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New Horizons for Corporate Data Access

Broadband is everywhere, or so it seems.

Most companies of any size have high-speed connections to the Internet, as well as fast Ethernet networks in their offices that give staff instant access to corporate data. Several million homes are now wired with fast Internet access via Digital Subscriber Line or cable modem technology.

But broadband is by no means a done deal. Huge swaths of business -- small firms, firms in smaller towns, and the huge percentage of workers who don't work in gleaming office buildings, from traveling salespeople to warehouse staff -- don't have the fast connections to the Internet and corporate data that their cubicle-ensconced colleagues exploit to do business better.

That's why, in the next two years, analysts expect businesses to adopt broadband even more widely, taking it beyond the head office.

Connecting Telecommuters and Small Businesses
Although intended for the home, 7% of businesses now use DSL or cable modem connections, reports research firm Ovum. One reason is that many users tend to do at least some telecommuting, such as accessing email, from home. And small businesses -- from one-person consultancies to local real-estate firms -- are discovering that the low cost of DSL and cable modems makes high-speed Internet access an easy decision.

Real benefits wanted. "Broadband is becoming ubiquitous," notes Mack Leathurby, director of network solutions management at Avaya Inc., which provides broadband infrastructure and applications. "But it's only now that we are seeing practical applications that make businesses money or save them money."

For example, Avaya implemented a virtual call center for JetBlue Airways Corp. that lets its Salt Lake City call-center staff work from home, using high-speed network connections that carry both voice and data. This let JetBlue more easily add staff as demand increases, while giving employees more flexibility in where and when they work, he says.

"People spend only if they can get a payback," agrees Dave Muragishi, a strategic marketing vice president at Nortel Networks Ltd., a broadband infrastructure provider. He sees such payback in fleet management, dispatch, health care, utility, and construction applications.

Pricing issues. Providers are taking note of the business interest and starting to offer the security and service levels IT demands. But there's a dilemma: "It's difficult for the service providers to build in these new applications at the [typical home service's] $50 price," says Peter Jarich, senior vice president at Velo-Blue Consulting. That's why, for example, Comcast Corp. and Cox Communications Inc. both offer broadband services with virtual private network (VPN) security and faster upload speeds -- but at double the normal cable-modem service rate. For many potential subscribers, even the standard pricing remains an issue, Jarich notes. That's why cable providers Cox, Comcast, and AOL Time Warner Inc. are investigating different rates for different speeds, says Imran Khan, a senior analyst at the Yankee Group research firm.

A new twist on T1. There's another option for small businesses: technology from companies such as Focal Communications Inc. that use standard telephone lines such as T1 or frame-relay but run both data and voice rather than having separate lines for each. Micah Systems Technology Inc., a database management firm in Silver Spring, Md., is elated with its integrated voice/data service: "We used to use frame relay but it would slow down considerably when there was a large amount of traffic," says Eldna Smith, the firm's vice president. "We're saving $400 per month, half the previous cost," she adds.

Connecting Small Town Business
Because of the concentration of people and businesses, providers have concentrated their rollouts of broadband technologies to urban areas. So much of the country has been left behind. For example, Barry Maher, an author and business speaker, was shocked when he bought a house in Silver Lakes, Calif., a golf community in the desert between Los Angeles and Las Vegas and discovered no one offered broadband connections. "Nowadays, it's a business necessity. I couldn't do business without it," he says. The regional DSL and cable providers in Silver Lakes "both keep saying, 'It's coming, it's coming,'" but Maher has heard that now for more than nine months. Dial-up modem service is unreliable, with slow speeds and frequent drop-offs, he says after trying several providers. So Maher's still working out of Santa Barbara, an eight-hour drive away.

Options will get better for people like Maher. "We're finding an excellent appetite for broadband access in our rural communities. It's a win for the local communities and a win for the company that doesn't have to buy lots of real estate and find commuters," says Paul Bertino, marketing director for HickoryTech Corp., a Mankato, Minn., carrier serving rural Minnesota and Iowa. Mankato's population of 50,000 makes it a big city for HickoryTech; the typical size of city served is 2,000 to 10,000. Bertino points to Waseca, Minn. (population 9,611), as an example of rural broadband demand: 20% of the HickoryTech phone customers sign up for DSL, despite competition from cable providers.

Many local Internet service providers offer "wireless DSL" systems in rural areas. The technology transmits a Wi-Fi signal from a tower using a directional antenna. "The biggest issue is that they're line-of-sight. If you're in a flat terrain, you can serve a lot of the community. We're in river valleys, so you can serve some and you can't serve others," Bertino says. But he adds that non-line-of-sight technologies are coming along.

How rural providers connect their customers depends on the customer's location, density of users, and topography. That's why "there'll be some usage of wireless and wireline technologies to be able to provide broadband in rural areas," Bertino says. "We're trying to match the technology with the concentration of the customers."

Connecting to New Locations via Wireless
The broadband rage today is the wireless LAN, known by the name of the technical standard it's based on, 802.11, as well as by the Wi-Fi name created by a vendor consortium. Wi-Fi lets users connect to the corporate network almost anywhere in the building just as fast as standard wired Ethernet connections. "Wireless networks are proven in the enterprise," says Ovum senior wireless analyst Michael Doherty. "They have a relatively low cost to deploy. They can prove their return in a relatively short amount of time. They're relatively easy to maintain."

Specialty industries go first. Wireless LANs got their start -- and have their biggest user base -- in specialized industries such as health care, where workers are mobile and don't sit at desks. "Those workers have to have real-time information right in front of them," says Anthony Armenta, executive director of the Wireless LAN Association, a trade group. Although wiring cubicles and desks is easy, connecting a nurse's station, hospital bed, inventory palette, or loading dock is not. That's why, says Ovum analyst Doherty, "there's a lot of interest in the WebPad [wireless tablet PC] in the medical industry, and why inventory and retail have been proven markets for companies like Symbol Technologies Inc.," which offers wireless scanners and sales terminals. The next major adopters, Doherty expects, will be the tourism industry (both for roving check-in and for letting staff update repair and room status immediately) and field-force industries (such as delivery people, salespeople, repair technicians, real-estate agents, and property managers).

Corporate Express Inc., a Broomfield, Colo., distributor of office supplies, has put wireless LANs into 20 of its 30 North American centers, in spaces ranging from 50,000 to 300,000 square feet. A wireless LAN "allows the ability to move around, and you have the ability to change your layout without having to rewire," says Tim Beauchamp, senior vice president of distribution operations. Corporate Express typically gets a 30% return on investment from wireless applications, he says, but it got an even higher ROI from an unexpected application: a voice system from AccuCode Inc. With that system, warehouse staff wear a headset attached to a mobile device that connects via Wi-Fi to the central server. As a worker scans a package, the server relays instructions via synthesized voice, which Beauchamp says is easier for staff to understand than peering onto a handheld's small screen in varying light conditions.

In Lincoln, Neb., Avaya set up a directional wireless connection for the state Roads Department, which had a cluster of 10 buildings two miles away from its main facility. The use of directional wireless was cheaper and faster to set up than traditional T1 or T3 lines, says Avaya's Leathurby.

White-collar benefits. Wireless LANs offer a benefit to general white-collar business as well. "It's easy to convince the enterprise to buy wireless LANs by saying you'll put it on the laptops," says Doherty, because that lets users work anywhere in the building, such as in conference or training rooms. For that reason, "it will be very hard to buy a notebook in three years without Wi-Fi in it," notes WLANA's Armenta.

A great Wi-Fi use, notes Doherty, is putting up instant networks for temporary workforces, such as consultants, auditors, or accountants who come in for a specific project. The technology can also be used off-campus: Avaya set up a directional wireless network for Novell Inc., providing high-speed wireless access at home to executives living near the software maker's Provo, Utah, headquarters.

IT issues. Security is a concern for corporate IT managers, since wireless LANs are easier to break into than wired networks. "The IT managers who are resisting are resisting for credible reasons," says Larry Birnbaum, vice president of the Ethernet Access Technology Group at Cisco Systems Inc. "But the good news is that it can be dealt with," he adds. "A lot of people are investing a lot of development time in security," notes Ovum senior analyst Abby Christopher. Advises WLANA's Armenta, "You need to apply the same security technology to wireless VPNs that you do to your wired networks." The IT challenge "is to bring security without limiting the access and services for the enterprise," says Tony Pereira, a Nortel enterprise product development director.

Another key issue is proper installation of access points. Too many access points can create interference, while too few will create gaps. Furthermore, different building materials will affect an access point's range and signal quality, notes Corporate Express's Beauchamp. But IT managers can take heart: Figuring out the access-point layout is not too difficult, says Eric McHenry, vice president for networking testing at Agilent Technologies Inc., a provider of broadband testing equipment. Because "the 802.11 testing area is really heating up now, we're expanding our testing tools to be wireless-network­aware," he says.

Broadband wherever you go. Wireless LANs are causing excitement outside the corporation as well. Wi-Fi hot spots -- zones in public locations like hotels, conference centers, subways, airports, and cafés ‹let travelers connect to the Internet and, using a VPN, to their corporate systems from their notebook or PDA.

Noting this promise, several firms -- including Boingo Wireless Inc. and Gric Communications Inc. -- are stitching together networks of hot spots, so users can sign up for one account and have access at multiple locations. An industry consortium called Pass-One is trying to create standards for such roaming.

At the same time, Starbucks Coffee Co. and AMR Corp.'s American Airlines have installed hot spots from Deutsche Telekom AG's T-Mobile USA unit (formerly VoiceStream Wireless Corp.) in more than 1,200 locations, with the intent of creating a nationally available system. Starbucks reports that 93% of its customers use the Internet at home or work and that people increasingly use the café as a meeting location while en route, making it a good location for business travelers and mobile workers to go online.

THE CELLULAR BROADBAND OPTION
Wireless hot spots like Wi-Fi have stolen the thunder from cellular-based data networks, known as variously as 2.5G, GPRS, and 3G. Those networks -- now being rolled out by AT&T Wireless Services Inc., Cingular Wireless LLC, Sprint PCS Group, and Deutsche Telekom AG's T-Mobile unit, among others -- are slower than Wi-Fi, though somewhat faster than a dial-up modem. But they let business users connect almost anywhere their cell phone works.

Cellular data technologies also offer unique services, such as location detection, notes Dan Boerema, a senior vice president at AT&T Wireless, for example letting someone find a colleague at a trade show using their PDA's location. Likewise, data-enabled cell phones or wireless handhelds that include cameras are very useful to insurance adjusters, real estate agents, and technicians, he says.

Several companies are looking to marry Wi-Fi with cellular technologies, so users get the benefits of both Wi-Fi and cellular data. Nokia Corp. plans to deliver notebook cards that offer both technologies, while Avaya Inc. is working on similar technology for handhelds and phones. In the meantime, T-Mobile plans to provide users unified accounts for Wi-Fi hot-spot service and cellular data connections. "The key," says T-Mobile USA chairman John Stanton, "is being able to access your content commonly across all connections." AT&T Wireless is investigating a similar approach: "We think Wi-Fi is very complementary to our nationwide GPRS network," says Boerema.

Cellular data technologies are also expected to get faster in the next few years. One way is through a 3G variant called UMTS-TDD, which runs as fast as 3Mbps. Using technology from IPWireless Inc., several carriers (including WorldCom Inc.) have made UMTS-TDD available in Memphis, Maui, and Missoula, Mont., for about $30 per month. IPWireless plans to offer modem cards next year that support both UMTS-TDD and Wi-Fi.

An even faster technology is Motorola Inc.'s Canopy, which runs as fast as 6Mbps within a two-mile radius and can be extended to 10 miles. Unlike the other cellular technologies, Canopy doesn't accommodate mobile users: Each building needs a receiver, and each computer needs to connect to that receiver via an Ethernet connection.