Can the Clearwire coalition save WiMax?

Can the Clearwire coalition save WiMax?

Hopes for nationwide WiMAX network hinge on alliance of telecom, cable and tech companies

Too little, too late?

But while Sprint and Clearwire have clearly succeeded in bringing market leaders aboard the WiMAX bandwagon, questions remain about whether the WiMAX alliance has been formed too late in the game.

For one thing, WiMAX could face problems related to its technological limitations. For instance, Gartner analyst Phil Redman says that because WiMAX is a data-only technology that can only transmit voice services over IP, it will have limited market appeal for users who want all-in-one 4G devices.

"It's going to be a challenge," he says. "Can you name any successful data-only networks that are around today? People who want cell phone and voice technology are going to have to carry second device unless they make it a combination device that uses both WiMAX and cellular technology."

What's more, WiMAX is due to face stiff competition in two years from LTE, the 4G standard that has been adopted by competitors Verizon and AT&T, and which is considered by many to be the next big wireless broadband standard. But while WiMAX is expected to have at least a two-year head start over LTE, delays in deploying WiMAX nationwide in the United States mean that Clearwire's time-to-market advantage is shrinking by the day. And as ABI Research analyst Phil Solis noted in a report issued earlier this year, delays in certifications by the WiMAX Forum could further constrain the time WiMAX has to enjoy the 4G market all by itself.

However, all is not lost. Jude says that if the Clearwire coalition can get its act together and start delivering a strong array of services and products quickly, it will still retain a good-sized time-to-market advantage over LTE vendors.

"If Sprint can get to the market yet this year, with a decent set of service offerings, it could generate a fair amount of buzz before the LTE crowd shows up," he says. "I think one key would be to tie up some of the content providers so that the LTE gang has a harder time delivering equivalent service offerings. So, bottom line, I think there could be some method to the madness when Sprint and Time Warner engage in talks."

Solis, meanwhile, acknowledges that WiMAX could have a more limited time-to-market advantage than it had initially hoped for, but also thinks that investments from major tech and cable companies will give WiMAX just the boost it needs to get back on track.

"With the infusion of capital, they should be able to stick somewhat to the aggressive nationwide rollout of the network and have decent nationwide coverage by the end of 2010 compared to maybe decent nationwide coverage from Verizon Wireless' LTE network by the end of 2011," he says. "So there is still at least a year gap looking at it that way."

Jeff Thompson, CEO of enterprise wireless broadband ISP Towerstream, also says that the high quality of the investors in the new Clearwire venture makes it hard to dismiss, and shows that many within the telecom, tech and cable industries view WiMAX as an important technology that will bring 4G wireless broadband services to Americans before any LTE products come to market.

"Clearwire has got a huge amount of titans that are validating this technology," says Thompson, whose company has already deployed fixed WiMAX technology and is currently testing the mobile WiMAX standard. "I think it's going to bring a lot of awareness for new products like this and it will lower the costs of devices. These are good things for the WiMAX base."

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