Ron Dennis

Vivato's recent funding announcement has resparked the ongoing debate of, "Are we blowing up another tech bubble with Wi-Fi?" I believe a better question is, "Why is Wi-Fi so 'fundable'?" as investors are wont to say. The pat answer is, wireless networking has the potential to be the "next big thing." Of course no one is saying what that next big thing is because no one really knows. In the interest of not only being a visionary, but a "practical visionary," I'm going to go beyond empty statements like, "It's going to be huge!" and imagine a killer application for Wi-Fi, right here.

These days, if a company is building out a new network, Wi-Fi gets serious consideration. After all, more and more employees are toting laptops, and more and more laptops are sporting 802.11 capabilities. For a small business it's almost a no-brainer to string a few wires to a few hubs, do a little software configuration, and presto! Your company is networked. For a larger business there are more serious concerns like security, bandwidth, and backhaul. All of these concerns are being addressed by a host of startups for a very good reason. If large companies decide that wireless networking is a superior solution to wired networks, it's going to be disruptive. The Wi-Fi providers (and their investors) are going to make a lot of money providing hardware, software, and services to these new networks.

But new network installations are not big enough. Real disruptive technology doesn't just add capability to the status quo, it obliterates the status quo. Take audio CDs, for example. At first they were a novelty. Once the value of CDs was unmistakable, vinyl records disappeared as a consumer item. Right now the same thing is happening with pictures, as DVDs are replacing tapes and digital cameras are replacing film. In order to achieve this sort of disruption, Wi-Fi will have to do better than be "just as good" as wired networking. It will have to be so compelling that companies will actually rip out their existing networks and replace them. No one knows what Wi-Fi killer application would cause such an upheaval, because it hasn't happened yet, but here's a vision that might just do it.

Let's assume the challenges of wireless networking a large business are overcome. After all, there are thousands of excellent minds working overtime to solve these challenges. Once a company has their wireless network, the next big bunch of wires to replace could be the phone system. All those wires strung through the company to each desk have to be connected properly and maintained. Employees are then tied to those desks in order to communicate.

However, using a Wi-Fi-phone, operating as a device on the wireless network, all the phones in a company would be "mobile phones," at least within the confines of the network. And if these new phones also offered cellular service when they are outside the network, a company could have a dream device for communication, truly mobile, always available. This sort of device could be produced as cheaply as existing digital phone handsets (about $200-$300 U.S.), especially if the market includes a majority of companies in the world. Now that's disruptive!

If this Wi-Fi phone system is compelling for companies, it's probably good for consumers as well. Could the killer app be wireless home phones using a single DSL line? Landline performance around the house and cellular performance everywhere outside a Wi-Fi network could convince most consumers that they have to have this new phone. Now we are talking about replacing all phones, not just business phones. Now I can say, it's going to be huge!

Of course this Wi-Fi-cellular phone system may or may not be the widget that changes the world. The point is wireless networks provide a platform where such things can be conceived and even built. I'm convinced that wireless networks are going to spawn a future that is very different than the one we are predicting today. And I am not alone. This is why so many new companies are chasing after Wi-Fi, and why investors are helping them.