Despite years of promise, Wi-Fi and cellular convergence remain a mishmash of Wi-Fi and cellular services, ambivalent cellular carriers and outdated client Wi-Fi infrastructures. All this makes the channel's job of delivering converged Wi-Fi and cellular services more challenging. But for solution providers who persevere, the reward can be much higher than average margins.

In theory, it should be easy to navigate across Wi-Fi and cellular infrastructures. SMB and enterprise mobile workforces do not want to worry about which cellular or Wi-Fi technology they're using for their cell phones, PDAs, netbooks and other wireless devices. In addition, the wirelessenabled devices should be able to find -- and hop onto -- the most cost-effective path for each voice or data transmission.

But that isn't how it works today.

For Kitty Weldon, principal analyst for enterprise mobility at Current Analysis, the absence of wireless convergence hit home during a recent family vacation across the English countryside.

"We spent all this time trying to figure out how much money we were spending on the voice and data side because we had 3G on the iPhone and on the AT&T netbook," Weldon says. "And there was a wireless router at every bed-andbreakfast in the English countryside. We were going in and out of Wi-Fi and 3G insanely. But it's not a consistent user experience -- you don't quite know what you're going to get depending on where you are."

Business travelers endure the same challenges Weldon faced. "Ultimately, for the end users to keep their sanity, there has to be a consistent user experience, some kind of prompting when you're going from one (network) to the other," she says. "But there's huge potential. If we had had Wi-Fi everywhere, we would have saved hundreds of dollars in global roaming."

Yet Wi-Fi is not everywhere, and lacks the reach of cellular technologies such as Global System for Mobile Communications (GSM) and Code Division Multiple Access (CDMA).

"In today's world, 802.11 (Wi-Fi) provides data and voice connectivity," says David Hettrick, a technology solution engineer with Ingram Micro. "The problem with 802.11 is that it's short-range." GSM and CDMA offer larger coverage areas. The goal is to somehow provide these services via one wireless highway, Hettrick says.

Paving the Way Toward Convergence
While a unified wireless highway is years away, hardware suppliers have been gearing up for the convergence, so solution providers have opportunities in the space right now.

"You see the cellular wireless adapters coming out for the laptop so you can have wireless access over cellular networks from your laptop," Hettrick says. "We're going to start seeing things like dual-mode phones that support 802.11 and a cellular network so they can use whichever wireless network is available at that time."

The dual-mode capability might incur cellular charges, he warns. "But if they're in their offices and they're using their 802.11g network there, they're going to go over the regular LAN lines and save on the cellular charges. So there are cost savings in this for companies," Hettrick says.

And cost savings has become key lately. "We're in the first stages of the market availability of these products. But there's definitely a huge market for convergence," says Nathan Schmidt, a partner with wireless solution provider Vilarri Mobile Solutions, a sister company of Citon Computer Corp. "Right now, I'd say the need is being driven strictly by efficiency increases. With the market changes in the last year and a half, things have drastically changed and it used to be about improving processes. But, really, cost savings is the No. 1 thing right now."

Wi-Fi-cellular convergence generates savings "typically by eliminating some of the overhead related to your cellular costs and then off-loading your per-minute charge to a lower rate -- to bring down voice and your monthly telecom costs," Schmidt says.

Non-laptop devices, too, such as the BlackBerry and the iPhone lines, are driving demand for convergence. One of Vilarri's most popular options is the BlackBerry device, Schmidt says. "We have a lot of success with BlackBerry integration with local LANs," he says. In addition, Apple's iPhone is "by far the fastest growing right now," he added.

The need for a converged network increases as customers equip their workforces with more wireless gear. And this trend spurs customer hardware infrastructure reviews that create upsell opportunities for solution providers to sell additional accessories such as wireless headsets and other peripherals. However, telecommunication audits and deployments can be exhaustive, Schmidt says.

"You need to do billing reviews, which is a complete history of telecom spending across the board, and that becomes a very time-consuming piece of it," Schmidt says. "You need to do the design phase, the drafting phase and then you start moving into the testing phase. From there, you hopefully move into deployment."

Sorting Out a Converged Solution
This process almost always yields problems, especially for SMB customers with a patchwork of mixed-vendor hardware supporting their wireless users, he says.

"The biggest hindrance is the initial deployment costs -- the time needed for someone to come in and evaluate your situation and give you a true representation of what you need. I think a lot of people assume it should be an off-theshelf product and it's not," Schmidt says.

First, solution providers need a converged customer infrastructure before they can advance.

"What this usually winds up being is, in Cisco's world, their Mobility Services Engine (MSE) 3300 Series appliance that allows for the wireless networks to be converged onto one wireless infrastructure so you can utilize the benefits of both," Schmidt says.

Weldon says that in many cases infrastructures "have to be fairly expensively upgraded ... That's a significant issue." In fact, long-term ROI calculations can sometimes fail to include upgrade costs, she says.

"Even so, there are some companies willing to put out money in the short term because the ROIs are potentially very significant, particularly for companies that do a lot of global roaming with mobile employees," Weldon says.

For solution providers, this opportunity means better-than-average margins of between 30 percent and 40 percent or higher, Schmidt says.

"You have to maintain a higher margin," Schmidt says. "There is a lot more overhead and a lot more training that's involved. You do have to stay on top of things and that becomes very costly."

When customers successfully converge their Wi-Fi and cellular networks, collaborative applications from Microsoft, IBM and Novell can be leveraged to exploit the new infrastructure, Ingram Micro's Hettrick says.

Clash of the Carriers
Once a customer deployment is in place, however, solution providers can face another hurdle -- cellular carriers like Verizon and AT&T. These carriers offer mobile and landline services that they don't want to cannibalize via a poorly thought-out convergence strategy, making them slow on the uptake. "If carriers can't make money at it, it's not something they're completely on board with," says Schmidt.

If the carriers do get their acts together, it doesn't mean things get easier. "Margins could decrease with more people in the field offering these services -- especially if the carriers get into it," Schmidt says.

Weldon acknowledges that in the telecom business, "there's ‘co-opetition,' so in some cases you're going to compete and in other cases you're going to be complementary and go to market together." Besides, carriers typically want only the big enterprise game as customers, and lack the resources to effectively serve the SMB customer markets, leaving them to channel partners.

While the industry players plan their next moves, they also are working with standards bodies to bring uniformity to Wi-Fi-cellular convergence.

In the meantime, solution providers should educate their customers. "A lot of businesses are not aware of these capabilities and they're not educated on the governance and security aspects of these types of solutions," says Robert Arnold, a senior analyst, enterprise communications, with Current Analysis. "I think there's a certain type of FUD -- fear, uncertainty and doubt -- surrounding them."

Solution providers also should do the footwork for their current and potential customers.

"What customers want is easily digestible packages so they don't have to do all the research on all of the solutions out there," Weldon says. "Someone has to guarantee performance. Someone has to put together some business case studies and some ROI analyses and make things simpler for the end users."

To seal the deal, solution providers will have to "bring it into perspective with the customer and essentially give them an overview of what the potential issues are and how we keep on top of those things and work through them," Schmidt says.

"In many cases, many of the customers have to scale back plans, which is what we've seen in the last year especially," he says. "They see the potential cost savings but they have to scale back because of the infrastructure and up-front costs that are required to make it all work."

But even a project deferred could ultimately yield good results. Many customers are taking the time in the economic slowdown to better analyze their next steps.

"I think in the long run it's going to be a huge boom for the market because these companies are investigating solutions to save money," Schmidt says. "When the market turns around, I think all these solutions are going to be in really high demand."