Once too unreliable to build a business upon, Wi-Fi technology is becoming an effective multi-purpose tool for service providers
As recently as a year ago, “wireless broadband” meant cellular networks. But recent developments are making Wi-Fi an attractive option for everything from traditional hotspot networks to business-grade WLANs (wireless local area networks).
Because Wi-Fi operates in unlicensed spectrum, and because it has relatively weak signals subject to occasional interference, Wi-Fi historically has been best suited for WLANs in residences or small businesses, connecting a few PCs and maybe a computer peripheral or two.
That made Wi-Fi common enough to imbue it with the potential for wider use. In the last two to three years, makers of game consoles, set-tops for accessing Internet video, DVRs, gateways, TVs, handhelds and other devices have happily leveraged the widespread presence of Wi-Fi routers in homes and coffee shops.
There is now a sort of perpetual feedback loop in which consumers demand more broadband services, and demand that access be available in more places, which encourages consumer electronics manufacturers to create more electronics devices leveraging Wi-Fi connectivity, which leads developers to generate more mobile applications, which inspires more consumer demand. … It’s another instance of consumers taking control of technology (see “Consumers are calling the shots: Better get used to it”).
But for service providers? For the longest time, the most visible business use of Wi-Fi was AT&T’s network of hotspots, which dates back to 2003 when predecessor SBC announced a plan to set up 6,000 of them. That network now numbers more than 20,000 in the U.S. and more than 125,000 globally.
Last year, Cablevision began stringing up hotspots all around the New York metropolitan area. Time Warner followed in the New York City area, as did Comcast in Philadelphia and New Jersey. In April, the three signed a roaming agreement that would allow their respective customers to connect via each other’s hotspots.
It took six years for cable to respond to AT&T’s Wi-Fi network. Why so long? What changed?
As mentioned, people have a lot more Wi-Fi-enabled devices, and an increasing number of them – iPods, smartphones, e-readers, handheld game systems – are mobile. With these new devices literally in hand, consumers have a newly developed expectation that Wi-Fi will work like the wireless broadband they get with their mobile phones.
At the same time, the latest version of Wi-Fi, based on the IEEE 802.11n standard, is more robust than previous generations of the technology (802.11a, b and g) and is capable of perhaps as much as double the range.
Meanwhile, companies such as Ruckus Wireless and BelAir Networks have bolstered Wi-Fi with techniques such as beamforming, in which the signal is directed to avoid obstructions, and frequency hopping, which switches channels to avoid interference, meaning service providers can offer more reliable Wi-Fi based WLAN service.
Finally, better tools for managing Wi-Fi WLANs are becoming available.
The technology is simply more robust and easier for service providers to implement and manage, and the demand is already there.
Among them, Cablevision, Comcast and Time Warner Cable have more than 20,000 hotspots in the Northeast. BelAir Networks is one of the main suppliers of that equipment.
Dave Park, vice president of product marketing at BelAir, said the three MSOs have the back office systems in place to verify and authenticate each other’s subscribers. Furthermore, they can react appropriately depending on the different service plans different customers may have – one customer might subscribe to a tier that provides free access, for example, while another might subscribe to a tier where day charges for Wi-Fi access apply.
The Northeast corridor from Connecticut to Philadelphia is heavily populated, and heavily traveled, which might make it easier to justify implementing a hotspot network, but Park disagreed. “When we deploy, it’s in a targeted manner – we deploy where people tend to congregate, along any street with a cluster of restaurants or medical offices, campuses, train stations and other transportation hubs. It makes it very cost-effective for any urban or suburban area,” he said.
He said the company has deployed hotspots in areas with only thousands or tens of thousands of potential users in North America and Europe.
Service providers who have Wi-Fi hotspots have not been in the habit of releasing any information about how much money Wi-Fi networks make. The widespread view is that a hotspot network is not a big moneymaker.
“It’s a retention strategy,” said Andy Fuertes, senior analyst with Visant Strategies. “It makes it more attractive to a customer to stay and less attractive to run off to FiOS or to a satellite service.”
FEMTO AND PICO
A few years ago, mobile handsets that connected to both wireless networks and to Wi-Fi networks began to appear.
The idea was that when roaming, the phone would connect to the cell network, but when home, it would switch to Wi-Fi mode and connect instead to the broadband service (DSL or cable modem) via a femtocell.
Those phones never caught on much in the U.S., and some makers discontinued their products, but Wi-Fi chips have become so inexpensive “that many phones are just tossing it in,” said David Callisch, vice president of marketing at Ruckus Wireless.
BelAir this summer introduced a new twist on the concept of cell backhaul specifically for cable operators, with Wi-Fi as a complementary component.
BelAir’s new picocell is a modular base station with modules for various types of cellular traffic (GSM, CDMA, eventually LTE) so that a cable operator can provide cellular coverage in a relatively small, defined area; the picocell also incorporates a cable modem so that the cable operators can treat the wireless coverage areas as just another node on the HFC network.
That’s the backhaul element. But in addition, the picocell can also create a Wi-Fi hotspot. Why could this be a great opportunity for cable?
Wireless network operators need more capacity, and they are going to keep needing more capacity for some time to come (see the “Mobile Backhaul: Ongoing Opportunities” wallchart bundled with this issue).
To put a new cell site in, a wireless network operator needs a location, power and backhaul capacity, explained Park.
But there are a diminishing number of physical spaces left to put new cell towers. Mobile network operators are adding more towers per site and expect to keep doing so, but demand is still fast outpacing these operators’ ability to build. So there are places where a cellular network operator can’t get coverage and others where they can’t get adequate coverage.
Cable operators, conversely, have network infrastructure in places where wireless network operators need backhaul; a picocell, or a strand of picocells, can be dangled anywhere off of an HFC network to provide additional backhaul capacity anywhere it’s needed. Cable’s DOCSIS networks are powered, and MSOs can add as much capacity as they need. Cable’s got location, power and backhaul capacity, Park pointed out.
Cable operators could set up backhaul, plus establish their own Wi-Fi hotspots in parks, plazas and other public places.
And, Park reminded, some cable companies own spectrum (they include Comcast, Time Warner Cable, Advance/Newhouse and Cox) that can be used to provide their own wireless networks, should they so desire.
“You get purpose-built Wi-Fi backhaul,” Callisch noted, “and you get to extend your cellular presence.”
“Cable gets a new model beyond dollarsfor-bits,” Park said, “and they get to leverage their HFC networks – their key asset.”
“Broadband is a land grab, and wireless is the easiest way to extend your presence,” said Callisch, “and you can do it for a fraction of the cost.”
He said that while companies like Cablevision, Comcast and TWC are putting strands out, they’re also looking at the SMB market. Companies like AT&T and France Telecom are already pursuing this market. Universities, hotels and sports venues are great target customers, Callisch said.
“We’ve been doing work, even with events like Lollapalooza,” Park noted.
Charter Communications has been providing Wi-Fi service for hotels. Charter call centers are the in-room support, noted Pete Hicks, director of product management for Charter Business.
And just weeks ago, the company began targeting SMBs with a managed Wi-Fi network service. The early response, said Hicks, has been positive and favorable.
“Our roadmap is to move into larger venue spaces,” he said. “There’s a need out there, and we have the infrastructure to support it. It’s very complementary to our HFC and fiber offerings we have today.”
Providing WLAN services is a good new business, of course, but that same avenue could also be exploited to extend an operator’s own wireless reach.
The proposal is to install base stations (rather than simple routers) on a customer site, broadcast an SSID (service set identifier – a signal that identifies a WLAN), “and all of a sudden you’re leveraging someone else’s fixed lines,” Callisch said. That could be a business customer, but there’s no reason why it couldn’t be a residential customer.
Meanwhile, more robust Wi-Fi access in hotspots is likely to feed into consumer demand for more robust Wi-Fi at home.
“As more IP devices with displays are coming available, that’s going to change consumer behavior,” said Lior Weiss, vice president of marketing at Celeno Communications. “Consumers will increasingly demand to watch video content on smaller screens, and that will drive carrier-grade Wi-Fi.”
There are six or seven IP devices in the average home, observed Carl Leuschner, senior director of HIS product management at Charter, and that’s likely to double or triple in a few short years. “What’s not often discussed is that as you push speeds up past what DSL can do, to 10, 20 megabits a second, you don’t need one killer app to drive the need for bandwidth. When you add six or eight devices, that’s all you need to increase the need.”
Charter is among the first MSOs in setting up home networks as a service for its customers. It’s a relatively new service, but it has exceeded expectations. The take rate with new customers, Leuschner said, is in the low double digits. It’s a revenue generator, he said.
The company is currently supplying its customers with a gateway – a router/modem combination.
“We’re not seeing beyond that yet, but we expect to,” Leuschner said. “That allows you to help customers with connectivity issues. You may have a consumer who has four devices that are getting good connectivity, but two that do not. You want to be able to look at those two and be able to say, ‘Oh, that one’s got the wrong password,’ or, ‘That one’s not getting a good signal.’”
There is a lot of effort in the vendor community to make Wi-Fi more reliable. Some are talking of “carriergrade Wi-Fi.”
Celeno defines carrier-grade Wi-Fi as 100 Mbps throughput in the home with no packet loss or resistance to interference in houses and apartments. The company provides Wi-Fi chips that offer carriergrade Wi-Fi through techniques such as beamforming and smart antenna arrays.
That’s a data rate and a level of reliability that might very well appeal to service providers, who want to support their customers’ ability to transfer HD video around their homes, but who require whatever means of distribution they choose to also support a high quality of experience level. So far, cable has relied largely on MoCA and DLNA for home networking (see “Coming to a home near you: Multi-room DVR services” on page 22), but having a wireless option to complement other techniques would be useful.
“Now with the technology becoming mature and more service providers adopting it,” Weiss said of Wi-Fi, “we expect to see a desire to embed the technology in gateways and set-top boxes.”