The WiMax LeapFrog
Interest in WiMax is at fever pitch. To believe the hype, this technology can simultaneously provide broadband mobile, wireless DSL, and "better than" T1/E1 enterprise services. But in reality, there is no single technology that can do it all. Instead there are – or soon will be – two types of WiMax: Fixed and Mobile.
Fixed WiMax, based on the Institute of Electrical and Electronics Engineers Inc.'s (IEEE) 802.16-2004 specifications, is closest to being deployed commercially. Network rollouts are widely expected to begin in the first half of 2006. Mobile WiMax, by contrast, is still in the lab, yet is potentially more disruptive and way more exciting. It is also an opportunity to leapfrog Fixed WiMax and encroach on the 3G infrastructure market, according to some chipset developers and equipment vendors covered in the new Unstrung Insider report, Mobile WiMax: Who Goes Where?
The report identifies the leading developers of Mobile WiMax silicon, software, and network equipment in the context of a long-term roadmap that should see WiMax deliver multi-Mbit/s download speeds to handheld devices on the move. These systems will be based on the upcoming specifications from the IEEE 802.16e Task Group, which is charged with developing "physical and medium access control layers for combined fixed and mobile operation in licensed bands."
A key feature of 802.16e that makes it suitable for mobile applications is the introduction of "scaleable OFDMA" (orthogonal frequency-division multiple access) to the air interface, as well as related enhancements, such as power-save mode, say supporters. Combined with smart antenna technology, the effect will be to deliver more robust signals to mobile devices, reduce the effects of interference, and enhance the system's range and throughput. Names in the frame on the chipset side include:
- PicoChip Designs Ltd., which builds software-upgradeable base station silicon and is the best-funded startup in the sector, having raised a total of $41.5 million.
- Cygnus Communications, which scored a $20 million Series A in June 2004.
- The stealthy Runcom Technologies Ltd. and Beceem Communications Inc. – both thought to be developing system-on-chip products for the notebook PC market.
- Less-stealthy startups Wavesat Wireless Inc. and Sequans Communications.
- And of course the industry big guns, Intel Corp. (Nasdaq: INTC) and Fujitsu.
On the software side, specialist vendors, such as ArrayComm Inc. and Roke Manor Research have scored wins with their smart antenna technology, while firms such as the stealthy SiWave expect to offer 802.16e software products.
Adaptix Inc., previously known as Broadstorm, is tougher to categorize. The firm offers complete system-level base station and mobile subscriber stations "to show it works," but it can also supply board-level components for WiMax base stations and/or license its software to silicon vendors.
On the OEM side, vendors such as Alcatel (NYSE: ALA; Paris: CGEP:PA), LG Electronics Inc. (London: LGLD; Korea: 6657.KS), Nortel Networks Ltd. (NYSE/Toronto: NT), Samsung Electronics Co. Ltd. (Korea: SEC), and Siemens AG (NYSE: SI; Frankfurt: SIE) are setting the pace in 802.16e. Motorola Inc. (NYSE: MOT) and Nokia Corp. (NYSE: NOK) have recently signed on to the cause. In related work, Mobile WiMax backers and the IEEE 802.16g Task Group are working to standardize mobility management for WiMax systems and will specify a next-generation, all-IP core network architecture similar to the 3rd Generation Partnership Project 2 (3GPP2) core networks, but without the circuit-switched legacy. This work will introduce into the system network elements equivalent to cellular base station controllers and an IP Multimedia Subsystem layer.
The first deployments of Mobile WiMax are universally expected to be the Korean variant of 802.16e, known locally as "WiBro," and could happen as soon as mid 2006, in the 2.3GHz band using a 10MHz chanel in time-division-duplex mode, with equipment from Samsung and LG. The next major deployments could be in the U.S, in the 2.5GHz band, with Nextel Communications Inc. (Nasdaq: NXTL) and Sprint Corp. (NYSE: FON) leading the way (see Sprint's Got WiMax Plans and Sprint Picks Moto for WiMax). Mobile WiMax, however, still has a lot to prove. Beyond showing that the technology actually works, supporters need to work hard to show where the technology sits on the price/speed/coverage continuum between high-speed wireless LAN and cellular voice. According to the Insider report, Mobile WiMax's most viable target market could turn out to be in low-mobility (portable), medium-speed (~0.5-Mbit/s) services, potentially putting it in conflict with today's hard-won, yet barely commercialized, Fixed WiMax standards. And vendors hoping to leapfrog today's Fixed WiMax systems by going straight to "Mobile" 802.16e will face challenges from Fixed WiMax equipment tweaked to work with self-install desktop modems and laptop cards in portable scenarios, says the report. Other technologies, such as 802.11 mesh and hotzones, could also be used to serve laptop-toting customers.
Whatever the application scenario, market entry will be difficult. In high-mobility scenarios, vendors could find themselves on the wrong end of a fight with 3G cellular, which itself is looking to steal Mobile WiMax's clothes and adopt OFDM and smart antenna technology as part of its long-term roadmap.
Both the technological and strategic debates may ultimately turn on just how mobile Mobile WiMax turns out to be. And so, for all its promise, Mobile WiMax will have difficulty finding a market "niche" big enough to generate the economies of scale that will permit it to truly thrive. — Gabriel Brown, Chief Analyst, Unstrung Insider
The report, Mobile WiMax: Who Goes Where, is available as part of an annual subscription (12 monthly issues) to Unstrung Insider, priced at $1,350. Individual reports are available for $900. To subscribe, please visit: www.unstrung.com/insider.