WiMax - don't believe the hype

WiMax - don't believe the hype

There is good news and there is a time lag: The fixed side of WiMax is well along the path to commercialisation, but mobile WiMax will not be in wide use until after 2009, according to research from Gartner.

"It's very easy, given the huge amount of WiMax hype at the moment, to see it as the next big thing after 3G," Gartner analyst, Ian Keene, said. "But that's not the case - it's a fixed wireless solution, an alternative to DSL. Mobile WiMax is a new cellular technology, and it's got a heck of a long way to go."

WiMax, based on the IEEE 802.16 group of standards, is intended to replace two distinct types of wireless broadband technology: fixed wireless, which could compete with or supplement ADSL, cable and leased lines, and mobile wireless, which makes broadband speeds available anywhere in a coverage area, including moving vehicles or public places. Mobile WiMax could complement 3G and Wi-Fi hotspots.

The standard is designed to make equipment less expensive and more interoperable, which would improve the business case for building networks. Equipment using the fixed 802.16d standard will arrive this year, and be certified next year. A relatively easy upgrade will add on mobile 802.16e capabilities, the WiMax Forum promises, but 802.16e equipment will not be ready for another three years or so. The WiMax Forum recently got a boost when telcos BT Group and France Telecom SA became members, along with Qwest, Reliance Telecom and XO. Operators who want mobile broadband are more ambiguous in their attitudes to WiMax.

Verizon, Sprint and Nextel, for example, have all said they are interested in mobile broadband but none are WiMax Forum members. Since February, Nextel has been conducting trials of a proprietary technology from Flarion and the company emphasised that mobility is key to its offering.

"This is for customers who don't want to be tied to their desk or their office," Nextel spokesperson, Chris Grandis, said. "You can go anywhere and use this service. It's beyond 3G."

Nextel also offers a wireless data card for laptops, operating at dial-up speeds, and plans to use Motorola WiDEN technology to quadruple bandwidth, in the second half of this year.

Sprint and Verizon are toying with high-speed cellular technologies such as EV-DO while waiting to see if anything promising emerges from WiMax efforts, but could just as easily use proprietary equipment if it is more cost effective, the companies have said.

"We do keep an eye on WiMax as we do all new technologies," Sprint spokesperson, Charles Fleckenstein, said. "If it makes business sense to move forward in this area, Sprint will do so."

In Europe, where 3G rollouts are already well advanced, wireless operators such as Vodafone and T-Mobile have even less incentive to jump on board a mobile technology that is years away, IDC analyst, Jan Hein Bakkers, said. "We don't think there will be any standardised [mobile WiMax] products before 2007," he said. "By that time there will be a lot of Wi-Fi hotspots out there already, and operators will have more UMTS [a 3G standard] networks. I don't see WiMax bringing that much additional value."

Others predicted more service providers would get on board the WiMax bandwagon, but agreed that it was still unclear what role WiMax would play.

"It's a very new technology, and operators are not absolutely certain where it fits in with the other parts of the jigsaw puzzle, vis-a-vis 3G, Wi-Fi hotspots and so on," Infonetics analyst, Richard Webb, said.

Fixed WiMax has a more immediate potential for success, according to analysts, because it will provide services similar to existing wireless broadband, while introducing lower costs and equipment interoperability.

Some analysts see this as a shrinking niche. BT announced this week it would enable another 1128 ADSL exchanges by mid-2005, which it claimed would give broadband access to 99.6 per cent of UK businesses and households.

France Telecom's ADSL will reach 90 per cent of businesses and households this year, according to IDC.

Across Western Europe, about 83 per cent of consumers and businesses had access to broadband last year, and in the next two years or so that would rise to 90 to 95 per cent, IDC's Bakkers said.

"In Western Europe, the role of WiMax will be limited," he said.

WiMax is expected to come fully into its own in areas where networks are not as fully built-out as in Western Europe and the US.

"Regardless of which vendor comes out on top, it is the millions of people in rural and developing markets who stand to gain the most from WiMax," Pyramid Research analyst, John Yunker, said.

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