NEW YORK-As carriers’ capital expenditures race ahead of revenues, existing wide area and new local area data networks are poised to capture a good chunk of the market for corporate e-mail connectivity, today’s killer application in wireless communications.
“In Europe, the (3G) bids were so high that carriers are having a tough time justifying the prices they paid,” said Kevin Werbach, editor of Release 1.0 and former Federal Communications Commission Counsel for New Technology.
“Europeans are smug because they believe they have it better than the United States, where we are wireless connectivity snobs. But if you ask Europeans what wireless data they have other than short message service and some people in Finland buying soda from machines, no one has any idea.”
Werbach was a panel member Oct. 6 at a forum, sponsored by internet.com, on “Overcoming the Delivery Gap in Wireless B2B Applications.”
Fiber deployments coming online now are not generating revenue as fast as they are spending capital dollars, a situation that is leading to hard questions, said Ronald Spears, chief executive officer of MobileLogic.
UUNet, by way of example, has seen its capital expenditures vastly outdistance its revenues, and this has caused “the market to look warily on the backbone for wireless Internet,” said Robert F. Henrick, a partner and leader of the pervasive applications initiative at OgilvyInteractive.
Henrick, who has a doctorate in applied mathematics from Rensselaer Polytechnic Institute, has worked for Lucent Technologies Inc. and AT&T Corp.
While mobile carriers upgrade networks for 2.5 generation wireless, which promises data speed increases to 60-110 kilobits per second from 10-15 kpbs, newcomers are at work installing local area networks in public facilities like airports, Henrick said.
“I see a lot of efforts at LANs, although uniformity and ubiquity will take some time,” he added.
Unlike Europe, the United States has networks available for data and does not therefore need third-generation wireless to provide it, Spears said.
However, broadband networks will allow developers to build more security features into wireless virtual private networks. That capability will help raise corporate comfort levels for permitting remote wireless access to information more sensitive than simple electronic mail, he added.
“Bandwidth is not so much a problem on our networks as is latency,” said Joe Fung, chief technology officer for Blueflame Inc., formerly PCSI Inc. He called mobile and wireless business applications “the untold story” in the United States.
“The real applications are for PDAs (personal digital assistants) and tablets using CDPD (cellular digital packet data) and CDMA networks,” Fung said.
“The smart developer will build applications that work in an off-line mode and can be synchronized.”
Recognizing that e-mail is a “killer app for wireless,” Research In Motion Ltd. was one of the first companies to build a device “that does this well,” Werbach said.
RIM, a Canadian company focused on device design and manufacture, is poorly equipped, however, to clear the next hurdle in tapping the corporate enterprise market, Spears said.
“The demand for RIM by enterprises is just starting, with 400,000 deployed and under 100,000 (of these) with Blackberry e-mail, but this appears to be the device of choice for enterprises that are early adapters,” he said.
“A company like RIM is not prepared to manage a huge deployment of many small devices by companies that expect 10,000 to 20,000 ready in 30-90 days. That’s why companies like MobileLogic have entered into partnerships with RIM.”
Corporate customers also require ongoing software updates and asset management services, including immediate discontinuation of service to lost devices.
“We like Palms, Pocket PCs and RIMs because they allow us to build applications for the enterprise that are collaboration tools allowing people to work better, faster and cheaper,” Fung said.
In Henrick’s view, the connectivity and synchronization offered by Bluetooth and other technologies, “on some of the higher frequencies with higher bandwidth, may be more important than cellular networks.” Ultimately, Bluetooth will facilitate applications that allow users to get information they need without having to connect to a centralized database, he said.
It is up to software developers to create enough applications with high revenue potential in order to encourage large scale production of Bluetooth chips, Fung said. Doing so will drive down the price, now about $50 per chip, to the $5 level that will push Bluetooth into widespread use.
Henrick cautioned the software development community to take better care in its development of applications for Web and other wireless access.
“It is really easy to build s–y services for small devices. The design effort needs to become more sophisticated,” he said.
