WiMax in 2010: Too little, too late?

WiMax is finally making wide-area wireless broadband a reality in many cities -- but another technology is fast encroaching.

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ABI predicts that there will be at best 34 million LTE users at the end of 2011, with perhaps twice as many WiMax users. And Adlane Fellah, an analyst at telecommunications research firm Maravedis Inc., even speculated that carriers who intend to deploy LTE in a few years might turn to WiMax in the short term to take pressure off their 3G networks.

Although LTE is lagging behind WiMax today and will likely do so for the next few years, it's far from certain that WiMax will win this fight in the long run. "To LTE's credit, WiMax's head start has lessened, and LTE has the support of most major mobile operators," said Daryl Schoolar, principal analyst for wireless infrastructure at research firm Current Analysis Inc., in an e-mail exchange.

"WiMax, on the other hand, has in most cases been the technology of choice for new market entrants -- Tier 2 and Tier 3 operators," Schoolar continued. "This gives LTE the advantage, as its operators often have deeper pockets and established relationships with the end user. Both attributes are needed to get a new network up and running."

Unless WiMax deployment rates speed up, LTE will become the dominant 4G data network by 2015, predicts ABI Research principal analyst Phillip Solis. Farpoint Group's Mathias concurs. "LTE will have the footprint, services, and carrier and vendor support to make almost everyone happy, especially when coupled with Wi-Fi, which it will often be," he said. "WiMax isn't going away, but its opportunities for growth will be severely limited, and I don't think that there's much that can be done about that either from a business or a technology perspective."

Looking ahead

Stanforth sees a role for WiMax as a public service, recalling the failure of many municipal Wi-Fi efforts, such as those in San Francisco, Chicago, St. Louis and Springfield, Ill., and speculating that WiMax might be better suited to the task. "Muni Wi-Fi flopped primarily because of both the lousy coverage of Wi-Fi and the cost to even get that -- it took 60-plus Wi-Fi [access points] per square mile to implement using a typical mesh architecture, whereas a single WiMax AP will probably cover well over a square mile. The economics of 'Muni WiMax' might make sense," he said.

Lori Sylvia, executive vice president of marketing at Red Bend Software Inc., which makes WiMax device-management software, thinks WiMax service delivery and infrastructure costs will need to decrease in order for WiMax to compete with DSL and cable. When all providers, no matter what technology they use, can provide multiple Mbit/sec. speeds, "then the buying criteria becomes like any other Internet service: coverage and cost," Sylvia said via e-mail.

Brough Turner, an independent wireless analyst and blogger, isn't optimistic. In an e-mail, Turner wrote, "The problem is WiMax products can never achieve the volumes associated with the GSM family of technologies (GSM, UMTS, HSPA, LTE). As a result, WiMax will always cost more to deploy, and WiMax handsets will be more expensive than comparable GSM family handsets. It doesn't matter if WiMax is 'better' than LTE or not, or that WiMax is ahead today. The installed base of GSM family technologies generates very high volumes for GSM family products. As those products migrate to LTE, LTE product volumes will drive costs well below WiMax costs."

It's not necessarily an either/or proposition, however. "In my opinion, LTE and WiMax will co-exist, as they are actually targeting different markets," said Schoolar of Current Analysis. "LTE for the most part is an extension of the current mobile ecosystem. It will primarily be used to do what we are doing today with 3G, but better. WiMax's primary market, however, will be more about fixed and portable services. As much as I hate to say it, WiMax really will be Wi-Fi on steroids. While WiMax's head start over LTE has diminished, I don't think it matters as much as people think, as the two technologies are running a separate race."

Steven J. Vaughan-Nichols, a Computerworld blogger, has been writing about technology since CP/M was the dominant desktop operating system. You can learn more about Steven and read some of his other stories on his Practical Technology site.

Copyright © 2009 IDG Communications, Inc.

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