Launching a WLAN Integrator
May 03, 2002
Startup Nvisicom wants to be seen as the leading installer of 802.11-based networks for homes and businesses -- and with the right partnerships could just reach its goal.
Randel Maestre, president and co-founder of Costa Mesa CA-based Nvisicom Networks, Inc., likes to tell two stories that illustrate the opportunities -- and challenges -- his new WLAN "solution provider" business faces. The company sells WLAN hardware and consulting and implementation services in southern California.
First story: When he moved into his new Orange County home last year, Maestre contacted three local networking companies, posing as a typical naive homeowner with multiple PCs that he wanted to network together.
"Two actually told me that it would be 'very difficult,' that they would have to go into the walls, and that I would have to put up with wires trailing across floors," Maestre recalls. "The other said he had 'this wireless solution' but it 'wasn't very secure.'"
Maestre cites market data that shows there are 34 million households in America with multiple PCs. Only 14 percent are networked, he says. It's a huge opportunity for wireless LAN vendors, especially given the obvious advantages of wireless over wired in the home.
Not that Nvisicom is focused exclusively on the residential market, Maestre says. It is also targeting small and medium enterprises where WLAN technology has a low penetration rate.
His second story confirms there is an opportunity and a challenge specifically for companies like Nvisicom. Maestre was in a major big-box technology retailer recently and saw the area where staff store returned products.
"I won't mention which vendor's products it mainly was, but there were a lot of wireless LAN products on that shelf," Maestre says.
The implication: small businesses and homeowners want what WLAN technology offers, some even know about it and are buying it, but too many are then finding that it's not as easy as everyone has been saying to get the technology to work properly. Which is where Nvisicom comes in -- or hopes to.
The question is: how does a small systems integrator/installer like Nvisicom exploit some of the vast market potential these anecdotes speak of and make a viable business of it? Maestre thinks he has the answer.
Solutions and Services
Maestre and a silent partner launched Nvisicom in November 2001. It only has a handful of small business implementations to its credit so far, and another handful of home installs. Still, Maestre believes they're on the right track.
The partners have a combined 20 years experience in the WLAN business. They worked variously in sales, marketing and technical support on AT&T Wireless's pioneering WaveLAN product -- now ORiNOCO. Maestre was there virtually from day one, he says.
"Most people think this technology has been around for the past year or two or three years max," Maestre says. "But WaveLAN was the first to market in 1990. We've been living and breathing this technology ever since."
He decided to form Nvisicom because he believes there has generally been too much emphasis in the past couple of years -- boom year for WLANs -- on bits and bytes, and not enough on building reliable solutions that work and deliver real benefits.
"We truly believe in solutions and services," Maestre says. "And we believe the wireless LAN industry in general is missing that piece.
The industry has also exaggerated how easy it is to implement WLAN technology -- with the kind of results Maestre observed at the big box retailer. That exaggeration is a significant market inhibitor, he believes.
Nobody would suggest a consumer set up his own mobile phone cell site, Maestre points out. Yet many of the issues that complicate implementation of wide area wireless networks also impact WLANs, such as security, integration with wired LANs and WANs, and propagation issues.So WLAN customers need the kind of help Nvisicom can provide, and they're willing to pay for it, Maestre insists, even in the notoriously low-margin residential market.
Nvisicom's strategy for building a business to take advantage of these opportunities has two complementary planks. The company will keep a tight focus on its core competency of WLAN "solution building." And it will form partnerships both as a way to supplement its skill sets and as a way to generate new business.
The partnership principle starts with the basics. Nvisicom is building a direct sales force -- 15 strong so far in southern California -- by partnering with independent sales agents and installers.
Maestre was visiting the retailer mentioned in his story because he's looking to forge partnerships with retailers willing to recommend Nvisicom to WLAN customers who buy hardware but are unsure about installing it or have trouble installing it.
The company already has partnerships with network and systems integrators such as Smplsolutions of Lake Forest CA, a company that focuses on voice telephony and structured cabling for small business customers, and Santa Ana CA-based mUrgent Corp., which does wide area mobile applications.
"If we get into an opportunity that needs structured cabling, we have a partner that can fill that void," Maestre explains. "If we need a security-related solution we can deliver that through another partner."
This is in contrast to other LAN and WLAN integrators who try -- usually unsuccessfully -- to do it all, he points out. The approach also generates new business for Nvisicom.
"We've already been brought into quite a few [of our partners'] accounts," Maestre says. "They see the benefit of wireless, but instead of trying to get up to speed on it on their own, they bring in our expertise."
Another key partnership is the one announced recently with Corona CA-based FSCi Inc., a high-speed Internet service provider and operator of Web-storefront and customer-education portal sites.
Maestre believes high-speed ISPs will be a valuable source of WLAN customer leads. Once a small business or residential customer has high-speed service, there is a strong incentive to network computers in order to distribute the bandwidth to all.
FSCi and Nvisicom have partnered on a new Web site, EverythingWirelessLAN. It will be linked from the other half-dozen FSCi-operated Everything portal sites, which together garner about 75,000 hits a month from FSCi customers and others, Maestre says.
The idea is that FSCi customers who want to install a wireless LAN to distribute a high-speed service throughout their facility will find Nvisicom through the site. Launched April 7, it has yet to deliver a sale. But it has brought enquiries from other high-speed service providers interested in partnering in the same way.
"This is the first, but it's most likely not the last," Maestre says of the FSCi deal.
EverythingWirelessLAN has also attracted enough enquiries from prospective customers outside Nvisicom's current southern California market area to help the company figure out where it should expand next -- probably to central California and/or parts of Arizona. That should happen in the next three to six months, Maestre says. Eventually Nvisicom will start moving east. Ultimately it has ambitions to be a national player.
The plan is to find local partners and sales agent-installers in each market the company enters. The residential side in particular is a very local, as well as low-margin, business. (The company typically charges between $75 and $100 to install a home WLAN.) Dispatching installers from a central depot would be impractical. There isn't enough margin to allow for employees driving great distances.
There are some soft spots in Nvisicom's strategy of cobbling together a virtual WLAN integration firm through partnerships. For one thing, building and maintaining relationships with partners is a long way from being a no-cost proposition. It takes considerable management resources -- resources Nvisicom will have to build. There may be questions about whether the company can control quality if it relies as extensively on partners as it says it will.
It's an interesting approach. It will be interesting to see how Nvisicom's story unfolds.