Photo credit: Tony A. Ridder, Sprint Nextel Corp. |
Sprint, in particular, has made mobile WiMAX-based 4G a hot property, thanks to its August announcement that it will build out an 802.16e network, set to go live in 2008 in the 2.5GHz band. The carrier’s vision is one of rich data applications, enabled by a wide range of new, consumer electronics-focused form factors. “Internet everywhere is the theme of our vision,” says Barry West, CTO and president of 4G mobile broadband for Sprint. “Access to the content, applications and information wherever you need it is something people won’t be able to get enough of. In 10 years we’ll look back and think, ‘How did we ever manage when the Internet was tethered?’”
The Hypothesis
If the mobile phone itself transformed telecom and the wider culture at large, the Internet was a second, and arguably more transformational, event. So mixing the two in the right proportions will create enough energy to ignite a new explosion of innovation and revenue, say 802.16e boosters.
 Samsung is in 20 WiMAX trials around the world. It will provide WiMAX-enabled devices such as this one to Sprint for its 802.16e network rollout. |
Mobile carriers, including Sprint, continue their commitments to update existing circuit networks with the faster EV-DO Rev. A technology or HSPxA, primarily to handle voice and the more traditional wireless data applications, such as texting and e-mail. The fourth generation of wireless networks instead will serve the fundamental purpose of enabling and extending the Web, which has become the No. 1 media in the land.
Social networking has changed the number of hours people spend online, resulting in an attendant shift of dollars within the media industry. Cities are working to eliminate the digital divide through municipal networking. Blogging, Google AdSense and other applications all are contributing to Internet traffic. Then there’s video.
“Nine to 12 months ago we saw a magical coincidence,” says Sean Maloney, executive vice president and chief sales and marketing officer at Intel Corp. “Finally, there was just enough broadband and power within the PC to contribute, after 10 years of promise, to the liftoff of broadband video.” A shift to HD is in the wings, too, requiring six times the bandwidth of standard definition.
“In 1995 everyone said, ‘The Internet changes everything,’” says Maloney. “Was that outrageous hyperbole? No. It’s all come through or exceeded what was thought, actually. And it’s contributed to overwhelming growth in our industry.”
Mobile WiMAX is being targeted as the new conduit for Internet-enabled content and revenue-enhancing applications. VoIP, presence, mobile television, interactive gaming and social networking are but a few next-generation applications a technology like WiMAX can bolster. Ultimately, WiMAX is part of the industry’s Utopian vision of personalized bubbles of broadband and content that people carry around with them, thanks to ubiquitous mobility. “This opens the way for personal, visual communications,” notes Sprint’s West. “You can connect with your family and see what your remote relatives are seeing. And then there’s user-generated content — we will all become personal filmmakers.” The underlying connectivity, he adds, will become second nature, making it simple to share content and experiences.
Geographical Distribution of Service Providers Investing in WiMAX According to Rethink Research, Europe dominates the 3.5GHz picture in 2006 with more than two-thirds of the world’s licenses. While Eastern Europe will see high growth because of its high economic growth and widely underserved regions, the biggest deals will be in Western Europe, especially as converged and mobile operators start to implement WiMAX as part of their combined platforms. Africa and the Middle East will increase spending on WiMAX, mainly in the 3.5GHz band, more than tenfold in the period, driven by new spectrum allocations and rising demand and economic growth. In Asia Pacific, the Korean Wi-Bro rollouts will kickstart the market, but by 2009 the greatest growth should come from China, Japan and the Indian subcontinent. By 2009, $2.28 billion will be spent in Asia on WiMAX, almost one-third of the total, and almost tripling the value of the market from 2006. This mainly will be in 2.3GHz/2.5GHz bands. In North America, WiMAX spending will total about 12 percent of the market in 2009. |
“WiMAX overcomes the voice quality and mobility hurdles Wi-Fi has faced, making for better accessibility and performance than we’ve seen in wireless before,” says Tom Jasny, Samsung Telecommunications America’s vice president of wireless and broadband networks. “This will be just like what one can do on a PC, only in a fully mobile environment, so it will complement a variety of legacy operator needs while opening up new opportunities for developers and user-generated content.”
There also are largely untapped applications, such as robotics, he adds. “Imagine controlling and managing household appliances, industrial machines and even battlefield robots that replace live soldiers,” he says.
The 802.16e version of WiMAX can offer both fixed and mobile access over the same infrastructure, opening the way for a personal broadband service that gives users continuous Internet access at home, at work and while they are on the move. West also says WiMAX has several other aspects going for it that make it the right basis for 4G to coagulate.
“The premise of WiMAX is to address throughput, latency and cost,” he says. “Whether we like it or not, people’s quality expectations are predicated on their fixed Internet connections, for which they pay $20 to $50 per month. They may pay a small premium for a mobile version, but not another $50. So with WiMAX, we can provide the services, meet the expectations and still make money.”
That’s because Sprint’s WiMAX will use 10MHz- and 20MHz-wide channels, achieving 40mbps peak rates on the downlink. “So we get nearly 10 times the cost efficiency as a result of using those wider channels.” Also, the flat IP architecture is more efficient than circuit-switched networks for carrying data. “The standard is well-written, and a lot of stars seem to have aligned behind it,” adds West.
A New Scientific Method
The promise of this 4G vision is not just a matter of letting people wirelessly access the applications they’re used to getting on a PC. If it takes off, Sprint’s mobile WiMAX initiative will incubate entirely new business models.
“WiMAX supports [an Internet applications universe] from the ground up — and 802.16e takes the Internet mobile,” says Greg Brown, president of Motorola Inc.’s networks and enterprise division. “Interactive, personalized, rich media services are the future. Everything goes digital ... and everything goes mobile, fostering an open development ecosystem.”
That includes services and applications. “The Internet service model will revolutionize the business model for cellular,” says West. “There are two ways to monetize this — the transport and the services you layer on top. Advertising, presence and profile will present interesting opportunities. Of course, it will also mean building new activation, device management and back-office systems.” There also will be more players in the value chain and more revenue-sharing going around, because 802.16e is an open environment, a far cry from the carrier decks and walled gardens of traditional wireless data models.
When it comes to the service, a WiMAX carrier like Sprint may have a sales relationship directly with a subscriber, or it could have a relationship with a camera maker, say, which could bundle WiMAX with photo processing software for the consumer. That shifts the operator’s relationship from the consumer to the device manufacturer. “With cellular, we’re in a world where subscriber acquisition costs are driven by us subsidizing the devices,” says West. “Now we can get to volume, lower cost per bit and a lower cost to acquire the consumer. It will enable an explosion of communications.”
 Samsung is one of Sprint’s major infrastructure providers. |
And so, devices also are a critical aspect of building the 4G infrastructure. “Operators will focus on content delivery — not just to handsets, but to a range of consumer electronics devices,” said Berge Ayvazian, analyst with Yankee Group Research Inc. He says it’s wide open as to what those devices will look like, citing iPod-like music players that are broadband and wireless-enabled, or wireless boxes for streaming IPTV no matter where subscribers are.
“In our agreements with Samsung and Intel, they have agreements to embed WiMAX, and we’re seeing a lot of interest from consumer electronics companies in WiMAX, for things that move and things that don’t,” says West. It’s expected that mobile WiMAX modules will be embedded into many data, consumer electronic and voice devices, including notebooks, PDAs, gaming consoles, MP3 players, cellular phones and smartphones, as well as devices for vertical applications, like CCTV cameras and in-vehicle subscriber stations. In theory, WiMAX will be far more ubiquitous than wireless is today.
For its part, Intel announced that the Intel Connection 2250, a dual-mode fixed/mobile WiMAX chipset, will be the basis for a new generation of CPE. Several vendors, including Alvarion Ltd., Aperto Networks, Motorola and others, will be using it in products launching in early 2007. “Wi-Fi tipped the notebook from being a low-volume business to a high-growth one,” says Maloney. “Now, the dominant client is arguably the notebook rather than the PC.” WiMAX, he adds, now has reached critical global mass, forcing devices to evolve further. Notebooks are scheduled to ship at a rate of 100 million over the next 12 months, while smart handsets are a “healthy business” as well, Maloney notes. “But the time is ripe for experimentation — device innovation will drive the big screen mobile Internet experience to deliver a no-compromise Web experience through new form factors, like ultra-mobile PCs or consumer devices, using standard browser technology.”
WiMAX technology is a tenth to one-twentieth of the cost of traditional products, he adds. “The simplicity of the network allows us to deliver new form factors at the low cost points necessary for mass adoption.”
The Road Out of the Lab
While the dreams and the plans for WiMAX are on the front Bunsen burner, so are the practical steps necessary for commercial deployment. The momentum behind the standard has increased more in the last 12 months than in the previous three years put together.
The first wave of certified WiMAX equipment appeared in January of 2006, and WiMAX equipment sales shot up 107 percent to $141 million between the first and second quarters, according to Infonetics Research. Now, the development of 802.16e mobile WiMAX-certified products is under way; an additional lab in Seoul, South Korea, is certifying compatibility and interoperability of mobile WiMAX products. The test procedure validation process began this quarter, and the first certified commercial equipment is expected early in 2007.
That will be followed in the second half of the year by equipment with multiple advanced antenna capabilities — MIMO and beamforming — for higher throughput and capacity, according to the WiMAX Forum. Widespread deployment could begin as early as late next year, it says.
By 2010, there will be 15.4 million WiMAX subscribers worldwide, generating more than $16 billion in service revenue, according to Senza Fili Consulting. Of that, 57 percent of WiMAX subscribers will be using 802.16e.
According to a WiMAX Forum white paper, among the broad mix of service providers trialing or committed to deploying mobile WiMAX are wireline incumbents, 3G and 2G mobile operators, DSL and cable modem operators, CLECs, WISPs, greenfield operators and MVNOs.
Worldwide WiMAX Investment Global WiMAX infrastructure spending is expected to rocket from $655 million today to $7.36 billion by 2009, just three short years away, according to Rethink Research. WiMAX spending is forecast to go from 22.5 percent of all broadband wireless spends in 2006 to be the dominant platform in the market, with a 63 percent share. |
Sprint will be the first operator in the United States to deploy 802.16e widely, and it has committed to covering 100 million PoPs by the end of 2008, followed by continued expansion should subscriber demand warrant it. Sprint will be using the existing cellular footprint it already has to support WiMAX rollout. Its infrastructure and device partners are Intel, Motorola and Samsung, and it recently got an RFP back for a fourth major vendor relationship. It also has active, ongoing discussions with consumer electronics companies. The devices will be ready when the network goes live, says West. Pricing, first markets and other nuts-and-bolts details will be released as the infrastructure gets deployed.
“We are so confident in this initiative that we’ve created a separate business unit,” he adds. “We are very aware of the innovator’s dilemma, so we are in a separate building to ourselves, and we brought our vendors with us. That shortens the development cycle because if there’s a problem or an idea, we can work on it right there.”
Proving the Theorem
Like any great experiment, forging ahead represents opportunities, challenges and risks. For all the work that’s been accomplished, there’s still plenty to talk about. For instance, mobility, unlike fixed deployments, will require interoperability across disparate networks and devices, and will spark the need for roaming, spectrum harmonization and multiband processors.
Maloney cites two lingering issues that Intel, Sprint and others “must fix” to be successful: cost and roaming. “Reducing cost is a WiMAX imperative,” he says. “And the roaming issue — now when you go to a Wi-Fi hotspot you have to pull out a credit card and answer 17 questions to get online at the airport. With mobile WiMAX, fixing that becomes critical.”
Also, the wireless world will consist of a hodgepodge of WiMAX, Wi-Fi, 2G, 2.5G, 3G and other 4G candidates such as 3GPP LTE. That will require a look at the long-term engineering of the network architecture. “Radio access will be diverse, but eventually the service layer will move to IP,” explains West. “All the access types will simply feed into IMS, and the network will seamlessly switch between access layers based on the best transport available for the application being used.”
On the device side, Sprint says it will offer dual-mode and multiband devices to account for the diversity in the access network. Samsung, for one, will deliver dual-mode devices supporting mobile WiMAX and EV-DO, enabling Sprint’s mobile WiMAX users also to utilize Sprint’s existing 3G network.
Jasny says Samsung also is working with other manufacturers and vendors to create a standard device certification and activation process.
Then there’s the question of user adoption. While big splashes have been made by Verizon Wireless for V CAST and other live video services, the uptake hasn’t been transformational. What is the guarantee that mobile WiMAX applications will follow a different path? Sprint remains bullish on the proposition, and cites evidence that user adoption will meet expectations. “We are very pleased with the EV-DO-a upgrade, and it’s given us some insight into how to format content and how this impacts things like battery life,” says West. “I am now more than ever convinced that there is a real market for our vision.”
West says the higher throughput and lower latency that mobile WiMAX offers translates into a better user experience and wider adoption. The operator also did a test run in North Carolina to trial the technology as well as consumer behavior. One application involved realtors, who installed equipment in their vehicles that allowed them to pull up libraries of 360-degree video listings they had filmed. When in the field, realtors could pull up listings from the video libraries to show potential buyers, before wasting their time visiting a house that didn’t fit the buyer’s requirements.
“Users will adopt this because of the practical benefits involved,” says West. “And the open Internet economy will mean that people will produce more software and applications, just like they do today for the Web. Imagine being able to control the surveillance cameras at your home whenever you want, moving the cameras around to check out an alarm. Any application you can think of can be written and delivered cost effectively.”
To read a Q&A on mobile WiMAX with Motorola Inc.'s Juan Santiago, senior director of product management and strategy for the networks and enterprise division, click here.
| Links |
| Alvarion Ltd. www.alvarion.com Aperto Networks www.apertonet.com Infonetics Research www.infonetics.com Intel Corp. www.intel.com Motorola Inc. www.motorola.com Rethink Research www.rethinkresearch.com Samsung Telecommunications America www.samsung.com Senza Fili Consulting www.senzafili.com Sprint Nextel Corp. www.sprint.com Yankee Group Research Inc. www.yankeegroup.com |
