A Look at In-Building Wireless
February 25, 2004
While the promise of wireless outfitted to a building like any other utility seems obvious, demand has yet to mushroom. But its time may be coming.
In his mind's eye, Ed Cantwell stares up at Chicago's tallest building. He sees more than just glass and girders. He sees an integrated wireless infrastructure that is as much a part of the Sears Tower as are its air-conditioning, heating and electrical systems.
"We fundamentally believe that wireless will become the next expected utility in a building, and when I say utility I mean just like centrally heating and cooled air, just like plumbing, just like electricity, where the tenants and the owners and the visitors will expect the building to allow for wireless services," said Cantwell, the president and CEO of InnerWireless , which in January announced that it would be outfitting the 110-story Sears Tower with wireless access available on all floors.
In-building wireless is touted primarily as a cost-saving measure. Rather than spending money to lay more fiber optics or cabling infrastructures, building operators can use in-building wireless technology to convert an optical or cable signal into RF, where the signal is then transitioned over to the WLAN.
While in-building wireless infrastructure is not a new idea, analysts say demand for this kind of capability will grow in the coming years as new economic models arise to justify the installation of such networks. ABI Research predicts the market for in-building cellular networks will break the $1 billion barrier by the end of this decade.
In the past, in-building wireless has been hindered by the lack of viable economic model. For a long time, it was unclear who would foot the bill for such networks, and who would stand to benefit. "There were some issues concerning revenue sharing between the company who would build the system versus the carrier versus the building owner," says Ed Rerisi, vice president of research at ABI.
Today that situation has evolved. With carriers eager to woo new customers, businesses eager to make Wi-Fi available to their employees, and building owners eager to lure new business tenants, the economics of in-building wireless infrastructure are shaping up to be a win-win-win situation.In situations where a single business may own an entire building, an increasing dependence upon Wi-Fi may prove to be the driving factor in the adoption of in-building networks. "They are saying: 'If I want to deploy Wi-Fi throughout my entire enterprise, maybe I should deploy this solution that gives me all my wireless coverage,' " said Rerisi.
At the same time, demand for better cellular voice access could give the Wi-Fi market a boost, by making whole buildings radio frequency (RF) friendly.
Some predict the early days of the in-building network will be driven by smaller players, in much the same way that Wi-Fi has ramped up not through big brand names, but rather through the efforts of smaller hotspot operators and home networks.
"Right now the carriers are waiting for the technology to mushroom, and in the meantime the landscape will be dominated by a number of small operators, which means there is an opportunity here for new players, or for WiFi operators to expand into voice-over-IP offerings," said Arun Handa, vice president of product management at IntelliNet Technologies . Once the in-building concept takes off, he says "then the carriers come in and acquire these deployed technologies and integrate them into their networks."
Will the technology take off? Cantwell is convinced of it, arguing that the efficiencies are just too good to pass up. In a traditional office, in-building wireless can reduce the number of access points needed to achieve full coverage by 50 to 80 percent, while improving throughput by 200 to 300 percent.
While some users may wonder about security on a shared network, Cantwell is quick to offer assurances. "Security is done in the digital domain," he said. "It is done with authentication, it is done with encryption, just like with your wired network."
If there's anything that will hold back the imminent arrival of in-building wireless, it is the large-scale economics of the day. For example, Cantwell closed on his first round of funding two days before 9/11, having previously signed up the World Trade Center as a customer -- that and tthe dot.com plunge, the terrorist threat, and the telecom collapse.
Before things really get rolling, "we have got to let the collective macro-economy settle back down," he said.