[IP] Mesh Radio Herd Plagued by Locusts
Begin forwarded message:
From: Dewayne Hendricks <dewayne@xxxxxxxxxxxxx>
Date: July 23, 2004 11:50:07 PM PDT
To: Dewayne-Net Technology List <dewayne-net@xxxxxxxxxxxxx>
Subject: [Dewayne-Net] Mesh Radio Herd Plagued by Locusts
Reply-To: dewayne@xxxxxxxxxxxxx
The Industry Standard: Guest Blog: Scott Rafer
Mesh Radio Herd Plagued by Locusts
<http://www.thestandard.com/movabletype/scottrafer/archives/000402.php>
I have only raised money for software businesses, so I am very used to
being asked about open- source projects as potential competition. VCs
must not ask hardware systems entrepreneurs that question as often. If
they did, they would have passed on a every mesh radio systems business
(and probably a few enterprise VOIP businesses).
From a proprietary systems perspective, the mesh radio business was
over before it began. Not only is Intel hedging its bets on Wi-Max in
cooperation with Cisco, but also an inexpensive open-sourced product
from LocustWorld already leads the field. I'd estimate that Locustworld
leads all other mesh radio vendors in both revenue and installed units
by at least one order of magnitude. The company appears to get paid for
their work in all cases, which the other vendors can not currently
claim.
There are arguments left and right about how well mesh radio and
LocustWorld scale in densely populated areas, but I don't see how these
arguments are relevant. In 24 months, when mesh radios are sold in
BestBuy for a few hundred bucks, another Moore's Law doubling will be
under our collective belts and lots of signal collision software will
have been greatly refined. How many $10,000 truck rolls can happen in
that period of time?
There are silver linings here, however. The economics of mass
deployment will force the primary radio chips and CPUs be sourced from
mainstream vendors, but some of the other subsystems businesses may be
very lucrative. Following the example set by the Wi-Fi laptop business,
radio chips lose money, but smart antenna technologies and innovative
power management schemes can be protected and margins preserved. If you
dissect one of Dell or Toshiba's Wi-Fi access points, you find a large
component overlap with their cheaper laptops. Also, Cisco may soon have
a large enough installed base of Linksys wireless access points to open
up the platform to developers. Will adding software to cheap Linksys
Wi-Fi radios let VC-backed mesh systems vendors generate enough revenue
to please their investors?
Archives at: <http://Wireless.Com/Dewayne-Net>
Weblog at: <http://weblog.warpspeed.com>
-------------------------------------
You are subscribed as roessler@xxxxxxxxxxxxxxxxxx
To manage your subscription, go to
http://v2.listbox.com/member/?listname=ip
Archives at: http://www.interesting-people.org/archives/interesting-people/