On Monday, I told you about Lucent's (LU) rollout last week of its new Orinoco wireless-LAN system -- the first fast, reliable, inexpensive, interoperable local-area-networking system. And about its alliance with the likes of Cisco (CSCO) - Get Report, 3Com (COMS) , Nokia (NOK) - Get Report, Cabletron (CS) - Get Report, Aironet (AIRO) and others to jointly promote IEEE 802.11B, a new, standardized approach to fast wireless connectivity.
If all the Lucent wireless group had done was jump on the bandwagon for affordable, fast, wireless networking under 802.11B, this wouldn't be such a big deal. After all, the "privilege" of competing with powerhouses like Cisco, Nokia and the other 802.11B players could get pretty expensive.
But Lucent's vision for 802.11B wireless networking is a lot larger. Lucent and its partners want to create a wireless-data world in which you can use your computer -- same notebook, same Orinoco card, same software, all already in place -- pretty much anywhere you go. (And, eventually, nonnotebook wireless devices as well.)
Apart from the $150 notebook and desktop-PC Orinoco wireless cards, and Lucent's $300 home-connection box, the Orinoco line also includes affordable, industrial-strength systems designed to allow companies, universities, hotels, hospitals, airports, convention centers and condo, apartment and commercial building managers to set up Orinoco networks on-site, which would allow anyone with an Orinoco card-equipped notebook to immediately jump online in any and every Orinoco-equipped area they visit.
Bingo: wireless Net access at your fingertips.
Imagine that: You have Orinoco set up as your home-networking system at a cost of about $500 for an access-point device and two PCs. You carry your notebook to your office, and you're instantly online, wirelessly, too. You go to another company's campus and you're online there. Over to a meeting at the local university and you're online there. To the convention center for a conference and you're instantly online there. To the airport and -- while you're waiting in the departure lounge or airline club -- you're online
No changing network cards, no rejiggering software. Just jump online, period.
This isn't quite Valhalla, which will require wireless Net access literally
, period -- in taxis, walking down the street, wherever. That will take something like a far-faster, next-generation
system, or more likely, one of the wireless-data systems coming that will pull devices (such as
-like PDAs, smart third-generation cell phones and other devices) into common communications.
But it's an exciting, and potentially profitable, start.
Lucent has a second, hidden opportunity here: its
support operation, which could become a prime contractor for installing these building-by-building, campus-by-campus Orinoco systems.
Actually, all those NetCare "feet-on-the-street" technicians could become an important strategic advantage for Lucent with Orinoco. It must move fast, along with the other 802.11B vendors, to quickly establish these products as the wireless-LAN standard. In yet another extension of Metcalfe's Law, postulated by Bob Metcalfe, the inventor of Ethernet ("The value of a network increases exponentially as the number of connections increase"), the more places we can get 801.11B connections, the more useful the system is to all users.
In the hotel market alone, for example, a quick, clean proliferation of Orinoco-flavor wireless-LAN connections could not only spell quick death for those companies trying to persuade hotel chains to let them wire their rooms for fast Net connections, but could also make Orinoco so valuable to the business traveller that she soon demands it at the office and installs it in her home.
The ability to muster lots of NetCare "tiger teams" to quickly install Orinoco facility-based systems, with a high level of quality assurance, could be the deciding factor for Lucent and Orinoco's market success.
This is far from a drop-dead-perfect deal. Look for aggressive 802.11B competition from Cisco, coming later this year. Cisco demonstrated late last year and early in 2000 its interest in moving into the home-networking market, and can be expected to be a strong player. Like Lucent, Cisco hasn't got much experience with consumer sales, but both are high on the list of so-called "learning companies," which adapt quickly and build their growing market experience into their corporate DNA very quickly.
Lucent is eager to persuade the so-called Wintel notebook makers to license the Orinoco technology, too, to build into the motherboards of new notebook designs. Near term, Lucent probably will sell to computer makers privately labeled Orinoco PCMCIA cards (and ISA/PCI cards for desktop machines, and access points), to deliver a fast path to market. But ultimately, the revenue stream from licensing deals could be much bigger for Lucent than its Orinoco manufacturing and OEM private-label business.
Some companies aren't yet on the 802.11B bandwagon.
, for example, are still supporting incompatible wireless-LAN systems.
(In an odd and very un-Intel burst of schizy-ness, Intel is supporting 802.11B for the office, but the incompatible
standard for home networking.)
Lucent says it has other Orinoco-like technologies in the wings, nearing market readiness. If so, the Lucent we've been waiting for the past few years may indeed finally appear: a diverse, forward-looking, technology-driven giant, now (or soon) freed of its ugly, slow-growth legacy lines, such as PBX switches.
If so, Lucent's
Black Thursday -- that ugly day in early January when it warned of a precipitous earnings shortfall, leading to a 28% drop in Lucent's share price over two sessions -- will soon be forgotten.
As originally published, this story contained an error. Please see
Corrections and Clarifications.
Jim Seymour is president of Seymour Group, an information-strategies consulting firm working with corporate clients in the U.S., Europe and Asia, and a longtime columnist for PC Magazine. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. At time of publication, Seymour was long Lucent, although positions can change at any time. Seymour does not write about companies that are, or have been recently, consulting clients of Seymour Group. While Seymour cannot provide investment advice or recommendations, he invites your feedback at