Wireless Wizards Won't Leave Telcos Alone

As much as we've written about wireless technologies that propose to replace Wi-Fi -- WiMAX and LTE, in particular -- this aging broadband technology refuses to die. Instead, it's getting stronger.

On Wednesday, the Wi-Fi Alliance announced Wi-Fi Direct, a new specification that allows Wi-Fi devices such as laptops, smartphones, headsets, and the like to discover and link to each other without the aid of a router.

News.com's Marguerite Reardon argues that Direct could challenge existing connectivity technologies such as Bluetooth. She's right, but I see this as a much bigger development. It could be the next in a series of steps to make Wi-Fi an end-to-end alternative for telephony, whether for voice or for data.

Too ambitious, you say? Perhaps, but remember that AT&T (NYSE: T  ) recently allowed Vonage's (NYSE: VG  ) mobile app for discounted international calling to operate on its network. The implication: Any iPhone user with a data plan can now make cheap calls, with or without a Wi-Fi connection.

You can almost hear the AT&T commercial playing in the background. "Who needs Wi-Fi when you've got AT&T?"

Skeptics will argue that regulators were always going to make AT&T, Verizon (NYSE: VZ  ) , and Sprint Nextel (NYSE: S  ) play nice with consumers. They've shown a distaste for captive carrier strategies and exclusive deals, such as Apple's (Nasdaq: AAPL  ) bear hug of AT&T as its exclusive iPhone distributor.

Would allowing all VoIP services to operate on carrier networks satisfy Washington? Possibly, but Congress has been arguing for handset choice, rather than call choice.

What's more, the FCC is investigating whether the way Google Voice operates is circumventing telecommunications rules. Google (Nasdaq: GOOG  ) , for its part, says that Voice is a Web application, not a carrier. AT&T isn't buying that argument, and it's taken its complaints to regulators.

Wi-Fi Direct may be a simple upgrade and nothing more. But every upgrade makes wireless broadband in general, and Wi-Fi in particular, more attractive, more pervasive, and much more of a threat to carriers who've operated without a meaningful alternative.

Not bad for a technology that's been around for more than a decade, eh?

Apple is a Stock Advisor selection. Sprint Nextel is an Inside Value pick. Google is a Rule Breakers recommendation. Try any of our Foolish newsletter services free for 30 days.

Fool contributor Tim Beyers had stock and options positions in Apple and Google at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. The Motley Fool is also on Twitter as @TheMotleyFool. The Fool's disclosure policy is 15 years young.


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