Wireless Technology An Entrepreneurial View

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Wireless TechnologyAn Entrepreneurial View

• Michael Hathaway
• Venture Partner, Austin Ventures

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Wireless Explosion
Wireless Markets Are Dynamic

• Growth markets in wireless technology include
• Digital Mobile Telephony
• Wireless Ethernet (802.11x)
• Wireless Mobile Hand held computers
• GPRS
• Convergence is happening in wireless first
• Integrated voice and data

WHY?
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Why So Much Wireless Activity?

• Wireless technology provides real solutions to
  real problems that consumers are willing to pay
  for. End of story!

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An Entrepreneurial Approach

• First of all having a vision is essential.
• Secondly technology is good
• But technology alone is insufficient
• Thirdly, think beyond the hype.
• What is really needed?
• What will actually work? Can it actually be
  built?
• Who is the customer and how much are they willing
  to pay?
• Identify what can be leveraged
• Time to market, technology barrier, etc.

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VisionExploring The Possibilities

• Ubiquitous Wireless Service
• Quality, integrated wireless services everywhere
• Fully integrated services and devices
• Media integration Voice, Video and Data
• Service integration email, vmail, document
  access, etc.
• Integrated devices and integrated device
  communication
• Security differentiation
• Better than legacy wired communication mediums.
• New and improved devices and interfaces

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RealityBusiness and Technical Challenges

• Infrastructure is inadequate
• Capacity is constrained, bandwidth limited
• Frequency spectrum is rationed
• Stringent investment community standards
• Un-profitable businesses are punished
• Un-profitable IPOs are a thing of the past
• Venture capital setting a higher bar
• Requiring experience,competitive barrier, and
  profitability
• Established vendors/operators are playing it safe
• Tending towards small, evolutionary steps

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RealityNetwork Operators Under The Gun

• Subscriber revenues are declining
• Willing to pay less each year for commodity
  services
• Specifically Internet access and mobile phone
  services
• Operators want new billable services to add
• Appetite for investment in capacity is low
• Need to leverage capacity that exists
• Operators want new, billable services
• Without having to invest significantly in
  infrastructure!

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Categorizing Opportunities

• Disruptive
• Obsoletes existing technology
• Digital Mobile Telephony replaced analog
• 802.11x
• Evolutionary
• Enhancements to existing technology
• 802.11a increased bandwidth over 802.11b
• Text Messaging added to digital telephony
• Integration
• Combining technology to create new product
  offerings

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OpportunitiesEnhancing Existing Services

• Video/Satellite broadcast
• Adding bi-directional data flow and interactivity
• Mobile Telephony
• Better Service by improving range, density,
  quality
• Integration with data
• Wireless Packet Networking
• Reduce power, increase range, integrate security

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OpportunitiesPractical Solutions

• Short haul consumer market
• Eliminate wires Infra-red, Blue Tooth, etc.
• Integrated wireless links between devices
• Security Enhancement and integration
• Simplification of administration
• Integration of encryption/authentication/policy
  mgt.
• Client/End user
• Power reduction,Miniaturization and cost
  reduction
• Display enhancement

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OpportunitiesNext Generation

• Broadband Wireless
• Convergence of voice, video and data
• Broadcast media integration
• Integration of satellite and terrestrial networks

• The Final Realization Of The Wireless Vision!

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Rules For SuccessIncreasing Density and Capacity

• Capacity problems are best solved by increasing
  capacity
• Spectrum limitations must be solved
• Band aid solutions are not sustainable
• Many solutions intrude on neighboring
  vendors/networks/solutions
• Increasing spectrum is the ONLY long term
  solution
• Bandwidth constraints
• Best solved with added capacity
• QOS only helps when congestion has already
  occurred
• Customers dont pay more for better class of
  service
• They simply change vendors until theyre happy

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Rules For SuccessWireless Security

• Encryption in and of itself, is not security.
• Essential security components need development
• Service Permissions
• Who gets access to what data and services?
• Authentication
• Are you really who you say you are?
• Network protocol and data security
• Is someone watching your activities?
• Can your key be hacked?
• Can your network session be spoofed?
• Integrated management and account administration
• Administrator must easily add, delete and change
  accounts

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Rules For SuccessSimplification

• Do not expose the customer to technical
  complexity.
• Example Early Deployments of DSL
• Difficult to deploy
• Complex to manage
• Capacity constrained
• Resulted customer dissatisfaction
• 3G can we avoid another DSL experience?
• New, complex services vs better existing service?
• Capacity is still constrained
• Japans 3G killer app free text messaging
• Vodaphones difficulties in deployment in Europe

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Rules For SuccessSizing Development Efforts

• Keep tasks bounded and well defined.
• Clearly defined development effort
• Believable schedules
• Sensible staff requirements
• Integration with existing platforms
• Well defined interfaces are essential

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Predictions

• 2.5G will prevail
• Its a logical incremental, evolutionary step
• Will people really pay more for 3G services?
• WI FI will evolve into a service
• Technology hurdles are surmountable
• Its here, it works and its simple
• Integrators will seize this opportunity
• At some point broadband wireless will happen
• And it will evolve out of 2.5G and Wi Fi

The industry will evolve on a path of least
resistance
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Summary

• Having a vision is better than not having one!
• Having the correct vision is even better
• Hype generates media attention, not profits
• Wireless broadband can and will happen
• Enabled by existing technology and integration
• Simplicity will prevail
• Packet based networks
• Intuitive, useful services, available on
  appropriate devices
• Services that are easily managed and billed for