Flarion Preps OEM Deals

Infrastructure startup Flarion Technologies is making further inroads into the OEM network market, with Motorola Inc. (NYSE: MOT) and Nortel Networks Ltd. (NYSE/Toronto: NT) flagged by analysts as likely vendor partners.

Flarion has publicly announced only a single OEM deal with Siemens AG (NYSE: SI; Frankfurt: SIE) for the use of its Flash-OFDM kit in the 450MHz band (see Flarion Flashes With Siemens). OFDM is a modulation scheme that can support an average data rate of around 1.5 Mbit/s for users in a standard, PCS-sized cell site, while using only 1.25 MHz of spectrum. This makes it approximately four or five times more spectrally efficient than comparable 3G technologies, such as CDMA2000 or UMTS -- and cheaper to implement.

Despite such advantages, Flash-OFDM is a proprietary technology and faces a battle to win the attention of carriers already committed to rival 3G standards. “Flarion needs to build some major Tier 1 OEM partners,” notes Current Analysis’s Peter Jarich in a recent report. The merger of Sprint and Nextel makes it unlikely that Nextel will go ahead with plans to adopt Flarion technology (see Deal Solves Nextel 3G Dilemma).

"The fact remains that no major operator is likely to go with a startup which is not yet linked to a major infrastructure vendor,” Jarich writes. Flarion's possible success with T-Mobile International AG probably relies on Flarion's OEM deal with Siemens (see T-Mobile Favors Flarion ).

Flarion’s VP of global communications and marketing, Ronny Haraldsvik, states that “further OEM agreements will be announced in 2005,” but declines to reveal details.

Unstrung has heard rumblings of deals with Motorola and Nortel for some time, and each appears an obvious ally for the startup.

Motorola has previously teamed with Flarion on a public safety project in Washington, D.C., prompting speculation of future closer ties between the two companies (see Moto's Flarion Call? and Flarion & Friends Get Gov't Gig).

Meanwhile Nortel provided infrastructure equipment and enterprise customers for Flarion’s high-profile trial with Nextel and has publicly praised Flash-OFDM technology in marketing presentations (see Nextel Launches Flash-OFDM). Flarion’s president, Mike Gallagher, was also senior VP for worldwide sales and operations at Nortel’s IP Services business unit.

“Both Nortel and Motorola are the obvious choices,” argues Andy Fuertes of Visant Strategies Inc. “Flarion’s marketing has suggested to me that their relationship with both of those could evolve beyond what is public knowledge... Both Motorola and Nortel have a lot to gain, since neither is an overall market share leader in the infrastructure space.” “Nortel and Moto make sense,” concurs Current Analysis’s Jarich.

Neither company is denying a potential tieup. "We only discuss announced relationships publicly so unfortunately there is nothing that we can say at this time," states a Motorola spokesperson.

“Nortel has not announced any OEM relationship with Flarion regarding Flash-OFDM technology, so I am unable to confirm,” adds Nortel spokesman Ben Roome.

As for the remaining vendor candidates, analysts claim Ericsson AB (Nasdaq: ERICY), Lucent Technologies Inc. (NYSE: LU), and Nokia Corp. (NYSE: NOK) are unlikely bets. “Given their 3G position, they would argue that EV-DO and HSDPA get you most of the functionality of Flash-OFDM along with a global base of standards,” says Jarich.

That leaves Alcatel SA (NYSE: ALA; Paris: CGEP:PA) as the only other big-name hope. “I would not rule out Alcatel in the future,” comments Visant Strategies’ Fuertes. “They have a strong international presence and, like Siemens, they appear eager to expand their product offering to include TD-SCDMA, WiMax, and possibly others. Acquiring market share would not hurt Alcatel either.”

— Justin Springham, Senior Editor, Europe, Unstrung

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deep_impact 12/5/2012 | 3:30:22 AM
re: Flarion Preps OEM Deals Is it true that Flarion's OFDM does 1.5 Mbits/sec in 1.25 MHz spectrum? How does that make it anymore spectrally efficient than EV-DO ?

fkuznik 12/5/2012 | 3:27:15 AM
re: Flarion Preps OEM Deals Rumour has it that Flarion reduced their staff by over 50% in the last few days. Probably the aftermath of Nextel dropping them.
lrmobile_justin 12/5/2012 | 3:27:12 AM
re: Flarion Preps OEM Deals Flarion's VP Global Comms & marketing, Ronny Haraldsvik, laughed at the suggestion. "It's silly."

Ok sure they are gonna make some cuts now the Nextel trial has been pulled and first gen product has been updated, but slashing HC by a HALF.....!!??

Unstrung Justin
freetoair 12/5/2012 | 3:27:12 AM
re: Flarion Preps OEM Deals Would not be surprising. What was thier HC? Seems to recall hearing 150+ at some point?

What does this say for the BWA market in general and the WiMAX crowd?

Companies with mature products, albeit proprietary, but very refined, mature products that have several years of field experience (Flarion, Navini, IPWireless, Arraycomm, etc.) still struggling to get some meaningful commercial contracts? Seems WiMAX so far is just helping Alvaion sell their T1+ replacement/backup alternatives. But very little last mile residential broadband. The WiMAX technology and cost model is not radically different from Flarion, others. In fact Flarion would seem to have a technology edge.

WiMAX in 2007 or 08 == too late, undifferentiated, etc. etc. to dent the last mile. IMHO

Have any WiMAX system vendors been funded lately?
Would seem a crazy investment given the centi-millions it would take.

wonderfull 12/5/2012 | 3:27:11 AM
re: Flarion Preps OEM Deals As far I am aware all other Flarion trials involve fewer Basestations and users. Didn't Flarion have 50+ Basestations for the Nextel trial?

Now that OEMs are on-board, Flarion needs far fewer staff in Hardware, Manufacturing, Testing, Support and Marketing.

50% cuts would make sense...Flarion had 230+ employees last year.
attwi2002 12/5/2012 | 3:27:11 AM
re: Flarion Preps OEM Deals gottaLoveWireless:
Our best guess favours a # of 290 people. We doubt Flarion laid off 145 people, it does not make any sense with the operator progress in EU.

The RTP trial was for 130+ Base stations.

freetoair 12/5/2012 | 3:27:05 AM
re: Flarion Preps OEM Deals 130 BTS

Hope that was a paid trial :)
geez...what does it take to trial it and prove it out? Maybe 3-5 BTS at most in various Sector configurations. The primary reason for this would be Interference testing, inter-sector degradation (scalloping), Mobility Mgmt, etc.

Range, capacity, performance, interference, mobility, OA&M, etc.

Does not take 130 bts
attwi2002 12/5/2012 | 3:26:59 AM
re: Flarion Preps OEM Deals tech_gnocchi:
Both IP Wireless and Flarion are enjoying great momentum in Europe. IPW for 2.1GHz in Eastern Europe and Flarion with Siemens for 450MHz. More colour to come after 3GSM - rumours has it that IPW may make an announcement at 3GSM.

tech_gnocchi 12/5/2012 | 3:26:59 AM
re: Flarion Preps OEM Deals what progress with operators in Europe? A lot of hot air, and no traction
whip 12/5/2012 | 3:26:57 AM
re: Flarion Preps OEM Deals The best thing about Flarion in Europe is that they're not Qualcomm.

Aren't they in a position to light up all of Germany now?
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