The Future of WiMax

The WiMAX technology has gain a lot of attention of recent from all stakeholders in the wireless communication industry, industry observers struggle to separate hype from reality. Explaining the market is a feat for anyone considering complexities such as fixed versus mobile WiMAX, product availability and timing, spectrum challenges, and the largely global nature of WiMAX.

WiMAX has been positioned not only as a technology, but also an organization comprising more than 170 vendors, service providers, system integrators and chip manufacturers. The WiMAX Forum has aligned an excellent breed of large and small companies. This will be a critical factor in the technology's enduring success.

The real excitement around WiMAX is not centered on the fixed version of the technology. Large-scale equipment and silicon makers are banking on mobile WiMAX to make their money.

There are a number of hurdles that must be overcome for mobile WiMAX to take off, including global spectrum availability and harmony, the development and adoption of mobile broadband applications, and a definition of the major differentiators of WiMAX products as compared to existing broadband and mobile technologies.

The broadband and mobile markets are moving targets, each shifting from the support of basic service sets to enhanced multimedia applications. Timing, pricing, and scale will be critical to WiMAX success, and vendors must prove that WiMAX can deliver much more than basic broadband.

Despite these obstacles, there are some interesting dynamics that could play out to make service providers invest in mobile WiMAX. As the war heats up between Telco’s and cable companies, triple and quadruple play service bundles are becoming critical. Many of these companies are now trying to figure out whether wireless data services will also become table stakes.


In regions such as Europe, Telco’s seem like a more likely investor in WiMAX. Providers such as British Telecom and France Telecom already participate in the WiMAX Forum. And Asia will be largely stemmed by the South Korean Wi-Bro initiative, which is now following the WiMAX technology trajectory.

One of the biggest market for WiMAX is in China, where IEEE and the Chinese government are already in discussion to make WiMAX the national standard for fixed broadband wireless access at 3.5 GHz. Intel has stated they will begin to make their Centrino laptop processors complete with WiMAX ability within the next two to three years. With a target date of 2008 for having all laptops equipped with this feature, the intel company has also put in place a plan to popularize wimax by putting Wi-Fi and WiMax on the same radio chip, code-named Ofer, in three years. Putting the two technologies on the same chip will allow consumers to switch between local hot spots and regional network, Making WiMax available in portable devices is the next goal for companies such as Intel, Motorola, Alvarion and several equipment manufacturers in the Wimax forum The technology already is finding greater acceptance in developing countries in the Middle East, Asia, and Africa that have no or spotty fixed-line broadband networks.

The Organization for Economic Cooperation and Development (OECD) has outlined some of the factors that could define the success or otherwise of WiMax wireless networking, the OECD report revealed that WiMax depends critically on spectrum allocation, a process which is still incomplete worldwide. This fact makes the OECD conclude that despite all the excitement over WiMax, the ultimate role of WiMax in the wireless market is debatable. The report also cited concerns about competition from existing network operators, who it said are more likely to upgrade their 3G investments with High Speed Downlink Packet Access (HSDPA) than roll out an entirely new network.

Other issues causing concern include the uncertainty about standards for mobile WiMax, the regulatory environment for connecting networks to the phone system, and the possibilities that operators may block ports rather than lose mobile phone revenue to voice over IP. If that doesn't happen, the report said, then WiMax may be useful if built into mobile phones.

Although there are misperceptions and legitimate impediments surrounding it, WiMAX will play a critical role in making broadband a more globally ubiquitous service. Wireless/wireline convergence will become a reality, and multiple broadband and mobile technologies, including WiMAX, will be needed for service providers to address different segments of the market.

WiMAX vs 3G

The low cost of the WiMAX spectrum compared to 3G is a clear driver for service providers to enter the field of wireless services with WiMAX. This difference in cost/Hz is particularly significant in Europe, where the average 3Gspectrum cost/Hz is 1000 times higher than the average BWA/WiMAX spectrum cost/Hz. The proportion is smaller in other regions, but remains in favor of WiMAX.

Moreover the aggregate 3G spectrum is in lower frequency bands than the aggregate WIMAX spectrum. This shifts the cost/Hz on a deployed equipment basis, due to the requirement for at least twice the equipment for each doubling of the frequency. However, even with that adjustment it is clear that the WIMAX spectrum is more economical, particularly when it is mapped to trends of devices to mitigate spectrum bands and modulation schemes.

Also the much lower cost of WIMAX licenses resulted in a high number of licensees, with a total of 721 and 106 license holders for WiMAX and 3G, respectively. However, the average amount of spectrum owned by a carrier is similar for the two technologies. North America is by far the leading region in number of WiMAX awarded licensees, with a total of 394 WiMAX license holders, against 186 in Europe, 97 in the Asian Pacific (APAC) region and in the Central America / Latin America (CALA) region.

In contrast to 3G licenses, the WiMAX licenses awarded around the world are essentially regional. North America is a perfect example, where 100% of its WiMAX licenses are regional, against 78% in Europe and 71% in the CALA region. This crowded environment will result in a highly fragmented, unpredictable and more competitive market, open to smaller and cost-aggressive players. It is important to note that not all licensees are active at the moment. In fact, more than half of the license holders in the WiMAX spectrum are still in the evaluation or trial stage. On the other hand, the low-cost spectrum has also attracted players that have fewer resources than the large mobile operators. Wimax spectrum was initially allocated for fixed-only applications and remains so in many countries. While 3G, with the emergence of enhanced 3G technologies like HSDPA/HSUPA, Scalable Bandwidth EV-DO, 3.9G and Super 3G, is expected to reinforce its head start over Mobile WiMAX in terms of performance, it appears clear that 3G carriers will have to compete with new players once WiMAX mobile technology is embedded in cell phones and reaches attractive price points and significant volume sometime in 2008.

Most regulators have not kept pace with the progress of technology that makes fixed-mobile convergence a reality. 77% of regulators still limit 3.5 GHz usage to fixed-only applications. More importantly, the 2.5-2.9 GHz band remains locked to WiMAX in most European countries, but the pressure on regulators to include BWA/WiMAX in the IMT 2000 definition will increase over time, once 802.16e systems become commercially available. Sweden has already opened a public consultation to allow the 2570-2620MHz band to be technology agnostic.
Whether it is fixed applications with CDMA technology or mobile applications with
BWA/WiMAX, the two fields are converging and will be competing for a share of the one-billion-subscriber market.


The major difference between WiMAX (and any new competition for wide area wireless) and established cellular is the allocation of harmonious spectrum.
In order to build mass market acceptance and deliver the full extent of ease of use, entertainment value and productivity enhancements, wireless service must be widely available across geographies and regulatory jurisdictions.

Some of the major trends influencing the ability of WIMAX to become pervasive includes:

1. Changes in regulations that make spectrum available and harmonize use of spectrum across international boundaries.
2. Multi-mode and multi-band enabling semiconductor ICs, devices and system designs that mitigate differences among spectrum regulations. As further progress is made in combining multiple radios that work in multiple frequency spectrums, the user experience will become similar to having an internationally harmonious spectrum.
3. All underlying wireless transport systems are converging upon communications protocols IP/SIP and network architectures such as IMS.
4. Communications industry revenues are increasingly driven by content and services rather than specific type of wireless network that delivers restricted/tailored voice and messaging applications. This trend will accelerate as the shift to IP/SIP and IMS takes place.
5. Markets served and revenue streams are becoming more diverse and customer-segment-specific. This diversity or ”one size does not fit all” marketplace means that service providers must have a full arsenal of solutions, from high bandwidth dedicated ”fixed” solutions to generic cellular phone services, in order to make ”highest revenue and profit density” use of spectrum.

Other factors, including the trend towards community wireless, the adoption of standards and concentration of IP into the hands of major semiconductor companies, also tend to press for liberalization, harmonization and availability of spectrum. Long term trends towards smart/cognitive radios are preceded by the current trend towards multi-mode, multi-band radios.