Wireless phone companies pouring billions of dollars into "third generation" networks that offer high-speed Internet connections without the tether of a cable or phone line have been casting a wary eye on a cheap wireless broadband system popping up on college campuses, in hotel and airport lobbies, and even in Starbucks coffee shops around the nation.
The cheap, short-range, but super-fast "WiFi" networks have been seen in some quarters as a potential threat to carriers' huge investment in third generation, or "3G," wireless networks. Some people may decide, the thinking goes, are happy enough with a fast wireless connection they can only use when sitting down and don't need to buy one they can use anywhere.
But in forums and interviews at the Cellular Telecommunications & Internet Association convention here this week, executives of some companies involved in both 3G and WiFi said they think the two technologies may turn out not to be archrivals, but close collaborators offering unprecedented mobility and speed for people who want to stay connected to the Net.
The vision goes like this: Someday millions of Americans will outfit their laptop computers with "air cards" that connect to 3G networks at speeds in the hundreds of kilobits per second when they are on the road or in public places.
But once in range of a WiFi "hotspot" in a coffee shop, hotel or office lobby, their connection would shift over seamlessly to a dramatically faster 11Mb connection. WiFi, technically known as 802.11b, typically covers just around a 130m radius, while 3G services are intended ultimately to be as ubiquitous as cellphone service itself.
A lot of behind-the-scenes work would have to take place first, including complex systems to mesh billing and allocate revenues between wireless giants like AT&T, Verizon, and VoiceStream, and the scores of WiFi providers -- typically tiny local companies operating as few as a dozen transmitters.
But one unexpectedly harmonious panel here this week brought together VoiceStream Wireless chief executive John Stanton, whose company has launched a near-3G service called iStream offering access at over 100 kilobits per second, and Sky Dayton, chief executive of Boingo Wireless. Dayton's California start-up went live in January, offering subscribers unlimited access to over 500 WiFi hotspots for $75 a month.
Stanton acknowledged that he viewed WiFi as a threat to consumer willingness to buy 3G services, but added: "It doesn't change the need for us to get spectrum to provide true 3G services. I view WiFi to be 3G with training wheels. It whets people's appetites" for a more pervasive high-speed Net service.
VoiceStream, a Bellevue, Wash.-based carrier owned by Deutsche Telekom whose markets include Greater Boston, is unique among national cellphone companies in that it already owns a WiFi business. In January, VoiceStream bought the assets of bankrupt MobileStar Network Corp, a Texas-based company that operated WiFi service access points at 650 US locations, including scores of Starbucks coffee shops, airport terminals, and hotel lobbies.
"We're trying to have WiFi be a part of a wider network that will really meet consumer needs," Stanton said. But VoiceStream is being very cautious about predicting how soon, saying only that a converged 3G-WiFi offering could happen "as early as next year."