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November 12, 2002

The Pulver Report - November 12, 2002

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In this Issue:

- Heard on the Net
- Panama blocking VoIP
- Watch out for Wi-Fi: The Goldman Sachs report on Wi-Fi
- The Almost Broken Business Models for 802.11 "Service" Providers
- The FCC and Open Spectrum: by Kevin Werbach
- Jeff's Observation: Opportunity for a 802.11 Community Networks
- pulver.com comments on the FCC issued E911 report
- Call for Speakers - Spring 2003 VON week
- pulver.com 2002/2003 Conference Calendar

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Heard on the Net

- Companies on the Move

Wavecrest Communications recently acquired Interoute's wholesale voice
operations.

Netrake recently closed US$20 Million in Series C funding.

Mediatrix recently secured CDN$4 million in additional private financing.

- People on the Move

Gur Kimchi recently left VocalTec Communications and joined Microsoft as
Program Manager in the Windows Networking Group.

Stephan Reckie recently joined BICOM, Inc. as Vice President of Sales and
Product Marketing.

Gordon Simmons has left Polycom and recently joined Seance Software of N.
Vancouver, BC Canada as Executive VP of Marketing.

Michael Frisby recently left iRevolution and joined Callserve as
business development director.

John Winchester recently left Avaya and joined Psytechnics as CEO.

Paul Sijben recently joined Picopoint at CTO.

David Fowler recently joined Groove Networks As Vice President Of
Marketing.

Michael Enck recently left Hewlett-Packard.

Tim Ward recently left LongBoard.

Scott Rex recently left Research First Consulting and founded Niimbus.

Jeffrey Gray recently left e-Vantage Solutions and founded Mobius 1.

Please email: people@pulver.com to report a change in your position.
Please refer to: "People on the Move" in the subject.

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Panama blocking VoIP

In a throwback to 1996, Panama has joined a list of countries
which have decided to block and/or ban VoIP. The official government
decree is posted to:
( http://www.ersp.gob.pa/busqueda/show_resol.asp?id=JD-3576&idsector=1 )

Like other Governments in 1996, the government of Panama believes that
they are losing revenue from the use of Internet Telephony, so it seems
they took the proactive measures they felt were necessary to protect
their revenue source. I personally doubt the government officials of
Panama will ever know how effective their attempt to ban VoIP services
will be. Those who wish to circumvent the degree will deploy their
own VoIP proxy solutions.

------------------------------------------------------------------------
Watch out for Wi-Fi: The Goldman Sachs report on Wi-Fi
(contributed by: Christopher Fine, Goldman Sachs & Co.)

At Fall 2002 VON, there was considerable buzz about IEEE 802.11 wireless LAN
technology, or Wi-Fi. Pulver Report readers may be interested to
know that the Global Investment Research group at Goldman, Sachs & Co.
recently published an industry research report called "Watch Out For
Wi-Fi," a comprehensive study of the Wi-Fi market. The report made
several key points:

1) The proliferation and technological advancement of Wi-Fi is driven by a
set of strong catalysts in place at the same time, similar to the factors
that drove rapid development and adoption of earlier technologies like
Ethernet, PCs, the Internet and the World Wide Web.

2) Large tech companies (including Cisco, Microsoft, Intel, IBM
and many others) are focused on Wi-Fi as a key technology, as are many
startups. Expect to see ongoing breadth of support for Wi-Fi and continuing
improvements in Wi-Fi semiconductor, systems, and software products.

3) The growth of Wi-Fi is likely to "pull through" sales in other sectors,
including PCs and PDAs, software, comm equipment, semiconductors, and
broadband connections. The result of this effect is likely to be a larger
market opportunity than direct revenues from Wi-Fi equipment itself
(although Wi-Fi technology alone is thought to be a $4 billion -plus
market by 2006, according to some industry analysts).

4) There are some short-term challenges to Wi-Fi, including spectrum
interference, QoS support, security concerns, underperformance of equipment
vs. hype, and scalability issues such as limited ability to support mobile
users who move from one "hotspot" to another. The likelihood is that most
of these challenges will get resolved within the next 12 months. We have
recently seen announced a major improvement in Wi-Fi security, for example,
supported by the Wi-Fi Alliance, a leading industry standards group.

5) Within the next few years, we are likely to see Wi-Fi networks installed
in many public places, homes, and enterprises. This means there is high
probability that a user can access wireless LAN - high-speed IP connectivity
and IP-based services - from just about anywhere, if the user is authorized
to do so.

The VON community in particular should watch Wi-Fi carefully - not only for
all the above reasons, which point to a fast-growing technology with many
applications - but because a near-term opportunity for Wi-Fi involves VoIP.
VoIP over Wi-Fi could offer homes and enterprises a non-proprietary and
inexpensive way to access both IP voice and advanced services from just
about anywhere. For the enterprise in particular, Wi-Fi may offer a way to
provide wireless IP-PBX support in a much more flexible way than traditional
approaches. Cellular handsets will begin to incorporate Wi-Fi sometime in
2003 - first for data only, but eventually providing a way to access both
LAN-based and cellular voice networks from a single device. Finally,
because Wi-Fi is really "wireless Ethernet", it offers the same power and
potential as wired Ethernet LANs do for advanced services incorporating
voice and all other media in a seamless IP fabric.

For more information, or for a copy of the Goldman Sachs report, please
contact Christopher Fine, the principal author of the report.

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The Almost Broken Business Models for 802.11 "Service" Providers

When I think of free, I think of viral. Free to me is viral. With regard
to 802.11, these days people get "free" 802.11 access in their
offices, some who install wireless networks at home have "free" 802.11
access in their homes and we at pulver.com give free access at our events.

The concept of the ISM band in the United States and Europe, which is
where 802.11 resides, was "license free". Over the years, no one ever
hinted at spectrum usage fees for the ISM band. I think those who wish to
charge for services on the ISM band should think again.

Why would anybody expect to pay anything when using their PCs outside of
the home? Especially when people can go to other peoples' offices and
friends' homes and get free access. Maybe it is just me, but why should
people be expected to pay for something which they already get free?
I think the business models of today's 802.11 "service" providers are
already busted, especially if they rely on consumers to pay for access.
Maybe Wayport and T-Mobile will get a few desperate people to use their
services since wireless is cooler than dialup, but at what price? I will
lose all respect for anyone I know if I find out that they are paying $40
a month for wireless access in the Melville or Great Neck Starbucks. What
do you think?

...And even if there are early adopters, over time, very few people will
pay for such service for any sustained period. Maybe for US$10 a
year but not US$40 a month and most certainly not US$ 80. I think those
people who think they can build a wireless service provider model using
free and unlicensed spectrum and make it work at US$50 to US$80 will fail
and may fail fast.

Maybe I'm missing something but what may seem obvious to me, may have been
overlooked by those who have funded such operations. The advent of the
Internet has in fact created a huge transfer of power from what once was
"central control" to end users.

Central control enables the service provider models of old telecom and the
new service provider models, which some large software platform companies
have recently tried to assert. It remains unclear to me if these service
provider models will ever really work. I believe the future of telecom
will look a lot like the computer and networking industry does today, with
many software companies, some platform companies, and system integrators.
A world with almost no service providers in the sense familiar to
traditional telecom. In the end, we may just need a utility provider of
connectivity and not much else.

So, O.K, maybe I'm being a bit harsh here with regard to future of
not-for-free WiFi Hotspots. I actually do think there c-o-u-l-d be a
Hotspot business case for our "road warrior" friends (myself included),
people who travel a lot, go through (and sometimes live at) airports
and stay in various hotels. These people I'm guessing would be interested
in paying about US$50 a month for access, but if, and only if, it would
cover just about all of the hotels, airport and meeting places they tend
to visit. To pull this off, the WiFi access providers will have to put in
place roaming agreements and implement HLR/VLR like services and jointly
permit roaming between all of these possible access points. They would
absolutely also have to deal with the issues surrounding wireless
security and make sure that their data is private and secure at all times.
This said, what I am sure of, is that people would only be interested in
WiFi island HotSpots if they don't have to pay duty each and every time
they visit a different island.

p.s. If you are still not convinced about the viral nature of 802.11
wireless communities please visit:
( http://www.personaltelco.net/index.cgi/WirelessCommunities ) which
includes a pretty extensive listing of wireless communities around the
world.

------------------------------------------------------------------------
The FCC and Open Spectrum: By Kevin Werbach (kevin@werbach.com)

Anyone interested in the future of WiFi, broadband, wireless technology,
and the communications industry in general should pay attention to what's
going on at the FCC. Entrepreneurs and technologists are used to dealing
with threats from regulators. In this case, there's an opportunity for
the regulators to actually make things better.

I'm talking about the FCC's Spectrum Policy Task Force Report, which was
officially adopted last week. The announcement is available now at
( http://www.fcc.gov ), and the actual report should be released within
the next week. The FCC is considering major changes in the way it manages
the airwaves. Those changes could open up new opportunities for
innovation...assuming the FCC makes the right choices.

The FCC is considering arguments for treating greater portions of the
spectrum as "commons," open for anyone to transmit. In other words,
setting aside more unlicensed bands like the 2.4GHz and 5GHz bands where
802.11b and 802.11a operate, and authorizing greater use of "underlay"
technologies like ultra-wideband that can share spectrum with existing
licensed services.

FCC Chairman Michael Powell tipped off some of the themes of the report
in a speech at the end of October, which is available at
( http://www.fcc.gov/Speeches/Powell/2002/spmkp212.html ). "Modern
technology has fundamentally changed the nature and extent of spectrum
use," said Powell. Powell called into question the basic rationale for
licensing frequencies exclusively to individual companies: that spectrum
is scarce. The head of the FCC making this statement is like the CEO of
a Bell Operating Company touting the virtues of voice over IP. The US
government has spent 90 years actively regulating spectrum use, either by
giving away licenses or selling them at auction. Now it's thinking about
opening up the airwaves.

What does this mean for the Pulver Report community? A great deal. WiFi
is an exciting technology, but it has many limitations. And it faces
threats from entrenched interests that want to impose restrictions on its
use. With more unlicensed spectrum, we could see unlicensed wireless
emerge as a real competitor for last-mile broadband connections. As QOS
issues are resolved, unlicensed wireless could even provide some
competition for voice services. And with Microsoft and Intel both making
significant commitments in this area, things could happen more quickly
than most people imagine. I recently wrote a whitepaper that goes into
more detail -- you can find it at
( http://werbach.com/docs/new_wireless_paradigm.htm ).

The FCC is under pressure from the military and licensed wireless
operators to abandon its efforts to open up the spectrum. That makes it
important to file comments in favor of innovation. The FCC is starting
its formal process by issuing the task force report and seeking comment
in a Notice of Inquiry. When that document goes up on the FCC Website,
it will have instructions for submitting comments electronically. Join
the revolution and show your support for open spectrum!

------------------------------------------------------------------------
Jeff's Observation: Opportunity for a 802.11 Community Networks

Looking at the viral evolution of local 802.11 networks and the
ability to quickly and easily deploy IP based services on them, I now see
an immediate reason why communities should take the steps needed
to now embrace this technology and commit to create their own private
802.11 community networks starting first around the homes of families who
have children attending the local elementary school(s). This same concept
applies also to middle schools and even to high schools and eventually
an entire town.

Once the community 802.11 network is created and maintained, one primary
use could be for the set of IP based location based services that could
be deployed. For example, one could go to the local PTA and show off
802.11 technologies that allow us to deploy Location Based Services in
small chips that we put in our kids' school bags that allow parents to
track their kid's bags. We could give our kids some kind of communicator
so they could press a button and ask for help, or send out a simple "I'm
ok" message. This network could also be used as a local and
private instant messaging network to announce school closings,
notices home about homework, after school activities, etc.

This wireless network could also be used as a simple 802.11 CB Radio
for school kids and their friends. Access to this network should be free.
Each community could decide whether or not to provide public links to
the public internet from such networks. This would need to be carefully
thought out, as I'm sure it could also be abused, but the fundamental
concept is the "are my kids ok?" network. :-)

As I think about the possible applications for such a network, my mind
jumps to the news about all of those horrible child abductions and the
Amber alert system. I'm hopeful that a community supported 802.11 network
might prevent such bad things from happening. We could place chips/devices
in our kids' favorite toys, stuffed animals, book bags, etc. I have
no experience with any Parent Teachers Associations, but if it was
pitched right, there should be some interest for a trial deployment,
especially if the equipment was donated.

One could also look to deploy other community services, such as a
community service that could track family members who suffer from things
like Alzheimer's. Our pets could be tracked around our neighborhood.
Parents could also check-in on their kids who are at other parent's homes
on play dates. This network could serve as a backup for relaying critical
information about relatives and friends who have medical conditions who
have to be monitored on a real-time basis. The applications and value of
such a network would grow as the number of people who are dependent on the
network increases.

All that is needed are people who would be willing to allow for such
equipment to have a presence in their homes. This would also require
people willing to donate the equipment to seed the project and others
with enough community spirit to help maintain the vision.

I realize we would need to address privacy concerns, as well as
all the wireless security issues to make sure that none of the
available information is abused...but I believe that there exists a
middle ground that we can reach that will make almost everyone happy.

I'd like to see the support of VPN tunnels so that I could access the
wireless network in my home and connect to the 'outside' world via my
own personal connectivity.

Maybe others are already doing it. If not, I'd like to explore what it
would take to start a movement to put this kind of activity in motion.
The world can become a better place. We just need to take the steps needed
to do these kinds of things on our own. Taking one step at a time,
just about anything is possible...it just needs to get done. Access to
the parent's 802.11x network should be free and cared for by those who
care about such things.

------------------------------------------------------------------------
pulver.com comments on the FCC issued E911 report

pulver.com recently filed a comment with the FCC in response to a
recently commissioned FCC E911 report. The report titled, "A Report on
Technical and Operational Issues Impacting the Provision of Wireless
Enhanced 911 Services", was issued October 16, 2002. The pulver.com
comments focused on the need to improve the ability to locate
indoors-wireless E911 callers and the potential solutions for the
problems of using 802.11b wireless local area networks (WLAN) access
points and other hybrid location technologies. The complete filing is
posted on the FCC web site

The pulver.com filing recommends that the FCC explore initiatives that
could improve locating indoors E911 callers. Some examples of such
initiatives could include (a) the evaluation of local positioning
technologies and algorithms that could be used for E911 deployment,
(b) the creation of databases to relate access point identifiers with
geographical position and (c) the translations of space coordinates
to floor and office and apartment numbers.

The current location solutions deployed to meet the FCC's E911
Phase II mandate are very effective in pinpointing the location
of wireless 911 callers on the road in open environments where high
location accuracy can be achieved. However, the positioning accuracies
for wireless emergency calls originating in the interior of large
buildings, subway stations and similar structures are inadequate for
locating callers.

WiFi Networks which have begun to take root in residential homes
as well as in many public and commercial areas, could potentially
provide a solution for local positioning. As 802.11 access points
become more ubiquitous, they could provide the infrastructure for
indoors positioning.

------------------------------------------------------------------------
Call for Speakers - Spring 2003 VON: Deadline is November 29th.

We have just started working on the schedule and sessions for
Spring 2003 VON which will be taking place March 31 - April 3rd at the
San Jose Convention Center.

Please feel free to email: your suggestions for
the content which you would like to see covered in San Jose.
Our formal "call for speakers" is open now and the deadline for
submitting speaking proposals is November 29th.

Please feel free to submit your speaking proposal to:
( http://pulver.com/von/speak/ ).

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pulver.com 2002/2003 Conference Calendar
( http://pulver.com/conference )

"Events for the Communications Industry" (tm)

2002

December 4-5 - VON Japan, Tokyo, Japan
( http://www.key3media.co.jp/von )

December 9-10 - SuperNova 2002, Palo Alto, CA
( http://pulver.com/supernova )

2003

March 31
- April 3rd - Spring 2003 VON, San Jose Convention Center, San Jose, CA
( http://pulver.com/von ).

March 31
- April 2 - Spring 2003 Location Based Services Summit,
San Jose Convention Center, San Jose, CA
( http://pulver.com/lbs )

April 1-2 - Connectivity 2003
San Jose Convention Center, San Jose, CA

April 2-3 - 2003 Presence and Instant Messaging,
San Jose Convention Center, San Jose, CA

April 29
- May 1 - SIP Summit 2003, Las Vegas, NV

June 4 - pulverReport party @ Supercomm 2003, Atlanta, GA.

June 9-12 - VON Europe 2003,
Olympia Conference Centre, London, UK
( http://pulver.com/europe2003 )

September
22-25 - Fall 2003 VON, Hynes Convention Center,
Boston, MA

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Please send your comments and feedback regarding this issue of
The Pulver Report to: jeff@pulver.com.

Jeff Pulver Tel. +1.631.547.0800
The Pulver Report Fax. +1.631.396.3996
November 12, 2002 http://pulver.com/reports

Posted by jeff on November 12, 2002 09:19 AM | Permalink

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November 12, 2002

The Pulver Report - November 12, 2002

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