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Carrier WiFi

Hotspots Risk Early Grave

The public access wireless LAN market risks withering and fading like an old bouquet unless serious steps are taken to slash tariffs and extend 802.11 coverage areas, according to the results of Unstrung’s November poll: 802.11 Hotspots: A Burst Bubble?.

Launched to an earlier fanfare of media hype, hotspot services have to date failed to become a serious revenue generator. In response to whether public access hotspots can ever become a cash cow, 28 percent (of 212 respondents) insist that such services will never make any real money, arguing that “hotspots have limited appeal in specific venues. Leave 802.11 technology to the enterprise.”

26 percent of the vote take the opposite view, believing “it’s only a matter of time before the hotspot wave has mass appeal.”

The majority (47 percent), however, claim “maybe, but we still haven’t seen a foolproof business model.”

So how can we breathe new life into the not-so-hotspot sector?

The favored cure is “increased coverage areas and the emergence of ‘metro-zone’ 802.11 networks” (32 percent).

Such opinion jibes with a recent Unstrung Insider report noting that a whole school of startups such as BelAir Networks Inc., Radionet Oy, and Strix Systems Inc. have set up shop in an effort to extend the coverage of today’s isolated and widely distributed hotspots (see Startups Rescue Hotspots).

Two main approaches are being adopted in the deployment of metro-zone 802.11 projects: point-to-multipoint systems and mesh-based systems.

Point-to-multipoint systems are products that operate with wired backhaul in traditional point-to-multipoint mode and use high-gain, directional antennae to increase coverage. Another approach to extending the range of 802.11 is to deploy access points in a mesh configuration, where each device acts as a network node and sometimes as an access point, usually with auto-discovery and self-healing software built in.

Of these two, mesh-based systems are deemed likely to be most successful in extending coverage areas (49 percent), compared to point-to-multipoint systems (34 percent). A cynical 17 percent claim that neither approach will help. [Ed note: Look, the glass is half full, ok?]

Almost as welcome as extensions in network coverage would be a dramatic cut in hotspot tariffs. 31 percent of respondents believe “sensible tariffs” are critical to future public wireless LAN success. “Stop this $10 an hour nonsense,” they beckon.

Other potential industry saviors include “the launch of dualmode 802.11/cellular handsets” (20 percent), “a revolution in hotspot roaming” (11 percent), and “somebody bursting this crazy WiMax bubble” (5 percent).

Moving on, this month we’re asking for your hot tips for 2005. And while you’re at it, feel free to poke fun at the technology doomed to inevitable failure and market mockery. Have your say here: 2005 Market Forecast.

— Justin Springham, Senior Editor, Europe, Unstrung

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