partner channel: Enterprise Wi-Fi Moves Into the Spotlight

Posted: 3/2004

Enterprise Wi-Fi Moves Into the Spotlight
By Tara Seals

While hotspots were the rising stars in 2003, corporate Wi-Fi applications are bound to grab the spotlight in 2004, creating opportunities for channel partners to sell equipment, professional services and bandwidth to power wireless LANs.

The take-off in the WLAN market has been driven largely by productivity gains and cost savings over Ethernet installations, attractive aspects for enterprises and SMBs looking to cut costs. At the same time, technology enhancements have made Wi-Fi a truly viable option for secure networking.

Were starting to see a switch where wireless really grew up and had a strong growth on the consumer side and home networking, and small businesses, explains Proxim Corp.s Ken Haase, director of product marketing. Were seeing a definite trend where the corporate growth is greater than consumer growth, because I think enterprises have finally recognized the fact that wireless networks are secure, in some cases more so than what they already have in place, and youll see more of a benefit with the use of wireless, beyond just being able to read your e-mail real-time.

DellOro Group forecasts the WLAN market will grow 23 percent to $2.2 billion this year, continue to grow in 2005 and will peak in 2006. While other segments such as residential may slow down, the enterprise market for WLANs is expected to maintain a five-year compound annual growth rate of more than 20 percent, to reach $1 billion in 2008, DellOro says. In the coming years, the enterprise wireless LAN market will increasingly thrive as enterprises continue to embrace WLAN technology for its convenience and as a means to improve productivity, says Greg Collins, senior director at the analyst firm.

Enterprises, particularly in vertical markets, can reap almost 27 percent more productivity by using Wi-Fi access to the network, according to a November 2003 study from Cisco Systems Inc. Sage Research Inc. reports that 80 percent of WLAN users surveyed expect to expand their deployment of wireless LANs in the first six months of 2004 for productivity gains.

WLANs offer several other advantages for a business, such as rapid adds, moves and changes within the enterprise environment, since it allows on-the-fly setup and simple self-configuration. Guest access is another attractive area, since Wi-Fi allows company visitors to get online without hassle and without having to wait for an IT manager to do the setup. Another popular application is hoteling, which refers to the ability of telecommuting workers to open their laptops at home or at the office, and be on the same network regardless.

Small, medium and large organizations are planning to run a wide variety of applications over their wireless LANs, including network connectivity for guests, in-building mobile telephony and video over IP, confirms Infonetics Research in an October 2003 study. The firm forecasts worldwide end-user spending on WLAN products to grow 97 percent between 2003 and 2007, from $1.49 billion to $2.94 billion.

Our study shows that organizations do not lack imagination in terms of the future uses for wireless LANs, nor underestimate its potential to deliver advanced applications such as voice or video over IP. However, security remains the most significant barrier to adoption for wireless LANs. The industry still has work to do to address enterprises lingering perception of wireless LANs as insecure, says Richard Webb, Infonetics Researchs directing analyst for wireless LANs.

Proxims Haase says this concern is abating. This time last year, everyone was still engrossed in security concerns, whether they were real or perceived. Now, new security appliances and the adoption of the Wi-Fi Protected Access standard have made WLANs as secure as their wired counterparts, he adds.

BIG OPPORTUNITY

Opportunities for partners in the burgeoning WLAN space run the gamut. An agent can sell the circuits needed to provide bandwidth to the WLAN, whether that be DSL, cable, T1 or other pipe, and then bring in the equipment for additional revenue. Alternatively, an agent could partner with a VAR for the equipment piece. Additionally, management software and services, integration and other value-added services provide even more revenue possibilities.

We provide the Internet connection that ties the system together  the WLAN is hooked up to the Internet, says Tom Sullivan, cofounder of Wi-Fi Guys LLC, which deploys Wi- Fi in hotels and offers agents commission on its Wi-Fi service and upfront payments on equipment. We saw an opportunity to sell more Internet connections to our hotel clients, DSL, T1s. We interconnect that with our equipment to hook it up to the wireless network.

Wi-Fi Guys also offers Wi-Fi as a redundant Internet connection from its hotel system to local businesses. Now whenever we put in one of our locations, you can go to the local business areas and see if they want to buy a discount back-up Internet connection, says Sullivan. It gives agents products and services to sell they wouldnt otherwise have access to.

Master agency Association Resource Group is working with VARs that replace or extend a companys Ethernet LAN with Wi-Fi. ARG can come in and examine the business network services, and often captures the business by offering a better quote on bandwidth. It also can layer on a redundancy sale. We have begun working with a Wi-Fi IP provider primarily to offer customers a truly redundant back-up service that doesnt rely on the land line providers, says Greg Praske, CEO at ARG.

A few aggregators and WISPs offer turnkey packages for agents to sell. One such is SkyRiver Communications Inc., which offers complete WLANs for the hospitality and multitenant office/residential markets. Its agent program pays partners a one-time percentage of the hardware sale and installation fees, and the agent can bring his or her own broadband service to the deal. SkyRiver master agents, including World Telecom Group and Ontario, Calif.-based Allcom, offer other revenue opportunities.

For education and colleges, it will be the solution, says Vince Bradley, founder, president and CEO of World Telecom Group. The infrastructure is inefficient because all these people have dial-up. This will make things more personal, it will completely change the way we do business and the way we look at the industry.

Boingo Wireless Inc. offers consumer and corporate Wi-Fi plans via an agent program. The latter allows agents to earn upgrade and renewal commissions on that account in addition to the one-time upfront sign-up bonus.

For their part, equipment manufacturers are embracing the channel, aggressively recruiting channel partners interested in taking business-oriented products to market. Cisco offers a WLAN technology specialization for partners, banking that such certified expertise will differentiate its VARs and integrators in the market. One of the latest to earn the specialization is NEXL Network Systems, which had its employees undergo testing to show it had an account manager, responsible for the sales methodology of the Cisco wireless LAN solutions; a systems engineer, responsible for the network planning and design; and a field engineer, responsible for the implementation and support of the wireless LAN solution.

Many small and medium-sized business and enterprise customers across a variety of industries are deploying wireless LAN solutions, creating a tremendous opportunity for our channel partners, says Surinder Brar, senior director of Ciscos worldwide channels. Our Wireless LAN specialized companies, like NEXL, will play a critical role in helping organizations realize the flexibility, mobility and cost-savings benefits that wireless LAN solutions can deliver.

Many companies have launched niche products that partners can use to tap new markets. For instance, ZyXEL Communications Co., which uses VARs conducting on-site end-user sales and consultation as a channel, in January launched the ZyWALL 70, an Internet security solution specifically for the small-to-medium business market. It addresses wired and Wi-Fi access, and integrates firewall, VPN, content filtering, bandwidth management and more into a single box. The targets of the hacker attacks on the Internet are no longer limited to large corporations, says Felix Chang, director of ZyXELs network security and application division. That is, companies of any size may become the next victim of network threats without warning. Despite the fact that the firewalls built into the gateways in small companies can prevent the attacks to a certain level, they are still vulnerable to the viral or worm assault from the networks within.

Meanwhile, Firetide announced the HotFusion Partner Program last fall, signing two initial system integrator partners, Seattle Micro and Pacific DirectConnect. Firetide is committed to working with leading wireless VARs, system integrators and service providers to deploy the next evolution of wireless networks and hotzones, says Frederick Harris, Firetides director of channel marketing. Firetides HotPoint Wireless Mesh Router eliminates the need for Ethernet backhaul for WLANs and create a self-configuring, self-healing IP mesh network, known as a Firetide Wireless Instant Network. The name is fitting - installation consists of plugging in the routers, which then self-scale and self-configure. The solution targets places where hard wiring is unfeasible. They also are compatible with existing off-the-shelf access points. HotPoints are designed for an easy sale and requires no expensive training or certification programs. The company says the instant solution gets partners easily involved in the market, while the mesh, AC-outlet based aspect allows them to differentiate themselves in the crowded WLAN space.

Another player in the mesh networking side of corporate Wi-Fi is Strix Systems Inc., which offers the Access/One Network WLAN solution, consisting of various modular components, including the wireless uplink and client connections. We designed it for the channel, explains Bob Jordan, vice president of marketing at Strix Systems. The company has gone so far to create a deployment tool for partners, dubbed the Architect/One. [It] lets the channel partner go in and engage the customer in a dialogue, lets them determine what the customer situation is and how they want to use it, [and] their tolerance for redundancy, explains Jordan. [Partners] can tell them without having to do a full site survey where to place the nodes. This also is a professional services revenue opportunity for the channel.

Also providing integration and professional services revenue to the channel, Proxim just released a seamless mobility solution for converged voice and data on WLANs. The OriNOCO Switching System is available as part of a total solution featuring an IP PBX from Avaya Inc. and a Motorola Inc. handset to be rolled out fully later this spring. The Switching System itself is available via Ingram Micro Inc. VARs, but the full solution will require integration on the back end.

Network management is another area where channel partners can cash in. BlueSocket Inc., for example, offers wireless gateways that secure and manage WLANs, allowing IT managers to control how and when users can access the network. The way the technology has evolved, there use to be one closet for the telephone system and another for the network, says Patrick Rafter, BlueSockets vice president of communications. Now that might be one Wi-Fi closet that can manage both of those, which is creating interesting challenges for the skill sets of the IT managers. So thats a tremendous opportunity for VARs and systems integrators who can make it easier for these people.

With these and other options available, it appears WLANs offer channel partners rich opportunities. Many industry players are bullish. I think people are beginning to acknowledge that wireless, truly wireless networks, are the future, says Doug Huemme, director of marketing at Strix Systems. We are seeing a lot of deployments now where people are deploying full wireless networks [as well as combination networks]...We are moving to complete networks without wires and I expect to see that happen in the next couple of years.