Strong signal for growth in Australian wi-fi sector

There’s never been a better time to go back into your customers and alert them to opportunities to upgrade their wi-fi networks to the latest technology, and likewise turn them into money-spinners by using clever data analytics.

“It’s a land grab. The new battleground in public wi-fi is analytics,” says Pat Devlin, ANZ managing director of Ruckus, one of the fastest-growing wi-fi vendors (it sold $94.5 million of equipment in the last quarter of 2014, up 18 percent on the year before, according to Canalys).

“[Shop owners] want to see your journey through the store and understand the decisions that you make.”

‘Window conversions’, where a consumer shifts from window-shopping to buying, are a powerful selling point. Accurate geographic analytic engines can tell when a shopper has stood outside a display for a time (‘dwelled’) before going into the store.

Analytics can influence rents, as landlords use foot traffic to decide how much to charge shopkeepers. Retailers can also track consumers as they move from online to the real world. Devlin says digital signs will use this feature to customise details to particular shoppers; it could show special offers to close the sale on the spot.

But coupled with the huge growth in wireless data analytics are issues of privacy and security.

If you walk around town with your smartphone’s wi-fi turned on, chances are that someone knows a lot more about you than you might feel comfortable revealing. These free wi-fi access systems may promise anonymity, but how realistic is that pledge, anyway?

Not very, says Wired Sky Networks director Matt Hall. His company installed last year’s wi-fi network for Vivid in Sydney, the festival of light organised by Destination NSW (Vivid is on again from 22 May to 8 June). Hall says ad-supported wi-fi networks often fail citizens and consumers.

“A lot of the time the sale of networks is done based on, ‘We’ll give you inside data on what pages [consumers] are looking at on their browser and track them’, ” Hall says. “But the consumer isn’t in the middle of that project. It’s more a relationship between the retailer and marketing-analytics company.”

It’s trivial to measure most Australian’s public habits because we leave wi-fi on all the time. In this passive mode, we’re broadcasting a lot about ourselves even before we explicitly log on, something network owners exploit.

Wired Sky delighted Vivid festivalgoers last May by collecting their de-identified wi-fi data as they walked through more than 50 points of interest in Circular Quay, in what was the biggest outdoor location-based wi-fi service in the Southern Hemisphere.

Wi-fi access points (APs) locked on top of lightbox signs at each art installation captured data from the 750,000 devices owned by the 1.4 million people who attended the 18-day event. This data was sent to Ruckus’ SPoT smart positioning analytics cloud before going to IBM’s analytics for projection as an ever-shifting heat map on the giant chrome heart opposite the Museum of Contemporary Art. It showed how many people visited an artwork on the LightWalk and how long they stayed. And it reported to organisers how many repeat visitors there were.

Wired Sky had just two weeks to stand up the network, including custom AP installation and testing. Destination NSW was able to quantify Vivid’s success and know which installations were the biggest crowd-pleasers.

Next: The privacy question

Turning aside from Vivid and talking about data capture generally, Hall says there’s a “question over privacy that needs to be handled better”.

“There should be a value exchange, an easily understood agreement between the two parties about what’s being provided,” he says. “I wouldn’t like to know that people can intercept my browsing history as I walked around. Even though most providers say they don’t link a name [to the device’s unique MAC address] they also have your name in a database.”

He says selling a device owner’s data to third party providers “needs to be debated” and legalese eliminated when logging-on. “It should be explained in a more straightforward way; [consumers] are often not fully informed [of how their data will be used], I think.”

US start-ups such as AisleLabs and Euclid Analytics are among a growing number of big data providers analysing user patterns on wi-fi networks. They analyse information such as which devices are on the network, their location, type and web activity.

Elsewhere, councils want wi-fi to engage with citizens. Last year, Adelaide City Council and Internode, which is owned by iiNet, installed a Cisco network of 300 APs to encourage people into the city’s lanes and parks. Other cities are installing APs on light poles, so they only glow when a citizen comes near, cutting power costs and tracking facilities use.

But the trend over the past five years for councils to deploy their own networks runs into policing and mandatory data retention laws passed by the federal government with Labor support in March, says Acurix co-founder and executive director Martyn Levy. And it could leave councils liable if spooks demand the identity of a user,
he says.

“[Councils] struggle to comply with the telecommunications carrier obligations. [Our] advantage is we have a carrier licence; our customers pass the bat to us,” Levy says. “Councils that deploy and operate their own networks are skirting the law.”

Acurix managing director Grant Farrow says film and TV studios will be “rubbing their hands together” to access public wi-fi data. “This may be cynical, but the people taking the most advantage of this will be for commercial gains,” Farrow says. “Most councils haven’t even thought about it.”

Acurix, which recorded 2.5 million wi-fi sessions on its networks last year, is a turnkey solutions provider and vendor of its own APs. It also distributes its solutions to value-added resellers and managed service providers. Its APs have the advantage of hardening against the brutal WA conditions that would melt and corrode other vendors’ enclosures, Levy says.

One of its customers, the Rottnest Island Authority, was the beneficiary last December as Instagram ‘quokka selfies’ went viral. Farrow says that, “just the fact that people are connected made it easier”.

iiNet wireless

Another way into council contracts is through street light upgrades. Greg Bader, chief business officer of iiNet, says councils justify public wi-fi through the benefit of replacing 50-year-old halogen public lighting for LEDs that use a third of the power.

“If you already have a wi-fi network, the incremental cost to add wireless control is nothing,” says Bader.

“So now you have a city area that has LED lighting and discreet control down to a unit [light pole] level; it saves maintenance and gives real-time reporting on performance.” Bader says outside lights could be used in the same way as they are inside licensed premises: to persuade people to go home at the end of the night.

“It’s almost psychology. Imagine an area of the city, it’s 3am and the pubs have closed and you have people on the street. You can vary the intensity of the lights to disperse the crowd.”

Although cellular mobile networks are replacements in many ways, wi-fi network operators can access their own data directly, Bader says, especially for smart cities applications, such as rubbish pickup or finding parking spots.

In some cases, up to a third of drivers were looking for parking, so guiding them more efficiently to a reserved car space eases congestion and cuts toxic emissions. “We look at the wi-fi as swamping a city, providing public access, and over the top we run a layer of command and control functionality for city services. You can bring up a real-time picture of what is happening in your city,” Bader says.

Technology is shifting, with more devices and better wireless protocols such as 802.11ac, but not enough partners are capitalising on opportunities to go back into existing wi-fi customers and update their infrastructure.

Such ‘re-dimensioning’ treats even those spaces that have had wi-fi for years as greenfields sites, says Steve Coad, ANZ managing director of Aruba, the vendor
that HP recently acquired to edge it closer to market leader Cisco.

“We have only a small number of resellers who are as skilled as my own guys when it comes to doing site surveys, and this is a chargeable service that is highly specialised,” Coad says. “It’s a big opportunity for the right guys.”

Coad says the release of Apple Watch, which sold out within hours as a million orders were made in the US, should spur resellers to go back into their customers. That is because the device strains existing networks that were dimensioned up to 10 years ago for laptops.

The low-power Apple Watch greatly increases the density of devices in a given area and, being worn by a huge blob of signal-attenuating water molecules, challenges wireless reception.

“I’d advise resellers to skill up around this area because there’s not enough people doing it at the moment. We tend to use the same handful of partners to do these jobs and they’re being stretched,” says Coad.

Next: Wireless and 'The Internet of Things

Peter Davison, country manager of wireless vendor Aerohive, is also bullish on the prospects on so-called ‘Internet of Things’ (IoT) – which includes the Apple Watch – to spur wi-fi infrastructure investment. Aerohive also provides ‘freemium’ Euclid analytics, he says. “If you like what you see, you can get their deep-dive version that gives you store-on-store comparisons, deflections and so on.”

Davison says that Aerohive is “fully geared for IoT. That comes to the heart of our network management platforms. We’ll be able to identify iBeacons [short-range retail APs] and the Apple Watch will become either a client or device on the network”.

He warns that without resurveying existing premises and public spaces, heritage
wi-fi networks will fail under the next wave of devices that are upon us. “It’s going to require re-dimensioning but that also gives you more granularity with positioning, especially with iBeacons where you want them every five to 10 metres.”

“It’s frustrating: people ask what’s the range of our APs? If it’s in the paddock, it will go a long way, but what are you trying to talk to it with? If it’s an iPhone and you’re down the end of the paddock you can see the signal, but there’s no two-way communication because your [low-power] iPhone can’t send the signal back.”

Breakout: iiNet covers the City of Churches

Internode, a division of iiNet, installed Adelaide’s wi-fi network, one of the world’s biggest, that provides free internet to 30,000 citizens and visitors a day. The 300 wireless access points (APs) cover North Terrace to Wakefield and Grote streets as well as south city, North Adelaide and parks.

Why A world-class infrastructure to keep Adelaide ahead of the curve, reinvent the CBD, and provide a cultural and social experience.

What Cover north CBD; align with the Splash Adelaide program that reinvigorates streets and lanes; 2Mbps down speeds.

Cost $1.5 million. State government ($1m);
Adelaide City Council ($500,000).

Who Five people ran the project; 60 construction contractors.

When 10 months (August 2013 to May 2014).

Alternatives 3G or 4G mobile data coverage or free hot spot ‘islands’.

Challenges Acquiring AP mounting points; council provided light poles that were cheaper than private infrastructure. Lack of council knowledge of public assets lost through decades of rationalisation. Street-level electrical circuits have poor documentation (and energy market planners couldn’t anticipate wi-fi AP installation). Coordinating council departments that usually don’t collaborate. Rundle Mall was under development, limiting access. Only 20 percent of light poles were suitable due to energy-efficient timer switches.

Breakout: Next wave of opporunities

Wi-fi is about much more than installing a few access points in a corporate office. New demands for wireless internet are exploding.

Apple Watch More devices means denser networks that need to be reprovisioned and re-dimensioned to deliver expected performance to users.

Big data Mobile devices spew out information that is helpful in a variety of ways from crowd management to setting commercial rents. As the Vivid project shows, wi-fi data is useful to report back to stakeholders and develop business cases for further funding.

Retail The spread of iBeacons, such as those made by Estimote (below), enables new business possibilities including converting a sale from online to in-store, ‘in the moment’ when the shopper is ready to buy.

Smart cities Consider how municipalities will benefit from automated streetlights and smart parking apps.

Tourism and open spaces Wi-fi is still an enabler and differentiator to attract custom.

Enterprise automation Handheld devices replace paper forms for data entry and information retrieval

Internet of Things As devices such as pallets and industrial equipment get their own wi-fi transceivers, consider how a wi-fi network can aid item tracking, proactive maintenance and management.

Breakout: Fastest-growing wi-fi vendors

According to channel-centric analyst firm Canalys, Cisco is far and away
the leader in terms of wi-fi market share, though the recent combination of Aruba and HP Networking will give HP a sizeable No.2 position.

But what about fast-growing vendors? As the below graph shows, market leaders are being challenged by upstart vendors ready to rattle the cage.

1. Zebra