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Mobile WiMAX Needs to Fight 3.5G Head-On, Not Complement It
In developed markets with extensive and expanding 3G and 3.5G networks, mobile WiMAX will need to differentiate itself beyond performance alone including cost advantages and more flexible pricing.
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WiMAX PR efforts to position 802.16e as complementary to 3G and '3.5G' appear to
be making little headway. While WiMAX supporters are keen to stress that
802.16e offers 'true' mobile broadband and that the current crop of cellular
technologies are best-suited to providing wide area 'narrowband' data and voice,
it is not an argument generally accepted outside the WiMAX community - at least
not yet.
The 'complementary' marketing position is less convincing in markets where
higher-speed HSPA and HSPA+ networks are emerging. Today, HSPA can offer
up to 14.Mbps peak downlink speeds while HSPA+ can offer up to 21Mbps with
further upgrades in the pipeline (although average throughput is likely to be
around a third of the headline rates). Mobile WiMAX has got the network
performance edge, however, with peak downlink rates of 40Mbps and a 10Mbps
uplink at full throttle.
But in the developed 3G and 3.5G markets where mobile WiMAX has got a presence -
such as the US, Korea, Japan and some parts of Europe - it still looks like a
straightforward fight between 802.16e and cellular to win the hearts and minds
of mobile broadband customers. Mobile WiMAX might be higher capacity and
faster than cellular, but mobile operators have got wide area coverage and are
practiced in the art of delivering voice.
The WiMAX camp often puts forward the argument that as mobile data volumes
increase, cellular networks will start to buckle - sooner rather than later -
under the capacity strain. This would give 802.16e networks the
opportunity to capture the higher-speed mobile broadband market - so this
argument goes - leaving cellular networks to ensure customers (using dual-mode
WiMAX/3G devices) can at least stay connected with lower data speeds (and voice)
when outside the reach of the much better performing 802.16e base stations.
But until cellular networks are widely seen to be performing at much lower
levels than 802.16e, mobile WiMAX is unlikely to persuade large swathes of
cellular customers (who are used to wide area HSPA) to 'complement' their 3G
contracts with a WiMAX subscription.
Supporters of WIMAX might say we are already at this stage, or at least very
close to it. This could very well be true but this assertion would need to
be backed up by hard evidence in the shape of impressive subscriber take-up
figures in the near term.
Moreover, where 802.16e coverage is limited it is going to be more difficult to
persuade existing cellular customers to splash out on presumably more expensive
3G/WiMAX dual-mode devices - with perhaps the need for two contracts -
particularly in the current economic climate.
The notion of two different technologies serving two different markets seems
more designed for the ears of regulators rather than as an accurate description
of how WiMAX and 3G/3.5G will play together in a commercial environment.
The 3G community has argued vociferously in various markets around the world
that to allow WiMAX mobility through the release of spectrum in the standardized
WiMAX frequency bands of 2.3GHz, 2.5GHz and 3.5GHz (and at much cheaper prices
per MHz than 3G spectrum) would undermine unfairly previous high investment.
Yet if WiMAX could be seen as complementary to 3G, then regulators would no
doubt have few qualms about releasing spectrum for 802.16e. But many
regulators don't appear to be convinced about the 'complementary' argument.
This has been a contributory factor to spectrum auction delays in some
potentially huge growth markets for WiMAX, including Brazil, Mexico, Russia and
India.
With WiMAX Complements
When integrated fixed-line and wireless incumbent operators do embrace WiMAX, it
is not to complement their existing 3G service but rather to fill in gaps in
their fixed-line broadband coverage where ADSL and fiber, for economic reasons,
can't reach. This was partly the thinking behind last month's deal between
Telecom Italia and Aria, a privately-owned ISP, where the Italian incumbent has
given Aria the right to use its 3.5GHz spectrum assets to supply broadband
service in some of Italy's regions. Under the agreement, Telecom Italia
will also be able to supply its own customers with WiMAX services via Aria's
nationwide white label wholesale offering.
"The deal will make it possible to extend the development of WiMAX as a
complementary technology to fiber optics and copper in the supply of broadband
services to the people of Italy," says Telecom Italia. Italy's incumbent
further points out that the deal was driven by a need to reduce costs and to
ensure it met the minimum WiMAX coverage targets set out by the Italian
regulator when the 3.5GHz spectrum was auctioned in February 2008. There
was no mention of WiMAX being used to complement the 3G service of Telecom
Italia Mobile.
Standalone cellular operators generally turn to WiMAX when they want to enter
the fixed-line broadband business and compete directly with ADSL and cable.
Vodafone Malta, using 802.16d kit from Airspan, is doing just that. HSPA
is marketed as a personal broadband service on the move, while WIMAX offers
multiple PC connections - as a family product - in the home.
Fighting the Mobile Fight
It is perhaps unsurprising that Ericsson, as an arch HSPA supporter and with no
WiMAX portfolio, should disparage 802.16e as a 'complementary' mobile data
option for customers. It routinely asserts there is nothing that a mobile
WiMAX network can do that HSPA and HSPA+ networks can't. From a technical
perspective this is pretty hard to justify and further claims by the Swedish
supplier that WiMAX - in terms of mobility - will disappear altogether
(http://www.telecoms.com/12212/coming-soon) sounds arrogant. It certainly
doesn't make for a constructive industry dialogue on operator network choices,
but that could well be Ericsson's intention.
Although faster-speed 3G networks make it more difficult for WiMAX to gain
ground in the mobility market, there are grounds for WiMAX optimism that 802.16e
can still make a significant impact. It certainly won't disappear as
Ericsson suggests.
In Japan, for example, UQ Communications started commercial mobile WiMAX
operations on 1 July 2009 with easy-to-understand and competitively priced
tariffs, both of which have been welcome hallmarks of mobile WiMAX operator
launches to date. UQ charges a monthly flat rate of ¥4,480 ($47) with a
one-off sign-up fee of ¥2,835 ($30) for a service that typically offers 16Mbps
throughput on the downlink and 3Mbps on the downlink (although this is achieved
over a network that is necessarily lightly loaded as UQ is only at the start of
ramping up operations). There are no long term contracts and no data usage
limits. UQ says it has plans to launch a one-day pass for ¥600 ($5) on 1
October 2009.
By contrast, NTT DoCoMo, the largest mobile operator in Japan in terms of
subscribers, is offering a monthly flat-rate of ¥4,000 ($42) for a theoretical
best-effort downlink speed of 7.2Mbps, although typical speeds are much lower
than that. It has no daily rates as far WiMax.com could see from NTT
DoCoMo's website, and there also were some reference to data usage caps.
Not an easy site to navigate and find out information quickly.
As well as targeting 3G subscribers, the 802.16e kit provided by Samsung allows
UQ to make a marketing push directed at Japan's ADSL customers, which can
typically receive over 10Mbps. But UQ won't be competing directly on
price. An ADSL service in Japan, without a leased POTS line, will
generally undercut UQ as it typically costs ¥3,500-¥5,000 ($37-52) per month.
But by offering both nomadic and mobile services as part of its monthly ¥4,480
package, UQ has a good chance of tempting customers to give up their home-only
ADSL subscriptions in favor of WiMAX. All this augurs well for UQ in
particular and for mobile WiMAX in general.
UQ also takes the view that it needs to fight 3G head-on by establishing a
nationwide coverage as soon as possible to match the size of the cellular
footprint. Although the terms and conditions of UQ's license require
population coverage of at least 50 per cent in each of the country's regions by
the end of its 2012 fiscal year (31 March 2013), the operator says it will have
between 84 per cent and 98 per cent population coverage in each region by that
time. That translates into nationwide population coverage of 93 per cent.
The complementary stance adopted by many WiMAX supporters, which suggests two
different markets served by two different technologies - where 802.16e quenches
the thirst of the mobile internet user and 3G cellular capacity is freed up to
provide wide area voice and narrowband data - is unlikely to unfold so cleanly.
For serving the mass mobile broadband market, it looks more likely it will be an
out and out scrap between 802.16e and HSPA/HSPA+ for fundamentally the same type
of customer in those areas where the two technologies find themselves up against
each other.
The good news for WiMAX is that, along with a high capacity network, the 802.16e
cost base appears to allow for very competitive prices, which should put
existing 3G operators under a lot of competitive pressure. That pressure
will increase as WiMAX coverage expands, more embedded devices become available,
and if voice can be bundled into the service.
Ken Wieland has been reporting and commentating on the telecom industry for
15 years. He has held various senior editorial positions, including most
recently as Editor of WiMAX Vision magazine at Informa Telecoms & Media. Now
working as a freelance telecoms writer, Ken contributes analysis and opinion
pieces to a number of websites, including the EIU (Economist Intelligence Unit).
He can be contacted at
ken2wieland@yahoo.co.uk.
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WiMAX Profile C is Not a Slam Dunk
As WiMAX standards evolve and drive towards consistent profiles, operators must consider business models and other factors when selecting equipment and solutions from vendors.
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In his keynote presentation at the WiMAX Forum Global Congress event held in
Amsterdam last month, Barry West, who now heads up the international interests
of Clearwire, said one of his priorities in the coming months was to persuade
operators to adopt WiMAX Profile C.
At first glance, the need to do so might seem strange. Why would any
operator not want to choose Profile C, which stipulates an open and
non-proprietary interface standard (R6) between the BTS and the ASN Gateway?
As Profile C operators are not tied into one vendor for BTS and ASN Gateway
equipment, they can force prices down through playing off different suppliers
against each other. They can also choose the suppliers that can best
support the functionality and services they want to offer over their network
rather than being tied to one vendor that might not be up to the job.
But, as West implies, the case for Profile C is not clear cut; if it were, he
would not need to campaign for its adoption. Despite the apparent
advantages of Profile C, some 'turnkey' vendors are still successfully tempting
operators with the two other Profiles available between the BTS and ASN Gateway:
Profile A and Profile B. As both Profiles can create vendor lock-ins, they
stand in the way of WiMAX interoperability progress between multiple vendors
and, potentially, lower equipment prices.
In some cases, though, there are strong arguments not to use Profile C,
particularly if operators can avoid the expense of a large ASN Gateway.
While Cisco believes that Profile C is the better choice for WiMAX operators
offering mobility services, not least because it centralizes the decision-making
for call handoffs between different BTSs - which then makes it easier for the
operator to control RAN traffic and offer QoS - this functionality is clearly
not necessary for a WiMAX operator focused on fixed and portable services only.
"Where handoff is not required, Profile B can be adequate," says Paul Sergeant,
Mobile WiMAX Solutions Manager at Cisco. "Profile C still has some
advantages, even in this case - such as QoS - but it may not justify the extra
cost."
Profile B does not define any interface between the BTS and the ASN Gateway, so
it is possible for Profile B vendors to pursue proprietary solutions and lock in
their customers. Due to increased customer demand, however, many of the
big WiMAX suppliers that started out by supplying profile B equipment, including
Cisco (through its acquisition of Navini Networks) are now shifting to Profile
C. According to Sergeant, nearly all of Cisco's 20-plus commercially
deployed WiMAX operator customers are moving from Profile B to Profile C.
This is an encouraging sign for Barry West and all those in the WiMAX community
campaigning for open network architectures, particularly if R6 interfaces can be
fairly easily software-installed on Profile B kit as Sergeant indicates.
Profile C Stumbling Blocks
One potential fly in the WiMAX interoperability ointment is Motorola, which has
long been a Profile B supporter. Although Motorola's WiMAX literature
points out that its wi4 equipment is 'functionally aligned with Profile C' - no
doubt largely due to intense pressure from Clearwire to which it supplies
802.16e kit - there is a feeling in the WiMAX community that Motorola will not
be able to make the transition from Profile B to Profile C as easily as others.
One senior executive of an independent ASN Gateway supplier, who wished to
remain anonymous, told Wimax.com: "Some companies have hardware pieces which are
very difficult to change to Profile C and Motorola is one of those companies.
They may have a hard time making the change [to Profile C]."
One person willing to go on record about Motorola is Peter Ziegelwanger, CTO at
Wimax Telecom, a small operator with a network presence in Austria, Slovakia and
Croatia. "[Profile C] is a complete change in Motorola's core network
architecture and has a lot of impact on its existing networks," he says.
Wimax.com was not able to get a response from Motorola regarding how many of its
customers it has moved from Profile B to Profile C, or to get an update on how
many interoperability partners it has (or is in interoperability testing) for
its BTS and ASN Gateway equipment. However, with at least 19 WiMAX
contracts to its name, as well as what it says is more than 75 WiMAX
'engagements' in 44 countries worldwide, Motorola is a major WiMAX player.
The speed that Motorola moves to Profile C will play a big part in how far the
R6 interface is made available in different parts of the world.
Another big Profile C stumbling block is Alcatel-Lucent, which is a keen
advocate of Profile A and has no plans to develop Profile C WiMAX equipment.
While the R6 interface is used between the BTS and the ASN Gateway under Profile
A, the RRM (Radio Resource Management) is split between the BTS and the ASN
Gateway: the RRA (Radio Resource Agent) resides in the BTS while the RRC (Radio
Resource Controller) is placed in the ASN Gateway. The upshot is that
operators using Profile A must have the same supplier for the BTS and the ASN
Gateway. And for some operators, if the price and performance is right,
Profile A is a reasonable (if not ideal) solution. Wimax Telecom, for
example, selected Profile A equipment from Alcatel-Lucent to roll an 802.16e
network in Croatia.
"We do not support an open R6 interface as there has been no market request for
it so far, at least in the 'enhanced wireless DSL' market segment that we are
targeting, and where we have seen the bulk of market activity in terms of WiMAX
deployments," an Alcatel-Lucent spokesperson told Wimax.com.
"Additionally, the vast majority of WiMAX deployments are single RAN supplier
deployments, and even in those cases where there are networks supplied by
several RAN vendors they are typically split into different areas/cities, each
of them being supported by one RAN manufacturer."
Like Motorola, Alcatel-Lucent has a big 802.16e presence around the world.
As of the beginning of 2Q 2009, the French-US supplier was supplying 802.16e kit
for 15 commercial networks worldwide, with a total of 36 Mobile WiMAX contracts
under its belt. Alcatel-Lucent's resistance to Profile C is and will be a
big restraining factor on the spread of R6.
Profile C Momentum
The Profile C question marks hanging over Motorola, plus the outright Profile C
defiance from Alcatel-Lucent, shouldn't detract from the significant amount of
interoperability progress that has been made on IOT and partnership-forming
between different BTS and ASN Gateway vendors via the open R6 standard and
Profile C. Much of the groundwork on this has been done - through
necessity - by the smaller standalone BTS vendors that don't have the resources
to develop ASN Gateways, such as Alvarion, WiNetworks, Aperto and Airspan.
They need Profile C to get a foothold into the market.
The WiMAX Forum is also embarking on a NWIOT (Network Interoperability Testing)
certification program that will only rubber-stamp equipment using R6 as part of
Profile C. The WiMAX Forum had previously taken the position of letting
the market decide between Profile B and Profile C - it had earlier dropped its
support of Profile A - much to the annoyance of the smaller, independent WiMAX
kit suppliers.
The WiMAX Forum's unequivocal backing of Profile C is warmly welcomed by the
likes of WiChorus, a standalone supplier of ASN Gateways and Home Agents that
has been active in promoting Profile C through its own IOT initiative, the One
Open WiMAX program. "We have reached the tipping point for Profile C,"
says Rehan Jalil, WiChorus' CEO, "but still a lot of work needs to be done."
Part of that WiChorus work, says Jalil, is supporting base station vendors even
if they are not yet fully Profile C compliant.
In the past, turnkey WiMAX kit suppliers would typically say to their
prospective operator customers that Profile A or Profile B was the way to go
unless they wanted to get embroiled in time-consuming IOT with multiple vendors
with little chance of a satisfactory outcome. That argument is much less
convincing now, particularly as Clearwire has been a staunch Profile C supporter
from the beginning. Barry West, when persuading operators to go down the
Profile C route, can also say as part of his sales pitch that they don't need to
do any IOT on vendors' kit that has already been tested on Clearwire's network.
Profile C looks the way to go for most operators going forward but it may take a
bit of time yet before it becomes what the open architecture proponents crave -
a de facto standard.
Ken Wieland has been reporting and commentating on the telecom industry for
15 years. He has held various senior editorial positions, including most
recently as Editor of WiMAX Vision magazine at Informa Telecoms & Media. Now
working as a freelance telecoms writer, Ken contributes analysis and opinion
pieces to a number of websites, including the EIU (Economist Intelligence Unit).
He can be contacted at
ken2wieland@yahoo.co.uk.
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