed every bit as determined that such services should be offered by the mobile operators, as opposed to, say, traditional ISPs.

I can see how wireless LAN services can be considered a natural complement to 2/2.5/3G service. But they are also Internet access services, so it seems just as natural for AT&T or Genuity or UUNET/WorldCom to offer a Wi-Fi subscription as a mobile add-on to your Internet access service. These companies are already offering dial IP roaming services - what difference does it make what the medium is?