WiMAX Forum Americas Congress 2009

The WiMAX Forum Americas Congress 2009 concluded recently in Ft. Lauderdale Florida. With a maturing WiMAX ecosystem, service providers prosper as they meet the growing demand for internet connectivity and mobile broadband services.

Kicking off the event, XJ Wang, Senior Director of Marketing for the WiMAX Forum provided a brief overview of the latest accomplishments in the industry.  Based on the WiMAX Forum's latest count, globally there are now 519 WiMAX deployments in 146 countries covering 140M POPS.  On the device front, there are 165 WiMAX products that have gone through WiMAX Forum certification and over 300 WiMAX products shipping today.

Wang also highlighted the little known fact that many GSM operators have also deployed WiMAX networks.  "While many of the WiMAX deployments are from Greenfield operators, there are 95 GSM operators that have deployed WiMAX networks," said Wang.  "Why have they deployed?  Because they see this as a new business opportunity that can contribute to their bottom line."

Wang also pointed to success of recent auctions this year of spectrum in Indonesia and that auctions in India are finally planned for early Q1.  He also attempted to head-off the WiMAX vs. LTE debate that often  characterize these events by emphasizing where the technology is today.

"This is not about which technology will win, but about how technologies available today can change people's lives," said Wang.  "WiMAX is creating jobs and helping countries bridge the digital divide.  This is what WiMAX is doing today."

The importance of broadband and the potential impact it has to improve people's lives was a reoccurring theme throughout the show.  In fact, many governments around the world including Spain, Finland and others are starting to view broadband as a legal right for their citizens.  In Panama, the government is working on an initiative to give all of its citizens free access to broadband.

According to the Worldbank IDC4 reported in June 2009, a 10% in broadband penetration results in a corresponding 1.3% increase in GDP, with an even bigger impact in developing countries.  Access to broadband creates jobs and helps provide people better access to health care and educational services.

Not surprisingly, WiMAX was featured prominently in recent proposals submitted under the US $7.2B broadband stimulus program, with 25% of the proposals submitted in the first round including WiMAX.


Mobile Incumbents Battle For Status Quo

With all the debate among wireless technologies, an interesting perspective on the evolution of the US telecommunications industry and recent political maneuvering by mobile incumbents was delivered in a keynote by Gregory Rohde with Utopian Wireless, a WiMAX operator that serves remote rural areas in the US.  Rohde was also the former U.S. Assistant Secretary of Commerce for Communications and Information, and the Administrator of the National Telecommunications and Information Administration (NTIA) where he was the principle advisor on telecommunication policies to the Clinton administration.

Drawing on his background in philosophy and theology, he compared naturalist Charles Darwin's Theory of Evolution to the evolution of technologies in the telecommunications industry and the importance of diversity to the health of the entire telecommunications ecosystem.  Rohde argued that a highly concentrated telecommunications market combined with a lack of diversity has inhibited innovation and has been one of the reasons for the US lagging other countries in broadband penetration.

"In the US, we have moved very quickly into a highly concentrated market which is not a very healthy thing," says Rohde.  "Depending on the source, the US currently ranks somewhere between 16-24 in broadband penetration compared to other countries."

Gregory Rohde, Utopian Wireless - WiMAX Forum Congress Americas 2009

"We have a highly concentrated telecommunications market on top of a highly deregulated market," says Rohde.  "The result is that incumbents have begun to substitute the regulatory protections that they used to have, with political protections and technology protections.  In the past 10 years, all the major telecommunication mergers in the US have been approved on average in less than 200 days.  How many other decisions in the FCC have happened that fast?  The fact is that consolidation and merger approval has been a priority for US policy for the past decade and we are seeing the results of that."

Rohde argues that the lack of competition and diversity in the telecommunications industry is beginning to have a direct impact on technology and regulatory decisions, with incumbents aligned around one technology (LTE) and new entrants around others (i.e.  WiMAX)

"The debate about LTE in the policy circles within the telecommunications community and even at capitol hill is a debate I have never seen before.  You actually have lobbyist that are pushing that argument that these other technologies are wrong and are going to interfere because they are not LTE, yet LTE does not exist.  Technologies that are traditionally debated in standards bodies among engineers are now being forced in to political environments."

Rohde believes that having multiple technology choices such as WiMAX and LTE, provides diversity and helps spur innovation.  "While the US has lagged in some areas, the advent of 4G technologies is going to provide the US an interesting opportunity to reclaim some space in this industry," says Rohde.  "WiMAX brings an open standard and that brings opportunities for innovation."


Yota Driving Industry

While much of the US media remains focused on Clearwire as a barometer for the success of WiMAX, more attention should be given to Russian service provider Yota which has quickly become the largest mobile WiMAX operator in the world.  In less than 6 months, the WiMAX startup has gone from 0 to 250K subscribers and is currently adding new customers at the rate of 2,500 per day.  The company has also reached operational break-even just 3 months after launching its network and has proven the success of the WiMAX business model.

The company has ambitious plans to transform itself from a Russian based WiMAX operator to a global brand of telecommunications and entertainment services.  Yota plans to expand to 180 cities in Russia by the end of 2012 as well as neighboring Belarus where it plans to cover 60% of the population.  Yota also has aggressive international plans and has allocated an additional $500M for international growth.  The company recently acquired licenses in Latin America and plans to launch WiMAX service in Nicaragua this month and service in Peru in 2010. 


Courtesy Yota - WiMAX Forum Congress Americas 2009

As impressive as its growth is the vast collection of products and services offered on its network including over 65 WiMAX embedded products.  Not satisfied with just modems and dongles, the service provider was the first to launch a WiMAX smartphone earlier this year and plans additional handsets in 2010, including one of the first VoIP over WiMAX handsets.

Earlier this year, the company launched the "Yota Egg," an integrated WiMAX/Wi-Fi device that receives a WiMAX signal and creates a personal Wi-Fi hotspot (similar to the CLEAR Spot launched by Clearwire, although the Yota Egg is completely integrated).  Based on discussions with Yota executives, a popular application for its customers has been to use the device in automobiles along with an iPod or other Wi-Fi connected device to stream internet radio through the car's audio system.  This is just one example of what is possible when customers have access to a mobile, always connected broadband network.
 

Yegor Ivanov, Yota - WiMAX Forum Congress Americas 2009

Yota is also in the process of rapidly expanding its mobile services research & development center known as Yota StarLab where is plans to develop innovative mobile services and applications, including advanced music, digital TV and video on demand services.  With recent agreements with Sony/BMG, Warner Music, Universal Music and others, Yota customers have access to over 1M recorded titles.

By offering a wide range content, applications and devices, Yota has seen usage on its network sky-rocket with the average user consuming 12.7GB of data per month (excluding idle and heavy users) and over 2,290 TB of network traffic in one month.  The company indicated that its WiMAX usage is 20% higher than the average ADSL/cable broadband usage in Moscow and Saint Petersburg and that the average session involves 5 handoffs between towers, indicating that customers are utilizing the mobile capabilities of the network.

New Devices & Applications

Although no WiMAX handsets were announced at the show, several vendors did announce new WiMAX modems and dongles.  WiMAX product and services provider Green Packet introduced two new products during the event.  Its new indoor CPE the "Tower" integrates WiMAX, Wi-Fi and a voice gateway into a single product.  Combining a Wi-Fi into the product provides a better experience for subscribers by allowing them to place the device near a window were they can get the best WiMAX signal and providing an instant Wi-Fi hotspot.  For mobility, Green Packet introduced the "Shuttle" which is an improvement on the USB dongle concept and includes a 5 foot USB cable and a suction cup to attach the device to a window.  Both products include omni-directional antennas and improved DB gain compared to their predecessor products. 


Greenpacket Tower/Shuttle WiMAX Modems - WiMAX Forum Congress Americas 2009


At the C-motech booth, we got a look at the new U-301 dual mode WiMAX/3G modem that Sprint plans to launch later this month.  The modem replaces the U-300 and features better performance and reduced power consumption with new chipsets from Qualcomm for CDMA and Beceem for WiMAX.


301 Dual-Mode 3G/WiMAX dongle - WiMAX Forum Congress Americas 2009


From an application perspective, D2 Technologies, which provides embedded IP communications software, announced a partnership with WiMAX chip leader Beceem Communications and ECS, Inc. to deliver VoIP over WiMAX on Android™ devices.  VoIP over WiMAX is being launched by several operators including international WiMAX service provider Yota which plans to offer the service on several handsets.

"Beceem has been the market and product leader in WiMAX since first devices shipped, and we are excited to continue to push the envelope of what is possible in 4G by having a mobile VoIP solution available for Android devices," said Lars Johnsson, VP of marketing & business development at Beceem.  "We have worked closely with D2 to integrate our market leading BCSM250 Mobile WiMAX chip into TI's OMAP™ processor, using the Zoom II MDP running Android and are excited to see how our collaboration with ECS has enabled this one-of-a-kind 4G phone."


Conclusions & Observations

Mobile WiMAX operators need to continue to find differentiated products and services to grow customers.  While faster USB dongles for laptops by appeal to some users, in markets with options such as free public Wi-Fi, this may prove less convincing.  Russian Service provider Yota is a good example of offering a differentiated mix of products, content and services.

WiMAX connectivity for vertical industries and M2M applications will provide a tremendous opportunity by itself.  The applications are endless and include fleet management, metering, telemedicine, security and others.  According to data provided by Sprint, the number of activated emerging wireless devices including smart phones, wireless CE, and enterprise M2M applications in the US will grow from 53M in 2008 to 268M by 2013. 

More innovative wholesale partnerships and MVNO (mobile virtual network operator) models such as Clearwire's relationship with Sprint, Comcast, Time Warner will be crucial for the success of the technology and to help grow subscribers.  While some MVNO models have failed in the past, most were pure marketing facades that did not offer any compelling advantage.

Pre-paid mobile broadband plans are becoming increasingly popular with operators, allowing customers to purchase a certain amount of capacity or usage and then "top-off" when they need more.  More WiMAX operators should explore these types of plans in markets where they make sense.

The opportunity for mobile broadband is enormous and there is room for multiple technologies.   Despite the debates in the press, the WiMAX ecosystem is healthy, mature and growing rapidly.  WiMAX technology is available today and is making a positive impact on people lives.

 

Tuesday, December 08, 2009 in Business  | Permalink |  Comments (0)