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Cover story: Hyperconnectivity or bust

Beverley Head, Information Age

10/04/2008 15:19:32

Four years from now the mobile communications industry will generate revenues of more than $US1 trillion a year. To put that in perspective, India's GDP only crossed the $US1 trillion barrier for the first time last year.

Demand for mobile communications is undisputed; it's even spawning a new lexicon - for example hyperconnectivity, or the ability to connect multiple devices over pervasive broadband networks, and GiFi (really, really fast connections).

The list of what people want to do on the move seems almost limitless. When Telstra surveyed people using its NextG network for more than SMS messaging or voice calls early this year, it found 45 percent of them used wireless data cards in their laptops to buy products online; 67 percent of them used them for online banking and to pay bills; 67 percent used them for work. Another 21 percent watched entertainment and a whopping 93 percent sent photos.

That's what people are doing today, but when a team of researchers from the National ICT Australia research centre announced in February the development of a single chip transceiver that should allow data download rates of up to 5 gigabits a second, it signalled the dawn of an entirely new class of mobile applications. Researchers claim that in the future, people with a personal digital assistant equipped with the transceiver chip should be able to download a high-definition movie at a wireless kiosk to take home to watch on their highdefinition TV.

Always on

One challenge for organisations is to work out how to exploit the rising demand for always on connection; so that employees can work flexibly and remotely; so that customers can secure access to new services.

Once they've worked out what they want to do with it, they have to work out how to provide it. That's complex says Mark Fioretto, enterprise general manager for Nortel, which provides services to organisations grappling with hyperconnectivity.

Recent clients in Australia include RMIT, Macquarie University, St George Bank and JB HiFi.

He says that there are a series of building blocks which are required when creating the right environment to exploit the inherent value of constant connection. First is to have networks that are reliable and able to match the 24x7 demands of mobile users. "The second consideration is access to resources whether over wireless, IP or direct connections, and as a part of that you have to introduce the complexity of security.

"Then around that you need the applications themselves, to integrate the different communications," says Fioretto. Underpinning all of this was the classic "Balance between spending the money to do it properly and the business benefit and return on investment."

Fortunately, according to analyst Gartner, because of network and supplier competition: "Mobile services is a buyer's market for corporate users." It recommends organisations "don't cash in your options by committing to multi-year contracts unless you can negotiate very attractive and flexible deals which take account of falling future price trends."

Hot competition

Certainly competition among the network providers is fierce. Besides the fixed line communications networks, third generation mobile networks are available in Australia from Telstra, Optus, Vodafone, Hutchison (which pioneered 3GSM in Australia back in 2003) and AAPT. These networks are increasingly being used not just for voice and SMS calls, but as a wireless entry point to the Internet and from there into private networks.

Third-generation networks operate with theoretical download speeds around 7.2Mbps, with a 1-2Mbps theoretical upload speed. (Practical speeds are a fraction of those figures, however). Over time GSM network speed will increase, with carriers already talking about development plans to take network speeds to around 100Mbps.

Gartner research director for mobile and wireless Robin Simpson, however, says such speeds are edging into fourth generation or 4GSM network territory, which he doesn't expect to become commercially widespread until around 2015.

Besides the third generation mobile networks there are Wi-Fi hotspots now widespread in metropolitan cafes, shopping centres and on campuses. These use the IEEE 802.11 standard which delivers a theoretical top speed of 54Mbps but over a fairly short distance.

Hotels which host business travellers routinely offer either wired or wireless network connections also generally charging a daily - and often fat - fee for the service. Meanwhile other users may choose to access corporate networks via their home Internet connection.

Security a concern

At the enterprise level, managing this slew of possible network connections, plus the plethora of different equipment, while ensuring security remains intact, is as Fioretto notes, complex. Companies such as Nortel are skilled at helping companies manage the problem, but tools are also emerging to help enterprises manage the process themselves. iPass, for example, allows mobile workers a single sign-on and password to access the corporate network from whichever network they are using. It also can check that the device being used has appropriate levels of security and virus protection before allowing connection.

Dollars and sense

Other services such as Boingo effectively serve as a Wi-Fi network aggregator, offering a flat fee for connection using one of 100,000 plus Wi-Fi hotspots available around the world for $US39 a month at time of writing - which compares favourably to some of the day rates that hotels charge for network access.

Gartner's Robin Simpson claims that most of the technical challenges in terms of being able to connect whenever and wherever people want are being solved: "The issue tends to be how much it costs, especially for global roaming."

For key employees however the cost may be less a factor than the convenience he says. As Fioretto notes if the business return on investment is there, the outlay can be justified.

Even so, "A lot of people are going around the world using Wi-Fi or broadband from their hotel", even though it can prove a "reasonably expensive way to buy broadband", says Simpson.

On its face, so is Telstra's NextG network - but Simpson says that for occasional users an hour or two connected on NextG can prove cheaper than paying a day rate to use a hotel network to connect.

Expensive or not, Telstra's $1.1 billion investment in the NextG network launched in October 2006 seems to be paying off. A relative laggard entering Australia's 3GSM market, the company is enjoying relatively rapid uptake and data now accounts for almost a third of Telstra's mobile services revenues.

In its half-year results reported in February, Telstra revealed that mobile revenues grew 14.5 per cent to $3.2 billion and mobile data revenue rose 46.1 per cent to $716 million. Wireless broadband soared 205 per cent.

Perhaps not surprisingly Dr Hugh Bradlow, chief technology officer of Telstra, claims third-generation networks are superior to Wi-Fi connections. "You can do it [connect] through Wi-Fi hot spots but it's very clunky because you have to identify yourself from hotspot to hotspot."

The challenge is compounded for people who need to connect from the hotspot to their corporate network through a virtual private network as they would also have to re-authenticate themselves every time they changed from one hotspot to another, he argues. Because NextG is a continuous wide area network, users could be "continually in range unless you are really are in the boondocks. It takes care of mobility and as far as the user is concerned they have an IP connection, and from there they can create a VPN (virtual private network) tunnel into the corporate network.

"And because the mobile network behaves like an IP connection you can maintain that VPN tunnel." Dr Bradlow, who by his own admission is a very mobile worker, actually uses the NextG network in Telstra's own buildings to connect to the corporate network. Bradlow confirms that "NextG is a fully engineered WAN. That it's more expensive is no question. It's on the licensed spectrum and you get what you pay for."