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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Thomas Mercer-Hursh who wrote (53203)	11/27/2002 11:37:50 PM
From: Stock Farmer	Read Replies (2) \| Respond to of 54805

Thomas, a very telling response. Essentially you have made the precise case why ubiquity is unnecessary. Folks aren't everywhere all the time. The vast majority of the time they are in very few places. And ANY solution that provides wireless data to these places is good enough for them. Enterprise, Home, School: these are the majority cases. Shopping mall, Bus stops, Lounges... Starbucks... just an example. The issue isn't whether or not we can get ubiquitous wideband data on my cell phone or on my WiLan hotspot. The issue centers around the most economical way of delivering bits-per-second-per person. I happen to agree with you that Enterprise (business use of wireless data) is the most important. And this doesn't mean the travelling executive. This means the local enterprise that equips its workers to be "always on" and unchains them from their desks to unleash productivity. Let's take a reasonable enterprise. People density at 250 sq ft/person. Let's give 'em 56 kbit/s bandwidth via wireless. That's 7 MBit/s per 100 radius. Um... that's about 20 GBits/second/square mile radius, assuming people are stacked only 1 deep. Count the number of base stations necessary to deliver a ubiquitous 3G solution to a 21 story downtown core and the situation becomes clear. Hotspots are the only solution to deliver the kind of bits/second/cubic foot necessary to cover the places that people are "most of the time". So the question must come down to whatever technology covers the hotspots most effectively. Guess which one wins? Here's a clue: to get the kind of bandwidth folks will find useful, the darn things have to be installed indoors, several per floor, every floor per high-rise. Who is going to be allowed to install the pico-cell inside the building? Your choices: (a) the IT departments occupying the premises, or (b) the Telco who runs a 3G network? Who has the CHANNEL to deliver the technology capability? It is the owner/operator/proprietor of the establishment. So the determining factor is whatever THEY select. And at the moment there isn't a lot of 3G for them to select from. Even if such suppliers started to spring up, they will be competing against entrenched channels partnering with the Gorilla of the Enterprise IT space (Cisco)... Ergo the battle for 3G in the enterprise is already lost... it's just a matter of time. In other words, I suspect 3G won't gain majority traction within the enterprise. Same for schools and other places where more than 30 active users might find themselves within reasonable proximity. Hotspots embedded within the IT infrastructure make too much sense. For home, the equation is different. 3G works for residential density, although stresses the installed base. The problem here is also one of channel and access technology. How do 99% of Internet users get to the Internet from home today, through their Cellphone? LOL. Yah, right. So to get this penetration, we have to expect a massive shift of behavior? Sure. And what is going to drive them to do this? If they dial up they do so at $0.00 per minute to an ISP. Answer this question: how are the majority of homes going to "go untethered"? They will take their existing access point, attach a wireless modem and attach another wireless modem to their PC or laptop or PDA or whatever. Not to mention the fact that homes are migrating towards "more than one PC". Anyone who thinks home networking will be centered on the cell phone is dreaming in technicolor. Sure, there will always be the loner with one laptop and one Cellphone who gets to their ISP via their cellphone... but these are more likely to be a minority. Which relegates 3G to a niche at home, at school and in the enterprise. Generalizing your statement (bold is mine): Having a connection available to check out news, stocks, sports, mail or whatever when one is in transit, but that isn't where serious data usage happens. So if 3G is only useful where serious data usage isn't happening, it's kind of hard to figure it will be the dominant wireless broadband data access technology. John