Some 12pc of broadband users will switch to WiMax

7 May 2008

Some 12pc of digital subscriber loop (DSL) broadband subscribers will switch to fixed WiMax connections within the next five years, new research claims.

A new analysis of the global opportunity for WiMax 802.16e by Juniper forecasts that up to 12pc of the global DSL installed base will be substituted by WiMax by 2013.

The Far East will lead with over one fifth of the 47 million subscribers in 2013.

WiMax technology is at a fairly nascent stage in the Irish economy. Eircom has a detailed rollout plan for the deployment of WiMax in urban areas across the country. Intel is performing WiMax-related R&D in the Leixlip area.

The main champion of WiMax in Ireland has been Irish Broadband, which was acquired last week by Imagine for €47m. WiMax technology – which allows mobile operators to roll out 10Mbps to 25Mbps wireless broadband over a distance of up to 10-15 miles – will allow Imagine to offer next-generation voice and data services to business and residential customers across Ireland.

“Strategically, we have acquired substantial network and spectrum assets on a nationwide basis, which enhances our current service offerings and which facilitates the cost-effective deployment of WiMax technology,” Imagine chairman, Sean Bolger said last week.

A region-by-region analysis by Juniper Research found there is a significant opportunity now for WiMax as a DSL substitute technology.

“WiMax will be an attractive offer in areas where there are no wired networks, and in areas where the existing DSL speed is suboptimal,” report author, Howard Wilcox explained.

“WiMax will solve the broadband access problem for users located at the fringes of DSL coverage. This is in fact the case in a number of developed nations such as the UK, the US, Ireland and Scandinavia, and WiMax network operators are deploying networks to address this market need.

“Additionally, in developing countries – such as India – network operators are aiming to provide basic connectivity,” Wilcox said.

The vast majority of the WiMAX 802.16e trials and network contracts which are being announced almost daily will begin by providing fixed broadband. Mobile usage will develop after initial demand for fixed and portable services – this will be an added benefit for subscribers.

Juniper said the annual fixed WiMax global market size will exceed 13 million subscribers by 2013.

It said the WiMAX device market – comprising customer premises equipment, chipsets, minicards and USB dongles – will approach US$6bn per annum by 2013.

The top three regions – the Far East, North America and western Europe – will represent over 60pc of the US$20bn-a-year global WiMax service revenues by 2013.

However, Wilcox cautioned: “Brand identification and service differentiation are major marketing challenges facing new WiMax operators.

“Many of the existing broadband providers are household names that already have widespread market presence and recognition. WiMax operators will need to identify and promote their unique selling points, whilst avoiding entering the market on the basis of price.”

By John Kennedy