Mobile operators will be able to plug in an appliance to easily roll Wi-Fi hotspots into their networks if infrastructure vendor Stoke delivers the product it is promising in the third quarter.
The Wi-Fi Exchange gateway will let subscribers get onto Wi-Fi networks built or offered by their carriers without any login or special software or hardware, according to Stoke. And unlike most smooth transitions to Wi-Fi that service providers offer today, this won't require a proprietary system on the back end, the company said.
Carriers like to help their subscribers get off the phone network and onto Wi-Fi because it can reduce the load on the cellular infrastructure. But usually when they do that, the subscriber has to log in, at least on the first visit, and the carrier loses the visibility and control it normally has on the mobile network, said analyst Craig Mathias of Farpoint Group. Making Wi-Fi widely and easily available will become more important as demand for fast mobile data soars, Mathias said. It will change from a cost-saving offload to a more integral part of the carrier infrastructure.
"Without Wi-Fi, the carriers cannot succeed," Mathias said. "They have been setting our expectations above what they are able to deliver."
Stoke sees its Wi-Fi Exchange as a tool both to get Wi-Fi networks online more quickly and to give mobile operators more control over those networks. It developed the gateway, a software product that runs on a standard server, by starting with a standard from the 3GPP (Third-Generation Partnership Project). The standard, called I-WLAN (Wireless LAN Internetworking) was written with laptops and Wi-Fi dongles in mind, Stoke Chief Technology Officer Dave Williams said. I-WLAN uses the IPSec (Internet Protocol Security) encryption system to secure data all the way from the mobile device to the carrier's network.
IPSec demands a lot of processing cycles, so it would strain smartphones and reduce their battery life, Williams said. So Stoke developed a system that runs entirely inside the network. It uses IPSec from the Wi-Fi Exchange at the carrier to the Wi-Fi controller at each hotspot, and the standard 802.1x and WPA2 Wi-Fi security mechanisms between the controller and the mobile device. Using WPA2 makes the system compatible with most standard smartphones, giving carriers more flexibility, Williams said.
Stoke envisions carriers using the Wi-Fi Exchange to sign up more third parties, such as shopping malls, as hotspot partners. They could get subscribers onto those partners' networks as easily as a carrier such as AT&T does now on the hotspots it exclusively controls at Starbucks and other locations, Williams said. User authentication could happen on the back end, through existing carrier systems.
At the same time, the Wi-Fi Exchange will also let mobile operators see their subscribers' activity on the hotspot, according to Stoke. Carriers want that kind of visibility, which carriers typically don't have on Wi-Fi networks now, to ensure security, Williams said.
Over time, detailed activity information should also allow carriers to measure subscribers' data use, prioritize applications and possibly charge for Wi-Fi use, analysts said.
Mobile operators haven't been demanding these kinds of gateway functions up to now, but as demand for data capacity grows, they are likely to rely more on the high bandwidth and relatively low cost of Wi-Fi, analysts said. Wi-Fi costs only about 10 percent to 20 percent as much as cellular capacity even if a carrier builds the wireless LANs itself, Mathias estimated.
In a few years, Wi-Fi may carry up to 30 percent of a carrier's data traffic, and they will want to control the subscriber's experience on it, said Phil Marshall of Tolaga Research.
"If you don't have visibility, as a carrier, then you can't do anything," Marshall said.
Stoke, which already sells two other types of mobile gateways, plans to announce the Wi-Fi Exchange on Monday and demonstrate it at Mobile World Congress later this month. The gateway is in trials at several carriers and will go on sale in the third quarter, Williams said.
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