June 27, 2006 10:37 AM PDT

Study: Wi-Fi cell phones will hit it big

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Sales of mobile phones with both cellular and Wi-Fi capability will be booming by 2010, according to a study by market research firm In-Stat.

Wi-Fi, which offers wireless Ethernet connections over a few hundred feet, is widely used by consumers to connect their PCs and certain handheld devices to the Internet. But until very recently Wi-Fi has been absent from the world of cell phones.

Cellular service providers initially saw Wi-Fi as a threat to sales of cellular data services like weather reports and stock quotes. But this perception is changing rapidly, according to In-Stat's research, as service providers acknowledge the marketabilty of phones capable of handling both cellular and Wi-Fi signals.

In-Stat analysts predict that 132 million of the devices will be in use by 2010.

More than 20 Wi-Fi-enabled models are either already on the market or will be released soon. Some of these new phones will be products of collaboration between cellular carriers and companies that offer voice over Internet Protocol (VoIP) services, which allow transmission of voice and data over the Internet.

Motorola, for example, announced a partnership with eBay's VoIP provider Skype early last year. If all goes as expected, customers with Wi-Fi-enabled cell phones would have the option of using Skype's service in place of a landline service as long as they are within range of a Wi-Fi signal. Once out of Wi-Fi range, they could then operate the same phone on cellular technology, analysts said.

"Customers that have bad cellular coverage inside their houses would be able to get around" it by switching to a combination handset, explained In-Stat analyst Gemma Tedesco.

The new phones are likely to become popular with consumers first, rather than businesses, Tedesco said.

"We don't see the business growing as fast," said Tedesco, citing the fact that wireless networks themselves have been much more readily adopted in homes than in businesses.

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Wi-Fi, Skype, eBay Inc., VoIP, cell phone

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Netgear Wi-Fi phone for Skype delayed
Just an FYI, Netgear delayed their SPH101, Amazon now says 8/24/06.
<a class="jive-link-external" href="http://www.digicoast.com/sph101.php" target="_newWindow">http://www.digicoast.com/sph101.php</a>
Posted by sgornick (14 comments )
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Thanks InStat for your marketing research...
but i think most of us already realize this. Why companies like Motorola do not enable wi-fi in products like the Motorola Q I do not know. Samsung included it (wi-fi) in its Samsung SCH-i730, but left it out of the SCH-i830. Can you guess which one is more popular according to CNET readers? Of course the older version with wi-fi is more popular, but then you get an old Windows operating system when you get that version.

Get it together cell phone companies. You obviously know what us users want without InStat's in depth research.
Posted by rhythmshocker (4 comments )
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Jury is out on this???
If one looks at the wireline parallels to this...Vonage likes are yet to be proven...traditional long distance carriers are fighting this and dont seem to be ready to give up their business to Vonage.

Why would cell carriers not follow the same and make it hard for WiFi voice service providers?? Like to hear from Instat...
Posted by agarwalsuresh (1 comment )
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Wifi Mobile Cell Phone Networks Are Coming - Resistence is Futile
Wi-Fi Cell Phones will create such a paradigm shift that if I was sitting in a 3G exec's seat, I would be shaking with fear.

Here is why.

Right now 3G radios have a maximum throughput of 3 megs. In a year, EVDO Rev.A will offer 10 megs.

You see the cell phone carriers advertising video clips delivered to a cell phone. The funny thing is that if more than 5 people tried to download a clip at the same time from one tower, it would instantaly become too congested to deliver on its promise.

It is simple mathematics. 10 megs / 10 users = 1 meg each.

And all engineers know that it isnt wise to use theoretical throughput in real world calculations.

Even the lowest and oldest level of WiFi, 802.11b, promises the theoritical 11 Megs of throughtput. Move up to 802.11g and you'll get 54 Megs. The 802.11n standard will deliver 100-400 megs, depending on who you talk too.

3G licenses cost millions of dollars. WiFi spectrum is free.

The cost to to build one 3g cell tower is several hundred thousand dollars, not including the license.

The cost to build out a WiFi Cell Phone tower will be more in the $10-20k range.

3G is designed for voice. Wifi is designed for IP. IP makes all things possible. Voice channels can do very little.

3G carriers will say they have a bigger footprint, which is true for right now, but that is about to change rapidly.

Every municipal government wants metro WiFi deployed in their city. However, they cant get over the risk or challenge of whether or not it is safe to gamble on long term investments with taxpayer money.

But there are companies that are planning massive WiFi Cell Phone Tower deployments in the United States and Canada. These deployments will be so swift and so well funded that the carriers will be completely blind sided.

My prediction is that once Google and Earthlink catch wind of who these guys are, they will get bought out and Google will own not only the advertising world, the search engine world, but also the wireless communications business that controls, navigates and provides access to everything that people are searching for.

I will give you a hint, it is one of the companies listed at: www.bbwexchange.com/meshnetworks/

Just for the record, I have been working with wirelesss before people ever heard of WiFi or WiMAX.

The only carrier that has a chance will be Sprint. Unlike the PCS guys that only have 30 MHz of spectrum, Sprint has 190MHz of protected spectrum. No one can compete with that. That is why they paid billions of dollars for the spectrum in 1999.

Best Regards,
Robert Hoskins
Broadband Wireless Exchange
Posted by roberthoskins (1 comment )
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