Look out.  Market collision on the radar.  Sometimes the simplest view of the world is the best.  The big question is: Why won’t Wi-Fi take the same path as Ethernet and become the common — and default — transport for RFID Active Tags and for Sensor Networks?

• Wi-Fi will continue to ride the cost curve and the adoption wave.  Sorry to mix metaphors, but Wi-Fi can only continue to get cheaper and more widely used — in public spaces, homes, and enterprises.  Like Ethernet in the wired world, Wi-Fi will become an irresistible wireless transport.
• Wi-Fi-based RFID Active Tags need a battery breakthrough.  There will be major sturm and drum over using Wi-Fi as the over the air link from a standards point of view, but the biggest hurdle for Wi-Fi active tags is the issue of battery life.
• Sensor networks should stop re-inventing the wheel.  With the exception of military applications where sensors are thrown out of airplanes for battlefield surveillance, sensor networks should use the network that is available.  Sensors for HVAC control do not need to be autonomous motes.  They should piggy back existing networks and plug into the analytics of in-place control systems.

Bottom line: pipes is pipes and should be made use of as the commodity that they are.  The money to be made is higher in the stack — in the analytics.  Case in point, though they use Wi-Fi as the plumbing, Pango has figured out that they are in the asset tracking business, not location based services.  OAT Systems and Reva Systems are way up the value stack from RFID readers and tags.

Why little networks will have bigger impact

The big networks are done…bring on the weenie nets

The Internet equipment business is still growing at a healthy clip, but try thinking of a new product to build for big networks that isn’t already in the Cisco or the Juniper price book. Going forward, the little networks of the world — the weenie nets — are more interesting.

Wi-Fi was first

Today, the most popular weenie net on the planet is Wi-Fi. Millions buy Wi-Fi because it is:

• Really cheap. Wireless LAN (WLAN) products were expensive door stops before they were standardized by 802.11.  Now they are built for next to nothing in China, a place where a really good software engineer earns $15K a year.

• Just good enough. Wi-Fi can keep up with your cable or DSL connection and basic web content. What else do you want? At those prices, nothing for the moment. Yes, I know, you need Wi-Fi coverage that reaches to the end of your house, but most suppliers have that problem solved with a new generation of antennas and chips.

• Connected to something good. Without the Internet’s content, plus IM and gaming apps, nobody would have cared about Wi-Fi — enterprise, SMB, or consumer.

Dreams of Smaller, Smaller, More, More

Okay, Wi-Fi has a proven market dynamic and some of the attributes for little networks. What’s next? I can only report on the dreams of the technology community at the moment. Unfortunately, many of these dreams are not roiling, boiling markets yet. Even so, they currently include:

• Passive RFID dream. As a replacement for bar codes, Walmart and others take delivery of pallets of Coca-Cola and Kleenex with passive tags (current cost ~$.10) that answer back when hit with radio waves at the door of the loading dock. Analytics engines sit behind the scenes to manage inventory and location.

• Active RFID dream. Picture a 50-acre facility for shipping containers, each with an active radio tag chirping about the contents of the container, or a hospital that can locate its defibrillators because they have little radios stuck to them. Once again the analytics engines are the brains of the bunch.

• Sensor network dream. Tiny network nodes, or smart dust, are dropped out of an airplane onto a battlefield. The nodes wake up when they hear human voices and self-organize into a mesh network that transmits surveillance. The landlord of a high-rise saves $.50/sq ft/month by distributing 50 temperature sensors per floor without pulling any wires.

• Home net dream. Whole-house audio and video, dueling game cubes, lighting control. Fun toys you’d like to have but don’t want to pay a lot for.

Watch out: dreams can turn to religion

Like Wi-Fi, next-gen weenie nets had better be really cheap, just good enough, and connected to something good. Beyond those key attributes, inventors are currently enamored with the following beliefs:

• Arbitrary topologies. When you throw surveillance sensors out of an airplane, you can’t predict where they are going to land, so next gen weenie net inventors believe they should support arbitrary topologies.

• Self-organizing behavior. Next-gen weenie net inventors believe the nets should be able to manage themselves without any central authority if necessary. If a central authority shows up, then the nodes should salute the flag, but until then they should be able to live on their own.

• Small. In addition to being low cost, weenie net elements should be small relative to the environment. The Star Trek communicator went from flip phone to badge, right?

• Always on. If they aren’t alive, what good are they?

• No maintenance. No tinkering and tuning, please. Especially, if I’ve got thousands or millions out there.

Like I said, I put these last attributes squarely in the category of belief systems. In the coming weeks and months, I will be writing about whether these matter or not — and how they fit as these technologies develop.