Aruba Networks Releases New White Paper on Femtocell Technology

Market Wire, May, 2008

Aruba Networks, Inc. (NASDAQ: ARUN), a global leader in wireless LANs and secure unified mobility solutions, today announced the availability of "Running for Coverage," a new white paper on femtocell short-range radio technology used to extend a cellular network into homes and office buildings. Today, many operators are evaluating femtocell technology, but few are offering commercial femtocell service to their customers. This white paper examines the underpinnings of the technology, the claimed benefits for both operators and consumers, and the reasons why the market hasn't yet developed. Furthermore, the paper offers a comparison of femtocells and Wi-Fi access points, and concludes with an analysis of how the two technologies might coexist in homes in the future.

"This paper explores whether the femtocell is a technology in search of an application, or ripe for growth but just slightly ahead of the curve," said Peter Thornycroft, author of the Aruba white paper. "Advocates of the technology have by and large come from within the cellular industry. In contrast this paper offers a Wi-Fi infrastructure vendor's view of femtocells. As they seek to solve many of the same problems, femtocells and Wi-Fi are often considered competing solutions. In fact, however, there are synergies when the two are used together."

Femtocells face two hurdles: they must deliver a high level of voice and data performance before they will be accepted by consumers, and the price must drop before cellular operators will consider the technology viable. The newest 3G phones offer data capability in excess of 2 Mbps, and this is typically considered the minimum acceptable floor for service. In early trials Wi-Fi demonstrated better performance than femtocells using the same Internet connection. Unless operators or femtocell vendors are willing to incur a financial loss, the current retail list price of roughly $200 per femtocell is too steep if the technology is to be deployed widely.

Since Wi-Fi is indisputably the technology of choice for an in-home wireless network, the eventual solution may be a combination of Wi-Fi and femtocell technologies in conjunction with a DSL termination. A more full-featured device of this type would enable integrated service providers to deliver a complete Internet, phone and TV service to the consumer, thereby justifying the higher equipment cost.

"While it might take some time, the possibilities exposed by the use of inexpensive femtocells in conjunction with Wi-Fi access points would favorably change the business model for service providers to the ultimate benefit of consumers," said Keerti Melkote, Aruba's founder and head of products and partnerships. "Markets catalyze adaptation, and the failure of the current femtocell model will force a rethinking of the technology if it is to survive. Wi-Fi is ubiquitous in homes and businesses, and therefore a natural component in any solution a carrier wants to deploy in these environments. Aruba's growing involvement with carriers and remotely managed services makes our technology a good fit for these applications, with respect to devices, wireless management, and massively-scalable policy enforcement mechanisms."

The new white paper, "Running for Coverage," can be downloaded directly from Aruba's Web site at http://www.arubanetworks.com/pdf/technology/whitepapers/WP_FEMTO.pdf .

About Aruba Networks

People move. Networks must follow. Aruba securely delivers networks to users, wherever they work or roam. Our unified mobility solutions include Wi-Fi networks, identity-based security, remote access and cellular services, and centralized multi-vendor network management to enable the Follow-Me Enterprise that moves in lock-step with users:

--  Follow-Me Connectivity: Adaptive 802.11a/b/g/n Wi-Fi networks optimize
    themselves to ensure that users are always within reach of mission-critical
    information;
--  Follow-Me Security: Identity-based security assigns access policies to
    users, enforcing those policies whenever and wherever a network is
    accessed;
--  Follow-Me Applications: Remote access solutions and cellular network
    integration ensure uninterrupted access to applications as users move;
--  Follow-Me Management: Multi-vendor network management provides a
    single point of control while managing both legacy and new wireless
    networks from both Aruba and its competitors.
    

The cost, convenience, and security benefits of our unified mobility solutions are fundamentally changing how and where we work. Listed on the NASDAQ and Russell 2000® Index, Aruba is based in Sunnyvale, California, and has operations throughout the Americas, Europe, Middle East, and Asia Pacific regions. To learn more, visit Aruba at http://www.arubanetworks.com .

© 2008 Aruba Networks, Inc. AirWave®, Aruba Networks®, Aruba Mobility Management System®, Bluescanner, For Wireless That Works®, Mobile Edge Architecture, People Move. Networks Must Follow., RFProtect, The All Wireless Workplace Is Now Open For Business, and The Mobile Edge Company® are trademarks of Aruba Networks, Inc. All rights reserved. All other trademarks are the property of their respective owners.