Delivering wireless LAN management tools in the form of software-as-a-service (SaaS) such as Aerohive HiveManager Online could be a catalyst for getting 802.11n deployments off the ground in smaller, budget-obsessed companies. Not having to own and administer any CPE other than Wi-Fi access points should make pricing simple and easily calculable.

Complementary to its cloud-based management service, Aerohive’s launch of a $689 dual-radio 802.11abgn AP-120 is in step with industry trends to bring lower-cost .11n-capable APs to market. So the AP cost is reduced and the CPE part of the equation goes away entirely.

Not having to invest in – and scale – on-site controller or management resources keeps capex in check. In Aerohive’s case, the company had already addressed the controller portion of the cost equation in its fundamental, “controller-less” architecture by bundling data and control plane functions together in distributed APs. This eliminates the controller element from the picture entirely. Now, with the SaaS option, customers also drop the capex of the management appliance and its associated system administration and per-AP licensing fees.

What you do pay is a flat yearly fee per AP for the hosted service. The fee you pay is either $60 or $110 per AP per year, depending on how flexible and granular you want your policy-setting configuration options to be.

Some quick math:

Let’s say you start with 5 APs and eventually grow to 20 APs at some point. If you were to choose the AP-120 and the HiveManager Online hosted cloud service, you’d start with a one-time capex of $3445, list ($689 x 5). Then you would pay either $300 each year or $550 each year in service fees (5 APs x $60 or 5 APs x $110). Software support and upgrades are included.

For each AP you add going forward, you pay another $689 for the AP and another yearly $60 or $110 service fee. When you get to 20 APs, you’ll have spent $13,780 on APs ($689 x 20), and you’ll be spending either $1200 or $2,200 per year in hosting fees (20 APs x $60 or 20 APs x $110). That’s all, folks.

So, is this a great deal? Readers? Comment from Aerohive?

What's the typical on-prem controller price? What markets does this best fit?

Comparing bottom-line pricing between vendors is really difficult and can take you down any number of rat holes. Not only is every enterprise environment different, but all the vendors have different pricing models, ranging from the very simple (Aerohive, Ruckus, HP ProCurve) to the mind-numbingly complex (Aruba, Meru). And they are changing all the time.

However, the Aerohive pricing is so straightforward that an organization can easily determine whether it could afford the solution. There are really only two costs to consider: The cost of the AP (times the no. of APs) and the annual service price. This model will likely be appealing to mid-market companies. There aren't hidden costs, such as of rack space needed for a mgmt appliance or server and associated power, system administration and software support with the hosted system. For a 20-AP configuration to incur a $1,200 or $2,200 annual hosting fee seems likely to be within the realm of even the stingiest budget.

Aerohive, Meraki, and Airwave are just the start of a trend towards delivering management "from the cloud" to better satisfy mid-market needs. Cost reduction and architectural simplification seem greater for vendors with controller-less architectures, but as Joanie points out, total cost depends upon product line, # of APs, annual maintenance fees, and the expected lifetime over which CAPEX is amortized. Furthermore, customers considering this approach should ask the questions raised about every "in the cloud" service (e.g., security, reliability, responsiveness). Given that WLAN management isn't part of the data path, it's a good candidate for this delivery model. Nonetheless, customers carefully consider what happens if the WLAN manager isn't reachable at key control points - for example, during authentication and roaming.

In response to Steve's question about the cost of on-prem controllers, as Joanie has answered, it depends on the controller sizing, feature licensing and redundancy costs for the various controller vendors.

The key thing is that Controller$ are not required in an Aerohive solution. Controller-based WLANs were designed for an era when there was insufficient processing power in APs to distribute the intelligence as happens in other networking infrastructure (routing and switching).

Today, Moore's law has ensured our HiveAPs cost the same or less than controller-based APs and are able to handle all aspects of authentication, association, fast/secure roaming, data forwarding, power and channel management, etc, completely eliminating the requirement for controllers.

The beauty of this approach when leveraging the cloud for management is that if the Internet pipe goes down, the Wi-Fi stays up, and you can still authenticate, roam and reach mission-critical network resources such as file servers and printers.