Big Savings or Big Hype?

— April 24, 2007

Voice over WiFi is set to save businesses a lot of money-- but not until at least 2008.

When David Hattey explains the big benefits--and big savings--related to voice over WiFi, he points to Europe.

During business and personal trips to Europe, Hattey, president and CEO of FirstHand Technologies in Ottawa, estimates that his smartphone helps him avoid about $100 per hour in cellular roaming charges.

What's his secret? Hattey's smartphone is a dual-mode device that supports both cellular and voice-over-WiFi services. Instead of logging dozens of hours on expensive cellular connections, he frequently makes calls in Europe using WiFi hotspots.

It will take a few more months for similar scenarios to be commonplace in the United States, predicts Ash Dyer, program manager for Cambridge Public Internet, a city WiFi project in Cambridge, Mass.

While dual-mode phones are plentiful in Europe, there are only a few such models available in the United States. Also, many European telecom networks provide "seamless" handoffs between cellular and WiFi systems, but such capabilities won't be widely available in the United States for at least another year, predicts Ed Golod, president of Revenue Accelerators, a technology consulting firm in New York.

"It seems like the device vendors are all waiting for a U.S. carrier to support tri-hannel--including WiFi--in their offerings," says John Southard, chief technology officer at New York Law School. "Of course, carriers have no incentive to do so since it may impact their billable [cellular] minutes. It will take a carrier with great vision and a long-term view to support voice over WiFi."

In the meantime, Southard is revamping New York Law School's IT infrastructure in preparation for voice over WiFi. He's currently working with Meru Networks to outfit the school with wireless switches, and he hopes to test voice over WiFi from MiTEL in the next few months. "I think we could deploy it within the next year in anticipation of a new campus building opening," says Southard.

His ultimate goal is to provide a seamless communications and messaging fabric that automatically moves students and teachers between WiFi and cellular systems. Getting Started
Proponents say the move to voice over WiFi is inevitable. Consider, for instance, a city with 500 municipal employees, each of whom is equipped with a traditional cellular phone. By switching to voice over WiFi, the city can save about $50 per employee per month on cellular service, estimates Dyer. "That's $25,000 per month and $300,000 a year in real savings," says Dyer. "If you carry that out over a couple of years, the city WiFi network has paid for itself. And that doesn't include the enhanced productivity from the communications features enabled by VoIP."

In addition to improving customer service in the field, voice over WiFi can enhance productivity back in the office. Today's enterprise switches, 802.11x wireless access points and WiFi handsets can allow factory workers, healthcare professionals and other types of employees to "walk and talk" as they move about warehouse floors, hospitals or more formal office settings.

The Home Depot, for example, is testing voice-over-wireless phones for workers within the retail giant's massive warehouses. Similarly, Fortune 500 giants such as The Boeing Corporation and Ford Motor Company each have more than 50,000 VoIP phones and are well-positioned for voice over wireless, notes Revenue Accelerators' Golod.

Small and midsize organizations are also answering the call for voice over WiFi. Current and near-term adopters include Federal Mogul in Southfield, Mich.; AFG Corp. of Kingsport, Tenn.; and United Health Care of Rochester, N.Y., says Dennis Holmes, director of wireless services at Outsource, a technology consulting firm that's assisting each of the deployments.

"Wireless VoIP offers immense value to mobile employees such as teachers, nurses and doctors," says Holmes. "It allows businesses to avoid the costs of rolling out traditional land lines," which have recurring costs every month.

"VoIP will prove to be one of the more powerful and universal uses for city and government WiFi systems, particularly with the coming plethora of new devices with software such as Skype pre-loaded," adds Jonathan Baltuch, president of MRI, a consulting firm that set up one of the nation's first city-wide WiFi networks in St. Cloud, Fla.

Voice over WiFi also sets the stage for so-called "presence" applications, asserts Richard McLeod, senior director for Unified Communications Solutions at Cisco Systems. Presence software allows a network to determine a user's location and his or her active devices (cell phones, papers, notebook PCs, etc.) to speed communications. When an employee is traveling, for instance, calls to the office can be automatically routed to the employee's dual-mode device, notes McLeod, without any type of preparation or intervention from the employee.

Remaining Challenges
Still, it will be six to 12 months before voice over WiFi gains a critical mass in the United States, predicts Golod.

At $400 to $700 per handset, wireless VoIP may be too expensive--at least initially--for some organizations to consider. Moreover, running voice over WiFi requires careful technical planning to ensure quality of service (QoS) and ample signal coverage.

"Voice is a far different application than data," says Golod. "If an email gets delayed for a few seconds nobody notices. But if a WiFi call gets delayed or dropped, IT is going to hear about it."

"Wireless VoIP faces a major challenge because VoIP protocols and WiFi have conflicting behaviors," adds Dyer. Specifically, VoIP protocols send small packets at regularly spaced intervals. Such timing methods work great on cellular or WiMAX platforms where a base station assigns time slots to subscriber units, Dyer notes.

However, Wi-Fi platforms don't adhere to such regimented designs. Instead, each WiFi client sends traffic whenever necessary and performs error correction until the traffic is transmitted. When mixing WiFi with VoIP, the result can be a five-fold drop in bandwidth with just two wireless VoIP lines running on the network, asserts Dyer. "This problem's too big not to be noticed, and I expect we'll start to see some solutions emerge in the next year or two," he says.

Already, some organizations use so-called "predictive simulation" technology to determine if a network design can sustain high data rate applications such as wireless VoIP. Motorola's LANPlanner software is one popular option for such testing.

To further enhance performance, IT managers are learning about Session Initiation Protocol (SIP)--a rapidly emerging standard for rich IP communications. SIP can be used for real-time services such as instant messaging and Web-based conferencing on a dual-mode device.

"Just about everyone is in learning mode right now with voice over wireless," concludes Golod. "We're sure to see some very successful deployments this year. But the big rollouts will begin en masse in 2008. You can bet CIOs will be budgeting for it."

Joseph C. Panettieri has covered Silicon Valley since 1992 and blogs daily at www.techiqmag.com.

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