WiFi Phones Hit A, G Notes

Continuing the push to reinvent the way businesses buy, deploy, and use telephone systems, SpectraLink Corp. said today it is releasing a new line of WiFi-enabled handsets, the first such devices to run over the 802.11a, .11b, and .11g networking standards.

Called the NetLink 8000 series of wireless telephones, the new product line will debut in the first quarter of this year with two models: the basic NetLink 8020 and the more sophisticated 8030, which includes built-in "push-to-talk" capability. The phones will sell directly from SpectraLink for $595 up to $675. SpectraLink also has OEM relationships with prominent telephony-equipment suppliers including Nortel Networks Ltd. , Avaya Inc. and Alcatel-Lucent (NYSE: ALU), which will presumably sell the new phones under their own brands.

Previous WiFi phones operated only over .11b networks, which use the 2.4GHz frequency band. The new phones now include the capability of running additional channels over .11g (which also uses 2.4GHz) and .11a, which uses the 5GHz band.

"There are applications where .11a is huge," says Ben Guderian, vice president of marketing at the Boulder, Colo.-based company, "particularly in areas where there's more density and the availability of the 2.4 spectrum is lousy.

"It's also important as we look forward to branching out from specific verticals into the general office market -- the 'carpeted environment.' "

While SpectraLink touts its OEM relationships with major PBX vendors, the real 800-lb. gorilla in the enterprise telephony space is Cisco Systems Inc. (Nasdaq: CSCO), which sells its own WiFi phones. Cisco, which has not yet released a .11a/g handset, is expected to do so shortly, perhaps by the end of Q1.

The next step, of course, would be 802.11n, the wireless broadband standard that will enhance previous 802.11 standards by incorporating multiple-input multiple-output (MIMO) technology for increased speed and range. Several cell-phone manufacturers are expected to preview dual-mode phones with 802.11n capabilities at next week's Consumer Electronics Show in Las Vegas.

Some industry observers, in fact, expect dual-mode handsets using .11n networking to make WiFi-only phones, such as the SpectraLink products, obsolete. Craig Mathias, principal at the Farpoint Group and an Unstrung columnist, expects half of all cell phones sold in 2011 to include WiFi connections. (See Five Technologies That Won't Survive 2007.)

"To date we have focused on tight integration with the corporate PBX," rather than cellular convergence, acknowledges SpectraLink's Guderian. "These handsets are strictly WiFi -- they're targeted at the enormous market, which people maybe don’t pay as much attention to, of rank and file workers who do not get a company cell phone from their employers."

In the longer term, SpectraLink expects to use SIP, or Session Initiation Protocol, to help open new enterprise markets for its devices used in voice-over-wireless-LAN systems.

Overall the corporate WLAN market continues to grow rapidly, expanding by 19 percent in the third quarter of 2006 alone, according to Synergy. Corporate WiFi/VOIP phones now generate $10 million in quarterly sales, the research firm says.

"We want to make sure we are positioned to be there as enterprises move forward in the adoption of WiFi and IP telephony," says Guderian. "It's happening, as many companies are rethinking the conventional wisdom of putting a phone on every desk."

SpectraLink says it has sold more than 200,000 NetLink handsets in the last eight years.

— Richard Martin, Senior Editor, Unstrung

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