Wireless

March 16, 2004
Integrating Wi-Fi with legacy systems not easy

Jasbir Singh

Gartner hails Wi-Fi’s potential by asserting that the market for wireless Internet access using Wi-Fi technology is growing enough to produce a profitable business model.

BANGALORE -- While Gartner predicts 71,000 hotspots worldwide by the end of this year, and over 150,000 by 2005, these numbers depend on an ever-evolving business case and the ability to overcome a series of financial and technological hurdles. However, one thing is certain: Wi-Fi is happening!

Operators are moving into the public WLAN or Wi-Fi space, creating a buzz among the early adopters and the so-called "windshield warrior" business community. End users have access to Wi-Fi signals, thanks to Intel’s Centrino initiative. That puts the Wi-Fi compatible silicon in every new laptop. Cometa Networks, with support from influential partners such as IBM, Intel, and AT&T plans to build a nationwide Wi-Fi network, potentially bringing service to millions.

Still, carriers and service providers, who consider building their own back-end solutions to enter the public WLAN market or augment their current Wi-Fi network often underestimate the complexities, time, and costs that go into building a scalable, flexible, operations support system and integrating the new OSS with legacy systems. These complexities are stumbling blocks to Wi-Fi’s eventual success, and fuel debates on whether carriers should build their own networks or buy the necessary pieces to operate public WLANs.

Large incumbent operators have entrenched infrastructure to handle billing, CRM, NMS and other functions. Integrating Wi-Fi with these legacy systems is not -- as many carriers are beginning to discover -- a straightforward task. Attention is demanded in a number of areas, including:

• Remote provisioning and management of network edge elements that are critical to cost-effectively deploy and manage hotspots;
• Providing localised content and a customised portal;
• Administrator-managed user provisioning so administrators can determine which employees are authorised to get WLAN services;
• The ability to roam and interoperate with other network operators and aggregators;
• Native integration to legacy billing systems to allow operators to consolidate remote access service billing into legacy dial-up, DSL, VPN, and even voice services;
• Native integration with existing CRM and NMS systems to streamline operations;
• Seamless GPRS/Wi-Fi authentication and billing via integration with carriers’ HLR/SS7 networks; and
• The ability to scale the system to potentially hundreds of thousands of hotspots as subscriber demand grows.

To meet those objectives with an effective homegrown solution, a network operator must spend several million dollars in upfront R&D costs over an 18- to 24-month period. However, as the telecom industry slowly recovers from a devastating slump, many organisations are unwilling or unable to fund multi-million dollar custom development projects.

Finally, even the most optimistic forecasts predict that the public Wi-Fi opportunity is 18 to 24 months down the road. While that gives operators time to work out the kinks, it also parallels the expected product development period. It is possible that an operator could invest time and money into a homegrown solution only to see the window of opportunity close as the market grows in a different direction.

Some operators are following a course that obviates building a homegrown network, but lets them quickly enter the market by leveraging neutral host networks such as Wayport. While this is a good way to move into the space on a small scale, it is rife with problems in the long term because a neutral host does not have the infrastructure to support the huge rollouts that AT&T, SBC, Verizon, and others are proposing. Additionally, providers who attach themselves to neutral hosts must use services that work with the host’s technology, and thus cannot differentiate their marketing efforts. A carrier such as Cingular, for instance, could not duplicate its rollover minute’s policy because Wayport does not offer that capability.

A third option for carriers is to buy the necessary ingredients to roll out Wi-Fi or WLAN networks without investing in homegrown networks. Many operators are skeptical about off-the-shelf products that may not meet their specific requirements or, worse yet, may not integrate with their legacy systems. These are legitimate concerns. OSS systems must satisfy operators’ specific public WLAN requirements, while concurrently, remaining open and modular so they can integrate into existing equipment and interoperate with legacy gear.

New features, VAS likely on Wi-Fi

Since Wi-Fi is a nascent technology, ongoing development will produce new features and value-added services such as VoIP, video/music downloads, online retailing and other services that must be quickly integrated into any ongoing offering.

The risk factor is considerably reduced when an operator purchases a vendor-based solution that focuses on a specific application. This lets the vendor spread developmental costs across multiple customers and trend consumer demands from those customers for easy technology integration. Several Wi-Fi OSS systems offer minimal upfront licensing fees and ARPU-based pricing to help operators enter the Wi-Fi market with minimal upfront costs but still grow their networks as demand increases.

Operators who choose the homegrown approach face a 36-month breakeven point, following at least US $2 million in investment and 18 months of upfront custom development. An off-the-shelf solution can provide a six-month market entry point with tens of thousands of dollars of upfront investment.

(The author is president and CEO of Pronto Networks. He can be reached at jasbir.singh@prontonetworks.com.)