Verizon picks Boston to launch wireless computer networks

Verizon Communications has picked Greater Boston as the first US market where it will roll out a service of installing wireless computer networking systems for small and medium-size businesses.

By Peter J. Howe, Boston Globe Staff

The service, being officially launched today, includes having Verizon technicians install and maintain networks that provide access among office and laptop computers, and from Internet access lines to computers, at speeds from 11 to 54 megabits per second, enabling workers to carry computers around the office while remaining connected to the office network or Net.

The Verizon offering includes the same ”WiFi” high-speed wireless access system, called 802.11b, that has been growing explosively at US colleges and universities and corporations, as well as at public ”hotspot” access points in airport lounges, hotels, Starbucks coffee shops, and hundreds of other locations that provide very high-speed Net access within a range of a few hundred feet. Verizon also is offering a much faster 802.11a version.

Some analysts said Verizon may be looking at not just a way to forge closer relationships with business customers and compete with AT&T and WorldCom, but also use the business network installation offering as a way to develop more expertise in WiFi in preparation for a future rollout of Verizon-powered hotspots. With dozens of small companies offering hundreds of new hotspot access, many analysts think the market is becoming ripe for a giant phone or wireless company to step in with its own nationwide service.

”There’s no doubt that wireless local area networks are the fastest-growing wireless technology in the world,” said Phillip Redman, an analyst with the Gartner consulting group. For Verizon, ”It’s about seeding the marketplace and growing another business” to stave off revenue losses from its declining traditional landline phone service.

Catherine H. Lewis, a Verizon spokeswoman, said: ”I think hotspots may be on the horizon, but that’s not what this particular rollout is about. It’s certainly something that is being looked at, and we have a number of wireless data applications that are being rolled out now.”

Pricing will depend on the configuration of customers’ offices and how many computers they are connecting. By way of illustration, Lewis said Verizon expects a typical office connecting 20 computers with two access points would cost $4,200, including planning, installation, configuring network security to thwart hackers, and ongoing maintenance. Additional computers could be connected for $110 to $120 each, Lewis said.

Verizon plans to charge a one-time fee with no recurring monthly charges, although it is also looking to bundle the wireless networking with sales of high-speed data lines to businesses such as T1, frame relay, and digital subscriber lines. Verizon is using networking gear made by Proxim Orinoco.

Lewis said that nationally, Verizon estimates that after subtracting companies that already have wireless networks or are unlikely ever to buy them, 30 to 50 percent of all small businesses are potential customers for wireless network products. She said Verizon decided to start with Boston because of ”the density of medium-size businesses in a concentrated area” making it an attractive place to market and support the service.

J.P. Gorsky, general manager of wireless products for Enterasys Networks, the Portsmouth, N.H.-based maker of office networking systems, said the Verizon pricing ”appears to be very consistent with what I would consider to be enterprise-class products you would buy from Enterasys or some of its competitors” such as Cisco Systems, Avaya, and others. Enterasys sells WiFi networking products for about $1,100 per access point, supporting both the .11a and .11b versions, and $80 to $150 per computer connection.

Gorsky said a key issue for Verizon will be demonstrating to business customers that its technicians have the expertise to handle complex network security and installation configuration issues. ”The professional service is always the wild card” in getting a bid from a vendor to install wireless networks, Gorsky said.

A new survey released yesterday by San Jose-based Infonetics Research said that sales of wireless local area network hardware reached $436 million globally in the third quarter of this year, about 58 percent of it spent in North America. That was up from $391 million in the previous quarter, Infonetics said.

Richard Webb, the chief Infonetics analyst overseeing the report, said he expects the strongest growth in the market in the next two years will come from carriers rolling out public access hotspots. In the United States, wireless carrier T-Mobile has begun offering hotspot services, but others have yet to follow.

Peter J. Howe can be reached at [email protected].

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