Wireless LAN pioneer Proxim has resolved its financial crisis, promising continued support for its products - but its rivals are queuing up to snatch away customers who have doubts about the future of its Orinoco line.
"If anything, it's a rebirth of the company," claims Jeff Orr, senior product marketing manager at Proxim, of the deal. Proxim will declare Chapter 11 bankruptcy, and Moseley Associates, a low-profile player which specialises in recycling wireless companies, will acquire all its assets for $21 million - substantially less than the $100 million Proxim which wireless news site Unstrung estimated Proxim needed to be debt free.
Proxim will continue to operate under its own name within Moseley, promised Orr. Its Orinoco enterprise access points - erstwhile market-leaders - will continue, but the emphasis will shift to outdoor hotzones, which cover a geographical area with Wi-Fi coverage and WiMax backhaul, he said.
"There's a much larger opportunity in the municipal market than in the enterprise, going forward," said Orr. "There is too much choice in the enterprise, and we will see consolidation,"
Despite this, Orr was adamant that Proxim would continue to support and extend Orinoco products. He claimed the company would "keep abreast" of new standards - despite its apparent lack of success with its efforts to keep abreast of wireless LAN switches.
WLAN switch vendors, meanwhile, are ready to snatch any of Proxim's enterprise customers that have doubts. Trapeze has extended its Open Access Point Initiative, aimed at integrating foreign access points to include support for Proxim's AP 4000 access points. Clients will be able to roam between Proxim and Trapeze access points with full security in a Trapeze WLAN, said Trapeze.
We are giving customers who have an installed base of Proxim APs a way to extend the life of their investment said Jim Vogt, CEO of Trapeze. Analyst Joel Conover, of Current Analysis agreed (albeit in a quote within Trapeze's press release): With Trapezes new capabilities, Proxim customers can migrate their legacy distributed AP deployments to a switched network architecture while enjoying complete mobility between the new and the old, preserving security policies with per subscriber granularity.
Meru, meanwhile has announced that users can hook up Proxim AP2000 and AP4000 access points to its controllers that use an innovative single channel architecture, or trade them in for Meru products.
With that sort of competition, Proxim may be wise to focus on municipal hotzones, where Orr claims it is the only company that can put together Wi-Fi and WiMax. "No-one else can address municipal broadband applications so well," he said, though existing players such as BelAir would probably want to dispute that.
Moseley's other acquisitions - Axxcelera, MDS and CarrierComm - would add other options for backhaul, he said. "Moseley is the second largest vendor of broadband wireless equipment in the world."
The deal is expected to close in six to eight weeks, and Orr did not expect serious objections from Proxim's creditors. "We have been working with current creditors to let them know the situation, and reach a common understanding, as well as with contract manufacturers and other partners. A common understanding was agreed prior to filing for Chapter 11."
"We're very excited to get beyond the question how we would survive," said Orr. "We are building roadmaps to demonstrate how long we intend to be in this market."