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An Analysis of Mobile WiMAX

Next generation or truly 4G mobile WiMAX is likely to be a specification that is never implemented on a significant scale.

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GLG Analysis

As expected IEEE 802.16m has been submitted to the ITU, along with LTE-Advanced, for consideration as a true 4G standard. This news may be confusing to those who thought that Sprint and Clearwire had already deployed "4G" WiMAX networks. Since the backwards compatibility of 802.16m with current 802.16e is being emphasized, any lingering idea that somehow LTE and mobile WiMAX might be merged, or that the latter could become the TDD version of LTE (it would have to eclipse the TD-LTE initiatives of multiple vendors and the world's largest (by subscriber numbers) mobile operator, China Mobile) has been put to rest.

Indeed the combined impact of the Vodafone/Verizon/China Mobile TD-LTE trials involving European and U.S. as well as Chinese suppliers will probably increase the interest of major cellular operators in finally deploying mobile broadband networks on a significant scale in unpaired as well as paired spectrum, rendering obsolete the argument that WiMAX is a unique mobile broadband solution for TDD operation.

The WiMAX Forum now touts a number of just over 500 WiMAX networks in 145 countries (as of mid-2009) as evidence that this technology is the "leading mobile broadband technology." This descriptor is utter rubbish. The best estimate of the total number of WiMAX customers worldwide as of mid-2009 is about 3 million, including those on "pre-WiMAX" networks. Hence the "average" number of customers on a WiMAX network is 6,000. Since a few WiMAX networks claim to have attracted one to a few hundred thousand customers (Clearwire accounts for over 500,000 including pre-WiMAX), many WiMAX deployments have a customer base that is far smaller than this figure.

The WiMAX Forum also boasts of having about 145 WiMAX certified devices. The math about how many of each will be sold is obvious. In contrast the total number of HSPA customers is close to 150 million (as of mid-2009), and a significant number of individual HSPA networks have substantially more customers than the entire global base of mobile WiMAX subscribers. Almost all major wireless network equipment vendors are now devoting their development resources to LTE.

Samsung, which announced an 802.16m trial in Russia is a very minor player in this business, although it is a prominent mobile handset supplier. Huawei and its smaller Chinese compatriot ZTE that also figured in the WiMAX Forum's announcement about 802.16m are still trying to cover all possible bases with respect to new wireless technologies, in large part by emphasizing that their equipment is designed to be as common as possible across all of them. But it is no accident that Huawei has established an LTE not a WiMAX development center in the U.S. So indeed 802.16m may win acceptance along with LTE as an IMT-Advanced technology standard. But the chances that it will go much further than specification and acceptance as an official standard and then enjoy significant sales with major deployment contracts are slim to none.

Operators now installing and committed to 802.16e should be very wary about the long term roadmap for mobile WiMAX technology. They should ensure that they do not lock themselves into this technology for very long, and should be preparing paths for migration to LTE. At the same time regulators everywhere should recognize the niche character of mobile WiMAX and avoid creating a situation in their countries in which substantial swathes of valuable spectrum for mobile communications are preferentially attributed to or allowed to remain with operators who are committed to deploying mobile WiMAX, as the 2.6GHz band is for now in the U.S.

This environment may inhibit the deployment of another technology whose roadmap is much more credible, and is widely supported by an extremely competitive group of global suppliers who possess the most impressive wireless credentials. As for the 2.6GHz band in the U.S. perhaps spectrum trading and migration strategies will enable the deployment of LTE at these frequencies in both FDD and TDD modes within a few years.

Intel has been a champion of WiMAX since its inception. But Intel's future in mobile product markets is much more dependent upon its ability to carve out a substantial share for its low power processors in this business and to have its components incorporated into devices that will work on 3GPP networks, than it is upon the supply of chipsets for WiMAX wireless modems. The only remaining questions are firstly when Intel will accept that mobile WiMAX is not a path to billion dollar success in the mobile markets it covets, and secondly whether it will change its wireless priorities quietly in a manner that does not draw critical attention to its abandoning a global strategy it has been pursuing very aggressively and vocally for several years. Otherwise the eventual frustration of Intel's widely publicized hopes for and bombastic advocacy of mobile WiMAX may be widely perceived as another significant major failure in its attempts to become a leading player in the mobile environment. It will be seen as convincing evidence that for all its talents and after multiple attempts Intel is still unable to figure out how to exploit the dynamics of the mobile business in ways that have a noticeable impact upon its revenues and performance.

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