CHANGING THE ROLE OF WIRELESS OPERATORS

Wireless technology is still in its infancy and as technology
changes so does the business model of the service providers.
Rarely have major changes to the infrastructure failed to
change the possible business models.
As technologies such as WLAN and Bluetooth improve,
they will serve a portion of consumers need for connectivity.
Wireless operators have traditionally offered services only on
licensed spectrum as it protected them from undue competition.
The future will see operators offering services over both
licensed and unlicensed spectrum reflecting a shift towards the
need for seamless management of wireless access across various
networks.

Operators of the future will need to compete not only against
the few that have purchased licensed spectrum but also those
that offer services in the unlicensed band. We believe that most
enterprise and consumer users will lean towards solutions that
integrate the authentication, customer care, and billing of as
many network access technologies as needed for their particular
use. Operators with licensed spectrum will still have an edge over
those without licenses, as many users will resist the hassle of separate
subscriptions for access needed on different overlapping
networks that will often service the same laptop or mobile device. 215

CHANGING THE ROLE OF WIRELESS OPERATORS

Wireless technology is still in its infancy and as technology
changes so does the business model of the service providers.
Rarely have major changes to the infrastructure failed to
change the possible business models.
As technologies such as WLAN and Bluetooth improve,
they will serve a portion of consumers need for connectivity.
Wireless operators have traditionally offered services only on
licensed spectrum as it protected them from undue competition.
The future will see operators offering services over both
licensed and unlicensed spectrum reflecting a shift towards the
need for seamless management of wireless access across various
networks.

Operators of the future will need to compete not only against
the few that have purchased licensed spectrum but also those
that offer services in the unlicensed band. We believe that most
enterprise and consumer users will lean towards solutions that
integrate the authentication, customer care, and billing of as
many network access technologies as needed for their particular
use. Operators with licensed spectrum will still have an edge over
those without licenses, as many users will resist the hassle of separate
subscriptions for access needed on different overlapping
networks that will often service the same laptop or mobile device.

CELLULAR THREAT OR BENEFIT?

Some may see WLAN and Bluetooth access as competition for
cellular access, it’s more likely to evolve as an extension of cellular
operators offerings. Wireless operators need WLAN technology
to offload heavy localized traffic especially in indoor
environments. Recent studies support the claim that 3G operators
will need WLAN technology to handle the most demanding
users in dense areas. The fact that WLAN uses unlicensed
spectrum will not mean that operators wouldn’t need to spend
money to operate these systems as they will need the same
centralized network management, subscriber identification, security,
and roaming systems in place to manage this last portion
of the wireless transmission. WLANs could be configured to
cache frequently accessed content and reduce the data traffic
carried by the backbone of the system that would be using
licensed spectrum.
Other issues ill need to be overcome for WLAN technology
to peacefully exist with other systems that use the unlicensed
spectrum. Congestion is a real possibility as there is no limit to
the number of networks and traffic that could try to use the
frequency in a given area. Security is an issue that is growing
in importance as more and more users have a WLAN card and
can easily walk or drive within range of many corporate systems.
Many of these systems have been installed with no
change to the equipments factory settings enabling anyone that
knows the common factory settings and passwords to gain
access to corporate networks. Interference will also be a challenge
especially for companies such as Starbucks since other
devices such as Microwave ovens can generate frequencies
close enough to 2.4 GHz to disrupt the WLAN transmission
every time they heat up a muffin. 214

CELLULAR THREAT OR BENEFIT?

Some may see WLAN and Bluetooth access as competition for
cellular access, it’s more likely to evolve as an extension of cellular
operators offerings. Wireless operators need WLAN technology
to offload heavy localized traffic especially in indoor
environments. Recent studies support the claim that 3G operators
will need WLAN technology to handle the most demanding
users in dense areas. The fact that WLAN uses unlicensed
spectrum will not mean that operators wouldn’t need to spend
money to operate these systems as they will need the same
centralized network management, subscriber identification, security,
and roaming systems in place to manage this last portion
of the wireless transmission. WLANs could be configured to
cache frequently accessed content and reduce the data traffic
carried by the backbone of the system that would be using
licensed spectrum.
Other issues ill need to be overcome for WLAN technology
to peacefully exist with other systems that use the unlicensed
spectrum. Congestion is a real possibility as there is no limit to
the number of networks and traffic that could try to use the
frequency in a given area. Security is an issue that is growing
in importance as more and more users have a WLAN card and
can easily walk or drive within range of many corporate systems.
Many of these systems have been installed with no
change to the equipments factory settings enabling anyone that
knows the common factory settings and passwords to gain
access to corporate networks. Interference will also be a challenge
especially for companies such as Starbucks since other
devices such as Microwave ovens can generate frequencies
close enough to 2.4 GHz to disrupt the WLAN transmission
every time they heat up a muffin. 214

BLUETOOTH—SHORTER RANGE BUT LOWER POWER CONSUMPTION

For devices that are too small or unable to provide the power
needed to operate a WLAN card there is a new technology in
the works called Bluetooth. Similar to WLAN technology,
Bluetooth is designed for smaller devices with lower power
consumption. This lower power means a shorter range of transmission;
Blue tooth will initially be limited to approximately 30
feet. With potential throughput on par with WLAN, Bluetooth
will compete with WLAN for short range access for laptop PCs
and printers. Bluetooth will be more suitable for smaller
devices and operates on a peer-to-peer configuration that
establishes a piconet (a series of connected devices that pass
the data along to one another in a kind of fire brigade manner)
to extend the reach back to a network when available.
Bluetooth will be used more often in scenarios where data is to
be exchanged between two or more devices such as between
multiple PDAs or between a PDA, cell phone, and a printer.

BLUETOOTH—SHORTER RANGE BUT LOWER POWER CONSUMPTION

For devices that are too small or unable to provide the power
needed to operate a WLAN card there is a new technology in
the works called Bluetooth. Similar to WLAN technology,
Bluetooth is designed for smaller devices with lower power
consumption. This lower power means a shorter range of transmission;
Blue tooth will initially be limited to approximately 30
feet. With potential throughput on par with WLAN, Bluetooth
will compete with WLAN for short range access for laptop PCs
and printers. Bluetooth will be more suitable for smaller
devices and operates on a peer-to-peer configuration that
establishes a piconet (a series of connected devices that pass
the data along to one another in a kind of fire brigade manner)
to extend the reach back to a network when available.
Bluetooth will be used more often in scenarios where data is to
be exchanged between two or more devices such as between
multiple PDAs or between a PDA, cell phone, and a printer.

WLANS AND BLUETOOTH— THE NEW ACCESS POINTS

While Internet access at work or home is easily accomplished
with fixed connections, wireless access is beginning to come up
to speed and offer the benefit of mobility albeit over short distances.
This growing wireless access technology is called
Wireless Local Area Network (WLAN) access and is essentially
a networking system that creates a wireless connection
between a device, typically a laptop PC, and a network or the
Internet. The power and size requirements of WLAN device
cards make it more suitable for laptops and some PDAs than
for smaller handheld devices such as cellular phones.
The majority of current WLAN systems use a technology
called the 802.11 standard, also known as Wi-Fi. Wi-Fi began
a couple of years ago under the name IEEE 802.11 High Rate
(HR) standard. Someone with a sense of nostalgia coined the
easier to relate term of Wi-Fi as a play on the old audio term
hi-fi (high fidelity), which entered the language back in the
1950s.
One of the key features of WLANs is that they use unlicensed
spectrum, currently most in the 2.4 GHz range
although systems are possible in 900 MHz as well as 5 GHz.
Operating in unlicensed spectrum allows WLAN operators to
set up a wireless network for only the cost of equipment and its
connection to a network or the Internet.

These WLANs are useful for providing access in targeted
locations such as offices as an extension of the wired network
or in public areas such as airports, hotels, and shopping centers.
These 2.4 Ghz systems typically have a range of about 300
feet and currently offer speeds of about up to 11Mbps, which
is roughly equivalent to older 10 Mbps Ethernet throughput.
Future WLAN standards should increase this to up to 54 Mbps
which would be much more suitable for multi-media applications
such as Video.
WLAN technologies can be implemented in two ways:
access point or peer-to-peer configuration. Access point configuration
is the most popular method and uses a wireless point
of access that connects to the fixed network connection on one
end and transmits wireless signals on the other end. Access
points typically accommodate six network interface cards
(NICs). These PCMIA type cards are the devices that allow the
connection back to the access point.
The other method of implementation is the peer-to-peer
configuration that works by allowing each end client or device
card to connect to each other and communicate directly
between laptops or devices.
Most WLANs are currently installed in offices to provide
mobility to workers that need to access the network while away
from their desks a growing number of systems are being setup
for public use.
There are groups of socially minded individuals that are
using public access WLANs to create pockets of network
access that would be free for all to use. A basic WLAN system
can be installed for under $1,000 and offer service to users in
a 300 foot radius of the antenna. Anyone with an 802.11b card
could in theory access the network. These networks could offer
limited access to localized content on a community oriented
intranet as well as offering access to the broader Internet.
WLANs are also being planned for public access in locations
that consumers frequent including airports, coffee shops,
and hotels. The potential for these systems to offer localized
content including advertisements or event specific content has
businesses excited about the possibilities. Starbucks has
announced plans to offer WLAN access points at numerous
test locations that would give anyone with a WLAN card in
their device access to a network. This network could be provided
as a free service or offered as a pay as you go system.
These systems can provide more than basic Internet access,
Starbucks could provide information designed to improve customer
service and sell more coffee. 213

ECONOMIC POWER

The Wireless Internet raises consumer power. By using the
Wireless Internet, people will become used to having as much
information as they need when making a significant buying
decision. Their information searching and digestion no longer
needs to be done at home: They will be able to access more
information outside the home, virtually anywhere, and at the
right time. For example, when buying a car, a user could have
all the latest information, including price quotes from competing
dealers, when visiting a dealer for a test drive.

Hazardous Occupations Monitoring

The Smart Shirt System has the potential to play a vital role
in the health and safety monitoring of individuals working
in hazardous conditions. Monitoring devices could be developed
that incorporate vital signs, physical sensors like GPS,
and targeted environmental sensors, such as carbon monoxide,
other poisonous gases, and temperature. 211

MILITARY AND OCCUPATIONAL PRODUCTS

As we can see from the activities of even one company that
is focused on wearable technology, this is an area that has
incredible potential as Wireless Internet continues to evolve.
Although many future devices may be in fact wearable, not all
future wearable devices will have full computing capabilities.
Even now, basic cellular phones are worn on users’ belts, in
much the same way as pagers. It may be a long time before
wearable computers and other devices are as common as other
wearable technology but don’t be surprised if the youth of the
future trade in their Sony Walkman and MP3 players for computer-
capable clothing. (Perhaps this means that The Gap and
Radio Shack will someday have something in common, too.)

Battlefield Combat Care Solution

The Smart Shirt was originally funded by DARPA for the
purpose of detecting bullet penetration, transmitting soldiers’
vital signs to a remote medical triage unit, and ultimately
saving lives on the battlefield. Sensatex expects to
work with DARPA and the Department of Defense to complete
the design of an enhanced Smart Shirt System for the
21st Century Land Warrior program. This System will be
able to fully withstand battlefield conditions and interface
with the military’s existing radio systems to create full
Information Node Capability for the individual soldier. 210

Home Monitoring

Sensatex is actively investigating the home-based health
monitoring markets for conditions that warrant continuous
and/or near real-time vital signs data collection and transmission.
An effective remote health monitoring product
could play a major role in the industry-wide trend to transport
patients to lower acuity and lower cost settings without
sacrificing the quality of care. At home, or even while being
transported via ambulance, the Smart Shirt System will be
able to collect health data in a comfortable and unobtrusive
manner and transmit it to a facility (including the emergency
room) that possesses optimum expertise about the
patient’s condition. The cardiac patient population, including
those prescribed Holter and event monitors, could significantly
enhance the quality of their monitoring using the
Smart Shirt System technology.

Home Monitoring

Sensatex is actively investigating the home-based health
monitoring markets for conditions that warrant continuous
and/or near real-time vital signs data collection and transmission.
An effective remote health monitoring product
could play a major role in the industry-wide trend to transport
patients to lower acuity and lower cost settings without
sacrificing the quality of care. At home, or even while being
transported via ambulance, the Smart Shirt System will be
able to collect health data in a comfortable and unobtrusive
manner and transmit it to a facility (including the emergency
room) that possesses optimum expertise about the
patient’s condition. The cardiac patient population, including
those prescribed Holter and event monitors, could significantly
enhance the quality of their monitoring using the
Smart Shirt System technology.

Home Monitoring

Sensatex is actively investigating the home-based health
monitoring markets for conditions that warrant continuous
and/or near real-time vital signs data collection and transmission.
An effective remote health monitoring product
could play a major role in the industry-wide trend to transport
patients to lower acuity and lower cost settings without
sacrificing the quality of care. At home, or even while being
transported via ambulance, the Smart Shirt System will be
able to collect health data in a comfortable and unobtrusive
manner and transmit it to a facility (including the emergency
room) that possesses optimum expertise about the
patient’s condition. The cardiac patient population, including
those prescribed Holter and event monitors, could significantly
enhance the quality of their monitoring using the
Smart Shirt System technology.

Hospital/Nursing Home Monitoring

Sensatex will partner with patient monitor manufacturers to
develop a Smart Shirt System that transmits vital signs data
either with or without wire to the vendor’s stationary or
portable monitoring unit(s). This includes retrofitting monitors
already manufactured and sold by the vendor to hospitals,
nursing homes, or skilled nursing facilities. By acting
as a single platform for all sensory components, the Shirt
will facilitate the placement of sensors on the patient and
will either entirely eliminate or greatly reduce the number
of wires connecting the patient to the monitor. The sensor
suite for this product will include 3-lead EKG, pulse oximetry
and respiration rate. 209

Sleep Studies

Despite a vast number of U.S. adults with sleep disorders,
such as adult apnea, insomnia, and narcolepsy, only a small
fraction seek diagnosis due largely to the discomfort and
inconvenience of hospital-based testing. The Smart Shirt
System offers test subjects a comfortable and unobtrusive
means by which to have their vital signs monitored and
transmitted for the diagnosis of these disorders.

Infant Vital Signs Monitoring

The Smart Shirt System will support the unobtrusive collection
of vital signs data (EKG, respiration rate) for the detection
of various disorders in infants, such as apnea,
prematurity, respiratory synctial virus, gastroesophageal
reflux, and seizure disorders. The data collected off the
infants’ body is transmitted wirelessly to a processing location
that will utilize analysis software provided by an existing
infant monitor manufacturer.

Infant Vital Signs Monitoring

The Smart Shirt System will support the unobtrusive collection
of vital signs data (EKG, respiration rate) for the detection
of various disorders in infants, such as apnea,
prematurity, respiratory synctial virus, gastroesophageal
reflux, and seizure disorders. The data collected off the
infants’ body is transmitted wirelessly to a processing location
that will utilize analysis software provided by an existing
infant monitor manufacturer.

Personal Area Networking

As a powerful wearable solution, the Smart Shirt System
can act as an enabler of the personal area network (PAN).
As computing devices become smaller and more portable,
people have taken to carrying notebook computers, pagers,
PDAs, and cell phones nearly everywhere they go. The next
technological step is to connect these disparate devices and
create a single network that would relieve the user from the
redundancy of features and concern over where information
is stored. As third generation cellular networks are
introduced and wireless local area networks and Bluetooth technology
proliferate, Sensatex will be able to facilitate the
deployment of the PAN using the Interconnection
Technology of its Smart Shirt and the unique features of its
communications and data management infrastructure. The
System’s unique advantage is its ability to interface with
devices both wirelessly and with wires, thus permitting a
total solution to generate optimal connectivity. 208

Team Athletic Training

The team model will utilize the basic architecture of the
amateur athletic training product in a kit that also includes
computing, communications, analytical software tools, realtime
display, and Internet access, allowing coaches and
trainers to manage the training of athletes in a highly efficient
manner.

Amateur/Individual Sports

Triathletes, marathon runners, cross-country skiers, cyclists,
mountain climbers, rowers, and aerobic sportsmen, among
others, present a significant market for the Sensatex Smart
Shirt. The Smart Shirt System will monitor heart rate, respiration
rate, body temperature, external temperature, altitude,
location, and orientation (compass) for the amateur
athlete, with the added benefit of hands-free connectivity
and switching capability between an MP3 player, radio, cellular
phone, and voice recorder. In addition, the product
will provide voice-activated readout for hands-free access to
information (e.g., a runner queries “distance” via voice and
receives voice response of “12.6 miles”).

Geriatric Monitor

The Sensatex Geriatric Monitor provides reassurance to
seniors and their families by continuously monitoring vital
signs, being able to detect a fall, knowing location through
the use of a GPS chip, communicating with two-way voice,
offering a “panic” button, and connecting automatically
with emergency services via pre-configured parameters.

Infant/Toddler/Active Child Monitor

The Sensatex Child Monitor is a “digital umbilical cord”
that allows parents to keep track of active children. The initial
products in this category will offer parents two forms of
functionality—continuous two-way voice communications
with children in the home environment and/or ubiquitous
communications with children, regardless of the parents’
location. The next generation product of the Sensatex Child
Monitor, whether local or wide area, will provide the added
features of vital signs monitoring and GPS-based locator
services.

The Products

By offering a customizable range of information processing
capabilities under mobile settings, wearable computing
technology finds applicability across the consumer reassurance,
lifestyle enhancement, and healthcare monitoring
markets. A wide breadth of the population, from infants to
the elderly, can use devices such as the Smart Shirt System
to enjoy meaningful improvements in the quality of life.

The Technology

The System incorporates the Wearable Motherboard™
Smart Shirt (the “Smart Shirt” or “garment”), a novel electrooptical
garment funded by the Defense Advanced Research
Projects Agency (DARPA) and developed at the Georgia
Institute of Technology, and an advanced communications
and data management infrastructure. Together, this integrated
solution provides an extremely versatile network for
sensing, monitoring, and information processing devices
that can enable a wide range of products.
The Smart Shirt permits the seamless acquisition and
disposition of sensory and environmental data to and from a
wearer; and the communications and data management
infrastructure permits the transmission of this data over
wired and wireless networks. The Smart Shirt’s
Interconnection Technology provides a flexible “bus” structure
that allows a potentially enormous array of sensors,
whether physical, environmental, or biological, as well as
information processing devices, to be mounted or embedded
at any location. These flexible capabilities permit data to be
collected from the wearer in an unobtrusive fashion and
routed to and from the communications and data management
network. By providing hands-free bi-directional data
transmission, data processing systems, and optimized wireless
communications using an expedient array of protocols,
Sensatex offers a total solution that is virtually transparent,
but ubiquitously available to the end user. 206

CONTEXT-SENSITIVE AND USER-AWARE

When you think about PC-based Internet access there are really
only two primary environments where most WWW access
takes place—work or home. Not only does the majority of
access take place in these two locations, the devices we use are
also at least partially configured to provide easy access to the
content we typically want while in these locations.
Bookmarks on my work PC are largely links to work-related
topics—competitors, industry information, conference web
sites, and, of course, my daily dose of Dilbert.com. The links
kept on my home PC are just the opposite—music sites, news
and weather sites, links to friends’ home pages, and, of course,
links to financial sites that do a great job of tracking my stock
market losses.
The point is that PCs are already somewhat context sensitive
based on the way we configure them. Mobile devices
will be used in a much wider range of environments and will
need to change and adapt to a user’s changing needs and
current context, ideally without much input or effort from
the user.

Wireless Internet access devices of the future will be able to
change and react to the user’s environment or possible context.
Data such as time of day, day of the week, location, and even
events listed in network calendars can trigger the device to edit or
change the presentation of information. An example is the navigation
menu on a PDA that changes to reflect the user’s location
as being at or near work and offering icons for applications that
are work related. The PDA menu would again rearrange itself
when the device realized (via GPS or other location technology)
that the user was now at home or in a shopping mall.
The next big leap in user-aware systems will be in the area
of wearable devices and systems. Wearable computing systems
might seem a bit far-fetched but humans have a history of
wearing technology—eyeglasses and watches are examples of
technologies that humans have become very used to wearing.
Back when clocks were primarily devices that consisted of
a large wooden box with springs and pulleys, the idea of wearing
one must have seemed absurd. The same is likely to occur
with computers. Even now we think of computers as being at
least the size of a laptop and therefore not very wearable, and
certainly not very fashionable.
Many companies are advancing the science of wearable
computers using Wireless Internet access built in to various
pieces of clothing. One example of a company that is leading
the way in wearable technology is Sensatex in Dallas, Texas.
The following is an excerpt of a white paper published by
Sensatex on the possibilities of a wearable computing system.
(Used with permission, of course).
Sensatex is focused on the development of the Smart Shirt
System (Figure 6.1), a wearable solution for moving a wide
range of information on and off an active person at anytime
and anyplace. The Smart Shirt System incorporates
advances in textile engineering, wearable computing, and
wireless data transfer to permit the convenient collection,
transmission, and analysis of personal data. By serving as an
enabler of wearable computing, Sensatex expects to play a
key role in the evolution of personalized, mobile information
processing. 205

4G SYSTEMS—STAY TUNED FOR 3D!

Already in the planning stages are 4G systems that allow for
even more amazing voice and data possibilities. Although we
don’t expect to see any real 4G systems for another 5 to 7 years,
working conferences on the topic were held in 2000. 4G systems
based on Orthogonal Frequency Division Multiplexing
(OFEM) technology are rumored to be 50 times faster than
3G, with bandwidth reaching 100 Mbps.
This capacity will enable multimedia applications such as
three-dimensional (3D) renderings and other virtual experiences.
Sophisticated knowledge management systems, speech
recognition, and GPS also will be offered. This all implies that
future wireless devices will have far greater storage and processing
capabilities than current devices without increased
power consumption.

SERVICES COMPLEMENT VOICE

With all the talk about Wireless Internet applications and other
data-related services it’s easy to forget about voice services.
Voice services will still be the bread-and-butter for service providers. Wireless Internet applications and services will
largely complement voice service.
Voice calls in the future will feature new tricks such as:
• Personal chat room effects. The ability to allow multiple users
to join and leave a conversation at will. Similar to text-based
chat, users will have the ability to silence one or more users
and only listen to selected callers. Just as chat rooms allow
users to send private messages to selected users without leaving
the main conversation, future voice calling will offer the
same type of feature.
• Stereo voice. When voice is transmitted in stereo, users will
be able to discern the direction of sounds and more readily
understand who is speaking or making comments during a
conference call.
• Concierge services. During a voice call with a concierge service
representative, the user should be able to request packet
data information from the live person he is talking to. For
example, the caller might ask for a list of restaurants in the
area he is visiting, or a map with the directions to a specific
location. He can receive this document while still on the
voice call and be able to discuss and clarify directions and
recommendations.
• Interactive call waiting. During a voice call the user will be
able to send a message to incoming calls to inform callers
how long the wait will be or to tell them what forms of communication
are currently being accepted. A notification that
the user is willing to accept text messages while on a voice
call would allow the caller to switch into text mode and continue
the communication via text until the existing voice call
is terminated.
The mixing of voice and data will allow features and services
that truly fit the user’s needs and preferences about convenience,
detail, and environment. 203

MVNOS—SPLITTING THE SYSTEM INTO TRANSPORT AND MARKETING

Wireless service providers have traditionally owned and operated
the entire wireless system. This system included elements
such as the radio transmission equipment, subscriber management
systems, billing, and customer care and, of course, the
license to use a certain amount of wireless spectrum. The service
provider created a brand (not always with a plan for their
brand, some had more of an accidental reputation than a
strategic branding effort) and ran the whole system of buying
spectrum, building a network and billing system, selling wireless
handsets, signing up customers, and setting up customer
care department to answer the phones and solve customer
issues. Some service providers were better at various parts of
this process than others.
Several factors have made this process more difficult as the
industry matures.
• Spectrum has always been and still is limited. The sheer size
and financial requirements needed to purchase spectrum in
today’s world favor the larger entities.
• Consumers that originally had two wireless carriers to choose
from (if they were lucky) are now faced with upwards of 3–5
options in the larger metropolitan markets.

• Network equipment is increasing in capacity and available
features but at the expense of increasing complexity and the
need for various technical network specialists.
• Billing systems are evolving from simple time-based voiceonly
billing to both voice and data charges, circuit- and IPbased,
and a growing number of constantly changing
promotions and affinity programs not always based on time or
even volume of traffic.
• Branding is becoming more important as service providers
reach out beyond the traditional customer base to appeal to
new groups of users each with specific needs and desired features.
• Subscriber acquisition costs average $300 and can go higher
as markets reach saturation. Subsidizing handsets purchases
for new subscribers ties up capital and lengthens the time to
profitability for each new subscriber.
• Data capability is bringing the need for readily available content
tailored to individual needs and desires.
• The costs involved in keeping the network up to date in functionality
and services depends on increasing network utilization
and efficiency. Even small variances in capacity
utilization can be the difference between profit and loss.
So essentially the environment for the wireless service
providers is one of increasing capital expense for network
equipment that handles voice and data as well as provision
wireless Internet content and services. The ability to leverage
well-known brands to attract specific customer segments is
necessary to quickly build traffic and improve time to revenue
while maximizing network capacity. Service providers are looking
at MVNOs as one way to increase the number of subscribers
in an attempt to pay down these investments in
network build out and maintenance.
Existing service providers may find that other companies with
established brands in noncommunications markets are interested
in leveraging their consumer relationships, content access, and
knowledge by entering the mobile space as an MVNO.

MVNOs would not have the licensed spectrum needed to
operate their own network, but would have other elements
required offering services to the consumers. Some of the pieces
an MVNO may choose to control and own include noncore
network elements such as:
• Voicemail systems
• Billing systems—prepaid or subscription
• Customer care centers
• WAP servers and gateways
• Retail facilities
These noncore elements would be minimal compared to
the cost of spectrum and core network equipment. Despite a
limited investment in equipment, connecting to more than one
existing service provider could further leverage an MVNO’s
brand and mobile equipment resources. This would allow the
MVNO to sell services on more than one radio network. An
example might be an MVNO that offers services over both a
GPRS network as well as a CDMA network all under the same
branding.
MVNOs would rely on the network capabilities of the
underlying operator and focus their efforts on marketing and
promotion efforts to build a subscriber base.
The MVNO might be a partner that has a well-known brand
name and also access to content that could be resold to the
service provider. Content and services could then be marketed
not only under the brand of the MVNO but repackaged for the
existing operators offerings.
The effect of MVNOs on existing network operators
includes:
• Ability to increase the total number of users on their network
albeit under two separate brands. The alternative branding
offered by the MVNO could very well help an operator to
appeal to new target markets not reached by the existing
operators market positioning.

• Access to content and promotions made possible by the
MVNO’s pre-existing business. An example of could be a
record label that has access to popular new music content
leveraging it’s artists content and brand names to attract new
mobile users to their particular MVNO service.
• Faster loading of customers on newer feature rich networks
could help in generating the traffic needed to maximize
return on infrastructure investments.
Not all companies will have a strong enough brand to carry
over into a new mobile service, some are more experienced at
brand extension than others. One of the more successful
MVNOs is Virgin Mobile in the United Kingdom. Launched in
1999, Virgin Mobile is a combination of Richard Branson’s
Virgin group (famous for Virgin record stores as well as Virgin
airlines) and U.K.-based network operator One2One.
MVNOs are poised to assist network operators that wish to
leverage investments in infrastructure by reselling network
capacity to well know brands that are capable of providing targeted
services to customers attracted to a familiar name and
brand image.
Freedom from the challenges of owning and maintaining
the radio transmission equipment allows MVNOs to focus on
creating new services that leverage new network capabilities
for voice and date while attracting and keeping customers.
Companies with strong brands could create an MVNO without
the need to purchase spectrum. MVNOs would only need to
negotiate with traditional carriers that have excess capacity to sell.
Freedom from the challenges of owning and maintaining the
radio transmission equipment allows MVNOs to focus on creating
and maintaining services that attract and keep customers. 201

SERVICE PROVIDERS OF THE FUTURE

Service providers or carriers have existed in the past by charging
for voice calls made on systems that use licensed spectrum.
The cost of this spectrum is increasing, with huge amounts of
money being paid for 3G spectrum to enable high-speed data
services in addition to quality voice calls.

But licensed spectrum won’t be enough for the service
operator of the future. Value for wireless consumers will come
from carriers that can provide end-to-end connectivity across
both licensed and unlicensed spectrum. As wireless connectivity
becomes more of a commodity, carriers will focus more on
other aspects of service such as security, privacy, storage, and
network intelligence features.
As we move towards 3G another type of service provider
model will emerge, the Mobile Virtual Network Operator
(MVNO). MVNOs will own no spectrum but will own or operate
switches, customer care and billing systems that connect
into another provider’s radio system.

SERVICE PROVIDERS OF THE FUTURE

Service providers or carriers have existed in the past by charging
for voice calls made on systems that use licensed spectrum.
The cost of this spectrum is increasing, with huge amounts of
money being paid for 3G spectrum to enable high-speed data
services in addition to quality voice calls.

But licensed spectrum won’t be enough for the service
operator of the future. Value for wireless consumers will come
from carriers that can provide end-to-end connectivity across
both licensed and unlicensed spectrum. As wireless connectivity
becomes more of a commodity, carriers will focus more on
other aspects of service such as security, privacy, storage, and
network intelligence features.
As we move towards 3G another type of service provider
model will emerge, the Mobile Virtual Network Operator
(MVNO). MVNOs will own no spectrum but will own or operate
switches, customer care and billing systems that connect
into another provider’s radio system.

COMMUNICATION PAST AND FUTURE

The future is about communication, but communications
has always been the future!
No one would argue that the Internet has forever changed
our lives. We are still inventing new ways to communicate over
the Internet, ways that will continue to change how we live and
do business.
If there is one thing we can count on in the future it is the
need and desire for humans to communicate and share information.
Throughout history we have seen countless examples
of how far people will go to record and communicate thoughts,
ideas, and useful information. One of the most obvious desires
of mankind has been to communicate with as much detail, efficiency,
and emotion as possible.
Cave painting imagery could tell an entire story regardless
of the viewer’s spoken language. Text-based books have been
instrumental in the transfer and preservation of knowledge and
understanding across cultures and continents. Music has
evolved from simple human-created rhythms to complex electronic
works that communicate emotions and set moods in
ways that words and pictures cannot quite express.
Comparing the communication needs of our prehistoric
cave-dwelling relatives to the needs of modern-day humans in
skyscrapers and condos we see that some of the basics are
unchanged. In terms of human communications, face-to-face
interaction has not always been convenient or practical: The
need to transfer thoughts and ideas in absentia continues to
this day.
When the average consumer thinks about how they used
the telephone 10 years ago and how they use wired and wireless
phones today it’s apparent that not much has changed. A
closer look reveals something more—the ability to call anyone
from anywhere at a reasonable cost has had an impact on the
way society uses and reacts to technology as a whole.
As technology barrels along it often seems as if the impact is
one way—that technology changes the lives of those who use it.
That society is defenseless to fend off the impact of innovations
that seemingly to reach into every corner of our lives. It’s more
accurate to think of it as a two-way street—people and culture
do influence the future of technology albeit at differing speeds.
It’s most apparent when traveling in different countries.
Some cultures are very work-oriented, some value leisure and
play more than material goods. The differences among cultures
create the environment for technology to add value or not.
How useful do you think a voicemail system or the ability to
check stock quotes would be on a small island where the primary
source of sustenance is fishing? The culture of societies
around the world will always evolve and adapt to the opportunities
before them, including technical opportunities. This is
not to say that technology will never get out of hand or even
cause great harm—history is full of examples of disasters
caused by technical missteps. But as surely as technology may
wreak havoc and destruction, cultures will bend the direction
of future technology to adjust the path of evolution in hopes of
more favorable results. 197

A FINAL WORD

As you can see there are many issues that will impact the adoption
of the Wireless Internet regardless of which protocol is
used or how cool the devices look. Some of these issues, such
as security and privacy, will be partially sorted out in the PC
world but mobility will add a layer of complexity that the Wired
Internet industry has not yet begun to tackle.
The dot.com era has certainly reminded us that no matter
how cool and interesting the technology, the talk will eventually
turn to how to make it profitable. Content that has value
must be protected from unauthorized use and copying.
Mobility will challenge how pricing can be structured, bills presented,
and revenue gathered in ways that do not inhibit trial
and adoption.

DIGITAL RIGHTS MANAGEMENT

Digital Rights Management (DRM) focuses on methods of protecting
content from theft and unauthorized distribution.
DRM gives digital content publishers the ability to securely distribute
high-value content such as music, books, photos, and
videos in a manner that controls access and distribution. This
control is central to protecting the creator’s and publisher’s
ability to collect payments for their work.
The public has not only become used to the idea that anything
found on the Internet is free but many have also shown
that they will disregard copyright protection if it is convenient
to do so. Software piracy has been an issue since the advent of
the personal computer. Unauthorized music distribution via
Napster and similar programs has been one of the fastest growing
activities on the Web.
DRM is a system that controls and restricts access to the
content. Authorized users may be identified individually, as a
group, or even by the device used for access.
Content must first be encrypted or encoded to block unauthorized
access. When a file is downloaded or accessed, the
DRM software performs an identity check and decides if access
has been paid for and authorized. If the rule for payment has
been satisfied the software then “unlocks” or unencrypts the
file. The file may then be accessed and used within certain
parameters based on the arrangements made at time of payment.
User access rights may vary just as they do in the physical
world—video tapes may be rented and available for limited
time periods or purchased for viewing at will.
Some DRM systems lock content to a particular access
device and prevent the file from being copied or moved without
authorization. Each device must have a unique identity
code or serial number that is unchangeable and stays with the
device for its useful life.
Files can also be watermarked and digitally encoded with
information that identifies the authorized user and a record of
not only when the file was transferred but what rights were
granted to the user. Files that are illegally copied can be traced
back to the source that was given original access.
Some of the challenges that DRM must overcome include:
• Ease of use. DRM will require some type of client software on
the access device, and consumers may not be willing to adopt
any software that limits the use of content too severely.
• Persistent protection. Limitations may be placed on the length
of time or number of times a file is authorized for use. In
other words—the music you purchase digitally today may
have an authorization that expires after several years or a set
number of plays.
• Device and other sharing limitations. Consumers are used to
the right to give away or sell items that they have previously
acquired. DRM makes this difficult. Fair-use laws exist that
allow the purchaser to make copies of music or videos for
personal use (i.e., a consumer can purchase a CD and legally
make a copy to play in a Walkman tape player). DRM could
limit a consumer’s fair use of the content.
Consumers may insist on keeping the right to transfer ownership
to others in much the same way as they would other
licensed content. Books and CDs are examples of licensed
content that an individual can give away or sell after they are
no longer wanted. DRM may impair those ownership rights.

While DRM presents us with certain challenges it will also
create new and useful benefits.
• Sticky availability or hope for the cluttered. We all have those
friends who despite help and many items from the organizer
store have a unique ability to lose or “misplace” almost anything
of value. DRM would allow users to simply provide a
username and password (or perhaps fingerprint for those
with poor memory) and gain access to all the content they
have rights to even if the playback devices are all “hiding”
somewhere in the closet or under the bed. Imagine how
much peace and harmony could exist between teenage siblings
that no longer have to argue that the other borrowed
and lost their favorite CD/MP3/Movie/Game cartridge etc. A
Staggering thought indeed.
• Super distribution. One of the more interesting benefits of
DRM will be the possibility of super distribution. Super distribution
is the ability to transfer content from person to person
in a digital format while accounting for payments back to
the publisher.
An example would be a user who has paid for and downloaded
a music file; another person wanting that file could
transfer payment information and authorization back to the
network DRM system and receive an authorized password
allowing the receipt of the file from the friend’s device. The
person who originally downloaded the file may be given a
small commission or credit in exchange for assisting the
authorized distribution of the file. In this system, it becomes
possible for a service provider to collect payment not for
delivering the content but for simply issuing authorization. 194

PROTECTING CONTENT

Not all the security focus is on protecting the user of the
Wireless Internet; plenty of activity is aimed at protecting the
content that users are accessing. Much of the content initially
available over the Wireless Internet has been that which is available
on the fixed Internet—free but not always of great value.
Studies show that Wireless Internet users are not eager to
pay for the same content they can get for free on a PC. A large
opportunity does exist to deliver content that users would be
willing to pay for, but methods of securing this content are
needed. In a physical distribution world the methods of protection
are clear—pay for it and they let you leave the store
with it. What you do with it after that is typically up to you.

FREEDOM OF EXPRESSION

The right to privacy online is linked essentially to one’s ability
to control disclosure of personal identity. This ability to control
access to your identity is easy in the physical world: We not
only decide who we interact with but our personal details are
not often in danger of exposure during simple activities such as
walking around town. We normally do not even provide our
names unless requested (unless at a conference where no one
seems to mind wearing name tags with our personal and company
info for all to see). In the Internet the opposite is true—
almost anyone willing to invest a little bit of effort can easily
uncover the digital footprints left on any site you’ve visited at
any date in the past.
This ability to control and hide one’s identity is critical in
maintaining a society that is capable of protecting freedom of
expression. When government or other organizations decide
that simply visiting and viewing certain information sites is a
threat, the possibility of censorship takes away one of the most
important powers of the Internet—freedom of expression.
Individuals with differing political, religious, or lifestyle beliefs
can use the power of the Internet to protect and educate others
without the fear of censorship or punishment only if privacy
is allowed. The transparency of the Web can be unforgiving,
but never a complete picture of the whole story. Historical data
that shows mistakes in an individual’s past may not include
enough of the data needed to paint a true picture. (PS: Will
someone please tell the insurance company that the Ben and
Jerry’s Ice Cream wasn’t for me and that my increased weight
is really in error. They recorded my weight in kg instead of
pounds; besides, I really have been hitting the gym, I just
haven’t swiped my card every time, OK?) 191

PERSONALIZATION GOES BOTH WAYS

Personal computers that access the Web open the door to
intrusion, but the Wireless Internet will likely produce more
valuable data because most devices can be tied to a person and
not just a household or fixed work location. The fact that content
destined for a wireless device is most often altered and filtered
to conform to smaller screens and limited navigation
provides even more specific data than PC surfing would generate.
A PC data trail may only show a visit to a Web directory
page that contains listings for entertainment; the wireless
device would likely go a level deeper and reveal that a user was
looking at listings for gambling entertainment. Location-based
services will also add another layer of very valuable information—
the history of exactly where you have been for how long.
Because technology and the data generated can be used for
legitimate purposes as well as abused, we will likely not see this
process of collection, storage, and analysis disappear. It may,
however, eventually come under the guidance of laws and regulation
that limit the potential for abuse.

Solving consumer privacy and security issues is key to
enabling growth of the Wireless Internet as applications
improve and become more personal. The current content
accessed most commonly via wireless devices is not very personal—
stock quotes, weather, general news, and the like. But
future applications will enable transactions and inquiries into
personal records like bank accounts and medical records—data
that is personal and damaging in the wrong hands.
Surprisingly, the U.S. constitution does not currently guarantee
privacy, unlike in Europe where the E.U. constitution
actually guarantees a level of privacy. Many other countries
have no similar laws, and in an online world where boundaries
blur, even the existing laws can be hard to enforce.

DATA ANALYSIS AND PROFILING

Software is getting better and better at slicing and dicing and
turning data into information. Databases can help companies
build profiles of user behavior based on billions of statistically
analyzed data points. Data fusion is also a popular way of adding
value to data by combining two or more data sources. Your shopping
history could be compared with your medical records to
reveal a statistical correlation between your rising weight and
your purchases of ice cream and snack foods. Processing the
records of others with similar histories could result in a profile
that companies could use against you. Imagine, while in line at
the checkout counter, you happen to get a wireless email from
your health insurance provider threatening to cancel your coverage
unless you put the Ben & Jerry’s back where you found it!

The very fact that Wireless Internet use will create another
source of consumer data is troubling when we look at the
money that is going into creating this system. The cost of new
networks and services can be at least partially alleviated with
revenue gained from selling this personalized data to companies
that are experts in data fusion and profiling and that specialize
in processing and selling consumer information.
Wonder why more consumers haven’t revolted and refused
to participate or even understand what is happening to their
data? We’ve been bought off with the convenience and savings
that these loyalty programs and electronic systems offer. Until
consumer awareness of the potential dangers increases most
will likely continue to sign away bits and pieces of personal data.
We believe it will take a series of high profile abuses of personal
data before many consumers will trade off that grocery store
loyalty card 20 percent discount on soda and chips in exchange
for greater privacy. 189

DATA STORAGE

The next stage in the possible invasion of privacy is data storage.
Data storage is becoming cheaper and cheaper. This is a great
thing when consumers want to store personal content like digital
pictures, tax records, and other accounting info. The bad
news is that data storage has become so cheap that there is little
incentive to throw data away. The majority of these systems
are built to collect and aggregate data automatically, without
much emphasis on error checking or data correction.
Data, both correct and incorrect, can now live on forever—
errors in credit reports, medical histories, purchases, and travel
records can all be accessed long after you have forgotten or
even knew of them. Trails and histories of what actions took
place and what content was accessed or requested become
almost permanent. The digital world is unlike the physical
world in that it doesn’t forget the past until told to erase it. In
the physical world one can be reasonably assured that eventually
nobody will remember you ever visited that “unique” store
or alternative nightclub back in college. Now, however, there is
a digital trail back to those questionable Web sites that lives
practically forever. (Or until someone deletes it, which could
take even longer.)

DATA COLLECTION

Often the first stage of an intrusion of privacy is data collection.
If the information doesn’t exist it’s hard to violate one’s
privacy. Whereas most individuals wouldn’t bother to go out
and gather this information, companies do this all the time,
often with our help. Grocery store loyalty programs are a good
example—we willingly sell our name and other personal info
along with a complete record of what we purchase and when.
There are many automated forms of data collection today—frequent
flyer cards, toll tags, credit cards, and phone bills. The
Wireless Internet will increase the amount of data that can be
collected. Initially this data will not be very personal—stock
quotes, news, weather—but as devices and networks evolve to
enable more sophisticated applications and services, security
will become an important concern and impact the growth of
the Wireless Internet.

PRIVACY VERSUS ANONYMITY

PRIVACY VERSUS ANONYMITY. Privacy has historically been
something that a consumer could control to a great degree by
simply choosing to whom to reveal information. Even the act of
leaving your home to go shopping presented a situation where
you could control who you greeted and gave your name or other
personal information to. Even the time of day you chose to go
shopping impacted who you might run into—going to the grocery
store late at night limits the type of people who would be
likely to see you. I once knew a teacher who would go shopping
late at night so that she could avoid having any of her students
observe her buying beer and cigarettes: She protected her privacy
by controlling her actions.
This attempt at privacy didn’t render my friend anonymous;
privacy and anonymity are often confused because their
purposes overlap considerably. Dictionary.com defines them as
follows:
• Privacy. 1a. The quality or condition of being secluded from
the presence or view of others. 1b. The state of being free
from unsanctioned intrusion: a person’s right to privacy. 2.
The state of being concealed; secrecy.
• Anonymity. The quality or state of being unknown or unacknowledged.
One that is unknown or unacknowledged.
Anonymity can be used to reinforce privacy, however both
are actually very difficult to achieve in today’s society. Even
those of us that are not movie stars or well-known celebrities
place a high value on our privacy and ability to occasionally be
unknown to those around us.

SECURITY AND PRIVACY

Technology and the evolution of communications networks
have been phenomenal—truly the kind of advancement that
can leave users gasping in astonishment. Unfortunately, not all
of the amazement is positive. Users are increasingly shocked
and concerned about the lack of privacy and security in our
increasingly digital world.
Whereas the majority of users are essentially unconcerned
about privacy, a growing number of consumers and pro-privacy
organizations are pushing for protection. In most cases it’s individuals
who want privacy and companies, governments, and
other large organizations that want to violate it—even though
this is typically done in the name of marketing, law enforcement,
or even customer service. Most consumers are unconcerned
because they feel they have nothing to hide—as long as
there is nobody walking in the front door with a camera crew
people feel they have nothing much to worry about.

M-COMMERCE—SECURITY PAYS OFF

Providing secure payments and protecting the privacy of an
individual’s personal data is critical to the growth of mobile ecommerce,
also known as m-commerce. M-commerce may
someday provide a true alternative to cash and make purchasing
items as easy as hitting a few keys on the keypad of your
Wireless Internet device.
One of the most important issues to overcome in the area
of m-commerce is fraud. It’s easy enough to prove payment in
the physical world—cash works well and credit cards have
sophisticated protection schemes to protect both the holder
and the merchant from unauthorized use. Over the Internet,
it’s quite a bit harder to confirm the identity of the entity that
is attempting to complete a purchase—merchants are unable
to ask for a photo ID or some other proof that the identity of
the person requesting the purchase is correct.

One solution may be biometric identification. Biometrics
involve the use of technology that can identify unique attributes
of an individual, such as a fingerprint or a scan of the
face, to be presented as proof of identity. The user might
have a fingerprint scanner built into their Wireless Internet
device. This scanned image would be transmitted to the merchant,
who would check it against a secure database of fingerprints.
If the user has registered in this database, and the
information matches, the merchant would allow the purchase
to proceed.

M-COMMERCE—SECURITY PAYS OFF

Providing secure payments and protecting the privacy of an
individual’s personal data is critical to the growth of mobile ecommerce,
also known as m-commerce. M-commerce may
someday provide a true alternative to cash and make purchasing
items as easy as hitting a few keys on the keypad of your
Wireless Internet device.
One of the most important issues to overcome in the area
of m-commerce is fraud. It’s easy enough to prove payment in
the physical world—cash works well and credit cards have
sophisticated protection schemes to protect both the holder
and the merchant from unauthorized use. Over the Internet,
it’s quite a bit harder to confirm the identity of the entity that
is attempting to complete a purchase—merchants are unable
to ask for a photo ID or some other proof that the identity of
the person requesting the purchase is correct.

ALA CARTE OVERTURNS THE BUFFET

ALA CARTE OVERTURNS THE BUFFET. Usage based billing isn’t
only about volume but will increasingly be about quality, speed
and privacy. Voice telephony has historically been incredibly consistent
in terms of quality. We’ve not really had the need to think
of what level of quality we desired when making a voice call—they
were all essentially the same. The future will offer many new
choices for voice and data quality as systems will be increasingly
varied, each with it’s own particular application and price points.
Users needs are very diverse and willingness to pay is widely
varied. Similar versions of content are already billed differently
in media other than the Internet: One might pay $75 to
attend a concert in person, $40 for a pay-per-view showing on
TV, $30 for a recorded videotape, $20 for the CD, or choose to
listen to the same songs on the radio for free.
Although no one would argue that the concert is likely the
best quality, not all users are able or willing to attend. They can
still find value in alternative methods of accessing an artist’s
content. The same will be true in the Wireless Internet world.
Some will be willing to pay for multimedia news clips that show
full-motion video highlights of the news, sports, and weather.
Others may opt for a less expensive voice and still-image version
or a free simple text version. 185

FREE

FREE. Someone else pays for what the users get. Maybe its
the content owners who forego payment in hopes of some
other future value, or sponsors might help defray costs via
advertising. This method is great for encouraging trials, but it
is difficult to sell that which had been free yesterday. We’ve all
encountered free stuff—remember those home cooked meals
as a kid? What do you think would have happened if mom
decided to start charging you after all these years? Can you
imagine your dad charging companies to advertise to you during
dinner in an attempt to defray household expenses?

FLAT RATE ACCESS, ALL YOU CAN EAT OR BUCKET PLANS

FLAT RATE ACCESS, ALL YOU CAN EAT OR BUCKET PLANS. These
plans offer either unlimited access or at least more access than
the service provider thinks you are likely to consume. The
advent of the “bucket” plan rocked the cellular industry by giving
users a large enough “bucket” of voice minutes so that they
became less sensitive to the time spent on wireless calls.
Price is not dependent on how much is consumed. Light
users subsidize heavy users and everyone pays the same entry
fee. These plans are great for heavy users who worry about
going over budget and want predictable expenses. These pricing
plans are bad for light or infrequent users who don’t want
a periodic fee for less frequent usage.
These plans have worked well for voice in large part
because everyone understands how much they might use—not
everyone is sure of how much they will use new data services.
For this reason, flat rate plans can be bad for encouraging
a trial of new services when end users expect usage to be low.
It’s hard to assess how often you’ll use new content or services
until you have tried them for a while. But who wants to pay for
the month upfront before you know? Difficulty in canceling
subscriptions adds to the barrier for new services. Flat rate or
bucket plans are great for encouraging the trial of new services
when end users expect usage to be high or for frequent users
after they become familiar with typical usage and want to control
costs.

ENTER THE CASH REGISTER

Billing is not only a challenge in terms of method of payment
but it is an important part of the adoption process. Billing and
the pricing model used for selling content and services need to
adapt to the evolving product lifecycle. The degree of experience
and acceptance level of the target market calls for a varied
approach when pricing new content and services. There are
three basic billing/pricing philosophies:
• Free
• Flat rate (all you can eat)
• Usage based (ala carte) 184

OK, NOW WHO’S GOING TO PAY FOR ALL THIS?

Billing is one of the more important variables that will impact
the success of a Wireless Internet. It will be increasingly
important to have multiple billing models to suit a wide range
of users. Users will vary demographically, geographically, by
access type, and by media and content type as well as by the
need to have billing information filtered or summarized. Billing
not only provides access and content providers with a source of
revenue but it will increasingly provide detail that helps to
determine which type of content is offered and promoted.
The early days of Internet revealed its inherent difficulty for
billing. The Internet was (and still is, to some degree) synonymous
with “free.” Users only pay for access; most content is free. It is difficult
to assess value of content because users of content do not
always agree about what is valuable and what is not. We can
assume that those who visit a particular site receive value from it,
but it is still hard to quantify that value in terms of dollar amounts.
The concept of value is—anything is worth what the market
will bear. The early Internet was more like an open warehouse
than a store—you found what you wanted and took as much of
it as you liked. Because the content was in digital format, you
could take as much as you wanted and still leave the same
amount for another guy. The supply was virtually endless: A digital
content “inventory” doesn’t get depleted except in terms of
availability via an access channel. If too many people try to take
out—or download—content at once, you have the equivalent of
waiting in a checkout lane. Bandwidth limitations place the only
restriction on what can be downloaded from the free Internet.
Because there was no system in place to request money in
exchange for content, it was difficult to determine if the content
was worth one cent or one million dollars. After all, it’s amazing
what people will take when it’s for free! Originally, this didn’t
bother the content-creation guys; they all thought that they
would make money later, after everyone was hooked on the idea
of getting content from their particular “shop.” Branding was the
byword, and the great World Wide Web was an open shopping
mall of opportunities. Unfortunately, this didn’t work too well.
Giving content away cost an amazing amount of real money. 183

UNIVERSAL MESSAGING— HAVE IT YOUR WAY

The history of voice telephony has had little differentiation—
local versus long distance, similar input and output devices
voice in, voice out. We spoke with our mouths and listened
with our ears. A louder handset for the hard of hearing, a tape
recorder for storing the “data,” and eventually the ability to
“share” voice with more than one person was as innovative as
it got (and this hampered by the fact that no one seems to like
being put on speakerphone).

The ability to visually present data changes everything: It
increases the methods of input as well as allowing for various
types of output depending on the receiver’s current situation
and preference.
Cellular phones and PDAs are improving in many ways to
better accommodate the Wireless Internet. While some devices
opt for a qwerty type keyboard, others have operating systems
that allow the use of stylus or pointer devices to navigate and
input data. All have increased display size and resolution, and
many have added color as well.
It’s easy to find examples of situations when voice is not the
most convenient way to communicate detailed information
quickly and discreetly. Imagine you are in an important meeting
where the speaker has gone over the time limit, yet it would
be seen as rude to leave the room. The problem is you are
expected to meet your spouse at a restaurant and it looks like
you will be delayed by about an hour. The information you
need to communicate to your spouse is essentially:
“Hi honey! Look, I’m still at work in a meeting that’s running
late and I’m not sure when this guy is going to shut up
and let us get out of here. Can you please call the restaurant
and move our reservation back an hour? If I can escape this
snore fest and avoid my boss on the way out of the building
I’m sure I can make it by then OK? Love you Buttercup!”
Given the choice to make a wireless phone call or send a text
message to adjust your dinner plans, what would you do? If you
were my co-worker, I sincerely hope you would choose the text
method. I’m sure we can all agree that work environments can
become uncomfortable when co-workers allow personal phone
calls to be overheard and share too much personal information.
Mobility combined with nonvoice data creates a need for
the user to choose the preferred input and output for each
communication situation. Data can be manipulated in more
ways than pure voice and still communicate most if not the
entire intended message. Data such as text, graphics, and video
can be filtered, shortened, condensed, and reformatted to better
fit the output device.

Universal messaging has a history of being defined to
include only what a given vendor’s solution currently includes—
a system that allows the user to combine voicemail and email
might be called “universal messaging” even if it does not truly
allow the sender to leave a voicemail that the receiver can read
over email. Instead the system might send the voicemail as an
audio file to the receivers’ email inbox.
True universal messaging includes the ability to convert
inputs such as voice and text into the output preferred by the
receiver. Content that is visual—photos and video clips—would
not be converted into text but may someday be summarized by an
intelligent software program that could better describe the content.
This is a 20-second color video clip that shows a group of
children blowing out candles at a birthday party—so that the end
user can choose whether to view it, save it for later, or delete it.
Possible conversions include text-to-voice, voice-to-text,
email-to-fax, video-to-still images, and many other combinations,
such as condensing text and then converting it to voice.
Digital also adds the ability to sort, search, match, and store all
types data. 182

WHO CAN I CONNECT WITH?

To increase the number of contactable users available and
reachable on a network requires the ability to be able to reach
others on different systems with different devices using various
protocols. The voice telephony system in the United States
today uses something called the SS7 layer as a common
method that all phone systems can use to transport voice calls
from one system to another. The same common connection for
Wireless data does not yet exist but is critical for growth of the
wireless Internet. This interconnection—ubiquitous availability
to communicate across networks, protocols, and media
types—will create the critical mass of users necessary to add
value to the network. Superior technology that does not
interconnect to legacy systems will offer limited value due to the
smaller network size and limited connections to other users
who do not have the same device or service.
Some systems allow for data to be sent but do not yet offer
a way to reply in kind. This inability to reply suffocates innovation
and adoption of new features and systems. For example all
digital phones are able to receive a text message but not all
have the required software to reply. Cellular phones on one
carriers system do not currently have the ability to send or
receive text messages from phones on other systems.
Proprietary technology only works if it allows for interconnection.
Many new features have these same issue and therefore
must start out focused on a niche market—a community of
some type, like a workgroup, service tech group, plumbers
union, or some other closed group that can all agree to use the
technology. Nextel is an example of a service that mixes general
access with private group access. Nextel wireless services offer
a unique service that allows the user to communicate with others
in a group by simply pushing a button and speaking. This
push-to-talk feature is great but only works if the others you
wish to contact have the same device on the same network.
The Internet is all about access to anything and everything—
the Wireless Internet must offer the same broad access
but Wireless Internet data will need to be altered to fit users’
needs in terms of technology, device, and environment.

METCALFE’S LAW IN REVERSE

There is a growing trend among wired and wireless services to
split the Internet into isolated mini-networks and gain an
advantage in directing and controlling users activities. This
technique is called the “Walled Garden” approach in that the
user is allowed access only to a limited area under the control
of the service provider. While giving the appearance of advantage
to the smaller closed network that can choose what content
and services the users are able to interact with, the reality
is that the mini-network loses value exponentially.
Examples of attempts to split the Internet into smaller isolated
networks include:
• The early days of email. Early email providers resisted giving
send/receive access to users of other email systems.
• Instant messaging systems. Closed IM systems such as AOL
IM have repeatedly blocked efforts of smaller IM systems to
interconnect users of various competing IM systems.
• WAP portals. Many wireless carriers have created WAP services
that are only able to access sites offered by the carrier or carrier
friendly providers. By locking the device settings or WAP
server settings other sites are blocked from access even when
users know and attempt to enter the competing WAP URLs.
• Blocking or banning the ability of other sites to link to specific
pages on another site (deep linking) requiring users to access
content only via the original homepage links. Some content
owners want to block any traffic that does not originate from
their marketing efforts while others welcome official or unofficial
affiliates that point to their site.
The effect of Metcalfe’s law in reverse reduces value for all
parties involved. The networks users lose the value of a larger
more complete network. The networks not only lose value individually
but as a (now separate) group as well. Because of
Metcalfe’s law, the largest network always wins over smaller
networks even when the smaller network initially offers value
creating features or benefits. As the larger networks grow, the
value of the sheer number of reachable users, services and content
ultimately favors the larger networks. Since the Internet is
the largest network of them all, it will not only eventually win
over smaller proprietary networks (wired or wireless) but the
wired internet and wireless internet will only benefit each other
as they join together into a common network.
Attempts to create walled gardens of content and services
for wireless Internet users have failed (and even been declared
illegal) in many European and Asian countries. Service
providers will only succeed in creating long-term value by
focusing on quality of services instead of limiting access to
other perhaps better services.

BILLING AND SECURITY ISSUES

Voice-based wireless devices may have started out as new
and exciting technology but their success was partially due
to their ability to connect to the old dull technology of landline
telephones. Imagine what would have happened if early cellular
phones were only able to call other cellular phones. Who
would these early users have been able to call? Perhaps the
only other users would have been a very small and exclusive
club of executives with a habit of traveling in remote places. It’s
clear that cellular devices and service would not have been very
useful to mainstream society. (Unless you consider the value
generated by keeping the boss entertained while out in the
boondocks—useful for some, I’m sure.)
The CB radio is a good example of a device that is limited
to communicating only with other CB radios. CB’s are relatively
cheap to buy and free to talk on—no roaming or per
minute usage fees. But they don’t offer the best value because
you can’t reach everyone you wish to speak with, those you do
try to reach aren’t always on, and privacy doesn’t exist. This
points out the need for interconnections and the ability to convert
from one protocol or system to another.
It’s relatively easy to create concepts for cool new devices
and services but regardless of how cool and unique a device or
service, the value comes from the ability to connect and communicate
to others.

Metcalfe’s law is the theory that the value of the network
increases exponentially. If you double the size of the network
(let’s say from a network that serves 1,000 users to one that
reaches 2,000 users) you more than double the value—you
actually quadruple the value of the network.
Imagine if someone were to approach you and offer to
switch your Internet service to one that was half the cost. The
only difference would be that this cheaper service could only
reach half of your current network. Would you be willing to
switch? Most likely you would not.
This is why both the telephony system and the Internet
continue to grow in both users and value—the greater the size
of the network the greater the value.
Dr. Robert M. Metcalfe, inventor of Ethernet, founder of
3Com Corp. and columnist for Infoworld. Dr. Metcalfe together
with D.R.Boggs invented Ethernet back in 1973 while working
for Xerox Corporation in their Palo Alto Research Center
(PARC). PARC was also involved in the invention of the PC
and Graphical User interface; however, it was not the place
where these innovations were developed into successful commercial
products. Ethernet, the name for Local Area
Networking (LAN) technology turned PC’s into communication
tools by linking them together into a common network.
In 1979, Metcalfe left Xerox and founded 3Com Corp. (so
named for three words—computer, communication and compatibility)
for the purpose of promoting PC LAN’s and
Ethernet as the standard. Metcalfe was successful in bringing
together companies such as Digital Equipment, Intel and
Xerox and made Ethernet the most widely used LAN.
Metcalfe retired from 3Com in 1990 and embarked on a
career in journalism that led to his writing a weekly column on
networking, “From the Ether,” for Infoworld. It was in this
forum that he published “From the Ether: A network becomes
more valuable as it reaches more users;” Infoworld Magazine,
October 2, 1995. This article set forth the principles now
known as Metcalfe’s Law.
This law is very important to the growth and adoption of
wireless Internet. The premise that the network value grows by
the square of the size of the network does not discriminate by
device or access method. The number of network users can be
a combination of various access devices using various access
technologies, each with their own network speeds. The sheer
number of wireless Internet mobile devices forecasted to be in
use in the future creates the yet another source of network
growth and source of value for all users of the network. 178

SECURITY VIDEO MONITORING

SECURITY VIDEO MONITORING
Security video monitoring applications help to visually assure
that valuable assets are not eroded or destroyed by unauthorized
users. Traditionally, security video monitoring was limited
to on-site video monitors that security personnel viewed as
either videotapes or as real-time images. The introduction of
low-cost digital video cameras and data connections allow for
the remote location of video cameras. When these cameras are
connected through the Internet, they are called Web cameras
(WebCams.)
At the end of 2000, there were already in excess of 100,000
public WebCams in operation throughout the world* and private
video monitoring systems have millions of privately
installed video cameras. Although many of these video cameras
are connected by wire, some are connected by wireless links.
The key applications for wireless security monitoring
included traffic management (traffic cams), public access
monitoring (public safety), law enforcement (cameras on
police cars), and other applications that require a camera at
remote locations where wired connections are not practical or
where mobility (video monitoring while moving) is important.
Figure 4-12 shows the video camera that is normally
mounted in police cars. Using high-speed wireless systems,
images from police cars can be monitored at a central facility.
This may dramatically increase the safety for police officers. 176

GOVERNMENT

GOVERNMENT. Providing education for government workers
is necessary to ensure that information-intensive systems (such
as tax collection) can operate effectively. In the United States
in 1999, there were more than 3 million government workers.
The average government worker receives 1 to 2 weeks of training
per year to learn software and technology systems, standard
processes, and to develop leadership skills. This results in a
requirement of over 5 million weeks of training. To minimize
the costs of travel and lost time, many government agencies
use distance learning programs to reduce training costs.

PROFESSIONAL

PROFESSIONAL. Because technology and business processes
are constantly changing, professional education is developed and
provided by companies to keep their employees competitive.
Training budgets range from 1 to 5 percent of a company’s gross
sales, and a growing percentage of these funds are used for distance
learning courses.

COLLEGE AND UNIVERSITY EDUCATION

COLLEGE AND UNIVERSITY EDUCATION. Since the Internet
was pioneered at universities to facilitate information sharing,
it’s not surprising that an increasing number of them are
creating Web-based universities. By 2002, 85 percent of two-year
colleges (in 1999 there were 847 two-year colleges in the
United States) are expected to be offering distance learning
courses, up from 58 percent in 1998. It is projected that over
80 percent of the four-year colleges (in 1999 there were 1,472
four-year colleges and universities in the United States) will be
offering distance learning courses in 2002, up from 62 percent
in 1998. Many of these will be Web-based. To put this into perspective,
there are 15 million full- and part-time college students
in the United States, of which an estimated 90 percent
are online, representing by far the most active single group on
the Net. Moreover, in 1998, 21 percent of these students purchased
$900 million in goods and services online.

It is estimated that 93 percent of distance learning programs
in American colleges and universities use email and
almost 60 percent use email in conjunction with the Web.†
When distance education is offered, campus visits are not
required for most programs. Learners register online each
semester and may take single courses for personal enrichment
or opt to enter a degree program. Textbooks and class syllabi
can be mailed to learners. Online classes run typically on a 16-
week semester schedule, beginning and ending at the same
time as on-campus classes. Students read their textbooks and
visit online message boards weekly, posting class comments or
questions whenever it is convenient for them. The back-andforth
commentary on the message boards simulates a classroom
discussion. Midterm and final exams are usually taken
under the watchful eye of an approved proctor at a local college,
library, or human resources training center. 173

PUBLIC (K-12) EDUCATION

PUBLIC (K-12) EDUCATION. Elementary education involves
developing fundamental skills in children and young adults.
Elementary education is normally funded and managed by
government agencies. It is the goal of many public education programs
to provide the same education opportunity to all the
members of a society, regardless of the economic status of its
students or the demographic structure of a community.
The economics of traditional public education systems limit
the offering of specific courses to regions that have a sufficient
density of students. To ensure that each student can be offered
the same education opportunities, distance education can offer
more courses to each student. Distance education also allows
students to interact with other students with similar interests
and needs at remote locations. Distance learning applications
delivered through the Internet can provide access to standardized
courses that provide equal education opportunities to
most students. Additional e-books will provide students the
ability to carry a single book.
By the end of 1998, approximately 89 percent of all public
secondary and 76 percent of elementary schools in the United
States were connected to the Internet. Since then, public schools
continue to make progress toward meeting the goal of connecting
every school to the Internet by the year 2000. (In 1994 only 35
percent of public schools in the United States were connected to
the Internet.) In addition to having every school connected to the
Information Superhighway, a second goal is to have every classroom,
library, and media-lab connected to the Internet. Schools
are making great strides to achieve this; and in 1998, 51 percent
of instructional rooms in public schools were connected.*
Connection speed is one of the key determinants of the
extent to which schools make use of the Internet. In 1998,
higher speed connections using a dedicated line were used by
65 percent of public schools. Additionally, large schools with
Internet access are more likely to connect using broadband
access technology.

DISTANCE LEARNING

Distance learning provides training to remote locations.
Distance learning has been available for many years and can be
categorized into public education (grades K–12), university
and colleges, professional (industry), government training, and
military training segments. In the early years, distance learning
was provided through the use of books and other printed materials
and was commonly referred to as correspondence courses.
Distance learning has evolved through the use of broadcast
media (e.g., televisions) and moved on to individual or small
group training through the availability of video-based training
(VBT) or computer-based training (CBT). These systems
evolved into interactive distance learning (IDL).
Distance learning relies on communication systems (e.g.,
phone lines or mail) to connect students and teacher as an
alternative to classroom training. Electronic learning
(eLearning) is a form of distance learning that is becoming a
viable option to traditional teaching methods and is poised for
major growth over the next several years.

Through the ability of broadband video and interactive
graphic technologies, students are exposed to far greater education
stimulus than in the traditional learning environment.
Integrated sound, motion, images, and text all serve to create a
rich new learning atmosphere and substantially increase student
involvement in the learning process.

The rapidly changing global economy is forcing industry
professionals to continually update their skill sets. Adults may
change their occupations several times in a lifetime as technologies
and skill sets become outdated. This requires continual
learning for adults. Adults between the age of 35 and 45 are
the fastest growing group of college learners.* To advance or
consolidate their careers, over 5 million adults complete some
form of distance learning each year.† This is one of the primary
reasons why online learning is booming, especially among
working adults with children. Distance learning via broadband
connectivity allows adults to attend classes in the comfort of
their living room or study, at their convenience.
Many online universities, including training and professional
specialty course programs, are catering to the rising
demand of industry to deliver skill-development courses to the
desktop at remote locations. These schools offer Web-based
professional certificates as well as associate and bachelor’s
degrees that are built around a solid core of business and computer
classes. Companies rely on these certificates to ensure
employees are qualified for their new jobs.

In 1999, most online classes did not require that students
have the latest high-powered computer. However, they did
require Internet access (via low-speed analog modem). These
distance learning courses were provided using low-resolution
graphics or slow-scan Web video. As broadband services
become more available and cost effective, it is predicted that
distance learning courses will evolve to use high-resolution
services such as high-resolution video conferencing.‡ Online
distance learning courses can be accredited by regional accrediting
agencies or via the Distance Education and Training
Council.

MOBILE CLINICS

MOBILE CLINICS. Mobile clinics are transportable facilities
where health care specialists can treat patients. Using wireless
high-resolution video conferencing, mobile clinics in the form
of buses or vans can travel throughout rural areas with clinical
technicians bringing hospital-type facilities to remote areas.
The clinical technician coordinates communications with medical
experts via wireless video conferencing consultations.
These telemedicine videoconference facilities allow hospital-
based physicians to view patient wounds from a live video
image. The traditional method requires visiting nurses to take
Polaroid photographs of wounds and forward them to physicians
for review. From the snapshot, the physician assesses
how the wound is progressing and determines whether changes
in medication or treatment are needed. Using mobile medicine,
visiting nurses dial the physician, forward the image in
real-time, and facilitate interaction between patients and hospital-
based providers. Images can be captured and stored in an
electronic medical record. The technology can help reduce the
cost of continuing inappropriate therapy and shorten the time
between data collection and decision making.

PATIENT RECORD MANAGEMENT

PATIENT RECORD MANAGEMENT. Patient record management
involves the storage and retrieval of medical information related
to a specific person. Patient information may be gathered
manually (such as an X-ray on film) or electronically (such as
a patient history data record). Patient record management via
telemedicine involves converting nonelectronic forms of information
(such as the X-ray) into electronic forms (data files) and
managing these data files to integrate data, voice, digitized
images, or video. These files are stored in a computer and can
be transmitted to workstations at a medical center, physician’s
office, or other site equipped to manage the telemedicine
information request. Rapidly transporting image data and diagnoses
between clinicians and medical doctors can add substantially
to improved patient care.

TELEMEDICINE

Telemedicine provides medical services through the assistance
of telecommunications. Telemedicine does not completely
replace medical expertise, but it is critical to providing quality
and efficient health care services.

Telemedicine is a rapidly growing part of the medical information
management market and is one of the largest and
fastest growing segments of the healthcare device industry. The
expected revenue by the end of 2000 is $21 billion.
In the United States, more than 60 percent of federal
telemedicine projects were initiated since 1998. The concept
of telemedicine exploits much of the state-of-the-art technology
available, especially if it is combined with the growth of the
Internet and World Wide Web (WWW).† 3G networks will further
guarantee a wireless extension of Internet-based services
and technologies. By reducing the time spent in copying, sending,
and archiving medical information, the cost of administration
and insurance claim processing is reduced. Mobile
medicine will enable healthcare workers to receive supply-ondemand
content in a mobile environment.
Some of the advanced telemedicine applications include
telecardiology, teleradiology, and telepsychiatry. Telecardiology
services incorporate transmission of ECG data, echocardiograms, heart sounds and murmurs, and cardiology images, and
can be performed in both store-and-forward and interactive
media. Teleradiology is the most widely adopted of all telemedicine
applications. Clinical radiology requires prompt, near
real-time transmission of still-frame images, but may also
demand live or full-motion video image communication and
display. Telepsychiatry allows psychiatric care to be conducted
at a distance to provide care more frequently to patients in outlying
areas.

Telemedicine applications usually encompass computer,
video, and telecommunications technologies—each with its
own role to play in the acquisition, transport, and display of
medical information. Some of the key areas related to telemedicine
include patient record management and mobile clinics.

MANUFACTURING

Telecommunication systems have long been used in manufacturing
processes to monitor and control production to ensure
quality. Manufacturing systems can benefit from wireless production
monitoring and low-cost data communication systems.
Production monitoring is the process of using data devices
or sensors (e.g., video cameras and keypads) that transfer information
via communications lines to keep records of physical
production. The Internet and other communication networks
are moving onto the factory floor to provide companies with an
inexpensive means to link workers and the machines they operate
to remote repositories of information. Distant managers
can watch what’s going on, literally, from wherever they are,
through sensors, tiny Web cameras, and Web displays built
directly into equipment deployed on assembly lines. Previously,
these monitoring devices required physical, wired connections
that limited their routing to production managers. By using the
Internet or other wireless technologies, managers located in
distant facilities can monitor production and ensure problems
can be resolved long before the problem causes lost production
or injury to personnel. Software that integrates Internet technologies
into factory operations was a small percentage of a
$4.8 billion market in 1999. Prepackaged manufacturing monitoring
software is growing by 14.2 percent a year.