WiMax may not threaten mobile operators

10 Feb 2005

An industry analyst has rowed against popular opinion that the advent of WiMax could portend the demise of mobile operators. Instead it may afford operators the opportunity to strategically complement 3G services to business users by enabling higher data rates.

WiMax is an emerging technology, which will operate in a range of frequencies, allowing operators to deploy services in either licensed or licence-free spectrum. The 802.16e standard is for fixed communications only and does not have any mobility capability. Although 802.16e is not fully standardised yet, many vendors have pre-standardised equipment available. However, this poses little threat to mobile operators. Much is expected of WiMax – seen as a key technology for overcoming insufficient broadband supply – and proponents claim it will be capable of sending data over a range of 30 miles with data transfer speeds of up to 70Mbps.

Proponents of the technology have also argued that it may result in the demise of mobile operators as consumers adopt new means of making affordable wireless calls through combinations of Wi-Fi, WiMax and voice over IP (VoIP). In Ireland, a local Wi-Fi provider has argued that consumers could save up to €300 a year off their bills by utilizing wireless VoIP.

However, according to a commentary by Ovum senior analyst Marta Muñoz Méndez-Villamil, WiMax does not pose a threat to mobile operators due to delays in the certification of 802.16e, which she says means that the launch of WiMax compliant products will be delayed by at least six months against the initial plan. “The first WiMax products now won’t be available before the end of 2005.

“If 802.16e also gets delayed, it will leave more time for other mobile broadband technologies to gain market share and acceptance, and it will become less of a threat to technologies such as HSDPA (high speed downlink packet access).” HSDPA is a cellular standard that offers wireless workers using mobile phones and cards a theoretical maximum sped of 2Mb per second.

“Even if 802.16e stays on track, we do not see it been deployed on a national scale by the existing mobile operators, as deploying a whole new network is not high on their current ‘to do’ list. However, it may be deployed in a more strategic fashion to provide higher data rates to business users as a complimentary service to 3G.

“In the longer term, operators have already started to ponder what is to come after HSDPA, as this does have bandwidth restrictions, especially in the upstream, and WiMAX might just be a contender. However, it is not the only one, and it is too early yet to state whether WiMAX has any real chance of being the next broadband mobile technology of choice beyond 3G,” Méndez-Villamil said.

By John Kennedy