Analysts: Wi-Fi a 'Positive Disruption'

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SAN JOSE, Calif. — As a wireless standard, 802.11 (also known as Wi-Fi ) is becoming quite a phenomenon and new findings being discussed here Thursday show there is no signs of letting up.

“Not since the earliest days of the Internet have we seen a technology capable of creating such positive disruption and change and we expect that 802.11 and its derivatives will only increase in importance over the next five years,” said Jupiter Research Director Michael Gartenberg.

During its one-day 802.11 Mobility seminar, Gartenberg and other analysts with Jupiter Research report that as devices are connected to the wireless Web, small business are beginning to take notice, with 80 percent saying they will spend less than $50,000 this year for operating expenses and equipment. Larger companies are reporting they will be making most of the purchases, with 47 percent saying they plan on spending more than $100,000 in 2003.

“Nearly half (49 percent) of all U.S. businesses have fewer than 20 percent of their employees connected. Small and medium sized businesses in particular are much more likely to have their employees connected via an 802.11 network,” said Jupiter Research Senior Analyst, Julie Ask. “This demonstrates that consumer and small office/home office (SOHO) markets have really driven deployments to date. That’s changing, though, as larger enterprises will drive growth later this year once security issues are resolved, which in turn presents new opportunities to vendors in this space.”

Already, 57 percent of U.S. companies already support 802.11 networks, with an additional 22 percent planning to implement and support this technology in the next 12 months.

Ask says small businesses (with less than $10 million in annual revenue) are leading deployment, with 83 percent stating that they either support 802.11 networks today or plan to in the next 12 months. By contrast, 71 percent of U.S. large businesses (defined as those generating $100 million or more in annual revenue) are supporting 802.11 networks or will do so in the next 12 months.

But while tapping into your local hotspot is a dream for mobile enterprise, most companies are asking two questions: “How do I make money off of this?” and “How safe is it?”

According to Jupiter’s findings, 31 percent of executives surveyed cited low network security as the number one barrier to deployment of WLANs . Their top concern? — Centering on rogue users accessing the corporate network from outside the corporation.

“Businesses seem to be well aware of security issues associated with 802.11,” said Ask.

Some 70 percent of executives surveyed by Jupiter agreed that the answer is a combination of proprietary and open standards with security technologies like 802.11i and WPA helping keep networks safe. New standards like 802.16, 802.20 and UWB are also expected to help lock down a network.

“In that stead, enterprise must view security as a process and not a stand-alone product,” said Ask. “Vendors should also approach small and large enterprises with solutions tailored to their needs and focus on education all around.”

And while high-speed wireless Internet access continues to pop up in airports, cafes, corporate offices, universities, factories and homes, vendors are expected to cut some of the costs of operating a wireless network.

As to making money, the seminar is part of a nationwide road show designed to help companies prepare for the market opportunities created by new wireless LAN technologies. The 802.11 Mobility research service will use consumer and executive IT surveys, online analysis, case studies and usage models.

Editor’s note: Jupiter Research’s 802.11 Mobility seminar is produced by Jupitermedia, parent company of this Web site.