Wireless WANs
We use the term wireless WAN to describe products and services that provide mobile wireless services using a single device over a wide geographic area. The core infrastructure for wireless WAN services is the cellular architecture that has been developed to support mobile voice communications. Today's 2G digital cellular systems offer greater cost benefits for service providers and more consistent voice quality for users. Unfortunately, these systems provide only limited data support, primarily circuit-switched wireless connections with data rates of 14,400 bps or less, and the lack of a unified standard has hampered market acceptance.
Although the limited data rate is the most common complaint regarding 2G cellular data services, the lack of always-on, packet-based services is a more significant impediment to application deployment. In fact, some of the early packet-based wireless services, including CDPD (Cellular Digital Packet Data) and Ericsson's Mobitex, have proven quite effective in enabling innovative mobile wireless applications, but these early systems are expected to be subsumed by more widely adopted standards, including GPRS (General Packet Radio Service) and CDMA (Code-Division Multiple Access) 2000 1X. Although there is some momentum behind both technologies, which offer packet-switched data services at theoretical speeds in excess of 100 Kbps, global deployment has been hampered by a dramatic financial downturn for telecommunication carriers.
There's little question that economic conditions will slow deployment of 2.5G and 3G services in the United States, but we expect to see all the major carriers broaden their data-oriented service offerings (see "Wireless Wide-Area Networks: Facing the Challenge 2002"). Look for AT&T Wireless, Cingular Wireless and VoiceStream Wireless to leverage their GSM (Global System for Mobile Communications)-based networks by expanding their GPRS offerings. Sprint and Verizon, on the other hand, are working on CDMA-based offerings, which may better position them in the long term.
It is difficult to imagine a scenario where the market fragmentation disappears, a reality that may hurt long-term acceptance. Meanwhile, the federal government is still struggling to find additional spectrum for 3G services, a move that is critical to long-term, high-speed data-service delivery.
Fixed-Access Wireless
Unlike other wireless technologies, fixed-access systems have nothing to do with mobility. Instead, they represent a cost-effective alternative to private cabling infrastructure or leased-line services. If you're faced with the challenge of interconnecting two buildings in a campus or metropolitan area when no pathway exists between the facilities, point-to-point wireless connections represent a reliable and cost-effective solution.
For around $5,000, you can implement a wireless Ethernet bridge that delivers better performance than that of T1 and pays for itself in less than a year. And because most systems are based on unlicensed radio technology and relatively simple radio/antenna designs, you can have the system up and running in a few days.
The market for point-to-point systems is maturing rapidly as vendors continue to improve value with higher data rates and enhanced management and reliability. A number of vendors, including Proxim and Western Multiplex Corp. now deliver cost-effective Fast Ethernet solutions and, if you are willing to secure FCC spectrum licenses, you can now acquire systems that provide several hundred megabits per second of performance. We expect significant developments in the coming year, particularly for high-performance systems running in the unlicensed 5-GHz band. Finally, don't overlook emerging fiberless optical systems that deliver high-bandwidth point-to-point services.
The point-to-multipoint market is a little more uncertain. The financial problems of LMDS (Local Multipoint Distribution System) vendors Teligent and Winstar may have soured some organizations on this technology, but the problems faced by these companies had more to do with ill-conceived business plans than faulty technology.
We expect LMDS systems to make a comeback within the next several years and think there is significant potential for systems operating in the MMDS (Multichannel Multipoint Distribution Service) band (see "MMDS Struggles to Find a Foothold", October 29, 2001). Not only has the market received a boost from the FCC's decision not to reallocate the MMDS spectrum, but it should benefit from forthcoming radio technologies designed to overcome the line-of-sight requirements of current offerings.
Despite the significant appeal of these wireless solutions, they all have substantial distance limitations and fail to meet the needs of users in remote locations. But satellite-based systems can deliver service virtually anywhere.
VSAT (very small aperture terminal) systems have been used for many years for low-speed data services, and they are now being offered for bidirectional broadband service. Some technical challenges still exist, particularly with temporary outages caused by heavy rain, but this technology is poised for broader deployment. And it's not just VSAT technology that is worth noticing. Large-aperture systems and even low earth-orbit satellite have significant commercial potential and should see development in 2002.
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