The Truth About WiMAX

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.


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