Industry Insiders: Ruckus Wireless CEO, Selina Lo
March 24, 2009
Selina Lo, a marketing visionary and straight shooter who doesnt duck controversy, says over the next ten years Wi-Fi could evolve to become the only network for business.
Meet Selina Lo, Wi-Fi billionaire.
Okay, we dont actually know where Lo ranks on the list of the worlds richest people, but her bio at the Ruckus Wireless WebsiteLo is the companys president and CEOsays she sold the first entrepreneurial venture she was involved in, Alteon WebSystems, for $7.8 billion, to Nortel.
Now Lo is at the helm of a Wi-Fi company with an impressive, if short, history, and by all indications a very bright future. Founded in June 2004 by Bill Kish, its CTO, and Victor Shtrom, Ruckus is backed, to the tune of $40 million, by heavyweight investors, such as Sequoia Capital and Motorola Ventures. Its here for the duration.
Lo, a marketing visionary, is also known as a straight shooter who doesnt duck controversy. Thats the way she comes across on the phone: smart, articulate, opinionated. Our conversation ranged from the economy to Wi-Fis role in an increasingly crowded wireless landscape to the future of that much maligned phenomenon: muni-Wi-Fi.
On the recession
The deepening recession hasnt started to pinch Ruckusyet. The two markets the company targets are service providers and mid-tier enterprises. The impact is mostly being felt on the enterprise side, Lo says.
Any spending that is discretionary has been cut back. So it depends on the attitude of the particular company, whether they look at Wi-Fi as a discretionary part of the IT infrastructure, or whether its a must-have.
On the positive side, Wi-Fi is increasingly becoming a must-have, Lo says. The trend is definitely moving to Wi-Fi as the primary network medium. You may see some companies not doing any new cabling now. And over the next ten years, I think Wi-Fi could evolve to become the only network.
The service provider segment, Ruckuss traditional sweet spotthe company started off selling in-home Wi-Fi video distribution systems to IPTV providersis pretty stable. Lo adds, however, that companies are being a little cautious about depleting stock of Wi-Fi product first before buying more.
The recessionary impact also depends on geography. Weve definitely seen that the enterprise business in Europe has been severely impacted by this economy. North America has been less affected, while Asia remains quite vibrant.
Ruckus recently announced that its new ZoneFlex 802.11n Smart Wireless LAN products were selected by AirMedia Inc., a Chinese service provider, for use in a digital advertising network in over 50 airports in China. Ruckus also supplies Hong Kong mobile provider PCCW with ZoneFlex products to light up thousands of hotspots.
In terms of the mid-tier enterprise, yes, were seeing some impact, Lo says. But its not disastrous, and its more than made up for by our service provider activities.
On growth markets
Where will the industryand where will Ruckussee its growth coming from in the future? Despite the short- to medium-term pain in the enterprise market, Lo believes the mid-tier segment will deliver significant growth for Wi-Fi equipment providers.
Most of the Wi-Fi penetration in the enterprise has been at the top end, Fortune 1000 companies, she says. In the next tierLo calls them the unfortunate 50,000Wi-Fi has seen spotty use, often nothing more than an access point in the lobby.
Basically the mid-size enterprise is just starting to deploy Wi-Fi now. And we are seeing a lot of uptick in enterprises, such as hotels.
Hotels? Surely hotels were among the first to adopt Wi-Fi?
Maybe, but many still dont have it throughout their facilities, she says. And with the proliferation of Wi-Fi-powered BlackBerries, iPhones, and other mobile devices, hotels are increasingly under pressure from customers to provide wireless access.
Wi-Fi is the number three requirement when people start looking at booking hotels, Lo says. So we are seeing significant growth there.
The other growth segment? Surpriseservice providers, Ruckuss other main target market. But demand there is changing. Now service providers are apt to want Wi-Fi for hotspots and public access. Which leads to another topic of discussion.
On the death and rebirth of muni-Wi-Fi
Lo agrees that failed muni-Wi-Fi projects gave the industry a black eye. The problems, she says, were three: the wrong business case, the wrong technology, and poorly thought out implementations.
That was yesterday, though. Actually, we are now starting to see a reemergence of that marketbut in a whole different form, or several different forms.
The biggest problem with the business cases for first-generation muni-Wi-Fi projects was that Wi-Fi access was the whole point, she says. Now service providers in other sectorsmobile telephony, pay TVare using metro-wide wireless as part of a larger strategy.
Some want to increase subscriber stickiness, as well as attract new subscribers by offering a free wireless extension to home or business services. A number of cable companies have worked with WiMAX provider Clearwire to do this. But Cablevision in the New York area committed $300 million to building a Wi-Fi public access network across its entire coverage area.
Theyre able to hold on to their subscribers and gain new ones, Lo says. She quotes recently heard figures suggesting that 70% of recent Cablevision subscriber growth has come from its metro Wi-Fi users.
And when they gain a subscriber, she points out, it is not just a subscriber to their muni-Wi-Fi. Maybe its a subscriber who will also move their broadband service, as well as their cable TV service to Cablevision.
That strategy has been receiving a lot of kudos, and now other cable operators are doing trials to see if it might work for them.
On Wi-Fis role in the larger wireless universe
Mobile service providers, meanwhilesuch as PCCW in Hong Kongare using Wi-Fi to deliver public access as a way to reduce data traffic on their expensive 3G networks.
Hong Kong users are very sophisticated, Lo says. Theyre constantly on the Internet. So PCCW needed to off-load some of that traffic. Theyre doing it by putting Wi-Fi everywhere, even in old telephone booths. Those are Ruckus.
The company has 5,000 hotspots so far.
Subscribers are using Ruckus when theyre not moving. Voice calls are all on the mobile network, but if theres a good signal available, data calls use Wi-Fi.
Wi-Fi is being used in similar ways in developing markets, such as India, where government regulators have yet to clear the way for mobile WiMAX services like Clearwires Xohm, and China, which recently licensed 3G providers.
Chinese operators, she says, are contemplating what they call a c+w strategyCDMA plus Wi-Fi.
Its [Wi-Fi] becoming the wild card technologyto plug all holes that have to do with wireless broadband, Lo says.
On Wi-Fi versus WiMAX
But surely WiMAX is or will be a better bet to play the wireless hole-plugging role? Lo isnt convinced. Not surprising, perhaps, given her company is committed to Wi-Fi, but what she says echoes what others are saying and makes some sense.
I think the WiMAX investment is certainly much bigger [to build] an infrastructure. Thats one thing. And secondly: end points. Look at the number of iPhones, and how much users like using Wi-Fi for accessing the Net [with them]. And look at the number of phones that have Wi-Fi built in versus [the number with] WiMAX.
In the open market, Lo says, its a question of which technology has the ecosystem in place to move forward and support this type of use.
The ecosystem is ready now for Wi-Fi. For WiMAX, its just starting to geljust when the whole [economic downturn] happened. So its not even clear that WiMAX will ever become a prevalent, mainstream technology.
On Wi-Fi versus Femtocells
Femtocells, another technology that could usurp potential roles for Wi-Fi in the wireless world, are a different story.
If youre a cellular carrier, femtocells are a dream come true, Lo says. They can use the same technology [i.e. GSM or CDMA], but cover every corner inside. I think its something that will happen just because the technology has so much carrier support.
Femtocells definitely have a role to play in bringing mobile voice inside, she says, but as carriers such as PCCW in Hong Kong already understand, data is another matter. Flat-rate data plans, needed to attract a mass market to 3G, will cause overloading both at point of access and in backhaul, and that will mean bad performance, Lo says.
I believe in the end, the service providers cannot afford to let people throw everything on 3G or 4G. Theyre not going to be able to support the amount traffic it will generate.
Enter, again, Wi-Fi. And Ruckus.
Gerry Blackwell is a veteran technology journalist and frequent contributor to Wi-Fi Planet.