ORLANDO, Fla. Are the complimentary or competitive? That's the headache wireless local-area network (WLAN) systems provide for today's cellular operators. With WLAN systems growing in popularity and 3G technologies struggling, some in the wireless sector feel that 802.11b WLAN systems provide a better option for delivering wireless Internet access. These sentiments are placing pressure on cellular carriers, forcing them to find ways to integrate WLAN into their overall service mix.
"WLANs will be a nemesis for 3G networks," said Goli Ameri, president of research firm eTinium Inc., during a panel session Monday at the CTIA Wireless 2002 trade show. "The business case for 3G is not as solid as it once was. And WLANs are going to be ubiquitous," Ameri said. For that reason, wireless LANs pose a real threat to wireless carriers, she said.
John Stanton, chief executive officer of VoiceStream Wireless Corp., also called WLAN technology could a potential threat to the cellular sector in a morning keynote. For example, the rollout of services such as 11-Mbit/second 802.11 WLANs could take data traffic away from carriers, Stanton said.
But like others carriers, Stanton said he is also weighing the potential benefits that WLANs can bring to the wireless sector. Carriers could integrate WLANs with existing cellular networks to provide high-speed Internet access to such hot spots as airports and major cities, he said. With that in mind, VoiceStream acquired the assets of MobileStar earlier this year. Now this technology is being integrated with VoiceStream's other network offerings, Stanton said.
VoiceStream is not alone in its efforts. Analyst Ameri said Telenor of Norway and Telia of Sweden are also deploying WLANs in Europe, and other European carriers are following suit. "Carriers would much rather lose revenue to their own WLAN networks than wait for 3G," she said.
At present the market is wondering who will establish the 3G network. Al Javed, vice president of wireless networks technology at Nortel Networks, said the rollout of a wireless network will require roughly 3,500 to 4,000 basestations. Though basestations are not expensive, Javed said, the network will require power, maintenance and a high-speed link to each piece of linked equipment. "This is a pretty expensive proposition for a carrier," he said.
One possible solution for a carrier would be to work with a company that already has a WLAN setup, such as WayPort and Starbucks, but this would raise billing and roaming issues, and also involve an element of risk. The business model for companies setting up WLANs is shaky right now, Ameri said. With companies like MobileStar and Ricochet failing, the viability of a wireless LAN remains a nagging question, she said.
Once established, the seamless integration of WLAN and cellular networks is considered a key ingredient. "The way of the future is seamless connectivity," Ameri said. "The win is anywhere/anytime connectivity."
Several companies are working to bring that connectivity to life. Deepak Mehrotra, chief executive officer of Gtran Wireless Inc., discussed the development of PCMCIA cards that house both WLAN and cellular functions during a panel session. Gtran has already launched a product that combines 1xRTT CDMA functions and 802.11b connectivity, he said.
Others are joining the fray. Nokia has unveiled a similar product that delivers seamless handoffs between GPRS and WLAN networks, Mehrotra said.