Optical/IP Networks

Year-End Review

Welcome to Unstrung's special Year-in-Review/Year-Ahead package. Over the next week, as 2005 wanes, we'll be looking back at the significant trends and developments that rocked the wireless world over the last 12 months – and ahead with some bold and uncanny predictions for 2006.

In Chinese astrology, 2005 was the Year of the Rooster, a time when practicality and forthrightness prevailed, order and stability were restored to the universe, appearances mattered, and strategic planning, careful rebuilding, and tireless effort were rewarded [ed. note: not to mention cockily strutting about the barnyard...].

In the wireless industry, that meant that '05 was a time of consolidation (both in terms of merged companies and technology types) and of hype coming down to earth. Chaos was banished, or at least tidied up a bit, as standards in many competing technologies began to emerge, and the way ahead came into focus. On the surface it may have seemed as if progress were stalled – particularly on some key, long-awaited wireless technologies – but underneath, powerful currents pushed forward.

In 2006, the Year of the Dog, many of these hidden or unseen forces will bear fruit. As everyone knows, dogs are loyal, full of energy and passion, and in need of focus and training [ed. note: and they enjoy licking themselves].

In the wireless industry, that means 2006 will be a year of boundless possibility but also a time of potential disruption if companies and customers don't make wise and far-sighted decisions. The Chinese characters for this year (which officially starts Jan. 29) represent "emanation," or bringing forth, and "temperance." These seemingly contradictory impulses indicate that established companies with incumbent customers will be held in check by newly emerging startups based on innovative technology.

So what does all this mean? [Ed. note: absolute dog doo?] Here are some overarching themes of the last year. Next we'll unveil our Fearless Predictions for 2006.

The rabid mergers and acquisition activity that marked 2005, as stagnant growth in some markets forced small companies to seek harbor with larger competitors and partners, shows no sign of slowing in 2006. From major carrier marriages like Sprint Corp. (NYSE: S) and Cingular Wireless and AT&T Wireless, to enterprise buying sprees by giant vendors Cisco Systems Inc. (Nasdaq: CSCO) and Juniper Networks Inc. (NYSE: JNPR), consolidation – and getting a leg-up on market rivals – was the name of the game.

Cisco’s acquisition of Airespace for $450 million earlier in the year was a particularly defining moment for the enterprise wireless LAN market, demonstrating that there will be no turning back from the concept of centrally managed WiFi networks. As yet, however, we haven’t seen major steps beyond that central concept into applications like voice-over-WLAN, RFID, and WiFi multimedia services. (See Where Next for WLAN?) Expect that to change over the next 12 to 18 months.

Holding Pattern
The rooster being a judicious sort of bird, some critically important wireless technologies seem to have been in a holding pattern the last 12 months. Several of the big ones, including mesh networking, WiMax, fixed/mobile convergence, and 802.11n high-speed wireless, all saw significant technological developments in 2005, but won’t actually be proved in the marketplace until 2006 – or, more likely, 2007 for 802.11n.

Paradoxically, metropolitan mesh networking got the shot in the arm it has needed for years thanks to the controversy surrounding Philadelphia's plans for a citywide public access network. The contract was awarded in 2005, and the network should be properly online next year. (See The Philadelphia Experiment.) This is when the public will really get to test how well mesh really works in a crowded radio environment for municipal and enterprise applications.

2005 has also been the year of so-called pre-WiMax technology, as Intel Corp. (Nasdaq: INTC) and a cadre of vendors have feverishly banged the drum about the benefits of mobile broadband, while actual interoperability testing trailed way behind the hype. But the first stages of testing (carried out in Beijing – how appropriate!) are now complete, and 802.16e – the basis of the mobile WiMax standard – has just been ratified. That means we should actually see some genuine WiMax-branded equipment next year and, with any good fortune, some actual interoperability between high-speed broadband networks.

Fixed/mobile convergence has been much touted by industry talking heads this year, but carriers and customers are still generally in a test-and-trial phase, at least in the U.S. Cingular Wireless and Sprint Corp. (NYSE: S) have been most aggressive on pushing forward with convergence plans.

And who can be really sure what is happening with 802.11n high-speed wireless? It's been a fractious year for 802.11n, which uses smart antenna technology to offer 108-Mbit/s-plus data transfer rates for the next generation of wireless LAN networks. Vendors are split about the best way to implement the upgrade, which is seen as a key enabler for WiFi multimedia services. (See Waiting for High-Speed WiFi.)

Now it appears that a merged specification may be approved next year by the Institute of Electrical and Electronics Engineers Inc. (IEEE) , which would mean ratified product on the market by 2007, Dog willing.

Delays and detours on the technology roadmap notwithstanding, the major development of the past year might be called a shift in consciousness. One thing is now clear about WiFi and other forms of high-speed wireless: Most people now expect a fast (and preferably free) wireless connection to be available when they open their laptops in airports, coffeehouses, offices, hotels, and other public areas.

This silent change marks a new era in mobile connectivity. Despite poor wireless coverage, security concerns, ridiculous pricing plans, and other snags, people are increasingly accustomed to the idea of WiFi being in the air around them and are generally much more au courant with new and emerging technologies than ever before. If nothing else, this is a change in social expectations that network managers, vendors, providers, and enterprises would all do well to be aware of – and to feed.

Dogs, after all, need lots of care and feeding.

Follow the links below for all our year-end wrapups:

— Richard Martin, Senior Editor, and Dan Jones, Site Editor, Unstrung

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