At first glance, managed Wi-Fi networks seem like an appealing solution for apartment complexes, offering the promise of seamless connectivity and centralized management. However, beneath the surface, these systems can introduce a host of technical, operational, and legal issues that make them less ideal than they initially appear. This post delves into the lesser-known drawbacks of managed Wi-Fi and demonstrates why Aditum Connect provides a superior alternative for both tenants and property managers.

Performance Degradation: LAN Traffic Overload and Device Bottlenecks

 1. Local Network Traffic Overburdens the Access Point

Managed Wi-Fi networks are not just responsible for handling internet traffic; they also handle local area network (LAN) traffic within each apartment. For instance, if a tenant wants to stream from their laptop to their smart TV or transfer large files between devices, this LAN traffic consumes bandwidth from the Access Point (AP), the same resource used for internet connectivity. This can lead to significant slowdowns:

• • High LAN Bandwidth Consumption: Streaming video or transferring large files within the apartment can use up as much bandwidth as internet activities, reducing overall network performance. On a shared Wi-Fi network, this affects not only the tenant engaging in the activity but also their neighbors, as the AP becomes overloaded with local traffic.

• • Old Devices Cause Bottlenecks: When a tenant connects an older Wi-Fi device (such as a Wi-Fi 4 or 802.11n device), it can disproportionately impact the performance of the entire AP. Wi-Fi networks often operate at the speed of the slowest connected device, meaning one tenant’s old smartphone or tablet could drag down speeds for everyone connected to the same AP.

 

The way to avoid this problem is by providing each tenant with their own dedicated, private, wired connection, and have them use a secure wireless router within their apartment. That way LAN traffic stays securley within their apartment, and no local traffic is passed through shared infrastructure. This ensures high performance and reliability, no matter how much local network traffic a tenant generates.

Infrastructure Challenges: The 5GHz Dilemma and Access Point Placement

 2. Wireless Signals and Wall Penetration

One of the technical limitations of managed Wi-Fi networks is their reliance on 5GHz frequencies for faster speeds. However, 5GHz signals do not penetrate walls well, making it difficult to provide consistent coverage across multiple apartments with a single AP:

• • APs in Hallways Fail to Deliver: To cut costs, many managed Wi-Fi networks place APs in hallways, attempting to cover multiple apartments with one device. This approach leads to poor 5GHz signal strength inside apartments, often forcing tenants to fall back to slower 2.4GHz frequencies, which are more prone to interference and congestion.

• • Increased Installation Costs: Because 5GHz doesn’t penetrate walls effectively, managed Wi-Fi systems ultimately need to place APs inside or very near each apartment, similar to what tenants would do if they installed their own routers. This significantly increases installation and operational costs while negating the benefits of centralized management.

• • Inability to connect wired devices: Many tenants still need or want to connect some devices to the internet via a wired ethernet cable.  If the building only offers Wi-Fi connectivity then those devices will be incompatible with the provided service, often making the tenant chose to purchase another connection, or perhaps select another apartment complex that is less restrictive.

 

Placing a cost-effective Wi-Fi router with optimal placement in each specific apartment layout eliminates the need for complex, costly AP installations and ensures better Wi-Fi performance, and allows tenants a wired connection option when needed.

Privacy and Security Concerns

 3. LAN Traffic Visibility and Data Security Risks

Managed Wi-Fi networks often route all traffic, including tenants internal LAN traffic, through centralized or shared infrastructure. This raises serious privacy concerns:

• • Invasive Monitoring: Network administrators may have the ability to monitor LAN traffic between a tenant’s devices, such as a file transfer between a laptop and a network storage device. This kind of visibility is unnecessary and invasive, exposing personal data and communications to potential scrutiny.

• • Security Breaches: Centralizing all tenant traffic increases the risk of a data breach. If the managed Wi-Fi system is hacked, personal data from every tenant using the network could be exposed, resulting in significant privacy and security issues.

• • Lack of Data Boundaries: Often marketed as a selling point by a Managed Wi-Fi provider for allowing Tenants to be on their LAN and roam anywhere in the building, this actually means that the Tenant has no control over where their data gets transmitted or how securely it is moved around the building. It also frequently means it can be sniffed or monitored by other Wi-Fi connected users. Everyone knows not to trust “coffee shop” Wi-Fi for these exact reasons, yet Managed Wi-Fi salespeople love to pitch this as a “good thing”.

 

When LAN traffic is completely private and isolated within each tenant’s apartment behind a individual wireless router, Tenants control their internal network and devices, the building no longer has any risk or liability for the security of tenants private communications. Whenever a prospective tenant who is particularly security minded tours a building, keep an automatic defibrillator nearby when you tell them all about using the Managed Wi-Fi roaming features for their LAN devices.

Public IPs and Remote Access: Limiting Tenants’ Flexibility

 4. Lack of Public or Static IP Addresses

Managed Wi-Fi networks normally cannot provide tenants with public IPs or have the ability to assign public static IP addresses, which can be a dealbreaker for certain power users or commercial tenants:

• • No Public IPs: Tenants who need to access their home network remotely, such as those who run a home server, VPN, or other advanced setups, may be unable to do so with a managed Wi-Fi system. This limitation hinders if not entirely blocks the ability to connect into their network from outside the building.

• • Commercial Tenant Challenges: For commercial tenants, such as those who run small businesses or need consistent remote access, the lack of a public or static IP may create additional headaches, making managed Wi-Fi a wholly unsuitable solution.

 

While the majority of tenants will not need or care about these features, a small portion of tenants will require them, and to these tenants the inability to meet their needs will likely drive them to either buy or rent elsewhere. It is not worth driving a potentially good tenant away by providing them an inadequate internet connection.

Device Compatibility Issues

 5. Captive Portals and IoT Device Frustration

Managed Wi-Fi networks often use captive portals for authentication, which can make it difficult—or even impossible—for some devices to connect:

• • IoT Devices and Captive Portals: Devices like smart bulbs, smart thermostats, and other IoT (Internet of Things) devices often do not support logging in through a captive portal. These devices rely on quick, seamless network access, which a captive portal can disrupt. As a result, tenants may find it difficult to connect these smart devices to the managed network.

• • Complex Onboarding Process: Tenants with a large number of smart devices may find it cumbersome to repeatedly authenticate each device through a captive portal, reducing the usability of the network.

• • Difficult to remember Wi-Fi: Even in Managed W-Fi cases where the authentication is handled by a SSID and Password, it’s often difficult or impossible for the tenant to customize these values, making it hard for them to remember their connection information.

It should be pointed out that the potential difficulty connecting tenant devices is also ironically mirrored by the easy ability for the building to connect their own IoT devices to separate hidden Wi-Fi networks setup just for IoT access, This is the one point where a managed Wi-Fi solution does usually win over other solutions.

 

Captive portals, or for that matter any device registration process, may be fine for a hotel or campus, are inappropriate solutions for providing a permanent internet connection to a tenant in their home, and only limit and hinder their ability to connect their desired devices.

Attempting to Fix LAN Traffic Issues Can Break Devices

 6. Disabling Device-to-Device Communication Creates More Problems

In an attempt to fix the LAN bandwidth issue mentioned above, some managed Wi-Fi networks restrict device-to-device communication—also called “device-to-device forwarding”—within the network. While this may reduce local traffic overload problem on the AP, it creates serious usability problems:

• • Broken Device Functionality: Many devices, such as smart TVs, printers, and game consoles, rely on device-to-device communication within the network. Disabling this feature will prevent these devices from working as intended, causing frustration for tenants and support headaches for property managers.

• • Essential Services Affected: Tenants expect their devices to communicate freely within their own apartment. Breaking this functionality by disabling device-to-device forwarding renders many modern smart home setups non-functional, making the network unsuitable for today’s tech-savvy residents.

 

Acting as the gatekeeper for deciding what type of devices or services your tenants can or cannot use on the Wi-Fi or connect to the internet is a terrible way of providing a high-quality premium amenity to tenants. All wired or wireless devices, from smart home equipment to entertainment systems, should work seamlessly.

Legal Liabilities and Compliance: The Risks of Managed Wi-Fi

7. Increased Legal Exposure for Property Managers

Managed Wi-Fi networks have the potential to expose property managers to significant legal risks when it comes to liability for certain tenant activities. Traditional ISPs are immune from this risk under the Communications Decency Act (Section 230):

• • Liability for Illegal Activities: In a traditional ISP model, the provider acts as a neutral conduit and is classified as a “provider of interactive computer services” under the CDA and as such is not responsible for the content transmitted over the network. However, managed Wi-Fi networks blur this line in ways that are legally untested, because the provider (or property manager) actively handles and manages traffic in ways that a traditional ISP does not. If tenants use the network for illegal activities—such as sharing illicit content or engaging in criminal communications—there is a chance property managers could face legal challenges.

• • Risk of Monitoring and Filtering: If property managers or their Wi-Fi provider monitor or filter network traffic, they might be seen as playing a more active role in the network’s operation. Some experts believe this could classify them as a “information content provider” exempting them from the Section 230 protections and increase their contributory liability exposure if illegal activities occur within their network. This distinction between a traditional ISP and a Managed Wi-Fi provider has not yet been legally tested if or to what extent Section 230 exempts a managed Wi-Fi provider from liability for the traffic of their users.

 

By offering a “dumb pipe” to each apartment with all LAN traffic contained behind a Wi-Fi router, you eliminate the involvement in tenant network activity and unquestionably remain protected by CDA Section 230, and thus property management has no responsibility for tenants’ network traffic, eliminating any legal risks associated with managing a centralized Wi-Fi network.

8. Compliance with CALEA Requests

An often overlooked but very real legal issue for managed Wi-Fi networks is their ability to comply with CALEA (Communications Assistance for Law Enforcement Act) wiretap warrants. Managed Wi-Fi solutions often find it difficult or impossible to isolate and record specific tenant data as sometimes required by court order. This may lead to situations where a legal warrant either cannot be complied with, or every tenant in the building may have their data logged in connection with a court order pertaining only to a single tenant.

 

Ensuring whatever solution you chose allows you to remain in full compliance with federal CALEA requirements while protecting the privacy of other tenants.

Conclusion: Aditum Connect Is the Superior Choice

While managed Wi-Fi solutions may initially seem like a convenient choice for apartment complexes, the reality is that they come with a host of performance, privacy, and usability problems, and some potential legal risks too. From LAN traffic overload and poor 5GHz coverage to privacy concerns and limited device compatibility, managed Wi-Fi networks often fail to meet the expectations of modern tenants, while also increasing the risk of legal issues for a property owner.

Aditum Connect offers a more tenant-friendly solution by providing:

• • Local LAN traffic stays local, no risk of data leakage or AP degradation from neighboring apartments

• • A dedicated, “dumb pipe” to each apartment, ensuring high performance and complete privacy.

• • Aditum Connect Zero Touch Wi-Fi routers offer fast and seamless automated setup and installation, but can be opted out by a Tenant for any brand router they prefer.

• • Minimal distance between Wi-Fi router and Tenants results in best possible performance, and more reliance on 5Ghz frequency band which supports many more devices.

• • Wired ethernet option for any devices that require cabled connections

• • Public and static IP options for power users and commercial tenants who need advanced network functionality.

• • Seamless connectivity for all devices, including IoT and smart home devices, without the need for captive portals or restrictive login processes.

• • Ability to comply with CALEA requests, isolating each tenant’s public internet traffic for legal purposes without compromising the privacy of others.

• • Optional: Automated billing & collection integrations available.

• • Optional: API available to integrate functionality into 3rd party tools, apps, and websites.

For property managers and owners looking to deliver a truly modern and flexible internet solution to their tenants without compromise, Aditum Connect is the clear choice. It combines the benefits of traditional ISP connections with the flexibility tenants demand, without the drawbacks of managed Wi-Fi networks, and at more competitive pricing to traditional Bulk service from the cable and telco companies.

 

Aditum Connect partners with local vendors or service providers of your choice. This means that you don’t have to add another external company to the list of who’s working your building for installation or maintenance, giving you greater control over who provides service within your properties. By allowing you to work with an already trusted local vendor, Aditum ensures a smooth integration process and unmatched flexibility in managing your building’s internet services.