The Uncertain Future of WiMAX

JasonYoo

The Uncertain Future of WiMAX [Copy link]

I'm always a fan of new wireless technologies. I'm a fan of WiMAX (which stands for Worldwide Interoperability for Microwave Access), but it's hard to tell where this technology is going.

Years later, all I've heard and seen is the harsh criticism that Bluetooth received when it first came out. Many people called Bluetooth a dead technology and a complete waste of effort. They also said that the technology would never achieve anything and who would be stupid enough to use such a thing. All the predictions were negative and pessimistic.

Fortunately, however, Bluetooth developers and supporters ignored those boring comments and continued to work hard, thus creating the most used wireless technology today. Looking at the sales of Bluetooth chips and Bluetooth-assisted devices, it can be found that its sales volume exceeds that of any cellular technology except GSM . Today, annual sales of Bluetooth chips have reached $500 million.

If you want to put this technology in a cell phone, it's easy to do. Cell phone sales are expected to easily reach the peak of last year, $810 million, or even $1 billion. Even if just 20% of the phones have Bluetooth chips, you can sell millions of units. And you can double that market share because you need to have one Bluetooth transceiver in the handset and another in the headset. I call it a quiet, unexpected success.

What does all this have to do with WiMAX? Nothing, except that WiMAX should have the same luck as Bluetooth. While it's not impossible to put a WiMAX chip in a cell phone handset, it's unlikely given all the competing technologies. WiMAX deployments are still in their early stages, and while we should be more patient, I'm still concerned about its future.

I recall my mixed feelings about WiMAX at the Broadband Wireless World conference in Las Vegas at Caesars in late April. When WiMAX was the featured technology there, I felt both affirmation and support and strong skepticism. In the past year, WiMAX has made great progress in commercial use, with more and better chips and new terminal products being produced. The basic wireless fixed standard 802.16d or 802.16-2004 is stable, and the new mobile version of the standard 16e is expected to be fully successful in 2007. At this time, all the fixed technologies are here, and if you want to get WiMAX products, you can get them.

But few groups are ready to adopt the technology, at least in the United States. Having the technology is one thing, detailing and testing the market and business model is another. Few have figured out the secrets of WiMAX.

What are the reasons for the reluctance to adopt this remarkable technology? There are many reasons. For example, there is the spectrum issue. In the United States, WiMAX is set to operate in the 2 to 6 GHz range, and 3.5 GHZ is most popular in Europe and Asia, but not in the United States. This leaves the 2.4 to 2.9 GHZ and 5.8 GHZ bands. The 2.5 GHZ band is the best, but there is almost no feasible allocation mechanism.

Sprint Nextel has some spectrum available. Many potential WiMAX users are also trying to identify other spectrum owners that might be viable in their applications. The 5.8 GHz band is viable, but rarely desirable due to its smaller range and potential conflicts with other services. But if you really want WiMAX in the U.S. right now, this band is probably your best bet.

Another factor hindering the adoption of WiMAX is competition from other broadband wireless services. 2.5G and 3G mobile digital services are now widely available thanks to GSM/EDGE, WCDMA, HSDPA and cdma2000 with EV-DO. Does WiMAX really have to compete? Since there are mobile services, they don't have to compete with the basic fixed 802.16 standard, but they do have to compete with the 16e mobile version.

If you want a mobile laptop, you can get one easily with a PCMCIA card from Cingular, Verizon, Sprint Nextel, and other major carriers. You can see why Sprint Nextel doesn't want to be very competitive in this area, but is instead trying to compete with the 3G cell phone infrastructure it has spent billions on by launching a new WiMAX service.

Another source of competition is from the highly established DSL and cable broadband services. I read a report recently that over 90% of PC users in densely populated areas have broadband service. Is the wireless coverage of WiMAX services really competitive? This is ideal for small cities and rural areas without broadband service. At least it seems like a good area.

Besides the emphasis on WiMAX at the broadband conference, I was surprised to see how big the local Wi-Fi business has become with many new vendors, manufacturers and many new buyers. Small and medium-sized cities are setting up Wi-Fi local networks to cover the entire town with broadband wireless service. These are sometimes completely free and sometimes discounted. Wi-Fi is already common on laptops and access points are very cheap.

Today's network wireless software is turning Wi-Fi into the most deadly competitor to WiMAX. Who should have thought? WiMAX. has higher data speed potential and quality of service possibilities. Add 802.11n and MIMO (multiple as in multiple output) to the mix, and it'll be even better. An IEEE task force could take a year or so to establish a final 11n standard, which would probably delay WiMAX adoption further.

So I will continue to be positive about WiMAX, even if it has some problems. It will be hard to succeed in Europe, Asia and many developing countries without normal communication infrastructure. And in some small rural areas where spectrum is available, some cheap airborne transmission methods are very useful. I am not indifferent to major deployments in these areas. The new mobile version of WiMAX has great potential, but it will have to compete with 3G and perhaps even with the forgotten marginal 802.20 standard. As with most new wireless technologies, we can only guess where it will end up, just keep an open mind, hold a positive attitude, and look for new applications and business models.

By Louis E. Frenzel

1234

Very thorough analysis, thanks.