The day is approaching where average consumers will want a true web-browsing Internet-style experience on mobile devices. It might not be anytime soon, but it’s coming nonetheless. For wireless carriers who are now trying to get subscribers to access mobile data over 3G it is both a blessing and a curse — as many have pointed out too many subscribers that might tune into (and upload video to) a truly-mobile YouTube on cell phones could clog a 3G network pretty fast.
What does that mean? Carriers have to upgrade their networks, and are now making the tough and expensive decisions about which way to turn for 4G (I know, it seems like we just got to 3G!). Does a carrier keep upgrading its 3G network and aim for what the telco world calls “long term evolution” (LTE) — 4G network technology from the cellular world which is many years from prime time? Or do carriers start building alternative data-specific networks with technology like mobile WiMAX that is available now?
Carriers are making different decisions based on a variety of factors: How competitive their 3G footprints are, how much spectrum do they own that can be dedicated for mobile WiMAX, and how they anticipate the growth of data-hungry mobile web subscribers. WiMAX is the wireless word of the year, in no small part to Clearwire’s not-so-smooth IPO efforts and Sprint’s (overly?) ambitious network buildout.
While the success of WiMAX is by no means assured, it is becoming a more attractive choice for certain carriers. Mobile WiMAX might be argued as not officially 4G, but it is a precursor. That’s why time to market is the biggest reason why carriers are starting to look seriously at mobile WiMAX. WiMAX is at least two years ahead of LTE in market time, writes ABI Research analyst Ian Cox in a recent report.
For a third place U.S. carrier like Sprint (which is also losing important post-paid subscribers) the company needs to do something sooner rather than later. As this article points out, Sprint needs to do something aggressive to stay competitive with CDMA-leader Verizon Wireless:
Being the smaller player means Sprint has no leverage to pressure Qualcomm, the mother of all sources of CDMA technology, to help it build a network more advanced than Verizon’s. In short, following the conventional CDMA route could leave Sprint stuck permanently in Verizon’s shadow. — VOIP News
Even the CEO of Vodafone recently pointed out at 3GSM that mobile WiMAX is now a major player for future wireless broadband networks, based largely on time to market, according to Seeking Alpha.
Mr. Sarin admitted that LTE is far from being implemented, let alone standardised, and astonished his audience by suggesting that LTE may not even be supported by Vodafone in the future. – Seeking Alpha
Vodafone even has some WiMAX bets in countries like France, Bahrain, Greece, Malta, New Zealand, and South Africa.
Another reason carriers are considering mobile WiMAX is that it is being touted as a cheaper (in some ways) technology to building and upgrading 3G networks. Dan Lockee, an analyst at Pyramid Research, wrote recently that WiMAX spectrum has been significantly cheaper than 3G spectrum, and “in some cases, WiMAX spectrum has been less than one-thousandth of the cost of 3G spectrum for a given geographic area.” Though, he also points out that WiMAX spectrum will get more expensive as more regulators release lower frequencies to be used for mobile WiMAX.
When comparing infrastructure to infrastructure, deploying mobile WiMAX networks is often thought to be cheaper than deploying 3G networks, though currently, ABI’s Phil Solis says the costs are actually about the same:
“what many companies in the industry are finding out is that the costs are approximately the same when comparing apples-to-apples (including, or not including, site acquisition, towers, other equipment, and backhaul for both 3G and WiMAX). This is not to say that it will remain this way, but just that at this point in time, mobile WiMAX deployment costs are on par with 3G deployment costs.”
Thinking about costs also depends on what networks carriers have already built and how they are upgrading. The costs are varying depending on the degree of the upgrade. Solis says that when Sprint makes its cost comparison claims, it is comparing the addition of mobile WiMAX to its existing 3G infrastructure:
“Existing base stations will be used (and some new ones added), other existing equipment at the site, and the existing backhaul. So what Sprint is really saying is that it will be overlaying mobile WiMAX onto its 3G network at one tenth the cost of what it takes to build out its 3G network. In other words, Sprint is greatly expanding its access speeds and capacity above and beyond 3G, and is doing so with a marginal increase in cost (a 10 percent increase).”
WiMAX might have lower costs and be ready now, but a lot of carriers are still aiming for LTE. ABI says network operators will invest a total of almost $18 billion in LTE capital infrastructure over the period between the end of this year and 2014.
There’s a lot of choices for carriers as they are forced to become mobile broadband suppliers and not just voice networks. While it’s not clear which one will be the “right” choice in the long run, we’re likely to see some pick WiMAX as the right choice for right now.
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I thought with WiMax less towers would be needed to cover an area. Also, can’t wiMax data access to sold as a viable internet solution for homes and small businesses?
I think Sprint made the right decision.
I was under the impression that their voice call capacity would be much higher with WiMax/Voip.
WiMAX is not a “for” technology, its an “against” platform, more specifically its a repudiation of Qualcomm. It has everything to do with going against QCOM.
I’m not saying QCOM is perfect and they have certainly been out played by Nokia for the last year plus, but the benefits of WiMAX will evaporate and then be crushed by future CDMA/OFDM versions. Check the last QCOM CC.
While the cost of the network is not trival, the cost of marketing, churn and CC are much more important especially in the beginning.
If a carrier can not compete today, changing technologies wont necessarialy help, other than to buy the executives more time to bank some badass bonuses before the board calls bullshit on the whole operation.
Which largely explains WiMAX in america.
What evidence is there that WiMAX will be crushed by Qualcomm? They couldn’t even crush GSM, which lagged them technologically rather than lead them like WiMAX. The crucial technologies going forward are not OFDM or CDMA, but MIMO and beamforming. Qualcomm does not have the stranglehold over those areas that it has over CDMA. Qualcomm still has some very useful IP, especially concerning soft-handover and power control, that will give it an edge in mobile applications and I think they will continue to be a key player going forward, but to think they will somehow magically become the only player is silly.
Jesse,
MIMO is about attentas, not an air interface. Nevertheless I think QCOM did pick up some IP in this domain, but thats not germane to my point.
I didn’t mean crush as in the marketplace, just in terms of raw air-interface performance. Which I thought would be more obvious since my main point was that Carriers and Vendors were trying their best to avoid QCOM. And which is the only way to compare with WiMAX at the moment.
What will be fun to watch is Verizon and maybe Alltel.
VZW and ATT are having their cake and eating Sprint’s lunch. If Sprint cant manage two technologies (CDMA and iDEN), what makes anybody think that a third will improve the situation? WiMAX is no silver bullet for wireless, much less a tonic for crappy leadership.
QCOM bought Flarion which gave them a lot of IP in the mobile broadband space. I feel that Flarion would have been much more successful had it not been bought, as now people don’t trust QCOM to be reasonable with the IP, so they choose WiMAX instead.
802.20 and 802.16e are not really going to be that different, from a user persepctive, in the end, so why choose the QCOM route, given the grief they caused with CDMA!?
“The 802.20 group points to its focus on full mobility as a differentiator. The standard will be designed to support high-speed connectivity at client speeds as fast as 200 miles per hour, says Ronny Haraldsvik, senior director of marketing for Flarion. ‘That’s the key differentiator with 802.16,’ she says.”
Looks like QCOM might be able to get the market for the high speed trains, and German autobahns. For the rest of the time, WiMAX will be cheaper.
I find it hard to believe that WiMAX will be similar cost to 3G to deploy. Is a WiMAX router going to be the same cost as a 3G switch?? We are talking about Cisco equipment vs Ericsson equipment. I don’t know of many cases where their price lines overlap!
A lot of things are still unsaid about WiMAX and it needs to go along way before it can stand up to its claims (as a technology).
Yes, a lot of the marketing spin on WiMAX leads people to believe that a lot fewer BTS (cell sites/towers) will be needed to cover the same area as an incumbent cellular (2G/3G) network. But that’s mostly not so. First off, look at the operating frequency that WiMAX is intended (2300 MHz upwards) to work in – and compare that to 800 MHz (or 1900 MHz/2100 MHz) for cellular. I’d say to provide competitive coverage, you’d need close to 1.5x the number of 2G/3G BTS – and that’s just for moderate urban environments. Dense urban? I don’t know, but it sure looks like a lot more!
Mobility in WiMAX is the next big question: cellular voice networks seem to be a lot better suited for handover but not WiMAX. What happens when an ongoing TCP/UDP session is timed out? IMHO, a far greater number of BTS (as compared to GSM/CDMA) will be needed in order to ensure “seamless” handover in mobile WiMAX networks.
(And oh, BTW, 802.20 is intended to address exactly that shortcoming in WiMAX: handoffs in mobile data networks. So QC may not be completely irrelevant especially if they own signifcant IPR.
These two factors alone point to the fact that CapEx considerations for WiMAX are at least as much as existing voice networks today, if not more. OpEx will vary from operator to operator and country to country, I daresay.
Then there are other factors such as in-building losses (first-wall penetration) that still remain to be seen in real-world environments – but those arguments are subjective and, to be fair, there’s nothing to suggest that pico- and femto-cells cannot be used equally well for cellular voice and WiMAX networks.
WiMAX was never intended to replace cellular voice and it is not ready to do so today, anyway. The kind of performance that cellular voice networks deliver today cannot be matched by WiMAX for at least the next couple of years. And I’m sticking my neck out on this one.
What WiMAX really delivers today is latent data capacity. This is far in excess of what 3G or EV-DO offer for a comparable network investment. Really, really much greater. But the question that faces most operators is: do I really have that volume of subs to consume this capacity. And in most cases, I think the answer will be “No”.
The operator will really need to grow his subscriber base by about 5x or 7x, if it is to use all it’s capacity effectively and therefore get RoI. Or hope to get it back faster, anyway. MIMO and OFDMA will be adapted to fit UMTS/LTE over the next couple of years and when those are mature, that’s when there will be a real apples-to-apples comparison about feeds and speeds in WiMAX and cellular (voice) technologies. The efficacy of MIMO in a number of environments is yet to be substantially proven and perhaps the rollout of WiMAX networks over the next couple of years will show some results – either way!
Up until then, it’s just a matter of using WiMAX as a filler or for pure greenfield ISPs. WiMAX will be good for ISPs, there’s no doubting that. For the next two years, I’d put my money on using WiMAX in fixed environments only – whether you use 802.16-2004 or 802.16e-2005.
DSL replacement or wireless DSL. Call it what you will.
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[...] WhyMAX? ” GigaOM … that can be dedicated for mobile WiMAX, and how they anticipate the growth of … WiMAX is the wireless word of the year, in no small part to Clearwire’s not-so … [...]