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WiMax: Town & Country

The latest report from Light Reading's research division, Heavy Reading, shows that wired operators are very interested in using WiMax to deliver fixed and mobile broadband services but finds that the nascent wireless technology is liable to be a country mouse rather than a city kitty.

WiMax boosters like to talk up the myriad fixed and mobile wireless applications that the technology will be used for -- when officially certified products start to hit the market -- probably in the second half of 2005.

But Heavy Reading's "WiMax Reality Check" finds that larger operators hoping to use technology to extend the coverage of cable and DSL services in urban areas may find it easier to stick with the devil they know rather than leap into the wireless unknown.

In the city, DSL and cable will prove to be extremely competitive on performance and price.

"DSL is continually improving in terms of both bandwidth and in coverage distance from the central office," the report states. "That raises the question: Assuming that commercial WiMax gear debuts in the second half of 2005, will DSL technology have improved to the point that many of the shortcomings WiMax is supposed to address no longer exist?"

And beyond DSL, a huge expansion in fiber connectivity is looming. "There's going to be an increasing number of subscribers who have access to fiber to the home," opines Shaun McFall, VP of field marketing at Stratex Networks, in the report. "When that's done, the game is over for WiMax."

And even on price it is hard to see how WiMax operators will compete with established wired networks. Estimates for the initial cost of WiMax basestations range between $10,000 and $20,000. Meanwhile, CPE boxes could cost anything between $750 to $250, according to vendors quoted in the report.

"Growth in WiMax equipment volumes will drive down the cost of network infrastructure and CPE, and the speed at which it can reach levels that are competitive with DSL and cable will determine how quickly and widely it's adopted," the report notes. "Price competition in the broadband arena is already fierce, so it's rather difficult to see how one could swoop in with an offer that would convince a broadband provider to adopt WiMax rather than upgrading its cable or DSL infrastructure."

And wired broadband operators are already offering services priced around $30 a month -- or under.

"We don't foresee in the near term offering service for $30 a month," says Philip Urso, founder and CEO of TowerStream Corp. in the report. "It's not profitable for us or for anyone."

But in rural areas the story is reversed: Broadband infrastructure is nowhere near as established, and WiMax starts to look like a much more attractive proposition.

"This market condition provides the most fertile ground for WiMax," writes Tim Kridel, the report's author. "In the rural area of a developed country, for example, the only option for Internet access might be dial-up – possibly via a long-distance call... We believe that this strategy is sound."

— Dan Jones, Site Editor, Unstrung

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douggreen 12/5/2012 | 1:08:29 AM
re: WiMax: Town & Country fiber_r_us,

It is your opinion (and that of many others) that the need for higher speed telecom access is in the same leaque as roads, sewers, water, gas, etc. The problem is that most people don't appear to see it that way or they would be screaming louder (like they do about gas prices). The discusion on this board is not being repeated in the average household.

IMO, the question of whether or not access infrastructure is the responsibility of private enterprise or the government is irrelevant until the problem is considered a problem by a broad enough cross section of the population. Don't expect the government to show any vision other than what they see in the polls.



douggreen 12/5/2012 | 1:08:28 AM
re: WiMax: Town & Country fiber_r_us,

Our network was built in a different era, when we were way ahead of the rest of the world and felt no need to "manage" it's evolution.

Some of the other countries had the "benefit" of having to come from behind. This forced them into a more managed evolution of their networks. Some governments likely did have more vision than ours, but they also had more "facts" in front of them. They also had the "advantage" that their governments managed more aspects of their lives anyway.

I think that it is fair to say that our population doesn't understand much at all about where we stand competitively with the rest of the world. We are too busy watching the stock market, playing the lottery, and watching reality shows. Instead of educating us on important issues, our media makes sure that we are fully informed on the latest with Scott Peterson.
lastmile 12/5/2012 | 1:08:28 AM
re: WiMax: Town & Country douggreen
It's a lot easier to run a fiber bundle to a high rise apartment complex and service hundreds of households than to deliver service to one house at a time.
Yes I agree but the US also has a dense concentration of population in cites that puts large percentages of people within easy reach of fiber.
I have been to Japan many a time and I am sure that the US can be divided into many 'Japans' in terms of population density/sq mile.
Even the dense concentration of population in our cites does not have fiber.
Most of our energy is spent on regulatory battles.
jpotterADI 12/5/2012 | 1:08:28 AM
re: WiMax: Town & Country I thought the value proposition of WiMax was mobility - DSL type speed but anywhere within the urban space, whether it be taxi, coffee shop, etc.

If the monthly cost was double existing DSL wouldn't many people pay for the freedom of mobility? Plus an SP could also roll out VoIP services over the network as well to compete with mobile carriers, right?

obviously there are regulatory challenges but in a perfect world are there any other reasons why the above would not work?
fiber_r_us 12/5/2012 | 1:08:28 AM
re: WiMax: Town & Country Then why do the other countries apparently "need it" enough to go out and do it??

-- Is it that their populations understand the value of good access more than our population?? (which wouldn't suprise me at all)

-- Or do their governments have more vision than ours?? (which wouldn't suprise me either)

-- Or that our LECs have paid-off politicians so that they could insure that regulations favored their ability to continue milking the ancient copper plant for another decade or two (at the expense of our country's leadership in communications)?
jepovic 12/5/2012 | 1:08:26 AM
re: WiMax: Town & Country Wimax promises to increase capacity and lower CPE prices. As anyone who has tried to sell and deliver FWA services know, that has never been the real problem with FWA.

Wimax will still have unpredicable capacity, depending on the local geography. This will be a hassle for sales people, and they will prefer to sell DSL and fiber.

Most importantly, delivery will still require on-site visits and new in-house cabling, which will make each new customer cost at least $500 plus CPE costs. That's a showstopper for all consumers as well as SMEs, and the larger corporates will still need fiber. Many times, customers will need permits and pay fees to the landlord for the antenna on the roof, which increase cost and delivery times. Compare with DSL, where you can fedex the CPE or just ask the customer to get it himself.

That leaves the odd cases of really rural customers, or sites with needs for extremely fast delivery. Those volumes won't be enough to get the component costs down anyway, or give the operators the volmues they need.

Wimax will fail, just like FSO and previous FWA generations.
paolo.franzoi 12/5/2012 | 1:08:26 AM
re: WiMax: Town & Country
Well, thats because there is no access problem. According to statistics I have seen 93% of consumers have access to broadband and 80% have access to 2 or more providers.

So since virtually everybody in the US can get broadband and only 60% has computers, I think you are trying to solve a problem that doesn't exist. By the way if you were paying attention, SBC just dropped its pricing today to $19.95 (you do have to buy a bundle).

Gee, I guess if access was a problem...hmmm...I guess that P2P would not be putting a strain on networks. Hmmmm....maybe the backbones are too oversubscribed to support the bandwidth that is out there if people use it. Hmmmm.....Mobility might be nice but broadband access is available. Hmmmm....highest rate internet access....who has that....oh wait its Verizon...hmmm....
rjmcmahon 12/5/2012 | 1:08:26 AM
re: WiMax: Town & Country The problem is that most people don't appear to see it that way or they would be screaming louder (like they do about gas prices).

Agreed that the public isn't going to get out in front with our access problem.

Leaders in our industry can do better than offering up WiMAX. Leaders in the power industry can do better than offering up BPL. The FCC can do better than offering VoIP as a subsititute for the competitive goals of the Telco Act.

We can and must do better.
douggreen 12/5/2012 | 1:08:25 AM
re: WiMax: Town & Country " SBC just dropped its pricing today to $19.95 "

The RBOCs are moving (or have moved) to tiered pricing. THe lowball prices are for service that is 2X-3X what you can get with dialup. This is just an extention to the evoluionary path that we were on with dialup (9.6 to 14.4 to 28.8 to 56K, now 128K DSL).

What many people are looking for is a leap in bandwidth that enables a new realm of applications.



paolo.franzoi 12/5/2012 | 1:08:24 AM
re: WiMax: Town & Country
Doug,

There is a company doing that. Its called Verizon. Once the shackles of having to resell its multi-billion dollar investment to its competitor was removed note what its doing. 15M/3M for $49.95 a month.

seven
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