The Holy Trinity of Wi-Fi

Having just returned from the annual CTIA Wireless show in my home town of New Orleans, I was overwhelmed by the emphasis on 802.11 Wi-Fi networks over the traditional cellular and wide-area networks that have typically dominated the headlines for this event. From major wireless carriers to mobile handset manufacturers and other major players in the mobile value chain, support for these expanding 802.11 network "hotspots" is growing exponentially.

Even Dr. Irwin Jacobs, CEO of Qualcomm, devoted a portion of his speech to attacking the business models of Wi-Fi networks, trying to diffuse some of the mounting emphasis on this technology while touting the benefits of Qualcomm's CDMA. While I had challenges completing a mobile phone call from inside the massive convention center, my e-mail and the Internet were readily available from my Toshiba e740 Pocket PC with built-in wireless LAN, thanks to the T-Mobile Wi-Fi "hotspots" throughout the convention center. T-Mobile has also deployed such hotspots at over 2,100 Starbuck locations across the country.

NNo visit to New Orleans would be complete without partaking in one of the many award-winning Cajun restaurants. As I enjoyed my crawfishé toufée at K-Paul's, the culinary haven of world-renowned chef Paul Prudhomme, I was reminded of what Chef Prudhomme refers to as the Holy Trinity of virtually every Cajundish: onions, celery and bell peppers. And it occurred to me that the Holy Trinity of Wi-Fi is Voice, Data, and Location.

Voice

While Voice-over-IP (VoIP--voice delivered using the Internet Protocol) for Pocket PCs is still in its infancy, one only needs to look to the penetration of VoIP into corporate America to see its potential for Pocket PCs. As Wi-Fi support becomes a standard feature in most Pocket PCs, VoIP will have an increasing number of adherents.

Today, traditional wireless voice technologies (CDMA, GSM/GPRS) are dominant in converged Pocket PC phones such as the T-Mobile Pocket PC Phone Edition, the Toshiba 2032, and phones from Samsung and Hitachi. While these technologies will continue to be the networks of choice because of their coverage advantage over Wi-Fi, significant cost advantages exist for Wi-Fi networks deployed in airports, convention centers, hotels, coffee shops, and cafés as the numbers of subscribers and devices grow significantly.

In the future, converged wireless Pocket PC devices will be equipped with both 802.11 Wi-Fi and traditional CDMA or GSM/GPRS. With intelligent switching software, being developed by Wi-Fi hotspot aggregator Boingo Wireless among others, users will be able to leverage low-cost Wi-Fi networks to complete voice calls. Users will be able to make VoIP calls over Wi-Fi networks but automatically switch to the superior coverage of traditional wireless voice networks (albeit at higher costs) when Wi-Fi network coverage is not available.

In a recent conversation with the CEO of Leap Wireless, a leading flat-fee wireless voice carrier, I asked about leveraging Wi-Fi networks in addition to the CDMA networks the carrier currently deploys. Unlike the leading wireless voice carriers, Leap Wireless claims to provide service where customers live, work, and play, instead of a wide coverage with roaming support. While coverage is a trade off, the $32.99 unlimited flat-fee pricing is attractive to Leap's customer base, and Leap Wireless boasts a cost per minute of approximately three cents as compared to a much higher per-minute cost for the major carriers. Using economies of scale with VoIP technology, Leap Wireless could leverage Wi-Fi networks to reduce this cost per minute to one cent or less. This is what makes Dr. Jacobs nervous, as well as wireless carriers who have invested heavily in CDMA/GSM/GPRS technology and licensed wireless spectrum. Forward-thinking carriers like T-Mobile and AT&T, however, understand that these networks can be complementary and have embraced Wi-Fi. Overtime we will see seamless migration from Wi-Fi to conventional wireless, and then VoIP will be much more practicable.