The magazine of the Melbourne PC User Group The Australian Wireless Summit 2004 Peter Lange

The Australian Wireless Summit 2004, subtitled "Strategies to transform your organisation into a wireless enterprise" took place in Sydney on 3 and 4 March. Two hundred and sixty-three attendees from 183 different organisations all across the industry were drawn to the Dockside Function Centre's stunning Darling Harbour views, attracted by an impressive speakers list and of course the business networking opportunities that events like this provide.

Often the most interesting pieces of information could be found in answers to questions from the audience or in individual discussions on the sidelines.

Impressive Speakers List

Presenters at the conference included high-ranking officials from industry giants such as Microsoft, Intel, Cisco Systems, IBM, Telstra and Optus, government, research and educational organisations such as the ACA (Australian Communications Authority), CSIRO (the Commonwealth Scientific & Industrial Research Organisation), the University of Sydney, and representatives of various large public and corporate users of wireless technologies like the health and transport industries for example. Several providers of wireless broadband services such as Hotspot Global, SkyNetGlobal, Azure Wireless, iPass and Xone also gave interesting insights into their businesses, and a presentation from a financial institution (Investec Bank) rounded off the spectrum of presenters.

Wireless Broadband

Much of the conference circled around the provision of wireless broadband access services - naturally a hot topic in a country like Australia (and many others) where almost every sector of the telecommunications market is still so clearly dominated by one incumbent player such as Telstra. This is particularly true for the access network, also called the "last mile" - those millions of wires that run from the telephone exchanges to every house - only Telstra owns virtually all of the infrastructure in Australia that connects the individual households and businesses to the telecommunications core networks. A virtual monopolist can dictate any price, if not controlled by a powerful and independent regulatory authority. This regulator is the Australian Communications Authority, ACA.

It would simply be too costly for a competitor of Telstra to wire the whole of Australia again, dig up the ground and pull a second wire to every house, and a third one from a third competitor and so on - so wireless technologies have always been eyed as a means to build alternative last mile infrastructures. In recent years technologies have evolved that are capable of providing enough bandwidth over a radio channel to accommodate many simultaneous phone calls, high speed data traffic etc. Still, rolling out wide area coverage with such systems is not a cheap and easy exercise, mainly because these technologies operate at very high radio frequencies where the range of each transmitter site is very limited.

WiFi technology, or 802.11 - covered elsewhere in this issue of PC Update - has enjoyed particular interest as a last mile solution because it is a very cheap technology, so it may open up opportunities in the business of wireless access provision even to relatively small carriers. The problem with it, however, is that it operates in an unregulated part of the frequency spectrum and is therefore susceptible to interference which may affect the quality of service. Nevertheless, several companies, large and small, in Australia have taken up this opportunity. Most of them are focusing on the hotspot business for now, providing Internet access to business travellers, typically in locations like hotels, airport lounges etc. Also the big ones, Telstra and Optus, have jumped on this bandwagon, realising that WiFi hotspots will steal some of the revenue from their 3G (third generation) mobile networks for which they paid millions of dollars in licence fees and infrastructure and which, even when they take off eventually, cannot match the data speed of WiFi.

Peter Acheson, Director Business Mobile at Optus, claimed that Optus currently has the biggest network of hotspots in Australia; 100 locations of the 500 that were planned by mid 2004 have been implemented. He admitted that it is getting increasingly difficult to get the sites needed to install the hotspot equipment. Venue owners have smelt the interest in the technology and want their piece of the cake. While the average time required to secure a site was three months some time ago, it is now more like 12 months.

Some venue owners on the other hand have already realised the value that free WiFi access adds to their core businesses. Many hotels for example are now offering Internet access free of (direct) charge to their guests and are finding that this differentiator is clearly making more people choose their venue instead of one without this service. Cisco Systems delivered an interesting presentation at the conference about projects they have carried out with international real estate company Colliers International, where the implementation of wireless systems in office buildings has at a stroke halved the cabling costs for the entire building, reduced maintenance costs, and given the building owners a differentiator over only conventional wired infrastructure. Tenants are appreciating the advantages of a wireless building and are willing to pay premium rent for it.

Other venue owners see a direct revenue opportunity and charge their customers directly for wireless access. Interesting is a pricing comparison on an international level as well. While 14 dollars will buy you one hour of WiFi Internet access through one of Telstra's hotspots at one of the McDonalds restaurants in Australia, the same 14 dollars buys you a whole month of access through one of the hotspots of operator Maxis in Malaysia! We still have some way to go in the direction of real competition and customer orientation. Telstra's small print is also interesting: "Customers will be charged a minimum fee of $5 per Telstra Wireless Hotspot login session [...] If a customer logs out early, any time which remains unused will be forfeited and will not be carried over to the customer's next login session". Now what if somebody fires up the microwave oven in the back at Maccas and your session drops out? We will probably see a revision of this pricing scheme soon.

So can money be made with hotspots? Much controversy has ruled this discussion since it started, and many business models have indeed failed in the meantime, but Paul Petterson, CEO of Xone who actually operates a hotspot at the function centre where the conference took place, assured the audience that yes indeed, it can be profitable. Xone starts making money when four people log on to a hotspot a day. Close to 100 did on the first day of the conference.

Jim Butler, Director at Investec Bank, gave an interesting insight into who finances the wireless industry and where exactly the cautious post-dot-com-bubble investors are putting their money: He was more convinced of technologies which, unlike WiFi, use licensed frequency spectrum (that comes at a price, but is then free of interference) and pointed to Unwired Australia and PBA (Personal Broadband Australia) as examples. Both companies have secured significant amounts of funding through innovative channels. Jim Butler sees significant risks for smaller wireless service providers without that kind of funding under their belts to defend their position, even only in niche markets, against the big ones in the business.

The real worry of the Telstras of this world is when alternative service providers using WiFi and other wireless broadband technologies start offering not only Internet access but voice traffic as well. The technology is already here, called VoIP (Voice over IP - Internet Protocol), working well in the wired world and wireless to PCs too, and it is only a question of when WiFi-enabled telephones and mobile phones will appear on the market to really start eating away on the very core business of the incumbent telecom companies. Voice telephony. Interesting times ahead!

Wireless Security

WLAN (Wireless LAN, WiFi) security was one of the most popular topics at the conference, obviously there is still a lot of concern about it. Rightly so? Well, a number of interesting conclusions were drawn at this event.
WPA encryption (WiFi Protected Access), the improved security protocol that is replacing the notoriously weak WEP (Wired Equivalent Privacy) is regarded as quite safe at the moment. Even though some scientists have already identified vulnerabilities in WPA it is still much harder to crack than WEP, at least as long as only short and text-based encryption keys are voided. And a further improved new release called WPA2 is planned for the middle of this year.

However, presenters and other experts at the conference agreed that not all risks are eliminated by encryption on the wireless link alone. Wireless security must also contain other elements, such as user and/or machine authentication and possibly end-to-end encryption, for example using a VPN technology (Virtual Private Network), and last but not least, the implementation of procedures like changing passwords regularly or prohibiting the use of unauthorised equipment in your organisation etc. Many of the risks in wireless networks are just the same as in wired networks and - let's be honest - we just "feel" safer when we see a cable plugged in, but the Internet itself is not safe - it is a broadcast medium and opportunities for eavesdropping, identity theft etc. exist just as well when there is no wireless component involved. We are just more worried because we feel anybody can intercept radio waves, which is true in some sense, but the truth is also that there are actually easier ways for hackers to gain access than parking in front of your house with their wireless laptop.

Users as well as wireless broadband service providers at the conference finally agreed that in practice, the amount of purely wireless-related attacks on networks occurring today is indeed negligible. This may change though as the coverage of services expands and reaches more and more users.

Case studies, case studies.

The most exciting presentations of the conference however came not from the industry giants and service providers but from - yes, the users of wireless technology. Some real success stories were presented, underpinned with facts and figures showing that those "productivity gains", "returns on investment"etc. that the glossy brochures of the industry giants promise are indeed not just hot air, they really can be achieved, and make a measurable difference!

Professor Steven Boyages, CEO of the Western Sydney Area Health Authority, gave an interesting insight into the health sector, which in Australia already consumes about one million dollars . per hour! Still, Professor Boyages foresees a further explosion of costs for medical care in the next four years, due to the ageing of our society, increasing expectations and rising costs in other sectors that health care also depends on - which just means that you and I will be paying higher premiums into our health insurances, and probably still get poorer benefits in return. The only way to avoid collapsing health systems that other countries with more aged populations than Australia are already experiencing, apart from lowering expectations, is to start saving costs and improving efficiency, now.

Professor Boyages gave a presentation on a new wireless system that has been implemented at Blacktown Hospital and which does exactly that. It enables staff at all levels to communicate with each other much more quickly and efficiently than the traditional system where a nurse would for example call the switchboard, the switchboard would then page the doctor, by the time the doctor gets to a phone to call back the switchboard to find out what the matter was, the nurse would already be somewhere else again and not reachable, and so on.

With the new system, staff carry small wireless communication devices around their necks or clipped to their collars and can talk to each other, hands free, directly, wherever they are. A voice recognition system provides that; all a staff member has to do is say "Call Dr. X" for example, and the direct speech connection with Dr. X is established instantly. Another feature of the system is a "Where is" function that enables staff to locate any other staff member instantly, so that time previously wasted running around looking for people can now be used doing more productive things. And simply by saying "Help" into his or her wireless device, a staff member is automatically heard by all others within a certain radius.

Apart from time and cost efficiency considerations, in the health sector quick and efficient communication can often be a matter of life or death. But also on the cost side, the new wireless system is performing well.
It has paid back its cost in less than eight months and is saving Blacktown Hospital almost 16,000 work hours per year, equivalent to a quarter of a million dollars.

Another exciting presentation was the one given by David Garnier, IT Director at SnapX, an Australian owned express courier enterprise. The company has gone through an evolution from using two-way radios in the 1980s, introducing vehicle tracking and "data to the vehicle" solutions in the 90s, through to "data to the driver" solutions from the late 90s. The initial SMS-based solution (Short Message Service, via mobile phones) for the latter soon proved to be too expensive and too unreliable, especially when SMSs sometimes take hours to be delivered on days like Valentines Day. So last year, the company implemented a GPRS-based (General Packet Radio Service, through the mobile phone networks) "data to and from the driver" system with rugged tailor-made PDA devices (Personal Digital Assistants) that also support functions such as signature capture, bar code scanning, workflow management, messaging etc.

Knowing at any time in real time where every driver and every parcel is, saves so much time and increases productivity that SnapX have multiplied the number of transactions they handle per day, resulting in corresponding revenue gains, and customer satisfaction. The system has already paid back its implementation cost more than 10 times over, and there is actually a remarkable side effect: SnapX couriers are paid on a revenue basis, so it has become not uncommon for them to earn to the tune of 150,000 to 200,000 dollars a year! An almost complete turnover of staff has occurred in this segment, however - the traditional typical driver was probably unhappy with some of the business terms and the loss of privacy by being monitored in real time. But for the others, what a great opportunity! Here is an example of how the benefits of a productivity-increasing wireless computing and communication system in an enterprise can really trickle down to the bottom of the food chain as well.

About the Author
Peter Lange has worked as a consultant in the wireless telecommunications industry for over 15 years, helping clients worldwide to plan, build and optimise wireless and mobile telecommunications networks.
E-mail: peter.lange@netcontel.com

Reprinted from the April 2004 issue of PC Update, the magazine of Melbourne PC User Group, Australia

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