Issue 06 April 2009 Market Watch: Listing of WiMAX ... · PDF fileMarket Watch: Listing of WiMAX deployments in Asia Feature: ... Packet One signs up ZTE; Yota extends free WiMAX ...

JOSÉ LUIZ FRAUENDORF, NEOTEC, URGES WIMAX PACE TO QUICKEN IN BRAZIL ��Page 16

Issue 06 April 2009

www.wimax-vision.com

Market Watch:Listing of WiMAX deployments in Asia

Feature:No painless upgrade to LTE or WiMAX

Case study:Digicel jumps from GSM to WiMAX

A mature chipset ecosystem shortens odds for WiMAX success

Betting on WiMAX chips

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content

02 Editorial

04 NewsHighlights of recent WiMAX developments from around the globe, including: Packet One signs up ZTE; Yota extends free WiMAX trial; Mobile WiMAX sales up; countdown to Global Congress; and VMAX gets green light in Taiwan

08 AnalysisDon’t delay on 2.6GHz; Clearwire confidence lifts WiMAX; public sector can give WiMAX a boost; and WiMAX on track

16 Interview—José Luiz Frauendorf, NeotecWiMAX licensing at 2.5GHz is at a standstill in Brazil and José Luiz Frauendorf, executive director at Neotec, an organisation represent-ing the country’s licensed MMDS operators (which have 2.5GHz spectrum assets) is far from satisfied

18 Q&A—Tzvika Friedman, AlvarionThe Alvarion CEO talks about his fallout with Nortel; the industry-wide implications of Alcatel-Lucent’s decision’s to cut its WiMAX investment; prospects for WiMAX growth; and vendor financing

20 Feature—Betting on WiMAX chipsWhen WiMAX supporters put forward the business case for deployment, they invariably refer to a mature and highly com-petitive WiMAX chipset ecosystem as one of their trump cards. With over 20 WiMAX chipset manufacturers in existence, it looks a forceful point to make

28 Feature—No painless upgrade to 4GThe transition from 3G to either WiMAX and LTE is not going to be a simple software upgrade, argues Monica Paolini. Some network elements can be re-purposed or shared, but in many cases, even this is not going to be cost-effective or desirable

32 Case study—WorldmaxIndustry watchers will be monitoring the progress of Worldmax with keen interest. If this Mobile WiMAX operator can make inroads into the highly competitive and mature Dutch broadband market, it would force a rethink of the view—widely held among analysts—that the best chance for WiMAX success lies only in developing economies

34 Case study—DigicelDigicel, a pan-Caribbean and Central American mobile operator headquartered in Jamaica, provides the WIMAX camp with powerful PR ammunition. After all, this is a GSM player that has eschewed the 3G path and placed its bets on WiMAX

36 Market Analysis—South AfricaFar-reaching regulatory changes look set to heat up broadband competition in South Africa. How far this will improve WiMAX prospects remains less certain, particularly as the debate about how to allocate 2.6GHz and 3.5GHz licences is proving to be divisive and prolonged

40 Market Watch—Asia-PacificA comprehensive listing of WiMAX operator deployments in the Asia-Pacific region

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WiMAX is picking up momentum. Clearwire is ramp-ing up its rollout e� orts in the US with a Mobile

WiMAX coverage target of 120 million people by the end of 2010. Japan’s UQ Communications, another ‘mega’ WiMAX project, began trials of its ‘UQ WiMAX’ service in February, which will continue for four months until commercial serv-ice starts on 1st July. It’s another milestone for the WiMAX industry with UQ deploying Wave-2 Phase-2 compliant

802.16e equipment, initially from Samsung. Backed by Intel and KDDI, UQ has an aggressive rollout schedule to achieve more than 90 percent na-tionwide population coverage by 31st March 2013.

Expansive WIMAX projects are of course essential in generating econo-mies of scale, as well as fostering end-user device variety. According to Intel, there are 26 Centrino-2 processor-powered notebook models using an embedded Intel WiMAX/wi� chipset;

the introduction of the US chip giant’s Atom processor will also help lower netbook prices. Clearwire predicts there will be nearly a 100 mobile WiMAX devices—including laptops, netbooks, handhelds, USBs and modems—available to customers by the end of this year.

While Clearwire and UQ each use the 2.5GHz frequency band, progress is also being made at 3.5GHz with the WiMAX Forum certification process in this band now well underway. Alcatel-Lucent and Alvarion each announced at February’s Mobile World Congress they had received the WiMAX Forum seal of approval for their respective 3.5GHz 802.16e base stations. Samsung and ZTE made similar WiMAX Forum cer-tification announcements on their respective 3.5GHz products only a few weeks previously.

And let’s not overlook the increased activity in Asia at 2.3GHz, another standardised WiMAX frequency band. As well as the rollout of WiBro in Korea, each of the licensed 2.3GHz Malaysian operators looks to be pushing ahead with 802.16e deployment. As WiMAX Vision went to press, Packet One had just signed a two-year deal with ZTE to speed up deployment across Peninsular Malaysia. And Korea and Malaysia need not be out on a 2.3GHz limb. Other Asian countries have released 2.3GHz spectrum, including Singapore, Australia, New Zealand and the Philippines. Indonesia and Vietnam are also thought to be looking at 2.3GHz for broadband wireless access.

Despite the economic downturn, which is adversely a� ecting nearly every industry sector, there are grounds for WiMAX optimism.

EDITORIAL

Scaling new heights

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Editorial DirectorMike Hibberd

EditorKen Wieland

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Packet One signs up ZTEMalaysian operator Packet One Networks (P1) has entered into a WiMAX technology partnership with Chinese vendor ZTE. In a two-year deal worth over $28m, which was signed in March, ZTE will provide WiMAX network planning and design, equipment supply—as well as engineering and network optimisation services—in areas outside Kuala Lumpur and the Klang Valley. P1 is target-ing over 450 new sites with ZTE WiMAX kit during 2009 alone.

P1’s first WiMAX equipment deal was with Alcatel-Lucent, which it selected in January 2008 to provide an ‘end-to-end WiMAX wireless broadband solution’. The

contract was valued at RM320m (approximately $71m at the time).

Alcatel-Lucent recently an-nounced, however, it would be focusing all its ‘4G’ mobility efforts on LTE, preferring to use WiMAX for fixed and nomadic applications only. This may have been a factor in P1’s decision to go with ZTE, although P1 maintains its partnership with the Chinese firm is simply to ac-celerate deployment.

In an e-mail exchange with WiMAX Vision earlier this year, Michael Lai, P1 CEO, said: “Our target is to cover 25 per cent of Malaysia [population] by 2009, 40 percent by 2010 and 60 percent by

2012. This is in line with the Malay-sian government’s national broad-band plan to provide broadband access to 50 percent of Malaysian households by 2010.”

The operator is aiming for at least 100,000 subscribers within 12 months of operation, which began August 2008. As of February 2009, P1 had 20,000 subscribers and press reports, at the time WiMAX Vision was going to press, was claiming that P1’s daily sign-ups were averaging at about 450.

P1 acquired its WiMAX licence in March 2007, giving it a 30MHz chunk of spectrum across Peninsular Malaysia in the 2.3GHz frequency band.

Yota extends free WIMAX trialYota, a Mobile WiMAX operator in Russia, is extending its free consumer trial period until 31 May 2009. Until that time, hold-ers of WiMAX USB-modems, express-cards and HTC MAX 4G phones will get free access to high-speed wireless internet, to Yota Music, to Yota’s photo-blog-ging service (Yap-Yap), as well as mobile TV (Yota TV) and online film browsing (Yota Video). For corporate customers, however, the commercial usage of Yota will start 1st April as previously announced.

The ‘Zero Service plan’ for Yota services started on 1 November 2008. As such, first users of Yota have seven months of free internet and the opportunity to fully or partially refund the price of the access devices.

Yota points out that subscrib-ers who bought a ‘4G’ modem or express card before New Year can fully recover their expenses through savings on free internet access. And all those who joined in March, having bought a modem or a card, can save 2,700

roubles ($80) because of the free offer. This is more than a half of the access device price for USB or express cards.

The free offer makes a smaller dent in the price of the HTC MAX 4G device. The dual-mode WiMAX/GSM touch-screen hand-set retails for around $1,200.

In separate news, Yota, along with Samsung, has announced the introduction of what they say is the first ‘4G’ ready netbook (mini-notebook) in Russia. A modified Samsung NC10, the new device has a built-in mobile WiMAX module plus software to connect to Yota’s 802.16e network. Sales of the Sam-sung NC10 4G netbook will start on 23 March at a recommended retail price of 19,990 roubles (around $600).

Yota holds nationwide spectrum across Russia in the 2.5-2.7GHz fre-quency band and is initially rolling out 802.16e networks in Moscow and St Petersburg using Samsung base stations.The eventual target is to deploy Mobile WiMAX in 40 Russian cities.

Mobile WiMAX sales upA five percent increase in Mobile WiMAX (802.16e) Q408 sales over the previous quarter helped to keep the size of the overall WiMAX equipment and device market on an even keel at $275m.

This is one of the findings from research published by Infonetics, which notes that the rise in 802.16e sales was enough to offset a “slight dip” in the 802.16d Fixed WiMAX segment during the quarter.

Looking at 2008 as whole, WiMAX had a pretty good year. Year-on-year, says Infonetics, worldwide sales of 802.16e equip-ment (ASN gateways, BTS, CPE) grew 188 per cent in 2008. Mean-while, sales of 802.16e devices (UMPCs, phones, and external data cards) grew 121 percent, al-though Infonetics notes the range of devices is still very limited.

And while Infonetics sees WiMAX infrastructure revenue subdued by the current global economic climate, it calculates that

strong CPE sales will drive overall mobile WiMAX market growth in 2009 as more services launch and new subscribers adopt WiMAX services for the first time.

“The WiMAX market will be leaner in 2009, leading vendors to rationalise their strategies: Nortel has exited, Alcatel-Lucent has transitioned its mobility R&D to its LTE programme, and others will have their commitment to WiMAX tested,” says Richard Webb, an Infonetics analyst. “As the year progresses, we will see more intense competition for fewer new contracts, and a tight race for market leadership. Cur-rently Alvarion, Alcatel-Lucent and Motorola lead the field, but there is evidence to suggest that both Huawei and Cisco are com-ing up on the outside lane.”

At the end of 2008, Infonetics calculates the number of Fixed and Mobile WiMAX subscribers at 3.9 million, up 120 percent over the previous 12 months.

Michael Lai, P1

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Green light for VMAX in TaiwanThe National Communications Commission (NCC), Taiwan’s regulator, has given the go-ahead to VMAX to start rolling out WiMAX base stations and related infrastructure in its licensed areas in the island’s northern region. The Taiwanese operator is deploying about 300 WiMAX base stations from Alvarion and Samsung with an initial budget, reportedly, of NT$1bn ($29m).

Alvarion announced in Febru-ary 2009 it had secured a $12m deal with VMAX to supply 100 base stations in the first stage of a three-part WIMAX rollout in the northern provinces of Taoy-uan and Hsinchu. The WiMAX network will enable VMAX to provide wireless IP services such as voice, data, video and gaming. VMAX is on course to be the first operator to launch a commercial WiMAX service in northern Taiwan.

“VMAX strongly believes in WiMAX as the best way to provide our customers the most advanced mobile broadband serv-ices available,” said Teddy Huang, VMAX CEO, at the time of the Al-varion award. “Subscriber growth is expected to reach 500,000 in five years.”

VMAX is expected to use a total of 1,200 base stations in the planned three-stage project. Samsung, as part of the first phase of the project, is supplying 200 base stations to VMAX. The contract, awarded in December 2008, is worth between NT$400-500m ($12-15m) for the South Korean supplier.

The awarding of contracts for the second phase of the project is expected by the end of 2009.

In October 2008, Intel Capital invested NT$386m ($11.5m) in WiMAX to secure a 20 percent stake. Tecom and Vibo Telecom are the major shareholders in VMAX.

Sagem adds Gigaset WIMAXSagem Communications, a French phone-maker and pro-vider of broadband products, has entered into an agreement to acquire the broadband and WiMAX business of Gigaset Communications, a subsidi-ary of Arques Industries and Siemens.

This is the first acquisition for Sagem Communications since being acquired by the Gores Group, a US-based private equity firm, in January 2008.

“This acquisition should reinforce Sagem Communica-

tions objective to become a world provider of broadband terminals, convergence and digital home solutions,” said Patrick Sevian, president of Sagem Communications, in a prepared statement. “We firmly believe that the global customer footprint and the excellent R&D capabilities of Gigaset will significantly enhance our positioning and the value we provide to our customers.”

Sagem Communications has 6,570 employees worldwide, with 2008 sales of €1.3bn.

Countdown to Global Congress

The annual WiMAX Forum Global Congress, produced by Informa Telecoms & Media on behalf of the WiMAX Forum, is a flagship event for the wire-less broadband industry—it is also fast approaching. Taking place at the Amsterdam RAI Congress Centre on 2-3 June, it is set to attract more than 4,000 industry representatives and so build on the enormous-ly successful first Global Con-gress, which recorded 2,663 attendees from more than 125 countries.

A truly international event, the 100+ speaker line-up at Global Congress 2009 reads like a ‘who’s who’ in the wireless broadband ecosystem, with extensive representation of operators (over 40), analysts,

regulators, consumer electronics companies and investors.

Speakers include Barry West, president, Clearwire; Dr Hamadoun Toure, secretary general, ITU; Terry Taber, CTO, Eastman Kodak Com-pany; Vivek Dua, DGM IT & regulatory affairs, BSNL; Dr Hyun-Myung Pyo, EVP, Korea Telecom; Philippe Dongier, sector manager, global informa-tion & communication, World Bank; Denis Sver-dlov, CEO, Yota; and Ron Reich, director, strategic investments broadband

wireless, at Intel Capital.Additional features at this

year’s event include a special focus day (1st June) on emerg-ing markets involving more than 20 operator presenta-tions. And in recognition of the vital role engineers have to play in driving WiMAX from a strategic concept to a live com-mercial network deployment, this year’s Global Congress will see the launch of a brand new Technical Symposium, providing tailored content for the engineers and focused upon addressing the technical challenges associated with RF network planning.

To download the Global Con-gress 2009 brochure and secure your registration, please go to www.wimax-vision.com.

Barry West, Clearwire

www.wimax-vision.com Shuichi Kako, UQ Peter Ziegelwanger,

WiMAX Telecom

Online Q&As

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8 | April 2009

The way we communicate has changed a great deal in the � ve years since I have been president of the

WiMAX Forum. Today, more then ever, we expect to experience telecommunications as real-time and virtual interaction that can easily span the continent or the globe. Whether you believe the ability to be ‘always connected’ is good or bad, we recognise how the communications revolu-tion has improved people’s lives around the world.

And we are in the early stages of the evolution to mobile internet anytime, anywhere. Mobile internet, in our

de� nition at the WiMAX Forum, includes all service models from � xed access in the home or enterprise, to nomadic, to fully mobile. � e importance of WiMAX technology is that it takes us to the next phase of this evolution today, providing the infrastructure to deliver high-bandwidth internet services available now, rather than in three to � ve years’ time using similar 4G technologies such as LTE.

Services based on WiMAX products will enable immediate location-based information about the world around us—such as ‘how long until my train arrives at the station’ or ‘where

is the nearest restaurant that suits my taste?’ As a result, the demand for broadband access has immense upside as its current installed base is low. Of the six billion people on earth, more than three billion are mobile phone users. One billion consumers are connected to the internet, but only 400 million have access through broadband. � is immedi-ate demand for broadband internet connectivity is what is attracting more than 400 operators who are commercially deploying WiMAX now. Particularly in that WiMAX infra-structure delivers broadband access at a cost far below other competing solutions such as 3G.

Certain operators and vendors aim to suppress this broad-

Don’t delay on 2.6GHzUnused 2.6GHz spectrum needs to be made available now to meet broadband demand and spur economic growth, argues Ron Resnick, president and chairman of the WiMAX Forum

band revolution and are attempting to delay the availability of low cost broadband access to UK citizens, and make the market wait additional years for their 4G solutions. � ese operators and equipment vendors have attempted to stall progress in support of their own self-serving interests, which are years behind what WiMAX is delivering today. Like the UK, countries around the world are taking action now to deploy true broadband internet, recognising how vital these services and applications are to spurring economic growth. Today, there are more than 400 WiMAX deployments in 133 countries across the globe, and in Europe there are 93 deployments across the continent—evidence there is clear momentum for 4G services. � e end result is that economies not deploying broadband access today reduce their ability to compete in a global economy.

It is important that WiMAX plays a role in delivering these services without delay with high-capacity broadband at a lower cost and at faster speeds. � e frequency bands needed for WiMAX deployment in the UK are currently unused: therefore, the launch of new services in these bands will bring bene� ts to consumers and the economy.

� e UK auction of the 2.6GHz spectrum by Ofcom rep-resents one of the most signi� cant allocations of spectrum for the foreseeable future in Europe. O� ering this spectrum is fundamental to creating a true 4G wireless broadband network in the UK in the next three to � ve years. � ere is always a level of uncertainty about technology develop-ments, but the � rst step is to allow companies access to those resources, such as spectrum. Radio spectrum is a � nite resource, and it is very important that governments make the right choices, including those that serve the needs of citizens that will bene� t from services delivered over this wireless medium. As stated, any delay in this auction will not only materially limit healthy competition, but also impact consumers and the broader economy. According to some estimates, the overall economic bene� t derived from the use of radio spectrum in the UK is in excess of £37bn, or three per cent of GDP. Making more e� cient use of this scarce resource will generate new value to the economy.

Ofcom has designed the auction in a way that signi� cantly reduces the risk associated with the purchase of the spec-trum. We shouldn’t expect customers and the government decision makers to wait until all uncertainties such as refarm-ing of spectrum in other bands are removed from an auction process. We suggest the UK and other countries around the world will be le� behind in the wireless internet revolution if spectrum isn’t allocated as soon as possible in the UK. � e needs of consumers must outweigh the wishes of corpora-tions not prepared to meet customer needs today. 2.6GHz spectrum allocation must be auctioned today in order to o� er consumers the technology of the future tomorrow.

Ron Resnick


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10 | April 2009

Clearwire confi dence lifts WiMAX Clearwire’s reaffi rmation of its large-scale rollout ambitions is good news for everybody in the WIMAX community By Ken Wieland

Clearwire has calmed fears among the WiMAX community

that it might be scaling back its network rollout ambitions. Dur-ing last month’s analysts confer-ence call on the operator’s 4Q08 and full-year � nancial results, Ben Wol� , as Clearwire CEO, said: “Our expansion e� orts are in full swing.”

It was good news for WiMAX sup-porters because until Wol� ’s statement, Clearwire had remained silent about its rollout plans since the mobile WiMAX JV (comprising the old Clearwire, Sprint Nex-tel’s WiMAX business unit, Google, Intel and three US cable operators) was formally established in November 2008.

Although Clearwire had a legitimate reason to keep quiet about its rollout plans until it worked out the full operational im-plications of the JV, the silence only served to fuel analyst and trade press speculation that Clearwire was not as committed to WiMAX as it once was. Perhaps this was through a lack of capital for a nationwide rollout, some conjectured, or even that take-up in the markets where it had already launched service—Baltimore (Maryland) and Portland (Oregon)—had not been as good as initially expected.

Either scenario would be bad news for the WiMAX community, which is looking to Clearwire to make a mobile WiMAX stand. By being successful in the US—up against the likes of AT&T and Verizon—Clearwire can go a long way to silenc-ing critics who typically say WiMAX is destined to be a ‘niche technology’ with no signi� cant part to play in developed markets (although the emerging markets still represent a sizeable opportunity for WiMAX).

A successful and large-scale Clear-wire would also quicken the pace of new WiMAX devices being introduced into

the market, as well as lower the prices for infrastructure and devices by generat-ing higher volumes. In turn, this might encourage smaller operators to go down the WiMAX route, which would further increase WiMAX economies of scale: a classic virtuous cycle.

Wol� ’s ‘full steam ahead’ message was therefore a huge sigh of relief for WiMAX supporters. But it won’t be Wol� leading Clearwire from the front. Only days a� er Wol� sounded his clarion call for WiMAX, Clearwire announced he would not con-tinue as CEO. Instead, Wol� becomes co-chairman alongside cellular pioneer and Clearwire co-founder, Craig McCaw. Wol� is to focus on the company’s ‘strategic and � nancing opportunities’ going forward.

Bill Morrow, a former Vodafone execu-tive, takes Wol� ’s place at the Clearwire helm. � e thinking seems to be that as Clearwire moves into an expansionist and operational phase, Morrow—bringing nearly thirty years of operational manage-ment expertise to the Clearwire board-room—is better suited to the task than Wol� , whose strengths are said to lie more in tying up deals.

While Clearwire has still to make good on its WiMAX aspirations—not an insig-ni� cant task—the technology’s detractors were denied the opportunity of pouncing on any signi� cant downsizing of the opera-tor’s WiMAX ambitions and using that as a stick with which to beat the 802.16e community. In June 2008 Clearwire said it was aiming for between a 120-million and 140-million population coverage by the end of 2010, and the March announce-ment roughly maintained that position—a 120-million target population coverage by the end of next year.

And Clearwire appears to have been busy behind the scenes since the com-mercial service launches in Baltimore (September 2008) and Portland (January 2009). Wol� says that 18,000 cell sites are

currently under development and summer 2009 will see further commercial launches in Las Vegas and Atlanta. “� e construc-tion is going well [in these two markets] with nearly 1,000 square miles being tested,” says Wol� .

Other major Clearwire launches slated for this year are Chicago, Philadelphia and Dallas-Fort Worth, along with the re-launch and upgrading of service in a number of Clearwire’s ‘pre-WIMAX’ markets, including Seattle, Honolulu and Charlotte (North Carolina). Clearwire o� ers � xed and nomadic services in 50 US markets using pre-certi� ed WiMAX kit; the Clearwire plan is to convert all of those pre-WiMAX markets to 802.16e by the end of 2010.

Major mobile WiMAX launches for 2010 include New York, Boston, Washington, Houston and the San Francisco Bay area. Clearwire’s aim is to have mobile WiMAX coverage in 80 US markets by the end of 2010, which includes 75 per cent of what Wol� describes as the ‘top’ US markets. If achieved, this would provide the 120-mil-lion population coverage that Clearwire is a� er by the end of next year.

“Our targets are aggressive and a nation-wide footprint will not happen overnight,” concedes Wol� , “but it doesn’t need to happen overnight for Clearwire to be suc-cessful.” Wol� argues that because the bulk of Clearwire’s pre-WiMAX markets are EBITDA positive—and which don’t have roaming capability between them—then nationwide roaming should not be seen as a prerequisite for mobile WIMAX success. “If we can achieve [EBITDA positive] with pre-WIMAX markets, it can only get better with rolling out mobile WiMAX services, which have a broader range of services, the promise of greater di� erentiation, and higher ARPU opportunities,” he says.

If Clearwire can come good on its plans, it will make impossible the charge that WIMAX is only a niche technology.

Ken Wieland


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12 | April 2009

Public sector can give WiMAX a boostWiMAX has an advantage over 3G in serving the public sectorBy Matthew O’Neill, PA Consulting

There is clearly a lively appetite for WiMAX in developing markets. � e

lack of � xed-line infrastruc-ture makes the technology an attractive proposition as it can be deployed quickly and relatively inexpensively.

Yet in developed markets, the bene� t of implementing this technology can appear

less obvious. A high � xed-line penetration, combined with most mobile providers looking to adopt the next crop of 3G tech-nologies, means it is much more di� cult for WiMAX supporters to present a solid business case proposition.

But in the race to be a leading wireless broadband technology, WiMAX must show that the technology can develop a signi� -cant market share in developed markets. How does WiMAX do this? � e glib answer is that it needs to reduce the barriers to entry. � is can be achieved by establishing itself quickly in markets that competitor technologies will � nd hard to penetrate.

One market is the public sector where there is an ever-increasing demand for mo-bile data services and where 3G has some distinct disadvantages. Organisations, such as emergency services, hospitals and government, are seeing increasing need for mobile broadband technologies.

Why is this a potential market? Why wouldn’t 3G be used in this area as well? � e answer is twofold. Firstly with 3G you can’t roam between providers. � is is a great frustration to the public sector and does not allow for joined up services, which is es-sential for today’s public services—especially the emergency services. Secondly coverage in city centres is patchy with 3G. Taking the UK city of Leeds as a typical example, where eve-rything is concentrated together—there are a number of university campuses, hospitals, government buildings, leisure and shopping facilities all in one area—yet 3G coverage

remains very patchy. � is is unacceptable to public sector organisations, many of which would rely on the network in a crisis.

However, a lack of strong 3G competition is not the only reason for WiMAX to choose the public sector as a route to market. � ere exists a classic network ecosystem e� ect where getting consumers to use and upgrade to mobile data is vital for the operators using either technology, whether it is 3G or WiMAX. � is makes the public sector particularly attractive as the nature of the long-term IT and networking contracts create greater stability than might necessar-ily be needed in the private sector.

Moreover, the public sector could make use of WiMAX networks where mobile data is increasingly being seen as a part of delivering services for everyday life. CCTV, for example, is being used more and more in the � ght against crime and terrorism. WiMAX networks could o� er an increased � exibility in being able to make the cameras much more mobile over a wider area.

In the health sector, WiMAX could play a role in supplying solutions to campus-based healthcare sites. However, the healthcare institutions are notoriously complicated beasts to navigate for any potential supplier. � ere can be a wide range of bodies with their own budgets and sometimes with dif-fering purchasing aims and objectives—even on the same site. Currently, in the UK, NHS hospitals have been rolling out wi� for data in hospitals at the moment mainly for voice. � ese solutions are useful inside many of the buildings but as soon as you step out of the building many NHS sta� are getting charged for calls rather than having them running over campus infrastructure. WiMAX could o� er a solution around this problem.

Operators have forever been guilty of fo-cusing on the technology and the standards rather than asking themselves what services do consumers want and how to deliver it. � e ‘build it and they will come’ mentality

means that many 3G networks have only recently begun to be � lled. � e key message in all of this is that in order for WiMAX to be successful it has to be focused on � xing speci� c customer problems combined with other complementary technologies, whether it’s in the IT or networking and telecoms domain. � is is especially true if WiMAX wants to play an important role in public sector solutions, which can have longer investment time horizons than some enterprise developments.

Taking the public sector would be a battle won against 3G but the war would rage on. In e� ect, breaking into the public sector would be a signi� cant stepping stone to becoming the dominant mobile broadband technology. � e next stage would be to break out of this environment and use the networks created in metro-politan areas to help create a national WiMAX network.

Proving the commercial viability of WiMAX and attaining signi� cant market share through dominance of the pub-lic sector has to be a main focus of this technology’s stakeholders. � e war will not be won by continuing to meet 3G on the main commercial battlegrounds where it currently has a signi� cant commercial advantage.

Matthew has worked in the telecoms industry for over ten years with a particular emphasis on product strategy and market-ing. Matthew has been with PA for the past � ve years and has worked extensively in Europe and the Middle East with both start up and incumbent operators. Matthew has worked on with both WiMax and 3G mobile technologies for numerous clients. Prior to PA, Matthew worked at telecommunica-tions equipment manufacturer, Siemens, and with the alternative Pan-European Carrier, COLT Telecommunications. He can be contacted at matthew.o’[email protected] or +44 (0) 207 312 4864.

Matthew O’Neill

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Sticky Note

14 | April 2009

WiMAX on track?WiMAX could fi nd a profi table niche in providing trackside communications systems for railway networksBy Ross Parsons, BWCS

W iMAX systems have recently been winning plaudits

amongst the train commu-nications cognoscenti as the rail industry looks to wireless communications to improve safety, speed up journeys and generally wring more money out of expensive rail networks.

To date, the vast majority of investment in trackside communications systems has been in GSM-R (Global System for Mobile Communications Railways). Initially accepted by European track and train operators, GSM-R is fast spreading across the world as the de facto standard for shore-to-train communications. Algeria, Tunisia, Czech Republic, Russia, India and China have recently awarded contracts, while the French track administrator, the RFF, is set to spend €1bn on a new GSM-R system covering 14,000km of railways. However, the capacity of the GSM-R networks for carrying mobile data is very limited, and this is where many analysts think WiMAX will come in.

Speaking at the recent Rail Commu-nications Regulations and Management conference organised by BWCS in London, several train operators and track administra-tors identi� ed a plethora of applications that could be run on trackside wireless networks if su� cient bandwidth is available. � ese in-clude: the provision of wireless security cam-eras on trains, internet access for passengers, remote monitoring of train systems, work-� ow optimisation, repair and maintenance e� ciencies, right down to putting wireless tags on freight and passenger trains so the operator can identify their whereabouts.

For some of these applications, the limited mobile data speeds o� ered by GSM-R will be su� cient. However, the majority require fast connections to shi� much greater quanti-ties of data than GSM-R’s feeble 9.6Kbps would manage, which is where many believe WiMAX can step up to the plate.

One of the leading supporters of WiMAX in the transport sector is UK-based Nomad Digital. � e company is keen to stress that its system’s strength lies in the ability to provide seamless hand-o� s between WiMAX, wi� and most other technologies—it is far from being an ex-clusive WiMAX service provider. As com-pany chairman, Nigel Wallbridge, is fond of saying, “It’s all about taking low-cost technologies and making them mobile.”

� e attraction of systems such as No-mad’s is that the train companies can use the high bandwidth network to run services that help reduce their costs. Nomad, which largely uses Redline WiMAX equipment on its deployments, argues that its high-speed wireless connections enable better com-munications between railways companies and their sta� on the train. � is can include remote CCTV monitoring of the train (and the track ahead), it allows HQ to constantly track on-board systems and engine per-formance, and allows the train to download information about where it is and whether all its doors, brakes and air conditioning systems are functioning properly. In addi-tion, Nomad and other operators, o� er train companies access to on-board picocells to boost mobile coverage in the trains.

Deploying trackside WiMAX is not a cheap option, however. While the system of-fers good coverage alongside straight tracks, it is o� en necessary to supplement it when the track begins to curve—even if only very slightly. By taking a directional antenna and pointing it straight down the line, suppliers can generally get several kilometers of cov-erage. However, wherever the track curves’ only even slightly out of sight, the operator has to rethink its coverage.

Peter Kingsland of Icomera, which sup-plies cellular broadband gateways, has a more jaundiced view of WiMAX’s future in the rail sector. “WiMAX certainly has a place in the urban/high-density population area of the track network where it can o� er

high-speed wireless broadband delivering safety-critical and money-saving applica-tions to commuter trains,” he says. “Howev-er, outside this small area, its relatively short range between base stations means it simply becomes too expensive to roll out and train companies are much better looking at exist-ing broadband cellular and satellite services for mainline route deployments.”

Despite the coverage cost for longer routes, WiMAX is spreading alongside rail networks. In Japan, Taiwan and the West Coast of America, high-speed wireless broadband services from the shore to the train are beginning to take hold. Japan Rail has introduced high-speed wireless services to its very high-speed Shinkansen trains running between Tokyo and Osaka. Meanwhile, the NTT experts involved in this operation have been working with Taiwan High Speed Rail (THSR) and the government-sponsored Industrial Tech-nology Research Institute (ITRI) to trial broadband internet access through WiMAX on high-speed trains. � e Taiwan tests are designed to provide data transmission speeds of 15Mbps between the terrestrial areas and high speed trains while the trains are moving at speeds of 250-300kmh.

� e size of the rail market is impressive. In Taiwan alone the high-speed rail service carries more than 24.46 million passengers a year, while Nomad believes that the total worldwide market for trackside wireless services is, in theory at least, 144,000 trains with some 6.5 billion passengers annually. How much of that market can be addressed by WiMAX will depend on a mixture of de-mand from train companies for high-speed broadband wireless connections and the ability of competing technologies to provide cost-e� ective alternatives.

BWCS hosts two annual conferences on Trackside Communications in Europe and one in Asia. For more information please contact [email protected]

Ross Parsons


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Untitled-2 1 1/4/09 10:35:35

WiMAX stalls in Brazil

W iMAX at 2.5GHz is at a standstill in Brazil and José Luiz Frauendorf, execu-tive director at Neotec, an organisa-

tion representing the country’s licensed MMDS (multichannel multipoint distribution service) operators, is far from satis� ed.

“It’s frustrating that other countries in Latin America and around the world are moving ahead with WiMAX and Brazil, which is one of the testing pioneers of the technology, is not,” he says.

� e lack of WIMAX progress in Brazil has also frustrated the WiMAX community at large—such is the potential size of the market—but it is particu-larly irksome to Frauendorf.

Neotec was created in April 2001 to represent the interests of Brazil’s regional MMDS operators, which use the 2.5GHz frequency band. Using ana-log technology for video transmission at that time, which is ine� cient and expensive, Brazil’s MMDS players wanted to pool their resources and research alternatives for more cost e� cient and standardised digital video transmission systems that they could all use. By acting together, they aimed to exploit their greater purchasing power.

� ey also wanted to identify the best broadband wireless access (BWA) technology for � xed and portable VoIP and data services—to complement their pay-TV service—and so they turned to Frau-endorf for help.

Frauendorf was running his own consultancy company at the time a� er having worked as general director at TVA, Brazil’s largest MMDS operator. He then set up Neotec once he got the call from Brazil’s 2.5GHz licence holders to represent them on analog-to-digital conversion and BWA research. Neotec’s MMDS members have operations in 42

out of the 50 largest Brazilian cities and cover 15 million households across 250 municipalities. � ey typically serve areas where it is not economically feasible to roll out � xed-line networks to deliver digital TV and broadband services.

A� er undergoing numerous trials with di� erent BWA technologies, Mobile WiMAX emerged as Neotec’s BWA system of choice as early as 2006, but the MMDS operators have been stopped by Anatel, the country’s regulator, from pushing ahead with commercial WiMAX deployment.

“I am sorry to say but we have a lot of enemies and very few allies, and the biggest enemy we have is 3G,” says Frauendorf. “A� er the 3G auction [December 2007], Anatel was afraid to let us start deploying WiMAX as it feared we might compete with 3G—and 3G companies have lobbied Anatel hard to postpone any WiMAX deployments.”

Before WiMAX can be deployed commercially in Brazil, Anatel has to certify the equipment. � e regulator has yet to do so and Frauendorf argues vehemently there is no legal basis for the delay. And the result, adds Frauendorf, is that broadband progress is being stalled unnecessarily in a country that has a population of 190 million, one of the strongest economies in Latin America, yet still has fewer then ten million broadband connections.

“According to the law in Brazil, MMDS is classed as a telecommunications service and the licensees are allowed to provide all services the technology permits in that spectrum, which includes pay-TV and broadband access on a � xed and portable basis,” continues Frauendorf. “� ere are a lot of people at Anatel, however, that like to think that MMDS is a pay-TV system only, but that is not cor-rect. We are backed up by the constitution.”

And Frauendorf argues that any fears that Anatel might have that MMDS operators might start o� er-ing mobility services anytime soon are unfounded, not least because it wouldn’t make any economic sense for the MMDS operators to do so at this stage. “We’ve always said, and we keep saying, that mobil-ity is not what we need now,” says Frauendorf. “Not only because we think 3G can provide all the mobil-ity that is required at this stage, but adding mobility services to the Mobile WiMAX network would raise the cost of the spectrum as well as increase the cost of the infrastructure by perhaps as much as three or four time times than if [802.16e] were used for only � xed and portable services. We have been working since 2003 on business models and we know what is feasible in Brazil and what is not. We’re not crazy.”

In three to � ve years’ time, once the price of Mobile WIMAX equipment comes down, Frauendorf expects there will be a stronger economic argument for MMDS operators to roll out full mobility services across their licensed footprints. But even then, says Neotec’s execu-tive director, it won’t compete directly with 3G. “We see WiMAX and 3G as being complementary,” he says.

� e 3G community—and Anatel—overtly dispute this and Frauendorf acknowledges there is still some lobbying work for Neotec to do in order to convince the doubters. In the meantime, as Frauendorf contin-ually emphasises, mobility is not on Neotec’s imme-diate agenda. “We have already proposed to Anatel that we will not be installing the mobility manager in the Mobile WiMAX network,” he says. “We will also make sure that the user can only use the equipment in a given sector of the cell so the mobility would be very limited. If the user moved from one cell sector to another, the connection would drop and we wouldn’t allow them to connect again.”

INTERVIEW


José Luiz Frauendorf, executive director at Neotec, talks to Ken Wieland about his frustration at the lack of WiMAX progress in Brazil in the 2.5GHz frequency band

16-17_WiMAX Vision_April09.indd 16 30/3/09 10:04:45


If the law in Brazil supports the MMDS licen-sees’ position on offering video and BWA serv-ices, and there are rock-solid assurances from Neotec that there won’t be any mobility services until at least three years’ time, why is Anatel still dithering on rubber-stamping Mobile WiMAX equipment?

Frauendorf says it is the sheer strength of the 3G and LTE lobby groups that is making Anatel think twice about going ahead with WIMAX at 2.5GHz. “I think Anatel is using mobility as an excuse to postpone the certi� cation of the equipment, because there is no regulatory reason why we can’t deploy WiMAX today,” he says. “� ere is a huge lobby from the LTE equipment manufacturers to postpone WiMAX because they know they are not ready yet. And once you start deploying WiMAX in this country, I don’t think LTE will � nd a place here, at least not in 2.5GHz and 3.5GHz.”

� ere is some WIMAX rollout in Brazil from 3.5GHz licences awarded in 2002, but Anatel is mulling over when to release more licensed spec-trum in this band. � e issue of mobility has again been a stumbling block and has caused repeated delays in 3.5GHz licensing, but Frauendorf points to an Anatel discrepancy in that Embratel, one of Brazil’s existing 3.5GHz licence holders in Brazil, has been allowed to upgrade its Fixed WiMAX network to Mobile WiMAX.

The MMDS road to WiMAXThe first pay-TV service in Brazil began in 1990—TV Filme—and was joined the follow-ing year by Canal+, an MMDS operation in Sao Paulo, which later became TVA, part of the Abril Group, the largest media company in Brazil. (In

October 2006 Spanish giant Telefonica purchased an undisclosed amount of shares in TVA.)

To develop triple-play services (TV, voice and high-speed internet access), the MMDS operators needed to have a ‘return path’ to enable interac-tive services and full BWA; MMDS operators were granted permission by Anatel to o� er a return path for the � rst time in 2000.

One of the big questions facing the MMDS operators was how to o� er BWA and video in the most e� cient way. Since 2000 they have been using ine� cient � xed LOS (line of sight) systems, DVT (digital video transmission) and the DOCSIS cable standard for transmitting data (including VoIP) on the downstream and the upstream.

To explore more e� cient BWA systems, Neotec conducted technology trials with both TD-SCDMA and OFDM-based technologies in Belo Horizonte, Brazil’s third-largest city, in 2003. As a hilly and green city (foliage leads to high signal attenuation) Belo Horizonte provided a challenging environ-ment for the BWA technologies to be put through their paces. If a BWA system could perform well in Belo Horizonte, it could perform well in other cities in Brazil.

� e results were encouraging for ‘pre-WIMAX’ technology based on OFDM. “It was clear that OFDM was far superior than TD-SCDMA,” says Frauendorf. “� e performance was excellent in terms of coverage and robustness.”

� ere were still a problem, however, as the spec-tral e� ciency of the OFDM-based system at that time was too low, making the cost of investment prohibitively high. But Frauendorf, speaking about the Belo Horizonte trials at the WCA (Wireless Communications Association) conference in 2003,

managed to attract the attention and involvement of Intel, which helped to spur WiMAX development and achieve the desired levels of spectral e� ciency.

“We’ve been involved with WiMAX from the beginning and from 2006 we have been trialling equipment in Sao Paulo from Samsung, Motorola and Nortel,” says Frauendorf. “And all the trials were o� cial inasmuch as we received licences from Anatel to test the equipment. And a� er each trial we sent a full report to Anatel about the technology. It’s important to say this because was nothing going on behind the scenes.”

But while Neotec can claim some success in the analog-to-digital conversion process—the MMDS operators have installed between 600,000 and 700,000 digital set-top boxes—WIMAX is stuck until Anatel gives it the go-ahead.

“� ere are three WiMAX base stations working at the moment in a pilot project in Sao Paulo,” says Frauendorf. “� e equipment is ready and even the contracts have been signed, but we can’t make any progress.”

Frauendorf ’s frustration is palpable. “We have always said that 2.5GHz is probably the only part of the spectrum that can accommodate both video transmission and broadband wireless,” he says. “Today we are transmitting 120 channels through MMDS, which is an equivalent TV package from the cable and satellite operators. From that point of view we are totally competitive, but we can’t o� er a full BWA service.”

While Frauendorf sees nothing in Brazilian law that supports Anatel’s stance, he is looking to resolve the issue without going to court. “We don’t want to enter into a legal dispute,” he says. “We want to settle in a peaceful way.”

José Luiz Frauendorf, Neotec

I am sorry to say but we have a lot of enemies and very few allies, and the biggest enemy we have is 3G


NameWiMAX Vision (WV): A� er Nortel an-nounced it was going into Chapter 11 you had to write o� $2.4m in Q4 2008 sales. How do you feel your former WiMAX partner has behaved towards you? Tzvika Friedman (TF): I am very unhappy with the way Nortel behaved. � ey owe me money and they are not paying it. � ey are hiding behind bankruptcy rules. We intend to get this money any way we can. Very simply, we shipped to them [Nortel] and they shipped to customers and collected the money. � ey can pay the money. It is not as if someone owes them and they owe us. � ey are using the Chapter 11 bankruptcy [rules] to their maximum advantage. Natu-rally, that is something I don’t like.

WV: How have you had to adjust following the break-up of your Nortel partnership?TF: In December 2008 we announced cuts that would give us about $15m of savings [in 2009], most of which were taken from opex and some of it from the COQ [the cost of equipment]. � e Nortel funding [for 2009] is about the equivalent of all the opex savings, so we needed to make those savings again because by not having [the Nortel] money could take Alvarion into losses. � e only way to deal with this immediately was to cut sala-ries by ten percent [excluding the lower paid] to � ll most of the hole le� by Nortel.

WV: What are the growth prospects for WiMAX during 2009?TF: � e market as a whole will grow be-cause there are several large projects mov-ing into implementation phase, including Clearwire in the US and UQ in Japan. For Alvarion, which is currently not involved in these two projects, it’s di� cult to say what the growth prospects are, but we do have a platform in place that’s capable of support-ing 15 percent revenue growth over 2008.

WV: How do you respond to the view that the biggest opportunity for WiMAX by far lies in � xed and portable applications rather than mobility?

TF: I see the market developing on three axes. One will be the mega projects, such as Clearwire and UQ, which will create a large ecosystem of devices and CPE. Second, there will be one or two WiMAX licences in almost every country and some will do per-sonal broadband once the ecosystem is there. � e third axis will be � xed and nomadic WiMAX operators supporting notebooks and then moving to mobility. Mobility is the natural migration path, so you will see a lot more WiMAX mobility in two years’ time.

WV: How does Alcatel-Lucent’s decision to stop WiMAX R&D investment for mobil-ity a� ect the WiMAX industry in general and Alvarion in particular? TF: For the industry, I’m not sure it’s so pos-itive as people can interpret it in a negative way. But companies leaving a technology a� er a few years is natural. When WiMAX started, everyone announced they were go-ing in, so some of the big players are bound to leave. Look at the DSL market, where lots of companies were involved to begin with. Now only Alcatel-Lucent, NSN and Huawei are still there while Ericsson, Nokia and Nortel all le� the market. WiMAX has still got Samsung, Motorola, Huawei, NSN, Alcatel-Lucent [for � xed applications], as well as Alvarion. And two or three years down the road from the start of a new technology, you can also get one or two new players that are able to establish themselves. Nokia did it with GSM, Qualcomm with CDMA, and Ciena with WDM. And yes, I would say Alcatel-Lucent’s decision on mobile WiMAX is good for Alvarion.

WV: How has the economic downturn a� ected Alvarion?TF: Our strategy is more or less the same. What has changed as a result of the � nancial crisis is that we are much more focused on whom we sell to in the sense of checking they have the � nance to go out and do the project. One of the reasons we think operators should choose us is because we are totally committed to WiMAX. We are

not going to cut our investment, we have the � nance, and we are here to stay.

WV: What is your attitude towards vendor � nancing?TF: We don’t have an issue with vendor � -nancing, the issue we have is with the risk. If we know there is no risk, we can easily arrange it, either from our own funding or from the relevant banks. Generally, though, we don’t do it.

WV: What about revenue-sharing agree-ments with operators?TF: We don’t do revenue sharing today but we are very open to what we call the managed services approach where we bill for capacity used rather than for the equipment. Revenue from managed services, however, is almost zero. � is is because, in most cases, once we go into detail about the WiMAX business case, the customer decides against managed services. � ey become more con� dent in the business case when they see we are interested.

WV: Will you be cutting R&D investment this year?TF: R&D cuts were not in the cost-cutting measures we announced last year. R&D was around $60m last year and should be about the same this year as the dollar/shekel ex-change rate goes a bit in our favour, which is around 20 percent of revenue. Hopefully that percentage will come down as we grow reve-nue. Our long-term R&D target is 15 percent of revenue, which doesn’t mean of course the R&D level will necessarily go down.

WV: In terms of achieving interoperabil-ity with other vendors’ WiMAX kit, how satis� ed are you? TF: Our open architecture can work with ASN gateways from Cisco, Hitachi, Harris Stratex, Nortel and Bridgewater. But there are still interoperability problems with Motorola and Samsung because they don’t use pro� le C [based on open standards]. I think the operators will push them to open up eventually.

18 | April 2009

THE SUPPLY SIDE | Q&A | Tzvika Friedman

Alvarion still buoyantWimax Vision talks to Alvarion CEO, Tzvika Friedman, about strategy and growth prospects for the Israel-headquartered WiMAX RAN supplier

Wimax Vision talks to Alvarion CEO, Tzvika Friedman, about strategy and growth prospects for the Israel-

To read the whole interview go to www.wimax-vision.com


Untitled-2 1 1/4/09 10:39:41

feature

www.wimax-vision.com/subscribe | April 2009 | 2120 | April 2009 | www.wimax-vision.com/subscribe

Betting on WiMAX chips

A mature and innovative chipset ecosystem can help persuade operators to adopt WiMAX

By Ken Wieland


feature


The 3G chips are much more expensive [than WiMAX] due to ecosystem defi ciencies where Qualcomm calls all the shotsLars Johnsson, Beceem

When WiMAX supporters put forward the business case for deployment, they invariably refer

to a mature and highly competitive WiMAX chipset ecosystem as one of their trump cards. With over 20 WiMAX chipset manufactur-ers in existence—and each appearing (so far) to appreciate the importance of growing the market by keeping prices down through not making any exorbitant royalty claims on patents—it looks a forceful point to make.

Th e proof of the pudding, as they say, is in the eating. Yet the WiMAX camp, with some justifi cation, can claim they are starting to deliver on the promise of lower-cost devices directly as a result of competitively priced chipsets.

When Xohm (now Clearwire) fully launched its Mobile WiMAX service in Baltimore in October 2008, the USB dongle—manufactured by ZTE using a Beceem chipset—retailed at an impressively low $59.99. WiMAX device chipsets, says Sprint, are in the $20 range.

“Th is is a far cry from what 3G can do on price,” says Lars Johnsson, VP of business development at Beceem. He argues it would cost a mobile operator twice as much to put a 3G dongle into the market. “Th e 3G chips are much more expensive due to ecosystem defi -ciencies where Qualcomm calls all the shots,” he continues.

Although Sprint—which fully owned the Xohm business unit at the time of commercial WiMAX launch—may have been able to lower its WiMAX device prices to a certain extent through the weight of its purchasing power, the third-largest operator in the US says there are “virtually no subsidies” on any of its end-user Xohm devices. (Th e Samsung PC express card retails for $59.99, while the Xohm modem from Zyxel sells at $79.99.)

Moreover, there are no lengthy contract lock-ins attached to the Clearwire service, something that mobile operators usually insist on as a form of a device subsidy if they are to give away their USB dongles and PC cards for ‘free’.

“I thought the prices [for Xohm end-user devices] would have been higher,” says Monica Paolini, founder and president of

Senza Fili Consulting. “When 3G came out, devices were much more expensive unless you signed a contract, so $60 is a remarkable price point. When wifi started, the cards cost $250 and it took some time before they came down to the $60 level.”

Th e WiMAX chipset ecosystem can boast a number of heavyweight players, including Intel, Motorola, Samsung and Fujitsu. Intel, as WiMAX’s principal fi nancial backer, is making particularly strong progress in lowering the cost for WiMAX-embedded laptops, netbooks and MIDs (mobile internet devices) through developments at the chipset level.

In April 2008, the US chip giant unveiled Atom, parading it as the world’s fastest proc-essor under three Watts. Using 45nm silicon technology, Atom is aimed at the ‘aff ordable’ netbook market.

And by combining the Atom processor with its EchoPeak chipsets—which integrate wifi and WiMAX on one piece of silicon—Intel promises a potent combination; one that could drive WiMAX adoption through seeding the market with WiMAX-embedded devices at prices not much higher than if they didn’t have WiMAX capability. EchoPeak chipsets, which are now shipping to PC manufacturers, are central to Intel’s WiMAX-embedded device strategy.

“You can add WiMAX to wifi chips with almost no incremental cost to the notebook or netbook,” says Ron Resnick, president of the WiMAX Forum. “If you try and add an HSDPA modem to that device, it can cost between $60 to $100 extra.”

But there is also a slew of smaller com-panies and start-ups in the WiMAX chipset ecosystem, including Beceem, Comsys, Altair, Wavesat, Runcom and picoChip. Competition is helping to drive innovation, which, in turn, lowers chipset costs and increases performance.

One important chipset development is the trend towards WiMAX SoC (system-on-a-chip) solutions, which combine the RFIC and baseband components (see ‘WiMAX device chipset de� nitions,’ page 28). Historically, diff erent companies manufactured the RFIC and baseband chipsets to produce two-chip solutions. By integrating the RFIC with the

baseband chipset on one piece of silicon, the bill of materials (BOM) cost can be lowered by as much as 25 percent, according to Beceem, with no performance impairment.

A string of WiMAX chipset suppliers now have single-chip designs, including Beceem, Fujitsu, GCT Semiconductor, DesignArt and Sequans.

Chasing volumesWhile innovation paves the way towards more cost-effi cient chipsets, higher volumes are ob-viously key in bringing costs down. Although WiMAX is growing, it is still a nascent market and high volumes will be diffi cult to come by in the short term, particularly for the smaller chipset companies.

Factor in the economic downturn and the prospect of generating much lower volumes of unit shipments than previously forecast, then it seems reasonable to expect that the WiMAX ecosystem will shrink to some extent through 2009, either through consolidation or start-ups falling by the wayside simply through lack of capital.

Some baseband chipset vendors, such as Wavesat, Comsys and Altair, are adopting what they believe to be a risk mitigation strategy by using the same piece of silicon to support more than one air interface, which increases their addressable market.

Th e growth strategy of Wavesat, a privately-held fabless chipset supplier headquartered in Canada, revolves around its ‘multimode 4G architecture’. Th e fi rm’s target customers are OEMs (original equipment manufacturers) and ODMs (original design manufacturers) of end-user devices (dongles and express cards) and CPE.

Dubbed the Odyssey platform, it aims to serve multiple ‘4G’. Th is gives it a better chance of generating higher unit volumes, which, in turn, lowers costs and should make the com-pany more competitive.

Wavesat’s ‘standards-agnostic’ position comes from having developed its baseband chipset to be soft ware-programmable to Mobile WiMAX or XG-PHS. (XG-PHS is the next-generation PHS (personally handyphone system) standard, which has been adopted by Willcom, a PHS operator in Japan.) Plans


feature


are also afoot to make the Odyssey platform soft ware-programmable to LTE by April 2009.

This flexibility allows Wavesat not only to serve multiple markets (and hedge its 4G bets) but enables its OEM and ODM customers to design and manufacture end-user devices to different ‘4G’ standards without needing to change the format of the device. The Wavesat proposition to its OEM/ODM customers is that all they need do is upload software in the factory to make the device adhere to the ‘4G’ standard of their choice, which gives them flexibility in responding quickly to market demand without increasing their BOM cost. The switch between the standards can only happen, though, if the same frequency band is used.

“Cost reductions can be quite dramatic with higher unit volumes,” says Raj Singh, Wavesat CEO. “Th e extent of those costs reductions will obviously depend on negotiations with the foun-dries [which supply the silicon], but once you get between two million and three million units per year, the prices start to come down quite rapidly.”

Th e Odyssey platform started sampling in 2008 and Singh says enough design wins have already been secured to ensure volume ramp-up in 2009. “We’re forecasting that our volumes will be in the 6-7 million unit range by 2010, across all market segments,” he says.

End-user devices using Wavesat’s Odyssey 8500 platform will not be multi-mode in the sense of users being able to roam seamlessly between diff erent 4G networks. Singh does en-visage, however, that the same 4G device (using soft ware-defi ned baseband chipsets) could still

be confi gured to access diff erent OFDMA-based standards if this were an operator requirement. By having diff erent soft ware stored inside the device’s Flash memory, a user could activate the appropriate 4G access bearer—at the press of a button, perhaps—according to the geography he or she is in. “Th at’s a pretty good trick,” says Singh.

For Singh, the time has not yet come when it makes sense to take the SDR concept beyond the air protocol. To optimise performance and silicon size, he argues, the core of OFDM technology still needs to be hardwired into the chipset. “We have done a lot of work in building customised DSPs that do one thing and one thing only,” says Singh.

Th e current crop of multimode products from Comsys, an Israel-headquartered supplier of integrated baseband chipset solutions, is focused on combining Mobile WiMAX with established cellular standards; it is already shipping its multimode WiMAX/EDGE CM1125 chipset. “It should be noted that as GSM/EDGE is not

OFDM/A based, there is a requirement for a minimal amount of extra hardware for support of this standard,” says Ehud Reshef, WiMAX product marketing director at Comsys. “But the CM1125 is true multimode in the sense that a single fi rmware can support GSM/EDGE and Mobile WiMAX, and service continuity between the two, given the right upper layer protocols support.”

Comsys is now working on its next-gen-eration ComMAX solution, which is focused on LTE, but it is not currently looking at a 4G multimode architecture along the lines of Wave-sat. “Due to the diff erent operators deploying WiMAX and LTE, we currently do not see the need for a WiMAX/LTE multimode solution,” says Reshef.

Beceem’s Johnsson is not convinced, how-ever, that software-programmable air-interfac-es are either cost-efficient or even necessary, particularly as he believes LTE is still some way off. “It is an understood phenomena that software modems, which have high-perform-ance DSPs, do not have the power perform-ance efficiency of the more hardwired silicon that we have,” he argues.

Beceem, which counts Intel and Samsung among its investors, is a fabless semiconduc-tor company exclusively focused on producing chipsets for Mobile WiMAX devices. And to win orders, and so increase chipset volumes, Johns-son says the key battlegrounds are performance, multiple radio capability (to address a global market) and having a large IOT (interoperability testing) footprint.

In late 2006, Beceem launched what it claimed to be the world’s fi rst Wave 2 compliant Mobile WiMAX chipset in the market. “We subse-quently set the MIMO application layer speed record at 33Mbps and nobody has been able to do that as of today,” says Johnsson. “Our nearest competitor does 25Mbps.”

Beceem produces 65nm WiMAX chipsets with in-built triband radio covering all the standardised WiMAX frequency bands: 2.3GHz, 2.5GHz and 3.5GHz. Johnsson adds that Beceem has done ‘very deep IOT’ with ten base station vendors, including Alcatel-Lu-cent, Alvarion, Motorola, NEC, Samsung and ZTE. “These factors combined,” says Johnsson, “give us a lot of leverage with the ODMs in

You can add WiMAX to wifi chips with almost no incre-mental cost to the notebook or netbookRon Resnick, WiMAX Forum


Untitled-2 1 30/3/09 09:32:57

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Despite the gloom surrounding the chipset market with the prospect of lower demand for laptops and netbooks in the wake of the credit crunch, Johnsson is confident that 2009 can still be a good year for Beceem. “Clearwire will bode well for us in 2009.” he says. “Last year the mar-ket for mobile WiMAX chipsets was around one million units across all suppliers, but this year we expect that to go up to four or maybe five mil-lion, and we’re looking to get a 50 percent share of that. We stand to profit from that very nicely.”

CE device market potential Another potential way to increase WiMAX chipset volumes could be through the embed-

ded consumer electronic (CE) device market. If CE devices—such as digital cameras, MP3 players, gaming consoles and the like—could be WiMAX-enabled without adding significantly to the cost of those devices, then a new and extremely large market could be opened up to the chipset suppliers.

Wavesat is looking to develop a ‘pared down’ WiMAX chipset for the embedded CE device market and achieve price parity with 802.11n chipsets (the higher performance version of wifi). Singh says this might be achieved in 2010 at a unit price of around $8. “If the cost of WiMAX chipsets are the same as wifi chipsets, the ODM perception of the

[CE] embedded market completely changes,” he says.

But if the claims of Coresonic are to be believed, the cost of adding WiMAX connec-tivity to CE devices will be much lower than the $8 level envisaged by Singh. “Because our solution is so small and low power, the incre-mental cost to someone else’s chip is less than $1 in terms of additional silicon area,” claims Rick Clucas, Coresonic CEO. In fact, he argues the incremental manufacturing cost of using its solution could drop as low as $0.20—if the volumes are high enough—when added to an SoC and using an existing CPU (in the SoC) to run the MAC layer.

Talk of SDR (software-defined radio) base stations has been around for some time. SDR, as Nomura Bank analyst Richard Windsor points out, is “one of the holy grails of the infrastructure business”. This is because radio access, through SDR, can be implemented in software rather than in custom chips. “SDR gives the vendor the ability to upgrade or change the technology at any time,” he says.

Developments costs at the chipset level have hindered SDR development in the past, but there now seems to be growing support among the supplier and operator communities. At MWC 2009, Hong Kong operator CSL announced it had selected an SDR solution from Chinese vendor ZTE.

One of the leading chipset exponents of SDR base stations is UK-headquartered picoChip, which describes itself as the only WiMAX chipset company focused exclusively on the infrastructure market. The logic of an SDR approach is compelling, says Rupert Baines, marketing director at picoChip. “If you design a chipset for handsets, the ownership cycle means you will throw it away for the latest features with the latest chips inside a year or two,” he says. “But it’s a much longer lifecycle for base stations as you need infrastructure for between five and ten years. Anyone who has got an ASIC-based solution for base stations is basically saying ‘we’re only in this for the short term,.”

Baines says base station software upgrades from the 802.16d to the 80-2.16e standard has already been proved through Airspan, a base station supplier customer of picoChip. ‘It’s a pure software upgrade,” he says. “Yes, it’s bloody hard work and really complicated software but that’s the nature of

the beast. The pain is ours in the development rather than our customers’ pain.”

While picoChip counts Intel, Fujitsu, AT4 Wireless, Samsung and Motorola among its customers, there is some still some reservation about the SDR approach among some suppliers. “picoChip’s approach is technologically appealing but alas it is difficult to adopt in a practical R&D environment,” says Ashish Sharma, corporate VP of market development at Alvarion. “It takes quite some time to train engineers to use it and typically DSP engineers prefer to work on mainstream processors.”

picoChip remains undaunted and is developing products for software upgrades, not only between different WiMAX standards but also from 3G to WiMAX or LTE—and even from WiMAX to LTE—should the operator want that flexibility.

However, Monica Paolini, founder and president of Senza Fili Consulting, warns that making the transition between different air interfaces will not be as easy as it sounds. “At a chipset level, suppliers may say they have cracked the problem of software upgrades but there are other hardware issues at stake,” she says. “The base station would have to be closed down for 3G and start functioning as ‘4G’, which will affect the radio reach. And SISO to MIMO necessarily requires more hardware.” (See Monica Paolini’s feature, No painless upgrade to 4G, pages 28-32.)

Is now the time for SDR base stations?


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Taiwan, which can address a global market with Beceem chips.”

Coresonic, headquartered in Sweden, is not a chipset maker in its own right. It is an IP (intellectual property) semiconductor company that licences its programmable architecture to companies further up the eco-system—the chipset suppliers—so they can manufacture SoC silicon that has an extremely efficient and cost-effective baseband component for processing applications.

Dubbed LeoCore, Coresonic’s baseband architecture can support a range of wire-less standards—including 3G/HSPA and DVB-T/H—plus protocol-specific firmware, but it is in the WiMAX-enabled CE device market, where Clucas sees one of the biggest opportunities. One reason for that, he says, is because baseband competition for CE chipsets is far less fierce than in the cellular chipset market, where the ecosystem relationships—from mobile operators through to OEMs and ODMs—are much more entrenched. Clucas sees chipset makers for CE devices, rather than the WiMAX chipset makers, as his main addressable market.

The Swedish company makes a number of bold claims in its ‘LeoCore WiMAX Personal-ity Pack’ literature. One is that the company’s complete Mobile WiMAX solution (from the RF interface through to the central proces-sor interface) can be implemented in a 65nm design using less than 1.5sqmm of additional silicon. Moreover, says Coresonic, Mobile WiMAX (using MIMO) will only require a maximum clock speed of 250MHz to run on LeoCore, which, along with a ‘very small gate count’, translates to a power consumption of less than 50mW in a 65nm process. And if you factor in power management and real-life us-age patterns, continues the Coresonic market-

ing pitch, then power consumption would be a fraction of this.

“The solution we are offering is so radically smaller and much more efficient than anything else available on the market that we have had potential customers coming up to us saying they didn’t believe it,” says Clucas. “That’s why we put a platform together to demonstrate it [at WiMAX World 2008, held in Chicago, September 2008].”

Coresonic still has its detractors and sceptics. Beceem’s Johnsson finds Clucas’ incremental cost claim of $1 and below as “simply not credible”.

But Coresonic would have the last laugh if it could make good on its promises, and Clucas ex-pects the market to eventually vindicate LeoCore. “You might see chipsets [using LeoCore] by the end of 2009 with commercial products available in the 2010 timeframe,” he says. “This fits in with the time when WiMAX rollouts will be mature.”

More specialisationHow will the WiMAX chipset market likely de-velop? Wavesat’s Singh says that chipset suppliers will try and differentiate more through greater specialisation as the WiMAX market grows. “As with all nascent markets, there is a bunch of start-ups but there isn’t enough granularity of definition to segment it,” he says. “There isn’t a big enough market to do multiple chips, so everyone has one chipset, occasionally two.”

As the WiMAX market develops and grows, a single chip for all uses becomes less practical. “The requirements of a CPE in terms of memory and processing power are significantly differ-ent from the requirements of a handset,” says Singh. “You are going to get a scenario where companies will have to bifurcate their product lines and do multiple things; one chipset design for handsets, one for more powerful CPEs, and a more integrated chipset for laptops.”

Singh says the CE market is promising, as are home base stations. “The femtocell market may well be the killer app that makes this thing really take off,” he says. “If you are inside the home, and your operator can give you five bars of signals on your cell phone, you actually have no reason to have a home line.”

Wifi is unmanaged spectrum, and for pen-etrating walls it is not ideal, so WiMAX should have an advantage argues Singh. “We’re ship-ping for femtocell usage today using existing silicon,” he says. “It’s not completely optimised but it is a solution. In two or three years’ time, we could have two or three product lines but you need to have big enough markets that can support each of them.”

One burden that the smaller chipset compa-nies might find difficult to bear is to scale up adequately to develop ever more sophisticated software that will be required to interoperate with more and more players. While Wavesat falls into the 70-100 employee bracket, Singh ruefully points out that Broadcom has a 300-stong team working on software development alone for its wifi chipsets.

But while WiMAX supporters typically talk about having a much more developed chipset eco-system than LTE, that advantage may well be short lived, says Paolini. “A lot of WiMAX chipset vendors are getting ready for LTE as they too want to keep their options open,” she says. “It’s compelling for them to do that, because a lot of the work that they’ve done on WiMAX is going to be done for LTE as well. Yes, the uplink is different, but there are a lot of commonalities. Once you have a WiMAX chipset, adding LTE doesn’t cost huge amounts. And it’s a way to address a market that’s going to be bigger. I think all of them, eventually, will have a WiMAX/LTE product.”

WiMAX device chipset definitions• WiMAX device chipset: A chipset that is based on or evolving to IEEE 802.16 standards—specifically 802.16-2004 and/or 802.16e-2005—and which is embedded in a device that a WiMAX subscriber uses to access a WiMAX service. Furthermore, the chipset typically consists of both RF/IF and baseband components.• RF/IF: A radio frequency integrated circuit and associated intermediate frequency components used in a WiMAX chipset, including the RF transceiver, power amplifier and power management. The RF/IF component is built to, or evolving to, IEEE 802.16 standards—specifically 802.16-2004 and/or 802.16e-2005—and operates in WiMAX spectrum, such as bands in and around 2.3GHz, 2.5GHz, 3.5GHz and/or 5.8GHz.• Baseband: A baseband integrated circuit used in a WiMAX chipset, including the associated memory and other components supporting key baseband functions such as MAc (media access control). The baseband component is built to or evolving to IEEE 802.16 standards, specifically 802.16-2004 and/or 802.16e-2005.

Source: Informa Telecoms & Media


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The transition to 4G technologies appears ineluctable and the near universal con-sensus is that 4G technologies—no mat-

ter how you defi ne the term ‘4G’, which is still a matter of debate—will all be based on OFDMA, at least in the downlink.

CDMA-based 2G and 3G still have a long life ahead of them and will continue to dominate the voice market for many years to come. No operator is in a hurry to dismantle their GSM networks to replace them with WiMAX or LTE. At the same time, the evolution of CDMA-based technologies has reached its natural end. Th ey are not as spectrally effi cient as OFDMA

technologies. Being optimised for voice services, they are not well suited to support wireless broadband connectivity. Finally the use of nar-row channels limits their capacity and increases the cost-per-bit in network deployments.

What is involved in the transition to 4G is becoming a hot discussion topic, especially when vendors are in the room. Trying to diff use wor-ries that 4G may turn out to be a repetition of the 3G experience (long delays, high capex, few devices and, eventually, a slow adoption growth path), some vendors are marketing solutions that promise to minimise the pain of the technology upgrade.

Can soft ware upgrades delay some of the hardware replacements? Which core network elements can be shared or re-used? Could you preserve your current platform—and presum-ably the vendor—to upgrade with a few, minor equipment changes (eg, change the radios only)?

Th ese are all very important questions as op-erators move into more detailed planning of how to deploy new networks or how to upgrade from the existing ones. For instance, can operators that plan to move from CDMA to LTE benefi t from an interim migration to HSPA? Which technology, WiMAX or LTE, is better suited for operators given their timing, market targets,

No painless upgrade to 4G

The upgrade to WiMAX or LTE requires a new overlay network, not just software upgradesBy Monica Paolini

28-30_WiMAXVision_April09.indd 28 30/3/09 10:11:15


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service planned and business model? The effort and costs involved in the transition has a huge impact on the operator’s decision.

More than software upgradesThe transition to WiMAX and LTE is not going to be a simple software upgrade. Some network elements can be re-purposed or shared but, in many cases, even this is not going to be cost-effective or desirable (see adjacent figure). In most cases operators will find that an overlay network is going to be the only suitable solution for multiple reasons:• Wireless interface: base stations and susb-

scriber devices. WiMAX and LTE use a new wireless interface that requires an entirely new radioa access network and new subscriber de-vices. The equipment already deployed that is a target for upgrades has been in operation for some time and will often not accommodate the power requirements of OFDMA technolo-

gies supporting MIMO or beamforming. Even if the new base station models use a platform that will in the future accommodate new tech-nologies, the ones currently deployed typically do not.

• Spectrum. WiMAX and LTE are almost exclusively deployed in newly acquired or unused spectrum bands. As a result, at a minimum, a new radio and new antennas (especially if moving to MIMO and/or beam-forming) are required.

• Cell locations. Operators may need to invest in new cell towers or rent additional locations to support OFDMA technology. Using a new spectrum band limits the ability to share base station locations and cell towers. Spacing between base stations depends heavily on the technology used and spectrum frequency. Moving to a higher frequency will require a more dense concentration of base stations, other things being equal. Operators will clearly benefit from sharing as many cell loca-tions with cellular legacy technologies as pos-sible, but this is not going to be cost-effective and spectrally efficient as different spectrum bands are used. Furthermore, antenna size and placement vary greatly depending on the frequency used, and the target tower may not have room to accommodate the new anten-nas. This is rapidly becoming a major issue as the equipment deployed increases and space and permits available for the construction of new towers are limited.

• Legacy networks. Wisely, operators want to extract all the value they can from existing networks. 2G cellular networks have enjoyed a long life span and they are still responsible for most of operators’ revenue—and even more so profit—as they are efficient at carrying voice and SMS traffic. When planning a new

WiMAX or LTE network, operators typically do not have network infrastructure to re-use.

• Core network elements. While some ele-ments of the network (eg, the AAA or the billing management) may be shared in some network environments, most of the core network elements need to be duplicated or replaced and this in fact will result in a more powerful but less complex IP-based core network with a flatter hierarchy.

• Backhaul. 3G networks are already suffering from a backhaul bottlenecks at cell sites that have a backhaul infrastructure inherited from 2G networks. OFDMA technologies like WiMAX and LTE bring a much higher capac-ity in the network that translates into higher volume of traffic to backhaul. Simply adding T1 connections will not suffice and operators will often need to adopt new backhaul solu-tions to accommodate the new traffic.

There are some welcome advantages in comparison to the evolution from 2G to 3G. Most vendors are working on modular base station form factors that provide operators with increased flexibility in the future to upgrade their networks. Operators can also gradually increase the size of the transmis-sion channels as they gain more spectrum allocations within the same band or gradually migrate from one technology to another. The increasing availability of microcells, pico-cells and femtocells also widens the choice in network architecture, and it is likely to bring higher network efficiency and capacity, along with cost reductions.

Backward compatibility? The move to 4G is going to be disruptive, regardless of the technology—WiMAX or

Mature technologies

2G: GSM, CDMA

3G: EV-DO, HSPA

Wi-Fi

Fixed WiMAX

Next-generationtechnologiesMobile WiMAX

(IEEE 802.16e, 802.16m)

LTE

New:Spectrum band

Wireless interfaceRAN infrastructure

DevicesHigh-capacity backhaul

Shared with legacy networks:Some core network elements

Some cell locations

4G upgrade requirements

Source: Senza Fili Consulting


feature


LTE—selected. The new wireless interfaces and IP core bring a much-improved cost framework and spectral efficiency, but the downside is that there will be no backward compatibility within the RAN between 2G/3G and OFDMA technologies.

But this does not mean that WiMAX and LTE networks will operate in isolation from cellular, wifi or wireline networks. In fact, much more so than in the past, there will be closer integra-tion across multiple technologies, as no single technology can single-handedly address the demand for subscribers to have both voice and broadband data services available everywhere on any device they own.

The integration will not happen in the RAN, but within the subscriber devices and the core networks. Increasingly, devices will support

multiple wireless interfaces that allow subscribers to connect to the best network available, based on their preferences, operator’s policy, and coverage. At the other end, interworking and roaming will be increasingly common among networks as a way to provide better domestic and international coverage and to increase the efficiency in the use of network resources.

Overlay network integrationThere is no dominant up-grade path to 4G technolo-gies. Different operators are pursuing different plans, which are based on:•Current and expected traffic demand. This is rap-idly changing as individual traffic levels have started to grow faster with the wider

availability of data-friendly devices like the iPhone, and of off-deck applications.

• Existing infrastructure and its upgrad-ability. Operators are trying to extract as much value as possible from their 3G networks by upgrading to HSPA. Upgrades to HSPA+ in many cases are not cost ef-fective as they require significant equip-ment upgrades to accommodate MIMO, as Darren McQueen, vice president of wireless broadband access technologies at Motorola, points out. In this case, a WiMAX or LTE overlay network may be more cost-effective. For many 2G cellular operators a transi-tion to 3G ahead of the upgrade to WiMAX or LTE may be difficult to justify in terms of cost and efficient use of spectrum. Leapfrogging 3G may give 2G operators the

opportunity to be among the first to deploy OFDMA technology, and move earlier to a leaner IP core network.

• Spectrum and funding availability. In many markets WiMAX and LTE spectrum in the 2.5-2.7GHz band has not yet been assigned and many operators welcome this as it gives them more time to prepare to move to 4G. Funding limitations both due to the current financial environment and to the recent huge—and unprofitable so far—investments in 3G are likely to push deployments further out in the future.

These factors will determine which technol-ogy operators will adopt and when. The costs and efforts required to upgrade from a 2G or 3G network to WiMAX or LTE are largely the same. There are “no profound differences” ac-cording to Jim Orr, principal technical architect at Fujitsu.

The different choices among operators mostly stem from their requirements. LTE is based on a standard developed mostly by 2G and 3G cellular operators and vendors to pro-vide them with a path to OFDMA. The WiMAX standard was developed by a broader ecosystem that also included IT and, more specifically, wifi vendors, which have provided the momentum to bring the flat all-IP architecture to mobile communications.

Operators that choose WiMAX have the op-portunity to be among the first to operate an IP mobile network and will be able to roll out their network sooner, as LTE equipment is still not commercially available. But in either case, the transition to OFDMA will require the introduc-tion of new radio equipment, devices and a new core network.

Monica Paolini is the founder and president of Senza Fili Consulting and can be contacted at [email protected]. Senza Fili Consulting provides expert advisory services on wireless data technologies and services.

Greenfield operators do not have to worry about a legacy infrastructure that has to be integrated with the new OFDMA networks and can enjoy more flexibility. At the same time, many greenfield operators are actively working with cellular operators on roaming arrangements that will provide WiMAX operators wider coverage, especially during the deployment stage.

The earlier availability makes WiMAX the obvious choice in the short term for many greenfield operators. Even in the long term, however, we expect greenfield operators to prefer WiMAX as its ecosystem is more closely aligned with their business models as aggressive new entrants trying to secure a sizable market share with better performance, wider choice of devices and more affordable prices before incumbent operators enter the market with their 4G networks.

WiMAX attraction for greenfield operators

GSM/HSPAcore network

GSM/HSPA

Wi-Fi

WiMAX

LTE

Backhaul to core network

Multimode devicesIntegration and roaming

across networks

Traffic aggregation

CDMA/EV-DO CDMA/EV-DO

core network

Wi-Fi network

Wi-Ficore network

LTEcore network

Multimode device roaming

Source: Senza Fili Consulting


For subscription enquiries contact Sophie Burdajewicz: Head of Marketing: [email protected] For advertising enquiries contact Tim Banham: Publisher: T: +44 (0)207 017 5218: E: [email protected]

By the time you finished walking Rover $224,663 will have been spent on WiMAX products.

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WiMAX goes Dutch

Industry watchers will be monitoring the progress of Worldmax with keen interest. If this Mobile WiMAX operator can make inroads

into the highly competitive and mature Dutch broadband market, it would force a rethink of the view—widely held among analysts—that the best chance for WiMAX success lies only in developing economies.

Jeanine Van der Vlist, Worldmax CEO, is con� dent that the business case is built on realistic assumptions. “We only need to have a 3-5 percent penetration of households to break even from an operational point of view,” she says.

A privately-held company, Worldmax counts Intel Capital and Green� eld Capital Partners among its investors, although the amount ploughed into

the company has not been disclosed. � e company has access to a he� y 80MHz chunk of spectrum in the 3.5GHz frequency band, courtesy of Enertel Holding (owned by Green� eld Capital partners), which bought the licence as far back as 2003.

� ere appears to have been prolonged delibera-tion among Worldmax management about how best to use the 3.5GHz spectrum. Although Worldmax announced in February 2007 it had selected Motorola to run a Mobile WiMAX pilot, the relationship didn’t develop into commercial rollout. Instead, Alcatel-Lucent was paraded a year later as Worldmax’s Mobile WiMAX vendor of choice. In June 2008 Worldmax started commercial operations in Amsterdam, a launch timed to coincide with the WiMAX Forum Global Congress event held in the Dutch capital.

Worldmax has launched commercial Mobile WiMAX in the Netherlands and the telecom world is watching

By Ken Wieland

� e initial rollout focus is Amsterdam, where 65 Alcatel-Lucent 802.16e base stations provide coverage across 50 square kilometres. � is gives a population reach of 360,000. “We are happy with the network performance and the level of indoor and outdoor coverage,” says Van der Vlist, adding that network capex to date is around €2m. “In fact,” she continues, “the network is performing slightly better than we had expected.”

Worldmax launched its Aerea 2.0 service in October 2008, upping its maximum downlink speed at the time from 1Mbps (Aerea 1.0) to 2Mbps. But Worldmax hasn’t been slow in adding new and faster products. Shortly a� er Aerea 2.0 the operator released Aerea 5.0, which o� ers 5Mbps on the downlink and 256Kbps on the uplink. And, in March 2009, Worldmax unveiled Aerea 8.0, which gives subscribers an 8Mbps/800Kbps service. Worldmax is clearly taking the battle to the country’s three mobile operators, which o� er HSPDA nationwide. Although HSDPA can give as much as 7.2Mbps on the move, the speed drops according to how busy the base station is.

“Our speeds are guaranteed, even at the edge of the cell,” asserts Van der Vlist. “It’s not a best-e� ort service, which the traditional 3G operators o� er. WiMAX is also a true internet technology, which means we can o� er higher speeds and better performance at a much lower cost [than mobile operators]. � at makes us more competitive.”

Van der Vlist says that as the Mobile WiMAX net-work is “built for really high capacity”, Worldmax can crank up end-user data speeds to between 10Mbps and 15Mps through the use of MIMO and other speed-boosting techniques. And as part of its promo-tional e� orts for its WIMAX USB dongle, launched in October 2008, Worldmax went out of its way to � ex its high-capacity network muscles by challenging cus-tomers to download as much as 10GB of data in one day. Although overtly a competition—the customer who could download the most data in one day won an Asus notebook—Worldmax was also emphasising its di� erent market positioning from mobile operators by associating itself with ‘unlimited’ data usage.

Tari� s for the Worldmax service, branded ‘Aerea’, range from €14.95 per month for 512Kbps on the downlink and 128Kbps on the uplink (dubbed Aerea 0.5), through to €39.95 per month for 8Mbps/800Kbps (Aerea 8.0), which can be purchased on a post-paid or pre-paid basis. � ere are no compulsory long-term-contract obligations for any of the Aerea packages. And like Clearwire in the US, there are daily and weekly rates designed to make it more attractive for customers to use the service when it is convenient for them. � e single day rate for Aerea 5.0(5Mbps/256Kbps) is €7, while one week is charged at €14.50. At the time of going to

34-35_WiMAXVision_Feb09.indd 32 31/3/09 15:01:32


We only need to have a 3-5 percent penetration of households to break even from an operational point of viewJeanine Van der Vlist, Worldmax

Selected mobile data packages in the Netherlands

Provider Name Monthly fee Contract Speed Usage limit End user device

KPN Instap 17.50 1 year 768Kbps 200MB 39.95

KPN Totaal plus 45.00 1 year 1.53Mbps Fair use free

Vodafone Nat.standaard Vast 19 1 year 768Kbps 400MB free

Vodafone Nat super fast 49.95 1 year 1.024Mbps 2.5GB free

T-Mobile Laptop economy 19.95 1 year 1.024Mbps 250MB 99.90

T-Mobile Laptop business 34.95 1 year 2.048Mps 1GB 99.90

Packages on offer as of 27th November 2008 Source: Worldmax

press, Worldmax had not yet announced its daily and weekly rates for Aerea 8.0.

Worldmax gives some � nancial incentive to persuade customers to sign up longer term. If an Aerea customer commits to a 12-month contract, the USB dongle comes free. Otherwise it retails for €89.95 if customers don’t make any commitment beyond one month.

But while the Worldmax tari� s look more attrac-tive and more � exible compared with those o� ered by mobile operators (see table), the Netherlands—and Amsterdam in particular—o� ers another chal-lenge to the Intel-backed operator: FTTH (� bre-to-the-home), which can o� er as much as 100Mbps symmetrical data rates, along with FTTN (� bre-to-the-node) plus VDSL—which can typically o� er up to 50Mbps on the downlink—is gaining traction.

A FTTH project backed by the City of Amsterdam (CityNet) is in the process of hooking up 40,000 households with � bre in one of the city’s districts. CityNet’s plan is to eventually connect all households with � bre in the Dutch capital, which translates into around 400,000 ‘last mile’ � bre connections.

And in September 2008, KPN, the country’s � xed-line incumbent, announced it had signed a three-year deal with Alcatel-Lucent—Worldmax’s supplier of Mobile WiMAX kit no less—to roll out FTTN plus VDSL2 in the Netherlands’ major towns and cities. FTTH and FTTN developments of this sort add to an already well-developed broadband market in terms of ADSL and cable adoption. According to Informa Telecoms & Media, the Neth-erlands had a 76.7 percent broadband penetration of households by the end of 2007, which translates into 5.6 million broadband subscriptions.

“FTTH will happen, as will high-speed ADSL and VDSL, because people will want to connect it to their TV screens,” acknowledges Van der Vlist. “But these connections are limited to the house. As soon

as you go out of the house, where wi� is out of reach, you will still need access to mobile broadband. � at’s where we see our o� er really going—to � ll that gap.”

Van der Vlist doesn’t rule out partnerships with FTTN and FTTN providers to o� er a bundled package of Mobile WIMAX and a high-speed home service. � is could either be with Worldmax acting as a retailer or providing wholesale capacity to other service providers. “Nothing is written in stone,” says the Worldmax CEO.

Testing the Amsterdam watersWorldmax has ambitions to extend WiMAX cover-age beyond Amsterdam, but will only do so once it has honed its marketing strategy. “We’re really testing out how the market is reacting,” says Van der Vlist. “� e process will last until mid-2009 and then we’ll build out a nationwide network, which we expect to complete in the 2013-14 timeframe.”

Van der Vlist says Worldmax is attracting a lot of interest from “young techies” and students. More un-expectedly, she says, is the high level of interest among small businesses. � e CEO would not be drawn on disclosing actual subscriber numbers, however, other than to say “it’s going according to plan”.

What isn’t part of the business plan are PC cards. Although one was initially available with the Aerea 0.5 and Aerea 1.0 service, the faster Aerea services don’t support it. “We discontinued the PC card because there aren’t a lot of notebooks out there that can support it,” says Van der Vlist. “It’s easier for us to distribute USB dongles [for our nomadic service].”

So far, the USB dongle choice is limited to one (and only available to order online). Although brand-ed as Alcatel-Lucent, the dongle is manufactured by Quanta, an ODM based in Taiwan. Van der Vlist does not reveal the extent of subsidy on the end-user device, but does say she is looking forward to when WiMAX-embedded laptops become available due

to the greater convenience it gives to the customer. “We’re expecting the � rst WiMAX-embedded note-books [at 3.5GHz] to arrive in the Dutch market in the second half of 2009,” says Van der Vlist.

End-user device variety, with a range of price points, will be key to stimulating nascent WiMAX markets. And while Mobile WiMAX at 2.5GHz is getting a lot of attention from OEMs/ODMs of CPE and end-user devices—primarily because of Clear-wire’s e� orts in the US— 3.5GHz is arguably being le� behind. Van der Vlist is diplomatic. “We’re happy with the devices we currently have, but we are less satis� ed with the speed new devices are becoming available,” she says. “We would like to see more.”

Although the Mobile WiMAX certi� cation proc-ess at 3.5GHz has already started, Van der Vlist says IOT is more important than certi� cation. “It gives us the certainty that the CPE and end-user devices will work well with the network. Certi� cation is a nice to have, but I am pleased with the IOT work done by Alcatel-Lucent [with its Open CPE programme].”

As well as WiMAX-embedded notebooks, Van der Vlist expects PDAs and UMPCs to become available this year; Worldmax has also started to extend its de-vice distribution channels from online to independ-ent retail outlets as of the end of 2008. “I’m pleased with the device roadmap’” adds Van der Vlist.

Worldmax’s 3.5GHz licence did not originally permit true mobility services. However, a decision by the EC (European Commission), which came into ef-fect in November 2008, allows all EU member states to o� er mobile services at 3.5GHz. It’s a development that Van der Vlist welcomes but she doesn’t see mobility as immediately crucial for the Worldmax business case, which is currently focused on � xed and nomadic us-age. “Mobility starts to become more important when WiMAX mobile telephony handsets become available and there is wider network coverage,” she says. “� at will happen in a couple of years’ time.”



Digicel puts its faith in WiMAX

Digicel, a pan-Caribbean and Central Amer-ican mobile operator headquartered in Jamaica, provides the WIMAX camp with

powerful PR ammunition. A� er all, this is a GSM player that has eschewed the 3G path and placed its bets on WiMAX. Digicel has ambitious plans to o� er bundled packages of broadband (nomadic, � xed and mobile) and multimedia applications to businesses and consumers—combined with its cellular voice service—and is looking to WiMAX to ful� l those ambitions.

“4G is available with WiMAX now and we just don’t know when LTE is going to happen,” says Magnus Johansson, broadband director for the Digicel Group. “We can also emulate a range of classic landline services with WiMAX, such as frame relay, POTS, ADSL and cable broadband. WiMAX o� ers us the whole service pie that we couldn’t touch with 3G. It’s about as close as you can get to a one size � ts all.”

Part of the WiMAX attraction for Johansson is that, unlike 3G, it o� ers quality of service and security support. � is enables Digicel to o� er SLAs to business customers and provide a good quality residential service. WiMAX is also a ‘� at’ overlay IP architecture, which lowers the opex bill. “We didn’t want to integrate another network with our GSM network,” adds Johansson. “We wanted to leave the GSM network as it is.”

And Digicel has ambitions that go beyond being a ‘traditional wireless service provider’. Following on from its award of a Jamaica-wide subscriber

television (STV) licence by the Broadcasting Com-mission of Jamaica in November 2008, Digicel is part of a consortium that plans to roll out ‘DigiTV’ during 2009 over DVB-T (digital video broadcast-ing-terrestrial) networks. It now describes itself as a ‘wireless media company’ and has plans to converge GSM, WiMAX and DVB-T networks to o� er bundled packages.

Moving into triple- and quad-play services is Digicel’s response to customer demand. According to a Technology Usage & Attitudes Study in Jamaica, conducted by Marketing Strategy in January 2007, it was found that 87 percent of respondents had a ‘high level of interest’ in a bundled package comprising high-speed wireless access, voice and mobile services.

WiMAX rollout so farDigicel has more than 6.5 million mobile subscrib-ers across its GSM footprint, which covers a total of 31 countries. But it is in Jamaica and Grand Cay-man where the company � rst started its commercial WIMAX operations in 2006, using 802.16d and pre-certi� ed 802.16e kit respectively.

And having a GSM network already in place has helped to lower Digicel’s WiMAX deployment cost considerably since it can use its 2G tower sites to locate WiMAX base stations. “� e WiMAX business case, as an overlay, is fantastic,” says Johansson.

In Jamaica, since April 2007, Digicel has been offering services, via 802.16d in 3.5MHz

channels, targeted at business customers using infrastructure from Alvarion.

Helped in some part by what Digicel describes as a ‘high level of dissatisfaction’ with the incum-bent telco, it has managed to penetrate about 80 percent of Jamaica’s large business market and capture about 20 percent market share of all businesses within the space of 15 months. Digicel o� ers a variety of ‘plug and play’ services in Jamaica over its 802.16d equipment, which typi-cally undercut the total price of the incumbent’s equivalent products (in terms of speed).

� is might seem overly generous of Digicel, particularly as WiMAX operators in emerging markets tend to charge a bit higher than rival o� erings on the grounds of being a premium product, particularly in relation to quicker instal-lation times. But the market dynamics are di� erent in Jamaica, says Johansson. “Business customers feel they are being ripped o� [by the incumbent]; while we are o� ering a cheaper service, it is still priced at a level that makes business sense for us,” he says.

� e WiMAX-enabled business services o� ered by Digicel in Jamaica include a best-e� ort wireless subscriber line service at 1-3Mbps; a dedicated internet access service of 1-5Mbps; a private data VPN service of 256Kbps-3Mbps; and a business voice service, which o� ers up to 30 channels. In addition, Digicel o� ers a bundled GSM and WiMAX service, with voice billing done on a per-second basis—by contrast, the incumbent’s voice

Pan–Caribbean GSM operator leapfrogs 3G and takes the WiMAX route to mobile broadband By Ken Wieland



How much spectrum is enough?

For WiMAX operators to have any chance of business case success, the WiMAX Forum recommends that a 30MHz chunk of spectrum should be the minimum allocation.

Yet Magnus Johansson, broadband director for the Digicel Group, believes that 30MHz is not nearly enough. Having already deployed 802.16d and 802.16e WiMAX networks in Grand Cayman and Jamaica, and with plans to extend its WiMAX presence still further, the Digicel strategy is to complement its GSM operations by becoming the ‘third pipe’ alternative to leased line, ADSL, cable and LTE.

But while Digicel aims to offer corporate and a mass market consumer services via

WiMAX for fi xed and nomadic broadband services (with plans to move to full mobility over WiMAX later), its ambitions could be thwarted by a lack of spectrum. “Unless we get 50-60MHz, it’s going to be hard to justify the business plan,” says Johansson. He argues that regulators need to rethink their spectrum allocation strategy if they are to fulfi l their goals of stimulating competition and driving broadband adoption. “I’m not just talking on behalf of Digicel,” he says. “This has wider importance.”

Given the tendency of regulators to slice and dice spectrum, usually through an auction process, Johansson’s proposals sound radical. Ideally, he would like the

2.5GHz frequency band—which contains 190MHz of spectrum—to be split into a maximum of three contiguous blocks. For the 2.3GHz band, which has 100MHz, Johansson would like to see that handed out into two contiguous blocks.

“For countries with low fi xed-line penetration and vision for universal access, the regulator should not enact arbitrary spectrum caps which could impede an operator’s ability to compete, or render the business case and investment too risky to pursue,” argues Johansson. “I have to have some kind of assurance that if I run out of spectrum there is more. If not, I am a sitting duck as I cannot increase my speeds. I am at a dead end.”

4G is available with WiMAX now and we just don’t know when LTE is going to happenMagnus Johansson, Digicel

billing is done on a per-minute basis. � e end result, says Digicel, is an annual churn rate of less than one percent among its business customers in Jamaica.

And while Digicel, as a privately-held com-pany, doesn’t disclose any revenue figures, it points to an annual decline in the incumbent’s revenues by 16 percent (a drop of $47m) for its 2007/08 fiscal year in the areas where Digicel is competing in order to highlight the scale of its own success in Jamaica.

Using QAM64 modulation, Johansson says Digi-cel is achieving base sector cell capacity of 10Mbps on the downlink and 10Mbps on the uplink with its 802.16d kit, yet all corporate customers require an outdoor CPE to access what Digicel calls its ‘� rst generation product portfolio’. � e next phase is to branch out into the personal broadband and PSTN markets using a nationwide 802.16e network, should Digicel manage to acquire one of four licenses being auctioned out in Jamaica come February 2009.

In Grand Cayman, Digicel has already entered its second phase with pre-certi� ed 802.16e kit from Alvarion using spectrum in the 2.3GHz frequency band. Launching a residential broad-band service on the island in September 2007 in a market where Digicel says the incumbent generates a ‘fairly high level of satisfaction’ among its broadband customers, it still managed to gain a 25 percent market share of the � xed broadband market within 180 days.

The marketing emphasis for Digicel’s broad-band service, which does not require an outdoor CPE modem and is available nationwide, has been on simplicity: the modem can be purchased at a dealer store and offers what Digicel describes as a ‘true plug & play experience’ in the home with no drivers to install and a set-up time of around three minutes.

To encourage customer loyalty in Grand Cayman, Digicel offers bundled packages of broadband and GSM at a discount of 20-30 per-cent compared to if the services were purchased separately. In December 2008 Digicel launched its pre-paid broadband service, which is fully integrated with its GSM pre-paid billing system allowing broadband customers to utilise all the top-up methods available for GSM. “The intro-duction of pre-paid broadband will open up the market to a whole new set of subscribers that no one could address earlier,” says Johansson. With the pre-paid offering Digicel’s subscribers can now top up for unlimited access, ranging from one day up to 90 days.

Going forward, Digicel sees Mobile WiMAX as key in developing attractive triple- and quad-play packages across its footprint, although the extent of that opportunity will clearly depend on spectrum availability. In August 2008, Digicel acquired a 2.5GHz licence in Honduras for $2m and Johansson says that the company has ‘several RFPs out [for spectrum] in other markets with responses scheduled for 1Q 2009’.

What is certain is that Alvarion will be a key partner for Digicel in rolling out 802.16e networks in the Caribbean. In April 2008, the Digicel Group announced a ‘master supply agreement’ with the Israel-headquartered WiMAX vendor, for an undisclosed sum, to deploy Mobile WiMAX across the Caribbean region over the next few years. Alvarion is cur-rently in the process of firmware upgrading the pre-certified 802.16e infrastructure and CPE in Grand Cayman to be fully WiMAX Forum certi-fied in Q1 2009.

� e widening spread of certi� ed equipment and increased volumes are already pushing down CPE prices down, which is making the WiMAX business case more attractive. “� e indoor CPE modem price points are closer to $100 and this year I think it will go below $100,” says Johansson. “My target is $75 by the end of 2009.”

But if Mobile WiMAX does become more pervasive, and capable of delivering voice, does that mean the end of the line for the GSM network? “No,” says Johansson, “because you are always going to get areas where you don’t need full-blown WiMAX. There will be a blend between the two networks.”

Neither does Johansson envisage revenue cannibalisation through GSM voice subscribers migrating to VoIP over WiMAX. “If there is voice revenue cannibalisation, the upside more than beats the downside because it will mean a higher number of broadband subscriptions,” he says.


MARKET


Far-reaching regulatory changes look set to heat up broadband competition in South Africa. How far this will improve WiMAX

prospects remains less certain, particularly as the debate about how to allocate 2.6GHz and 3.5GHz licences is proving to be divisive and prolonged.

Yet South Africa’s telecom landscape is undergo-ing seismic change.

� e policy of ‘managed liberalisation’, pursued by communications minister Ivy Matsepe-Casaburrri—one which favoured existing network operators as it gave them some protection from increased competition—was e� ectively blocked by a ruling

from the country’s high court in August 2008. Altech, a South African telecoms and media

company, had taken its case to court that its Autop-age subsidiary—which holds a VANS (value-added-networks services) licence—should be able to build its own infrastructure. � e high court ruled in Altech’s favour and, by doing so, ruled against the status quo in South Africa’s telecom markets.

� e high court decision means that all VANS licence holders in South Africa, and there are more than 300, can now ‘self-provide’ or build their own networks. � ey are no longer obliged to lease backbone capacity from either the country’s two

� xed-line operators (Telkom and Neotel), or the three mobile network operators (Vodacom, MTN and Cell C).

And given that the government has minority stakes in Telkom, Neotel and Vodacom, the VANS licence holders no doubt feared that Matsepe-Casa-burri’s policy of ‘managed liberalisation’ would mean that 2.6GHz and 3.5GHz licence allocations would more than likely bene� t the incumbent players and limit competition. � e high court ruling means that South Africa’s VANS players can convert their licences into ECNS (electronic communications network services) licences. � is is important since having ECNS status is one of the pre-conditions of being able to apply for either a 2.6GHz or 3.5GHz licence.

To rub salt into the government’s wounds, a high court judge, in November 2008, rejected Matsepe-Casaburrri’s personal appeal against the August ruling, underlining the right of ICA-SA, the country’s regulator, to convert VANS licences into ECNS licences. Adding insult to injury, Matsepe-Casaburrri was ordered by the high court to pay the full legal costs of lodging her appeal.

Although the Communications Users Associa-tion of South Africa (CUASA) has complained that ICASA is not moving as fast as it should in converting VANS licences into ECNS licences, the regulatory environment is shi� ing in favour of the consumer. More facilities-based competition should help to lower prices, and even if a large majority of new ECNS licence holders decide in the end not to build out their own networks, they will at least be able to strengthen their bargaining position for backhaul capacity with incumbent network operators.

But not everyone is convinced that li� ing the ban on self-provision will stimulate greater broadband competition in South Africa. “It means nothing,” says Alan Knott-Craig Jnr, managing director of iBurst, a broadband wireless service provider in South Africa’s main metropolitan areas. “In fact, ironically, it will slow down deregulation.”

Knott-Craig says he prefers the original 2.6GHz and 3.5GHz licensing plan whereby a select and limited number of companies would be invited to bid for the new licences to self provide. With more than 300 companies now potentially entitled to throw their hats into the ring for the same limited amount of spectrum, Knott-Craig envisages long-running disputes and courtroom battles over how the 2.6GHz and 3.5GHz frequency bands should be allocated. “� e licensing process could be dragged out for years,” he says.

South Africa fi ghts over spectrumRegulatory uncertainty is holding back WiMAX progress in South Africa

By Ken Wieland


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WiMAX [204x277 AD]:WiMAX AD[277x204] 30/3/09 09:09 Page 1

2.6GHz under disputeIn May 2008 ICASA announced a set of guidelines for 2.6GHz spectrum allocation and immediately came under � re. According to the regulator, six nationwide licences of 20MHz are to be o� ered through auction but candidates would � rst need to pass a beauty contest before they could enter the bidding process.

To many industry players, including iBurst’s Knott-Craig, 20MHz is simply not enough on which to build an attractive business case. iBurst already has access to 20MHz at 2.6GHz—which is owned by its parent company WBS Holdings—and does not intend to be part of the 2.6GHz licens-ing process. However, iBurst is very much part of lobbying e� orts directed at ICASA to increase the 2.6GHz spectrum allocation to 30MHz per licence. “If ICASA publishes a policy that says it isn’t feasi-ble to run a network on anything les than 30MHz then we should be entitled, by default, to 30MHz as well,” says Knott-Craig.

Another controversial licensing issue relates to ICASA’s stipulation that bidding consortia for 2.6GHz spectrum, in accordance with the Broad-Based Black Economic Empowerment Act of 2003, should be at least 51 percent black-owned. Some local commentators have expressed concern that building a WiMAX network from scratch will be out of the � nancial reach of black-owned groups, which, in turn, would slow down broadband rollout with spectrum going unused.

Pleasingly for WiMAX supporters, 3.5GHz spectrum is also up for grabs, which is another standardised WiMAX frequency band. ICASA plans to use the same beauty contest and auction combination in this band as it will for 2.6GHz, but they will be regional licences and comprise—according to ICASA’s initial recommendations—2x15MHz spectrum per geographical area. ICASA has stated that between nine and 20 3.5GHz licences will be awarded with the intention of having at least two 3.5GHz operators per local municipality geographical area.

But ICASA, at the time WiMAX Vision went to press, was indicating it could be as late as June 2009 before it reaches a � nal decision on how it will allocate 2.6GHz and 3.5GHz licences. However, as ICASA is embarking on another round of industry consultation, it does at least give some hope to lobbyists that there is still time to sway the South African regulator.

Room for WiMAXBy African standards, South Africa has a well-de-veloped ICT market. In comparison with even mid-

ranking economies in the rest of the world, though, South Africa’s ICT scorecard looks considerably less impressive.

According to EIU (Economist Intelligence Unit) estimates, fixed-line penetration was a meagre 8.2 percent at the end of 2007 (and much lower in non-white households). And in a country where the population is around 48 mil-lion, the number of broadband users, according to the EIU, was barely above 700,000 as of 31 December 2007.

� e paucity of � xed-line broadband infrastruc-ture, combined with high charges for � xed-line calls from incumbent Telkom, has contributed to strong mobile growth in the country. By mid-2008, mobile penetration was in excess of 90 percent.

Given the clear demand for voice and broadband internet—there were around 15 million internet us-ers in South Africa by the end of 2007 according to the EIU—there is substantial potential for WiMAX to ‘� ll the gap’ between supply and demand, not least because Telkom is not obliged to unbundle its copper local loop to competitors. Wireless net-works, in most cases, are the only realistic option for competitors wanting to enter the broadband access markets.

And WiMAX already has a presence in South Africa. Neotel, which has held a second national operator (SNO) licence since December 2005, launched commercial WiMAX services in July 2008. Using 802.16d kit from Telsima in the 3.5GHz band—where Neotel has 2x28MHz spectrum—the SNO o� ers WIMAX as another last mile access option to complement its existing portfolio of enterprise products of � bre access and proprietary point-to-multipoint wireless solutions (10.5GHz) from Cambridge Broadband Networks.

� e WiMAX service that Neotel o� ers is, however, capped at 1Mbps symmetrical rates. “We take the view that if someone currently has a requirement for a 2Mbps symmetrical services, then the potential for bandwidth growth up to 4Mbps and 6Mbps is much faster in the next one or two years,” says Rajeev Sinha, head of products and solutions at Neotel. “It makes sense to deploy other media that can support the higher band-width requirements, such as � bre and point-to-multipoint wireless.”

Where WiMAX has a distinct advantage over � bre and traditional leased lines is quick installa-tion times. “If the branch o� ces are in the coverage area where we have base stations, and are getting NLOS [near line of sight], we can connect in less than a week,” says Sinha. “Fibre-based solutions can take up to six weeks.”

Neotel’s initial geographical focus for WiMAX is in three metropolitan areas: Guateng (Johan-nesburg and Pretoria), Cape Town and Durban. By the end of Neotel’s 2009 � scal year (31 March), Sinha says it will have about 80-85 percent WiMAX coverage of its addressable market in these three areas. “� e following year we will increase coverage close to 100 percent and then we will move into other geographical areas,” he says. Neotel has also applied for a 2.6GHz licence with the intention of deploying Mobile WiMAX networks for � xed and nomadic applications.

� e WiMAX o� ering by iBurst is available in Johannesburg, Pretoria, Cape Town and Durban. Launched commercially in October 2008 —using a total of 125 802.16e base stations from Alcatel-Lu-cent and Huawei—a WiMAX best-e� ort broadband service is targeted at high-end households and SoHos, while an assured rate WiMAX product has been designed for SMEs.

“� e maximum assured symmetrical rate we have is only 512Kbps, but that has more to do with the amount of spectrum we have than with the technology,” says iBurst’s Knott-Craig. “Having said that, 512Kbps is perfect for around 60 percent of businesses in South Africa. � e broadband service, which can burst to 2Mbps but averages out at around 1Mbps, has no guarantees attached to it.”

Knott-Craig takes the view, at least in the medium term, that WiMAX can complement HSDPA, proprietary wireless and DSL solutions. Vodacom, South Africa’s leading mobile operator in terms of subscribers, holds a 24.9 percent stake in WBS, iBurst’s parent company. And through a MVNO arrangement with Vodacom, iBurst o� ers its own branded HSDPA service. “As a strategy, it is senseless to tie yourself in to only one network. One type of technology can’t service every type of customer’s speci� c broadband needs,” he says. “WiMAX, for now, is positioned at the higher end of the market o� ering a faster, more reliable service. Better than ADSL but not as good as leased line.”

Further down the line, once Mobile WiMAX coverage is ubiquitous, Knot-Craig believes 802.16e could compete head-on with cellular. In the mean-time, a more pressing issue for him is spectrum allocation. He is particularly irked that Telkom and Sentech (a broadband provider) is sitting on large chunks of spectrum and making little use of it. “ICASA needs to adopt a ‘use it or lose it’ policy,” he says. “It also needs to allocate spectrum fairly and to people who have got su� cient capital to do something with it. ICASA needs to create certainty in the market.”

ICASA needs to allocate spectrum fairly and to people who have got suffi cient capital to do something with itAlan Knott-Craig Jnr, iBurst




Country Operator Spectrum band Technology Launch Status

Australia Austar 2300 MHz WiMAX Jul 2005 In Service

Australia Unwired 3500 MHz WiMAX Jul 2005 In Service

Australia BigAir Group 5800 MHz WiMAX Jul 2007 In Service

Australia Allegro Networks 3500 MHz WiMAX Sep 2008 In Service

Australia Internode 3500 MHz WiMAX Jan 2008 In Service

Bangladesh BanglaLion Communications 2600 MHz Mobile WiMAX Jun 2009 Planned/In Deployment

Bangladesh Augere Wireless Broadband Bangladesh 2400 MHz Mobile WiMAX Jun 2009 Planned/In Deployment

Bhutan SamdenTech WiMAX Sep 2009 Planned/In Deployment

Cambodia Cambodia Data Communication Company WiMAX Feb 2006 In Service

Cambodia Citylink WiMAX Mar 2008 In Service

Cambodia Chuan Wei Co Ltd Mobile WiMAX Jun 2009 Planned/In Deployment

Fiji FINTEL WiMAX Jul 2007 In Service

India Aircel Business Solutions 3300 MHz WiMAX Oct 2006 In Service

India Bharti Airtel 3300 MHz WiMAX Mar 2007 In Service

India Sify 3300 MHz WiMAX Jun 2009 Planned/In Deployment

India Tata Communications 3300 MHz WiMAX Jun 2007 In Service

India Reliance Communications 3300 MHz WiMAX May 2007 In Service

India MTNL 3300 MHz WiMAX Jan 2009 In Service

India BSNL 2500 MHz Mobile WiMAX Feb 2009 In Service

Indonesia CSM WiMAX 2006 In Service

Japan UQ Communications 2500 MHz Mobile WiMAX Jun 2009 Planned/In Deployment

Korea SKT 2300 MHz Mobile WiMAX Jun 2006 In Service

Korea KT 2300 MHz Mobile WiMAX Jun 2006 In Service

Laos SKY Telecom WiMAX Dec 2008 In Service

Laos Millicom Lao Co Ltd WiMAX Sep 2008 In Service

Malaysia Asiaspace Dotcom Sbn Bhd 2300 MHz Mobile WiMAX Aug 2008 In Service

Malaysia Packet One (P1) 2300 MHz Mobile WiMAX Aug 2008 In Service

Malaysia Airzed Networks 3500 MHz WiMAX Jun 2005 In Service

Malaysia REDtone 2300 MHz Mobile WiMAX Aug 2008 In Service

Malaysia Y-Max 2300 MHz Mobile WiMAX Sep 2008 In Service

Myanmar Myanmar Teleport WiMAX Nov 2007 In Service

New Zealand CallPlus (Slingshot) 3500 MHz WiMAX Oct 2006 In Service

New Zealand Airnet New Zealand Ltd WiMAX Dec 2005 In Service

New Zealand Whoosh Wireless 2300 MHz WiMAX Sep 2009 Planned/In Deployment

New Zealand Telstra Clear 3500 MHz WiMAX 2006 In Service

New Zealand NZ Wireless 3500 MHz WiMAX 2006 In Service

New Zealand Tuaropaki 3500 MHz WiMAX 2006 In Service

Pakistan Mytel 3500 MHz WiMAX Jun 2009 Planned/In Deployment

Pakistan Telecard 3500 MHz Mobile WiMAX Sep 2009 Planned/In Deployment

Pakistan Wateen Telecom 3500 MHz Mobile WiMAX Jan 2008 In Service

Pakistan PMCL (Mobilink) 3400 MHz Mobile WiMAX Oct 2008 In Service

Pakistan DVCOM 3400 MHz WiMAX Sep 2009 Planned/In Deployment

Pakistan Wi-Tribe 3400 MHz WiMAX Sep 2009 Planned/In Deployment

Philippines Innove Communications 2500 MHz Mobile WiMAX Oct 2008 In Sevice

Philippines Prime Communications 2500 MHz WiMAX Dec 2009 In Deployment

(formerly Pacific Internet)

Philippines Globe Telecom 2500 MHz Mobile WiMAX Mar 2009 In Service

Singapore Qmax 2300 MHz WiMAX Jan 2006 In Service

Singapore Qmax 2300 MHz Mobile WiMAX Sep 2008 In Service

Sri Lanka Dialog Broadband Networks 3500 MHz WiMAX Nov 2007 In Service

Sri Lanka Lanka Bell 3500 MHz WiMAX May 2008 In Service

Sri Lanka Lanka Internet Service Ltd 3500 MHz WiMAX Jun 2009 Planned/In Deployment

Sri Lanka Sri Lanka Telecom 3500 MHz WiMAX Jun 2009 Planned/In Deployment

Taiwan FarEasTone 2500 MHz Mobile WiMAX Sep 2009 Planned/In Deployment

Taiwan VMAX Telecom 2500 MHz Mobile WiMAX Jul 2009 Planned/In Deployment

Taiwan Fitel 2500 MHz Mobile WiMAX Dec 2009 Planned/In Deployment

Taiwan Tatung 2500 MHz Mobile WiMAX Apr 2009 Planned/In Deployment

Thailand Advanced Info Service WiMAX Jun 2009 Planned/In Deployment

Thailand TT&T (under contract from Mae Fah Luang University) Mobile WiMAX Sep 2008 In Service

Tonga TCC 3500 MHz WiMAX Jun 2007 In Service

Source: WCiSData as of March 2009

State of WiMAX play in AsiaA rundown of WiMAX operator status in the Asia-Pacific region

www.wcdisdata.com


89601A 802.16 WiMAX modulation analysis software

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© Agilent Technologies, Inc. 2009“WiMAX” is a trademark of the WiMAX Forum

www.agilent.com/find/wimax2

Move forward to what’s possible in WiMAX™. Agilent cleared the

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It’s WiMAX testing at the edge of possibility.

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Issue 06 April 2009 Market Watch: Listing of WiMAX ... · PDF fileMarket Watch: Listing of WiMAX deployments in Asia Feature: ... Packet One signs up ZTE; Yota extends free WiMAX ...

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