Closing in on the holy grail of citywide Wi-Fi
Israeli startup Wavion is promising a cheaper way to flood entire cities with wireless broadband.
By Michal Lev-Ram, Business 2.0 Magazine writer-reporter

SAN FRANCISCO (Business 2.0 Magazine) -- Municipal wireless is still in its infancy, but new technology from Israel could give budding citywide networks the growth spurt they've been waiting for.

Just last month, Wavion, an Israeli company with offices in San Jose, Calif., introduced a new line of wireless access points that it claims can quadruple the coverage and capacity of existing metro Wi-Fi networks. (Access points, or APs, are the devices that connect wireless networks with the Internet and then broadcast a Wi-Fi signal for laptops and other devices to pick up.)

In order to cover a one square-mile area, says Wavion, just eight of its "spatially adaptive" APs are needed, as opposed to 25 conventional ones. That will translate into lower infrastructure costs for service providers, which could help goose along delayed citywide Wi-Fi projects.

For instance, Google (Charts) may have to install more access points than it expected to in its project to blanket its hometown of Mountain View, Calif. with Wi-Fi. MobilePro, a Bethesda, Md.-based startup, recently pulled out of a deal to unwire the city of Sacramento in California. And in Taipei, Taiwan, the citywide network has yet to sign up anywhere near the number of users it needs to break even. Cutting hardware costs should speed up these deployments by making networks cheaper to operate.

Supersizing Wi-Fi

Wavion's access points use a combination of custom hardware and software to run six specially designed antennas in a single access point. (Most conventional access points only have one or two antennas.) The company is already running trials in Cumberland, Maryland and Haifa, Israel, and will soon be testing in Florida and various locations throughout Silicon Valley.

Alan Menezes, Wavion's vice president for marketing and business development, says he expects major rollouts of metro-area Wi-Fi networks to begin by 2007 or 2008. Just how big of a part Wavion's gear will play in those rollouts has yet to be seen, but Sam Lucero, a senior analyst with ABI Research says Wavion's technology is promising.

Of course, the startup is facing competition from Cisco (Charts), Motorola (Charts), and other big Wi-Fi hardware makers. Wavion's basic approach of stuffing more antennas into a single access point may sound easy to duplicate, but processing multiple Wi-Fi signals with custom chips and special software is tricky work - the sort of digital signal processing that Israel engineers specialize in, according to Menezes.

"We can cut capital expenditures in half, and operating expenditures by more than half, not to mention eliminate dead spots and bring other advantages to users," says Menezes.

A wireless link with Google?

Wavion's also rumored to be in talks with Google. Says Menezes, "I can't speak for Google, but yes, they are very interested in our technology."

That might just sound like big talk, were it not for the fact that Wavion is backed by more than $22 million in funding from venture-capital firms including Google investor Sequoia Capital. Sequoia has a history of encouraging companies it invests in to work together.

The burgeoning demand for municipal Wi-Fi is undeniable, analysts say. A recent report published by ABI Research states that the area covered by municipal Wi-Fi networks - 1,500 square miles in 2005 - is expected to jump to 126,000 square miles by 2010.

"By 2011, metro-scale Wi-Fi will probably still not be ubiquitous in the way that cellular networks are today," says ABI's Lucero. "But I think it will be fairly common - particularly in the U.S., the U.K., Australia, and certain other countries and regions - to be able to go to a major city and find a metro-scale Wi-Fi network in place."

In other words, Wi-Fi could one day be a public amenity that's as common and expected as street lighting or sidewalks. And if cities are looking to roll out wireless as cheaply as possible, Wavion's approach could give it an edge. Top of page

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.