The Truth About WiMAX

34 Comments

OECD had recently released a report on WiMAX and its impact on competition and regulation. You can download the PDF from OECD website if you are interested in it. I have not spent studying the report, and have skimmed it. It seems to be a comprehensive in looking at issues such as spectrum allocation, and compares national policies. Some countries have issued licenses, and some have not. What I found most interesting was that WiMAX despite the hype is more about connectivity, and less about a panacea for higher speeds.


The report points out that a typical base-station, can handle an area between 3-to-10 kilometers in a non-line of sight environment. Or about 40 Mbit/s per channel, which basically boils down to this: one cell could theoretically allow hundreds of business connections at 1.5 Mbit/s and thousands of residential connections at 256 kbit/s. It is easier to see why I have always believed that this is a long haul technology, which can then work in tandem with WiFi meshes, for local connectivity.

That makes perfect sense in the near to medium term, because it will take a few years for the gear to become cheaper, and technology to become capable of delivering more capacity, and speeds. According to some estimates, the current subscriber equipment costs about $300, about two times (roughly speaking) the price of WiFi, cable and DSL customer premise equipment. In-Stat, estimates that it would take a total of $3 billion to set-up a national WiMAX network in the US. That is a huge chunk of change. (Which explains why smaller countries are proving to be early adopters.)

The report also looks at the potential impact of WiMAX on the new GSM/Wi-Fi phones. The biggest concern, apparently is how those who are building the WiMAX networks will treat standalone VoIP providers. Remember Clearwire had given Vonage the heave-ho from its network.

34 Comments

Steve

Is it possible to use Fon with Clearwire and have an even more secure setting?

Ron

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Jesse Kopelman

Chetan. what do you think you’re Verizon friend would say — WiMax is great for the US, we just wasted $10B on fiber and 3G the last couple years? The so-called super 3G/4G DoCoMo and other are working on has as much in common with WiMax/WiBro as it does with the CDMA2000 that Verizon is currently using.

Chetan

Took me a while to get to the bottom of this. WiMax is not suitable for the US market said my Verizon friend, atleast not for an ISP which has fiber(Speed and reliablity are THE BEST) goals. Best suited for Asian markets. Telcos are likely to go with Super 3G which will be led by DoCoMo.

Paul Jardine

Om, the point the Swisscom figure was supposed to show, is that people don’t move too far from their homes, and they definitely don’t move around wide areas on a regular basis, they have specific destinations and home locations. Are these so hard to predict?
Perhaps Americans move around more, morbidity statistics would suggest otherwise, however!
I could also be wrong in my inference from the Swisscom figures, but what I’m saying is that you don’t need a huge amount of coverage to make the service attractive to customers. Another reader mentioned FON and it will be interesting to see how it develops. Will the patchy coverage be a problem?

rick

Great backhaul though. And can be independent of the incumbents.

This will be Wimax’s greatest asset.

rick

Speaking for myself, when I refer to Wimax, I’m referring to the mobile (802.16e). Fixed obviously has limited use.

Wimax as a mobile technology is just another competitor IMO. Not a deal-breaker.

Sam

I have no idea why people keep trying to compare WiFi to WIMAX. They are very different technologies for very different applications. WiFi is a fine technology for mobility within your house, office or in some cases, public buildings. However, it is NOT a reliable technology for WAN use. The range for each access point is too limited and the use of unlicensed spectrum is already started to show why it is not a feasible long-term solution (interference in populated centers is getting ridiculous).

WIMAX is a misunderstood term. It is used for both fixed and for mobile standards. The fixed standard is currently available, but has very expensive CPEs and a limited commercial application. The mobile standard is really the one that provides the interesting applications. This is the one that Intel is really pushing and a similar technology is currently deployed by Clearwire internationally. This allows for reasonable bandwidth speeds (Clearwire offers 1.5Mbps in the US) but also the allure of portability/mobility. It is clear this will not replace all bandwidth choices. Some people want to download video at home, and will want more than 1.5Mpbs. But a lot of people don’t, and 1.5Mbps is sufficient. However, a lot of people do want the ability to use their laptop outside of their house and not have to pay to access each hotspot they get to. That is where the allure of mobile WIMAX comes in. You can use it as an adjunct to your home connection, but if you want to save some money and don’t need to download video, you can also use it as your only bandwidth connection.

As for how it will compete with the other mobile data technologies, the proof will be in the pricing. No one is expecting HSPDA to ever be offered for much less than $40-45 per month due to inherent costs in deploying the technology. WIMAX should be able to be offered for much less…

rick

Here’s a great article on FON, the open-source wireless mesh company. It even quotes Om.

Here’s the real deal:

Take a FON worldwide mesh-network backhauled by independent Wimax operators and you got a whole new internet infastructure less the phone and cable companies unless they decide to wisely jump in too. I love it!!!!

This is what technology was made for!

Jesse Kopelman

On Instat’s $3B number: I’d say this number is only accurate if you are doing licensed and already own the licenses. You could conceivably do a network of 15,000-20,000 sites using licensed frequencies below 3 GHz for $3B and that would cover 90% of the US population. However, to get the same coverage using unlicensed you would have to factor in at least 10 dB of better link budget to deal with interference and that would require 3-4 times as many sites. To avoid having to spend the money on the additional sites and their backhaul, you need that license which will probably set you back at least $5B. So, I would put the REAL cost to build a nationwide network at more like $10B. Still, $10B to cover 250M people is a good price. Even if you can only get 20M customers, that is only $500/sub which is a lot less than you would pay to buy an existing 3G carrier.

Dennis Evans

“On WiMax, how can we expect those that have already invested in Wi-Fi equipment to run out and change to WiMax?” How about if their existing equipment quits working?

“Airgo Networks took the occasion of last Friday’s vote by the IEEE 802.11n Taskgroup to proceed to the “letter ballot” phase of the standardization process, to go public with the developing standard’s little secret. The firm claims that the “802.11n Draft 1.0 does not provide for interoperability with nearby legacy 802.11b/g networks”.

“Specifically, if ‘Draft N’ or ‘N Ready’ products are released to market based on Draft 1.0 of the standard, they will severely degrade – or even disable – nearby 802.11b and 802.11g networks,” Airgo said. “

http://www.tgdaily.com/2006/03/13/80211nbackwardscompatibilityissues/

rick

Om, you right on about Intel. I couldn’t agree with you more. They try to “manufacture” technologies and usually come up short. A silicon expert they are, but new markets are a challenge for them.

Om Malik

i think some of you are believers, and why not. fixed wireless does hold promise. it always has. from microwave to where we are today, the technology has progressed.

but between promise and reality is a gulf of time, and technological progress. it is no different with wimax. what i am pointing out is the hyper inflated expectations and FUD being spread by the likes of Intel, which has an abysmmal record in communications despite spending billions buying up companies.

paul, i don’t understand your comment about swisscom and three mobile cells and $3 billion. would you be kind enough to expand on that. sorry for being a little slow… its sunday after all :-)

Dennis Evans

“Swisscom recently reported that over 70% of their customers use only 3 mobile cells to make calls!” ???

United States total area: 3,537,441 square miles
Alaska 656,425 square miles
Switzerland 15,940 square miles

Not sure you could scale: Mainland US is 180 times larger.

Cingular alone has 50,000 cell sites [AT&T integration][with another 6,000 planned], Verizon has 26,000 in US. They each average 2.5 mile in radius and approximate 20 square miles. 30% Overlap is required.

If MIMO WiFi were used the radius drops to 800 feet. 25-30-35 per square mile.

Rick

It will also play nice with IMS, which is THE next generation carrier network.

Rick

Wimax will be good for rural and developing countries. What happens after that is a mystery. The government may have new spectrum in 5 years.

It would be nice to someday circumvent the phone and cable companies and have a third alternative.

BTW, why do people buy Vonage when they have to keep paying for a regular phone bill? I don’t see the business model there.

Dorian

While it will take a couple years still for CLECs and ILECs to pick up on WiMAX, it will happen.

I started a ‘wireless ISP’ in 2000 with the entire goal being to circumvent the ILEC/CLEC. I was sick of being hostage to them and seeing other businesses suffering due to their crappy and spotty service.

The ISP that I started is now approaching 3000 square kilometres in coverage primarily in urban core and city suburbs. The best part – I have no reliance on Telus (ILEC) at all and am the only ISP in SW British Columbia that can lay claim to that statement.

I am actively acquiring like companies in other cities to expand the terrific model we have built.

While we only have about 20% of network built on what has been termed ‘pre-WiMAX’ equipment we will be deploying WiMAX gear later this year as it becomes available to us.

Dorian

http://www.metrobridge.com
http://www.dorian.ca

Paul Jardine

Some people are only going to remember that you said WiMax was for backhaul, Om. I read the bit about waiting for the device equipment to come down in price, but I suspect you will be misquoted in the coming months.
I agree that the bandwidth is not going to be all that was promised, but it never is. WiMax is not so much about the speed, or the backhaul (though that bit is important), but about the (much) larger cell size. Swisscom recently reported that over 70% of their customers use only 3 mobile cells to make calls!
I’m also having a hard time believing that it would cost $3billion to roll out a WiMax network for that 70%

Dennis Evans

Having been involved with 2.1 and 2.5Ghz systems since the early 80’s in Metro and treed burbs in US, it is one thing to deal with a 300-1000 ft distances and quite another to extend out a few miles. The single tree attenuation can range from 8db -16 db depending on variety and moisture in the leaves; the forest can be 40 db.

Multipath and ducting caused by humidity layers and passing thru boundaries rear their ugly head beyond 3 miles in humid costal and desert climates.

Just as early Wireless Cable [2.5 GHz] business plans failed for disregarding non line of site issues. [Granted there were other reasons].
The In-Stat estimate of $3 Billion could be off by a factor of 3 if ubiquity for 90% of the population is really achieved.

By being selective [redlining] you probably could illuminate 20% of US [in cities] for $3 Billion…that’s $130 per potential or $1,300 CAPEX, if only 10% of those illuminated signed up. Many will chose more bundled expensive cell data plans.

We should know which is correct in a year or so.

The problem with unlicensed spectrum is you have no way to shut off/reduce power of not on network sources [existing and future home wireless overlay networks fed from DSL/Cable].

Metro WiFi could get a bad name fast.

Robert J. Berger

WiMax proponents spread mis-information about the capabilities of wireless. They give a whole list of capabilities 40Mbps (some claims 70Mbps), Non-line of sige, unlicensed, licensed, 10 kilometers or more range.

The thing is you can get maybe two of those combinations, but they make it sound like you can get all of those features in any WiMax.

The reality is that if you use unlicensed WiMax it will have an insignificant better link budget over 802.11a WiFi (they use the same portion of the spectrum, same maximum power output and have the same physical propagation characteristics). So if you have ever used 802.11a you know how short a range you can do with that.

There is a very limited amount of licensed spectrum for WiMax (2.5Ghz) in the US. That spectrum is primarily owned by 3 players already. There can never be the manufacturing scale of CPE or Basestations for licensed tech as there is for unlicensed tech. So licensed WiMax will always be significantly more than WiFi.

Related to the scale of the market for WiMax vs Wifi, is the fact that so many people all over the world are developing new tech and capabilities around WiFi vs. WiMax, so WiFi is evolving dramatically faster than WiMax.

So WiMax is to WiFi as all the failed competitors (Token Ring, 802.12, ATM) were to Ethernet. WiFi is recapitulating the evolution of Ethernet. WiMax is following in the footsteps of ATM…

DG Lewis

Om,

40 Mb/s per channel is if you have 15-20 MHz channels. In the US, the available licensed channels are 5 MHz (WCS band) or 6 MHz (BRS/EBS band), which means a realistic data rate (for user payload) of about 13-16 Mb/s, depending on range. Upstream and downstream combined. Shared.

Om Malik

Terry,

you sum it up nicely.

I think despite all the Intel dollars, it is impossible to make people switch to newer stuff. it will happen in time, but not as fast as most are expecting.

a typical gestation period of any wireless technology is seven years – from standards approval to widespread adoption. Many have forgotten that Apple started pushing wifi back in the late 1990s, and only now does everyone think about setting up-wifi network.

Om Malik

whenwego… i don’t understand how you say that my thinking is so incumbent. perhaps, you might want to read the piece again. :-)

the problem i am pointing out is that, the technology at best can do 256 kbps. unless it increases in speed and reliablity, it is hard to compete against the incumbents.

10 mb/s up and down is good, except it cannot do video very well. much more bandwidth is needed in order to do that.

Terry Horner

Add wireless fiber solutions like GigaBeam to the WiMax and mesh solutions too make a network (or collection of networks) 99.9% wireless and you’re dead on.

On WiMax, how can we expect those that have already invested in Wi-Fi equipment to run out and change to WiMax? It just isn’t going to happen. I know bunches of people that have sworn never to upgrade their old analog televisions (which represents a huge chunk of America), so how can we expect those same people to keep changing wireless technologies? Those same people still have cell phones that are just cell phones, not the converged devices people like you and I use. I don’t think people are really that dependent on the wireless to necessitate the upgrade so WiMax won’t explode like Wi-Fi has.

whenwego

Your thinking is sooo incumbent. To paraphrase DEC’s Olsen, you cannot imagine why any consumer would need more than 256K? If I could get 10 MB up/down, I would cancel my DISH Network!

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