Wireless LAN vs. Cat5 Ethernet LAN
Cost Comparison

Often the nicest cost comparisons are those that list specific items with dollar amounts attached for each option being compared. However, with a wireless LAN there are so many variables to consider that it is impossible to give a definite dollar amount for the “general case” since each case is, in fact, fairly unique. This section will concentrate on a brief comparison between wired Ethernet and the most popular wireless LAN, 802.11b (“wireless Ethernet”). The focus will be on the different costs that must be considered, not necessarily on the dollar amount of each item.
 
There are three main components that make up a typical wireless LAN: the wireless network card, which you will find in the desktop or laptop, the access point used to connect wireless clients to the network, and the bridge, which allows for building-to-building wireless connectivity.
 
Del Smith gives the following commentary on the “hard costs” (hardware, initial setup costs, etc…) and the “soft costs” (maintenance, efficacy, etc…) associated with a wireless LAN as opposed to a wired Ethernet network.
 
Hard Costs  
The costs associated with a typical wired solution are familiar to many people. Consider, for example, a couple of new corporate office buildings. Traditional wired costs may include CAT5 copper cable runs in the ceiling and through walls, along with their corresponding data drops needed on just about every wall feasible. This must be considered because, unless you are going to run the cable yourself, quite a bit of installation costs will be associated with laying the basic wiring and data drops.
 
A wireless LAN also requires installation (preferably professional if the network is very large) and some degree of cabling; however, one access point can usually be installed in the amount of time it takes to terminate one data drop. To make this part of the solution complete, you may also need to add in the cost of traditional RJ-45-based network cards, depending on whether your systems come with them preinstalled.
 
Until recently, wireless network hardware has been more expensive than Ethernet hardware. The relative cost of wireless hardware has decreased significantly, making a wireless home network much more affordable to establish.
 
Recall that in a wired network, a fiber-optic cable run may be needed to connect two buildings due to the distance limitations and conductivity of copper. Consider the cost of connecting two adjacent buildings that are 150 meters apart with a fiber line. Take into account the installation time and the special equipment needed on each end. Perhaps there is also a small concrete walkway that runs between the two buildings…. The cost could become enormous.
 
Now compare that with the cost of using two Cisco Aironet bridges to provide line-of-site connectivity between the two buildings, not to mention that these two locations can be connected and up and running just a few hours after opening the boxes. This small scenario may be overly simplified. But the fact remains that once you take into account the associated installation and setup fees, a wireless LAN can be implemented at a fraction of the cost of a wired one—and a wireless LAN can usually be set up in a much shorter time frame.
 
Soft Costs  
The real-estate issue: If a company has a long-term lease (five or more years) or owns a building, a traditional copper wired network could suffice for the duration of the organization's needs.
 
In contrast, a short one- to three-year lease may provide a greater cost value for wireless. Paying for a wired LAN in this situation could be considered a sunk cost if the organization decides to move, whereas a wireless network could be deemed an investment that moves with the company. So even if the wireless network cost more up front than a traditional wired network, a wireless network could pay for itself if the organization will be moving its office.
 
Another compelling benefit of wireless LAN solutions is increased mobility and productivity. Examples include doctors who can make their rounds with immediate access to patient information, conference rooms that allow access to corporate data during meetings, and libraries that enable you to complete research while remaining connected to a corporate network and/or the Internet. The increase in efficiency that can be realized by the freedom of a wireless LAN may sometimes be difficult to measure in terms of soft costs, but it's real and should be considered.
 
Conclusion  
As mentioned before, there is no simple equation that can determine whether a wireless LAN is indeed more cost-effective than a wired one for any given scenario. Both the hard and soft costs of each solution have to be evaluated, along with security, standardization, and performance issues. But with wireless prices falling and productivity gains increasing, the wireless vs. wired cost comparison deserves a closer look.
 
Ballpark Figures: The presentation of these figures is designed simply to give an idea of what price-range each type of network is in. A particular scenario would require an individual analysis that takes into account all the aspects of the situation (amount of cable needed, number of hubs/switches, number of access points, etc.).
 
Ethernet CAT5 sealed 50 ft cables: $20
Ethernet hub or switch: $60
 
Wireless Access points: $60-$1,400
Wireless network card : $39-$300+
 
Sources:
Wireless Networking
 
Ethernet Networks Overview
 
Microsoft Broadband Networking Hardware
 
Take Advantage of the Cost Savings of a Wireless LAN

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