The Future As Seen Through Technology – wi-fi

The Future As Seen Through Technology – wi-fi – Industry Overview

Dan O’Shea

Byline: Dan O’Shea


Wi-Fi profitability was an elusive concept even before Verizon Communications announced recently that it would offer free Wi-Fi access to its DSL customers. And while Verizon hasn’t said whether it will ever attempt to make money off Wi-Fi as a stand-alone access medium, the implication thus far from major carriers is that they don’t think they can.

Steve Nicolle thinks carriers just haven’t been shown a viable option for making Wi-Fi profitable. As a veteran of the Wi-Fi business for all of four months, but with 18 years under his belt working for carrier-focused telecom vendors such as Nortel Networks and Sigma Systems, Nicolle’s perspective is more deeply rooted in the business realities of carriers than in the fascinating capabilities of a rapidly growing access technology.

The soft-spoken Canadian is president and CEO of Tatara Systems, a company that has developed a carrier-grade Wi-Fi service delivery platform tailored to fit right in with a large carrier’s operational infrastructure.

Despite all the Wi-Fi hubbub, the mercurial industry lacks solutions that are sensitive to the operational and management needs of large carrier networks, Nicolle said. Meanwhile, much-heralded plans to build out hot spots by the thousands, a confusing array of technology choices, and a failure to leverage the nomadic nature of Wi-Fi users in the creation of business models are issues that have made the market look like a scary place for cost-conscious but profit-driven carriers to play.

“Public Wi-Fi will happen,” said Nicolle. “It will be important to Tier 1 service providers, but to turn a profit, you need to realize it will be a shared network medium and a heavily roaming-centric market. Most usage by carriers’ customers will not occur on their home networks.”

In fact, as much as 80% of a given user’s Wi-Fi transactions may happen under hot spot coverage owned or operated by another carrier or retail service provider, said Kevin Jackson, co-founder and vice president of marketing at Tatara Systems.

As various hot spot network operators blanket public areas like airports, the cost of providing Wi-Fi drops dramatically as an increase in the number of user sessions becomes more likely with greater coverage. For example, in an airport such as New York’s JFK, a service provider can make a return on the cost of providing access even if as little as 1% of the day’s visitors use it, Nicolle said.

What carriers need in light of these facts is something at the operational and management layers of their businesses that allows them to develop a distinct bond with roaming users. Providing measurable quality of service and offering value-added features on top of vanilla Wi-Fi access will strengthen that bond.

Tatara’s new hardware/software product suite, the Wi-Fi Service Delivery Platform, includes a subscriber gateway for centralized deployment in a network operations center or a central office. It encompasses the authentication functions of a Radius server, along with many other support features from billing and mediation databases, application servers, OSS reporting tools and other network elements. The SDP also includes a service manager client software piece that reports quality-of-service information back to the subscriber gateway.

Tatara currently has a lab trial with a Tier 1 network operator; commercial availability is expected later this year.

“The gateway maintains an ongoing connection with the end user,” said Jackson. “The retail service provider can provide notification of location-specific services, presence awareness, SLA auditing and other applications even if users log in to their enterprise VPNs.”

These applications could include “local” applications, such as a printing service offered by the owner of a specific hot spot, or “global” applications such as multimedia messaging offered by the retail service provider. The SDP product family also includes an optional partner gateway for managing billing and settlement between retail and wholesale Wi-Fi partners.

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