Do Consumers Want WiMAX Without Knowing it?

Recent research indicates that the public is hungry for the kinds of services that WiMAX can produce.

Research House In-Stat has released new research that indicates the public is desirous of the service mix that WiMAX carriers such as Clearwire are planning to deploy.

In a climate where broadband wireless is giving carriers of all stripes increased revenue opportunities, the mix of services WiMAX technology is planned to support appears to have the public's interest. This is crucial for carriers as voice revenues are flattening and the search for new revenue streams to produce growth is in high swing.

The picture for WiMAX opportunities with business customers however is less rosy. In-State reports that business customers need more ubiquitous service and likely higher speeds and may be slow to drive WiMAX growth in that sector.

For consumers however, the potential to be able to connect multiple devices and to shift a broadband connection from home to office to mobile appears compelling. In-Stat reports that consumers are already using public broadband wireless networks at increasingly higher rates.

However, the study reports that fixed broadband wireless carriers are vulnerable to WiMAX mobile services and I am skeptical of this. Granted, there will always be pockets or even large swaths of the US where WiMAX licensed spectrum service can and will cannibalize fixed broadband providers, but without knowing what specifically In-Stat bases this conclusion on, I have my doubts.

Why? Well, to begin with most fixed broadband wireless carriers are already operating by necessity in niche unserved or underserved markets. This can often mean rural markets, but not always as companies like Towerstream, Sparkplug and Covad Wireless are focused upon high-end business customers in Tier 1 marketplaces. In both instances I don't believe WiMAX is well-positioned to assail these specific niches.

Don't get me wrong WiMAX carriers like Clearwire will own the mass-market potential and fixed broadband wireless carriers will likely always be a very small segment of the market relative to that. However, that does not mean that a mass-market play will necessarily cannibalize fixed wireless opportunities. In the case of high-end business models the unlicensed band technologies most commonly used are actually probably better for serving this segment with wider channels and customer specific features. And as far as rural markets, the big players will deploy there dead last. This means a long time from now folks. Is WiMAX a long-term threat? Yes. I will buy that, but short and near-term. Nope. I don't think so.

Tim Sanders

The Final Mile

Friday, June 20, 2008 in Business  | Permalink |  Comments (2)