As 3G Networks Buckle, Ruckus Wireless Sends Smart Wi-Fi to the Rescue
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existing manufacturers. “At the high end of the market you had Cisco, Aruba, Airspace, Meru, Trapeze, and everybody going after the Fortune 500,” says Callisch. “And at the low end you had Belkin, Linksys, and Netgear, who didn’t build anything worth deploying. There was a chasm in the middle—people who didn’t have a crew of 15 IT guys, who just needed something that was easy to deploy, low cost, and reliable.”
Around 2007, Ruckus started selling access points to hotels. That was good timing, since that’s exactly when more guests started showing up with Wi-Fi-capable mobile devices like the iPhone, Callisch says. Soon Ruckus had built up a network of 1,500 resellers purchasing equipment and reselling it to hotels and other institutions. The steady demand from these vendors helped to balance out the company’s revenues from telecom carriers, which had been highly bumpy, with “a multimillion dollar order every other quarter,” says Callisch. But neither business was spectacular: Callisch calls them merely “going concerns.”
That’s when Tikona came along. “When they first came to us, we had no idea who they were,” says Callisch. “They said, ‘We want to offer broadband to residences and small businesses in India, and we are going to take your products and put them on buildings and mesh them into zones and start offering service at 2 to 5 megabits per second.’ And we said, ‘Why would you do that?’ And they said, ‘Because fixed lines are sparse, and 3G is too expensive, and we don’t have the money to license new spectrum.’”
That was in early 2009. Since then, Tikona has purchased 32,000 outdoor access points from Ruckus and scattered them across 30 cities in India.
“When that happened, a light went on in our heads,” says Callisch. “We started looking a lot more closely at the carrier market, and we found that because of all these dual-mode devices—the iPhone and the iPad and BlackBerry and Android—people want fast connectivity, and 3G wasn’t going to suffice. There were going to be different kinds of carriers, some just wanting to take data off other networks.” Then traditional wireless carriers started to reach out to Ruckus, saying they wanted to build concentrated Wi-Fi networks that would plug into their existing cellular networks and take over in the areas with the densest 3G traffic. “That launched us into the whole mobile-operator space, and that is where our focus is going forward,” says Callisch.
It was precisely to offload traffic from its overburdened 3G network that AT&T bought Wi-Fi hotspot operator Wayport in 2008, Lo points out. “It’s a development that is really going on worldwide in all the markets where 3G is common,” she says.
But how would carrier-operated Wi-Fi work at a scale larger than a coffee shop hotspot? And hasn’t this all been tried before in the form of the municipal Wi-Fi networks built by many cities in the mid-2000s—which are now generally seen as a total flop?
“There were quite a number of reasons why municipal Wi-Fi was a failure,” says Kish. “During this whole municipal thing, the laptop was the thing that had Wi-Fi built-in. There weren’t iPhones or Google phones. And people generally don’t walk around with their laptops [meaning there wasn't much demand]. Secondly, these networks were all built with 802.11g, which is limited to … Next Page »