A Practical Navigator for the Internet Economy

The Universe of License Exempt Wireless

Commoditization and 802.11 Standards Progress Merges with Design Innovation and Pent Up Broadband Demand

Result is Chaotic World Where WISP Entrepreneurs Are Beginning to Build Complete Telecommunications Systems

Introduction How to purchase this issue. $400 single copy or 1200 group.

Fifteen months ago The COOK Report very tentatively asked whether license exempt wireless could replace the local loop? The conclusion was maybe. How was not at all clear. The answer now is a definite ‘yes’. The necessary technical pieces to enable this all exist, although the exact steps and timetable by which it may happen are not yet discernable. Nevertheless, the pieces are falling into place. They are contained in a complex and chaotic mosaic that this combined issue of The COOK Report will describe. The highlights of this mosaic found in newly available license exempt spectrum and new modulation rules. In mushrooming capital investment in 802 standards. In proprietary variations on those standards. In increasing processing capability and decreasing prices of hardware powered by Moore’s Law. Finally in investment at a local and individual level that is made possible by low prices driven by commoditization.


The developments make it feasible for small entrepreneurs operating locally to create offerings on the basis of a first hand understanding of local market needs. These local entrepreneurs operate with economy of scale unavailable to any large company that dreams of installing national service but doesn’t understand the layers of over head involved. Such a company will think it is using economy of scale because its mindset will be mired in the relative uniformity of wireline installations. It will understand too late that every wireless installation has its own set of very complex variables that are shaped by unique qualities of the location in which it takes place.


How to summarize the status of license exempt wireless? It is an entire complex and fascinating world unto itself. With the beginnings of sensor networks, RF ID technology, Ultra WideBand and Zigbee, a fern like undergrowth is sprouting up around the more mature trees of the 900 MHz radios and 802.11b and the UNII services in the 5 GHz range. The forest is becoming a jungle. The individual trees and perhaps even the jungle floor are continually discussed in the trade and national press. Trying to understand what it all means by reading what is “out there” doesn’t work. It is like trying to understand the rain forest by reading isolated descriptions of each tree and plant. The vast number of ‘wireless” stories appearing in the national and trade press are sound byte, tree and plant descriptions. Small segments and vignettes. This COOK Report will try to give a meaningful picture of the whole.


We have immersed ourselves for the last eight weeks in another ‘symposium’ mail list, two interviews, many phone calls and a visit to the Wireless Communications Association International (WCAI) show in Washington DC in an effort to document the state of license exempt wireless in the global telecommunications marketplace. The changes since we concluded our first assessment (COOK Report June July 2002) 15 months ago are quite amazing.


We are trying to bash boundaries and develop ways of looking at the world other than from the traditional wireline point of view -- hierarchical and well ordered. It turns out that wireless is very complex, multi-dimensional and chaotic. Everyone here is trying to describe the wireless elephant (Dave Hughes calls it a whale – half of which is virtual – not real. Reality can only be ascertained when complete systems are deployed in the field and real communication takes place.) We have seeded our panel with people from both the wired and wireless world. This has led to some heated debates that show how different the fundamental view points of wireline and wireless world are.
We conclude that one cannot adequately understand what is happening without also understanding these fundamental differences.


All the experts have their field of specialization and talk from the point of view that feels most secure. What we have seen is that even those net headed fiber folk who do understand the way the wind is blowing have great trouble imaging that anyone in his right mind would choose the uncertain and chaotic world of wireless rather than live with the security of wireline nets with well defined beginning and termination points, interconnection routes and hierarchy.


The increasing power of chips and software is challenging the human understanding of what information intelligence and communication is. There is not only the physics of wireless but the interaction of the bits with humans and with other devices. Like McLuhan we may ask whether wireless communication may be extending the human nervous system into the world around us? A whole series of sensory systems are emerging in that fern like undergrowth in the jungle – that will flow out into what is beginning to be called pervasive Internet and computing. I intend to investigate this flow.


Yet even within the wireless world we see substantial gaps between the researchers, the policy people, the hardware manufacturers and the Wireless Internet Service Providers (WISPs) who do the purchasing and installation of the radios. The WISPs themselves are in the center of chaos. They must choose between a bewildering array of radios, modulation schemes, antennas, cost of site, CPE equipment, density of coverage, cost of back haul and bandwidth delivered by different radios under different conditions – all of which is constantly changing at accelerating rates. Only by installation experience can they get a good grasp of how to make the most effective choices from the variables they face and work toward broadband delivery of service at a cost per customer that can enable them to find buyers for and operate at a profit.


What we can see is that this technology can deliver a full range of services and that it will begin to encroach on and devour more traditional services. Earlier this year we have seen (you dear readers and I) how voice is a bucket of bits. The same as email in cost to deliver - if, that is, you have broadband. Since late January we have been using Vonage – an average of 3000 minutes a month for the last 6 months. Can a WISP customer use Vonage? Or Packet 8? Yes. Can a cell phone customer buy a sip-based phone that uses 802.11b instead of a LEC cellular service? Yes. See http://www.sipphone.com


If your home or business could connect to fiber with a gigabit Ethernet open point of interconnection would it be even nicer than wireless? Of course. There’s just one small problem that, in about 97% of the territory of the US (rural) and 99% of the world at large, the chances of doing this at an affordable price are extremely remote. Unless that is, one lives in one of the large areas of Canada served by a condominium dark fiber build and municipal network, or in an increasing number of generally small municipalities in the US that are building their own networks. The chaotic end state will be some combination of fiber and wireless. The proportions are not yet clear. However the proportion of wireless is likely to be far higher than most people can presently imagine.


Fiber is always very nice if you can connect. But even in cities where you may have it to the curb, the cost of getting it inside the building is often prohibitive. There are gigabit radios from multiple manufacturers that offer more cost effective ways of connecting urban users offices to fiber. What about mesh for local infrastructure? Some possibilities are emerging. It’s too early to tell how they will play out. They will likely play out in patchwork splotches on the wireless landscape.
Fifteen months ago license exempt wireless had a set of frequencies, power requirements, varied modulation schemes and increasingly smart antenna designs in its arsenal. At the end of 2003 these are still all there. However, they are being joined by something new of profound importance. The power found in better silicon to sort out a meaningful signal from what otherwise just is undecipherable background noise. The radios are getting better and better. Their progress appears to be open ended.


Conclusion
Wireless Fiber in Our Future?


This issue then surveys the wireless rain forest. It travels from the emerging Smart Dust on the forest floor upwards through the 802.11 family of products to 802.16 and proprietary but still license exempt solutions. At the very end of our exploration our attention has been directed to some interesting and potential major developments are brewing in the “rain forest canopy.”
As we finish this issue on Labor Day Weekend we have gotten a brief glimpse of new frontiers. In the 60 GHz band there is already 7 GHz available under part 15 rules. This is certainly enough for well engineered wireless back haul at gigabit rates. What is missing at the moment is the low cost radios to fill this ecological niche in the wireless rain forest. With a huge amount of hertz over which to spread one’s information, one does not have to employ vast amounts of new and costly digital signal processing to pack information into small channels. This is why unlike very high speed routers, very high speed radios don’t have to be radically expensive. Radios are working at 60 GHz. They are on the drawing board in the 70 to 100 GHz range. Eight companies have a very interesting petition at the FCC. NPRM-02-180 covers 71-76 GHz, 81-86GHz and 92-95GHz bands (also know as WT Docket 02-146) Among the filers of comments in February 2003, there was an extremely high degree of consensus on: Site-by-site licensing in accordance with Part 101 rules.


Part of the issue for license exempt radios is that the security agencies would like to know where these ultra high-speed radios are. From the investment point of view because Part 15 radios have to accept interference they are expensed. In other words, written off with short lifetimes. The part 101 licensing being proposed is quite intriguing. Path by path. From point A to point B. Suggested fees are reasonable: Federal fee of $230 to file, and $5 a year to renew.


The licensing is essentially for a fat pipe for ten years. An auction to be named band manager may be proposed by the FCC Wireless Telecommunications Bureau, but industry wants a path coordinator, like the current microwave frequency coordinators, and no third party, like the venture firms that won the 39 GHz auction. A trusted path coordinator would be allowed to charge separate fees to cover the costs of calculating and maintaining the path licensing data base. The thought is that these rules would give serious reason for investment in the design and manufacture of these millimeter wavelength radios.


The goal here is “wireless fiber” at ten gigabits per second. The pay off starts with affordable extension of fiber into 750,000 business buildings with 20 or more employees in the US, Three quarters of these 750,000 buildings are within one mile of buildings containing networked fiber. Cisco Systems, Bridgewave, Ceragon Networks, Endwave, Harris, LOEA Communications, Stratex Networks and Terabeam are telling the FCC they think there is a serious business case for “wireless fiber.”


Such millimeter wavelength radios will be limited to line of sight and to a distance of about a mile. They will be weather impacted. These will be fine in cities where there is alternative infrastructure but may not be as useful in rural areas. Dewayne Hendricks points out that before year’s end he will be testing a radio in the 5 GHz band that will do 400 megabits over a distance of many miles. He adds that by 4th quarter of next year he expects the same radio to be doing a gigabit. We shall likely examine these developments in a future issue.


Executive Summary
Fiber Where You Find It


Summarizing the state of the industry, in mid May we wrote:


“Specialized solutions are out. General commodity based and increasingly open source solutions are in. Gigabit and ten gigabit Ethernet prices are plummeting. Enterprises are building their own fiber networks generally at bargain basement prices gleaned from the wreckage of the bubble. We explore what all this means for the economics of the industry. We explore in great detail the question of fiber for the rest of us. It is beginning to happen but excruciatingly slowly. No one yet quite sees how to administer an inevitable coup d’grace to LEC copper.”


Wireless for the Rest of Us


After having spent the summer immersed in license exempt wireless, we must add wireless to the commoditized rebuilding mix that we reported on in May. Indeed wireless may turn out to be a very powerful “dark horse.”


Wireless, as we found out, is its own world. It demands that its users deal with far more complex issues than fiber. It teaches the importance of location like no other technology. Conditions for installation vary at every location. What works at one point may well not work a kilometer away.
What is not yet generally understood is that the radios behind license exempt are either now good enough or likely to become good enough within the next 18 months to be considered as viable replacements for most wireline applications. If fiber is already in a locality, use it. When you need to go where fiber isn’t terminate your fiber into an ethernet that is shared with your radios. Use your radios to achieve what you would otherwise do with fiber. The capability is not totally here yet. But it is coming. It is far closer than most can imagine.


In talking about wireless, we are talking about an environment with many more components that the wireline world is used to. Bringing people like Andrew Odlyzko and Jonathan Thatcher who have built their reputations in the world of fiber was very instructive. They questioned why given the possibility of clean stabile fat pipes that can be built with fiber why anyone would willingly make a tradeoff that would involve the much messier world of wireless.


But people are plunging and will continue to plunge into the messy wireless world because it will deliver broadband connectivity at prices they can afford.


We contend that although the cost of FTTH is declining the cost of ten megabit plus wireless is coming down MUCH faster. Given how wireless is modularized and ultimately individual and edge deployable, we predict that it is finding an ecological niche that will be especially appropriate to the likely economic and political environment of the coming decade. What is starting out as a niche will likely become an ever-larger foundation.


While some of our panelists state that the hundreds of millions of radios being built to the specifications of the 802.11 family of standards will produce ever more powerful radios at ever cheaper prices, others say that special purpose radio design will be as competitive. These folk say that the creation of the necessary chipsets are modularized into building blocks of components such as digital signal processors and field programmable gate arrays. These building blocks they maintain can be pasted together to achieve new functionality and sent for production at ever cheaper prices at the new Taiwanese “fabs”.


Fiber is great but wireless looks likely to become a viable alternative to virtually every wireline application.


As we shall begin to investigate in future issues, wireless may begin to fill user financeable gaps that must be overcome for the knitting together of many of the business processes needed for the real time corporation. The work of Dave Hughes that we highlight in the final chapter of this report opens the door onto what is being variously called ubiquitous or pervasive computing. Something simply not attainable without continued advances in wireless and something that the COOK Report will turn to in its next issues.


Meanwhile readers should turn to our introduction on pages one, four and six. For a quick over view they should then either read pages 112 to 128 or travel chapter- by-chapter through this report.

Contents

The Universe of License Exempt Wireless

p.1

Chapter One
Redefinition of FCC Modulation Rules Enables
Further Radio Innovation

New Radios in New
Bands Find New Markets p.7

Late 2000 Marked a Major Shift in Part 15
Regulatory Policy p.7

From Two Allowable Modulations to Many p.8

Design Objectives and the Knob of 'Favor' p. 8

Design Innovation as Enabler of Growth in
the Personal Productivity Market Place p. 9

Dealing With Complexity and With Local
Economics p. 10

Part 15 and Volume Market Opportunities p. 11

New Modulation Schemes p. 13

Wireless Fast Ethernet p. 13

 

Chapter Two
Policy for Use of License Exempt in the First
Mile p. 15

Scaling Up Unlicensed: From Hot Spots to Hot
Zones p. 16

Reclaiming the 'Vast Wasteland'
Unlicensed Sharing of Broadcast Spectrum p. 17

Another Paper on End-to-End Worth Noting p. 17

FCC Feint on Rural Wireless p. 18

So Where Are We Headed?
Spectrum as Property - It Isn't p. 19

Regulation and Economic Value -
Infrastructure or Just Plain Commerce? p. 19

 

Chapter Three
802.11 Family’s Impact on Telecom
Infrastructure p. 21

Internet Access or Connectedness? For What
is the Technology Actually Being Used? p. 21

Mesh Powerful But Faces Issues of Scalability p. 22

Mesh Rebuttal p. 22

HotSpots and Where Does 802.11 Really Fit? p. 23

Why 802.11 Will Out Evolve Everything Else p. 24

Market Place Role of 802.11 – Both the PC and Ethernet of Wireless. p. 25

802.11 as Neighborhood Area Network p. 26

Speed Disparity Between Needs of Wired and Wireless Worlds? p. 26

Business Opportunities -- Wireless As anEnabler of Small Business p. 27

Standards or Not? p. 28

Who Needs Gigabits? Fiber in Grant County p. 29

Wireless’ Ultimate Market? p. 30

802.11b Not the Be All and End All p. 30

Steven Cherry on Wireless p. 31

Business Model Prospects p. 31

Design Issues and Good Wireless "Citizenship" p. 33


Chapter Four
Peter Ecclesine on Freedom to Innovate and
Commoditization as the Engines Behind
Wireless Development p. 35

Identifying Market Place Winners p. 35

Scoping Out the Personal Productivity Market p. 36

Quantifying How Smaller and Cheaper Drives
Opportunity into Mass Markets p. 37

Intelligence Gathering for Corporate Resource
Allocation p. 38

How to Evaluate OFDM p. 38

Personal Productivity Tools are the Future p. 39

Problems of Scaling WLAN to WMAN
Networks p. 40


Chapter Five
An Interlude - Will the Future Be Fiber or
Wireless or Some Combination of the Two? p. 41

Where Does Broadband Wireless Fit in a More
Global Architecture? p. 41

Wireless is Integral to Broadband Needs But
It Is Not "the" Solution p. 41


Chapter Six
Separating Hype from Reality With 802.16 p. 44

802.16 Versus 802.11 p. 44

Wireless Infrastructure Plays p. 44

NLOS and 802.16 p. 45

802.16 to Operate in Differing Bands -
Role of WiMax p. 46

802.16 and the Declining Price of 802.11
Chipsets p. 48

If Not 802.16 Something Better Than 802.11
is Needed p. 49

802.16 Drawbacks p. 50


Chapter Seven
Design Issues Some Non 802 Systems Such
as Canopy and Licensed Bands (MMDS) p. 55


Canopy and Robustness in Interference p. 55

West Point and MicroSoft Campus Wi-Fi
Rollouts p. 56

Canopy’s Operating Environment p. 57

Channels, Coverage and Scalability p. 58

Integrate the Rules into the Radio p. 59

MMDS and LMDS Business Model Viability p. 60

Local Multipoint Distribution Service
- A Licensed Failure p. 60

The “Spoiler” in Licensed Spectrum p. 61

Do WISPs Need Licensed Spectrum? p. 61

Chapter Eight
WISP Business Models p. 64

Understanding Canopy Cost and Operation p.64

Commoditization of Access Costs p. 65

Mixing Bands – Operational Issues p. 70

Wireless Business Costs p. 72

What Capacity Does a WISP Need? p. 73

Do WISPs Influence Their Operational
Environment? p. 74

Chapter Nine
Wireless and Hierarchy
Antithetical to or Supportive of a
Wireline “Pecking Order?” p. 75

You Get to Choose Where You Get the
Bandwidth p. 76

Hierarchy in Networks? Point and
Counterpoint p. 77

Further Debates about the "Necessity" of
Hierarchy p. 78

The Medium Should not Be Seen as the
Source of the Reliability, p. 80

Two Different Definitions of Reliability p. 81

Reliability in the Context of Hierarchy p. 82


Chapter Ten
How to Think About Technology Choices
Some Guidelines for Decision Making -
Everything is Local p. 85

The Goal is Connectivity not a Technology p. 85

Wireless Adds Environmental Location
Issues to the Decision Matrix p. 86

Four Dimensions p. 86

Wireless Destroys Wireline Economy of
Scale Arguments Including Centralized
Planning p. 88

But What About Backbones? p. 89

Backbones? Who Needs Backbones? p. 90

The Internet Used to Be Hierarchical p. 92

Role of Peering in Keeping Traffic Local p. 93

Korean Internet Traffic Follow up p. 94


Chapter Eleven
Dave Hughes and Micro Radio Networks p. 96

Dave Hughes: I Live in a Different
Wireless World Than Most p. 96

Boundary Bashing p. 97

David Hughes On the Use of Meshes to
Collect Sound p. 99

Soundscaping as an Environmental Profile p. 99

Shoutcast for Making Data Presentational p. 100

Pervasive Computing to Wire the Planet p. 100

Amateur Radio Operators Become Part
of Global Weather Forecasting p. 101

Smartdust p. 103

Fuel Cell Advances p. 105

Device to Device Radio Network
Organization p. 106

Printed Fuel Cells p. 109


South Wakaito Community Network p. 110


This Newsletter in Short Form p. 112


Executive Summary p. 129

 

Contributors to this Issue

Boyd Bangerter, Director of System Architecture & Standards, Intel Labs.

Robert Berger, CEO Internet Bandwidth Development Corp.

Michael Calabrese, Director, Public Assets Program, New America Foundation.

Mike Cheponis, President, California Wireless, Inc and specialist in design of antennas and ultra small radios and related software.

Steven Cherry, Senior Associate Editor IEEE Spectrum.

Peter Ecclesine, Technology Analyst, New Markets & New Technologies, Corporate Business Development (Investments and Acquisitions) Cisco and Editor for 802.11j

Jim Forster, Cisco Systems Distinguished Engineer.

Tom Freeburg, In May 2003 retired from Motorola where he led development of Canopy. Currently consulting.

Sebastian Hassenger, Senior Strategist Pervasive Computing, IBM.

Dewayne Hendricks, CEO, Dandin Group and member, FCC Technological Advisory Council.

Dave Hughes, Owner Old Colorado City Communications (a WISP) and NSF funded wireless researcher.

David Hughes, Rural economic development specialist and designer of wireless data collection grid.

Pete Kruckenberg Senior Network Engineer at Utah Education Network and the Intermountain GigaPop, and been involved in the intermountain west ISP and service-provider industry since 1993.

Patrick Leary, Alvarion's Chief Evangelist for North America. Spectrum Policy Task Force member and named 'WISP Advocate of the Year' for 2003.

Jon Lebkowsky, wireless network development University of Texas, Austin.

Sheung Li, Director of Marketing North America, Atheros Corp.

Andrew Odlyzko, Director Digital Technology Center University of Minnesota.

David P Reed, wireless researcher Media Lab and HP Labs. Author with Clark and Saltzer of 1983 end-to-end Internet Architecture paper.

Marlon Schafer runs a wireless ISP in Odessa Washington and is an independent consultant to other WISPs.

Steve Stroh is Editor of FOCUS On Broadband Wireless Internet Access newsletter. He has written extensively on wireless since 1997. Has long had the vision of complete broadband wireless solution that we explore in depth here.

Jonathan Thatcher chaired the ten gigabit Ethernet standards effort; chaired the Ethernet in the First Mile Alliance (EFMA). Past Chief Technologist at World Wide Packets.