Wi-fi and the future of wireless

America is getting "unplugged" faster than an MTV musician as the revolution in wireless communication picks up speed.

What started a century ago with Marconi's radio and became the now ubiquitous cellphone is now taking shape around a two-way radio technology called wi-fi (short for "wireless fidelity"). It promises to unplug more communications devices by making the Internet available just about everywhere and letting people talk to each other more easily than ever before.

The new wireless could transform not only the way we communicate but also how we pay for it. Some analysts think today's cellphone model - a private network of towers that charges for access - is looking a little dated in the face of "infrastructure-free" networks where devices would talk directly among themselves. Not everyone believes wi-fi will go that direction, and the technology faces big obstacles. But if it does reach critical mass, it could storm the cellphone industry with the same momentum that carried cheap IBM clones past Apple personal computers two decades ago.

Consumers will benefit no matter what. Competition will force down the price of wireless Internet access.

"The market will push us toward a wireless future," says David Reed, an adjunct professor at MIT's Media Lab in Cambridge, Mass., who is studying the future of wireless communications. And its arrival looks much more certain than that of the paperless society, which never materialized, he adds. "People love paper, but I can't find a single person who says that about wires."

Signs of the new wireless technologies abound. Consumers are setting up wireless local area networks (WLANs) in their homes. These allow multiple computers to hook up to one fast Internet connection or laptop users to connect from the comfort of the sofa or the back patio - anywhere in their house or yard. Some 20 percent of homes with such fast Internet connections (known as broadband) now have WLANs too.

Away from home, wi-fi access points, so-called hotspots that permit wireless connections to the Internet, are popping up everywhere: in bookstores, coffee shops, truck stops, marinas, and airports. Even a bench in a shopping mall or a public park may be a place to connect to e-mail or the Web. Limousines are offering wi-fi service for customers on the go, and within the next year, major airlines are expected to announce the availability of wi-fi connections during flights. Cerritos, Calif., a Los Angeles suburb, plans to become one big wi-fi hotspot by placing transmitters all over the town of 51,000 residents.

Think of a wi-fi hotspot as a miniature cellphone tower. A low-power radio transmitter connected to the Internet sends out a signal that reaches at best a few hundred feet. Any computer or personal digital assistant (PDA) equipped with an inexpensive receiver can hook up at broadband speeds. An ever-growing number of new laptop computers have wi-fi capability built in as a standard feature.

Estimates vary as to the number of hotspots in the world today, but everyone agrees the number is multiplying rapidly. In a conservative estimate, ABI, a technology think tank in Oyster Bay, N.Y., predicts worldwide hotspots will grow in the next five years from 28,500 to 208,000.

But much else about the future of wi-fi remains less clear, including who's going to pay for public hotspots installed outside the home. Right now, most of these require users to pay for access, either through a subscription (perhaps $30 to $40 per month) or on a one-time basis ($7 for 24 hours, for example). That model doesn't satisfy those who travel and don't want to run up a lot of charges to different providers. So companies setting up hotspots are now beginning to sign "roaming" agreements that let customers use hotspots owned by other providers.

Looking ahead, analysts say prices will drop because of brutal competition. Until then, it's the business traveler who's most likely to pay for public wireless access. That's one reason hotels look like the next big growth area for wi-fi service.

Hotels are an "interesting bellwether" of where wi-fi is headed, says John Yunker, a wireless-industry analyst at Pyramid Research in Cambridge, Mass. "They're cash-strapped, but they're going ahead with deployments because they have to. The guests are demanding it.... We expect all major hotel chains to have announced some degree of wi-fi deployment by the end of next year. And many already have."

Pyramid also predicts that wi-fi will soon become a free amenity at many hotels (it already is at some restaurants).

Because wi-fi travels over public airwaves, security and privacy are concerns. "When I'm in Manhattan, I can stick my wi-fi-enabled PDA out the window, and I can tap into four or five access points that aren't secure to check my e-mail," says Ed Rerisi, ABI's research director. "People don't realize how vulnerable they are."

But issues like security, along with the problems of cost and identifying hotspot locations, aren't going to hold wi-fi back, analysts say. "I think all these problems have solutions and gradually over the next couple of years all of them will get solved," says Craig Mathias, a principal at Farpoint Group in Ashland, Mass. "The sky's the limit" for wi-fi.

Cellphone companies have their own plan for covering the world with high-speed Internet access through a technology called 3G. But the jury is out whether it's arriving too late to push aside wi-fi. Cellphone companies "could find themselves obsolete in a while," unless they find new ways to add value for customers, says Dr. Reed of the Media Lab. One cellular company, T-Mobile, is hedging by making a major investment in wi-fi hotspots.

As an alternative to wireless companies that build infrastructure and charge for access, the Media Lab is studying "viral communications," in which every laptop or other wi-fi-enabled device would cooperate to relay data. In this "infrastructure-free" network, the system could have great resiliency, Reed says. If one route of information was blocked, other radios would form another trail to send along the data.

Though the data might pass through many radios, security would actually be enhanced, he adds, because the route of the message would be unpredictable to hackers and because it would force the data to be encrypted. The intermediate radios wouldn't know the encryption key.

Even the question of powering up unplugged devices is solvable. Reed sees a time when they could operate "parasitically by living off the radio waves of things that happen to be plugged into the wall."

Others envision wi-fi transmitters embedded in every power strip in an office, making a whole company one big hotspot. "Who knows?" analyst Yunker says. Wi-fi is a disruptively inexpensive way to communicate "and it's hard for anything else to compete with that."