Comcast Launches First WiMAX Market

Becoming the first cable operator in the US to offer WiMAX service, Comcast announced the availability Tuesday of bundled WiMAX services in Portland, Oregon. Other cities likely planned in the coming months.

With the launch, Comcast becomes the first cable MVNO (mobile virtual network operator) in the US offering high-speed WiMAX services.  Although no further announcements have been made, Comcast will likely launch additional markets in the coming months as its WiMAX wholesale partner Clearwire rolls out additional cities.

The new service will be marketed as "Comcast High-Speed 2go" and will provide mobile data to laptops, netbooks and other mobile devices over wireless networks with download speeds of up to 4 megabits per second.  Existing 3G wireless networks typically offer download speeds between 1 and 1.5 megabits a second or less.

Comcast will leverage its existing install base of customers, offering mobile broadband as a bundle to its existing internet service.  Comcast will offer two different devices and service plans: The Metro data card, which is typically installed into a laptop to allow wireless internet access, will cost $50/month when bundled with home internet service and will only work within the WiMAX coverage areas.  A nationwide version for $70/month will allow subscribers to get online via Sprint Nextel Corp's 3G network where the 4G network is not available.

Last year Comcast became one of the major investors in Clearwire, providing more than $1 billion of the $3.2 billion Clearwire received from Google, Intel, Time Warner and others. 

Putting the weight of the Comcast brand and sales channel should be a nice boost to WiMAX efforts in the US.  Mobile WiMAX will complement nicely with Comcast's current internet offerings - providing a bundle of one of the best fixed internet services with the best commercially available mobile broadband service.  Partnering with Sprint and offering a dual-mode 3g/WiMAX option gives them access to a nation-wide 3G footprint while WiMAX networks continue to be built-out.



 

Tuesday, June 30, 2009 in Deployments  | Permalink |  Comments (1)

Alvarion Scores Major WiMAX Win in the US

This week WiMAX equipment provider Alvarion announced that had been selected by US broadband provider Open Range Communications, Inc. to build a 4G wireless network covering 17 states, 546 rural communities and reaching up to 6 million people. The $100M deal spans 5 years and represents the largest deal to date for the company.

Open Range Communications began moving forward with its plans after receiving funding of $374M earlier this year to build out its network - including a $274 loan from the USDA's Rurual Utilities Service (RUS) and $100M from One Equity Partners.  The funds received from RUS are from its annual re-reoccurring program and separate from the US Broadband Stimulus Funds being released later this year.  The company plans to begin deploying the network in Q3 with the first services offered in Q4 this year. 

Open Range plans to use WiMAX technology to deliver broadband services to un-served and underserved communities in America - offering portable and eventually mobile voice and internet services to its planned coverage areas including western states California, Colorado and Nevada; Midwestern states Wisconsin, Illinois, Indiana, Ohio and Nebraska; southern states Arkansas, Alabama, Florida, Georgia and South Carolina; and eastern states Pennsylvania, New York, New Jersey and Delaware. 




"We are excited that we are able to be involved in such a visionary program that can bring broadband services to un-served and underserved areas to the rural US," said Greg Daily, President for Alvarion North America.  "You are looking at a 4G state-of-the-art network that is going to roll into rural America, similar to a metropolitan area and frankly, better than a lot of metropolitan networks."

The network will be built on Alvarion's WiMAX Forum® Certified™ 802.16e BreezeMAX® solution utilizing spectrum in the upper 2.4GHz ATC band, based on an arrangement with mobile satellite and data provider Globalstar.  Last November, Globalstar received an Order and Authorization ruling from the FCC allowing Globalstar's spectrum to be used for Ancillary Terrestrial Component (ATC) services in the US.

"Its a ground breaking project from many perspectives," said Daily.  "In addition to our own RAN (radio access network) solutions and CPE (customer premise equipment), we are also integrating the backhaul, IP core and ASN gateway and AAA server functionalities.  In terms of the network build-out, we are the lead system integrator."

The deal reflects a major milestone for Alvarion and perhaps offers a glimpse of the types of deals to come.  For the past 18 months, the company has been signing-up smaller turn-key projects including ICE in Costa Rica and VMAX in Taiwan, but this one is unprecedented in terms of size and scope.  Open Range reflects the second service provider for Alvarion that has received Rural Utilities Services (RUS) funding.  In April, Main Street Broadband announced that it had selected to deploy Alvarion equipment after securing $34M in RUS funding.

The announcement sends a strong signal for the overall wireless broadband industry and WiMAX technology in particular.  With the first Notice of Funds Availability (NOFAs) from the Broadband Stimulus Funds due out at the end of this month and subsequent release of funds later this year, I'm sure we can expect to see more of these deals in the near future.


 

Thursday, June 18, 2009 in Deployments  | Permalink |  Comments (5)

WiMAX Internet Service Now Commercially Available in Atlanta

US WiMAX provider Clearwire officially launched its CLEAR™ WiMAX service in Atlanta on Tuesday. The Atlanta metro area receives the distinction of becoming the largest Internet hot spot in the US with service available to three million people across 1,200 square miles.

The announcement on Tuesday follows the soft launch of the city a little over a month ago.  The launch will officially kick off early today with festivities planed at Atlantic Station located in midtown Atlanta, including a CLEAR-branded hot air balloon and live demonstrations of WiMAX products and services.  In addition, CLEAR and Intel will announce plans to provide dozens of embedded WiMAX laptops based on Intel® Centrino® 2 processor technology, as well as netbooks based on Intel® Atom™ processors, with CLEAR service to Atlanta Public Schools before the start of the next school year.

"By delivering broadband connectivity to people, and not just places, we now offer Atlanta the freedom to enjoy super-fast Internet access wherever they go in our coverage area," said Marc Brachman, General Manager of Atlanta market for Clearwire.  "Whether it's a busy parent who wants full Internet connectivity in the back of the family minivan, a small business owner looking to conduct online video chats with customers from the field, a person looking to access entertainment sites like Hulu without being tied to a fixed-location, or a college student simply looking for one Internet service provider to meet their needs at home and on-the-go, CLEAR delivers.  We're providing a valuable, new kind of Internet service designed to make our customers' lives more enjoyable and more productive, wherever they happen to be in our coverage area."

As part of a multi-year network build-out plan, Clearwire's 4G network will be available in major metropolitan areas across the United States.  In addition to Atlanta, mobile WiMAX is already available in Baltimore, Maryland, and Portland, Oregon.  Clearwire plans to officially launch service in Las Vegas later this summer (although service is already currently available on its website).

The company plans to bring CLEAR to 80 markets and up to 120 million people by the end of 2010.  Some of the additional markets planned to launch in 2009 include Chicago, Charlotte, Dallas/Ft.  Worth, Honolulu, Philadelphia, and Seattle.  Some of the additional markets planned to launch in 2010 include New York, Boston, Washington, D.C., Houston and the San Francisco Bay Area.

It should be interesting to see how the Clearwire Atlanta launch unfolds in the coming months, especially on AT&T's home turf and its aggressive marketing of its own mobile broadband offerings.  The key for success with Clearwire will be in "clearly" differentiating the performance advantages of its WiMAX network relative to AT&Ts 3G network.  Go Clearwire!


 

Tuesday, June 16, 2009 in Deployments  | Permalink |  Comments (7)

Clearwire Releases Q1 Earnings & Confirms Details on Upcoming Market Launches

US WiMAX provider Clearwire released Q1 earnings on Wednesday reporting a 21% increase in revenue along with reductions in operating losses compared to the prior year. The company also announced new additions to its leadership team and confirmed the official launch of the Atlanta market for June followed by Las Vegas later this summer.

Clearwire's new CEO William T. Morrow, just 2 months into the new role, led the call highlighting some of the key operations milestones for the quarter including achieving 500,000 subscribers across all of its markets.  Morrow also re-iterated some of the advantages of Clearwire's vast spectrum holdings and its ability to deliver a rich, pervasive mobile internet experience relative to other current 3G technologies.

"It is a pivotal time for Clearwire as we begin to significantly scale our operational capabilities, gain merger integration synergies, leverage key partnerships and ramp up our network construction and deployment activities to an unprecedented rate," said William T. Morrow, chief executive officer of Clearwire.  "We are ushering in the next-generation of services providing a rich and unconstrained digital experience by delivering broadband Internet access through a quickly growing array of new devices and applications that take advantage of speed and mobility in exciting, unanticipated ways.  As we extend our network to many more cities during the next two years, we believe CLEAR will be the first truly pervasive mobile broadband service, unlocking the true potential of the Internet for our customers and providing Clearwire tremendous opportunities for long-term growth."

The Q1 revenue increases were driven by a 13% increase in overall subscribers and a 7% increase in ARPU (average revenue per user).  The company also reported that the growth rate of new subscribers for the first 3 months in Portland Oregon where it launched service early this year, has been 2.5X that of other market launches.  Clearwire currently operates 46 markets utilizing pre-WiMAX technology that it plans to covert to mobile WiMAX at some point in the future.

Morrow also confirmed Clearwire's plan to cover 120 million Americans across 80 markets by 2010 was still on track, but emphasized that its broadband strategy was not dependent on a nation-wide footprint and that the business model of WiMAX enabled a good ROI even with lower penetration of markets.  The full commercial launch of Atlanta is planned in a few weeks, followed by previously announced markets in Las Vegas, Dallas and Chicago and others later this year. 

The company also expressed that new, innovative types of devices - such as the Clear Spot(TM) portable Wi-Fi router, made possible by Clearwire's WiMAX network, will help drive adoption by providing unique ways for subscriber to connect devices to Clear's network.  The Clear Spot creates a mini portable Wi-FI hotspot that can be taken anywhere and provides access for the numerous devices such as the iPhone that have Wi-Fi capabilities.




 

Thursday, May 14, 2009 in Deployments  | Permalink |  Comments (3)

Clear WiMAX Service Now Available in Atlanta

Although a full commercial launch is planned for later this summer, residents of Atlanta, Georgia are now able to sign up for Clear's high-speed mobile WiMAX service.

A review of the coverage section of the Clear.com website indicates that WiMAX service is now available for most of the Atlanta metro area.  Up until now, Clear's WiMAX service has only been available in one other market, Portland, OR, since the beginning of January.  Clear has other WiMAX markets planned for Las Vegas, Chicago and Dallas later this year.  Mobile WiMAX service available in Baltimore under Sprint's Xohm brand will also be merged under the Clear moniker at some point in the future.

Sources with Clearwire were not available for comment, but have indicated that Clear service is now being sold in Atlanta as part of its operational readiness activities.  This is necessary to test out the network and finalize other logistics.  The announcement of store locations and other marketing activities are planned as part of the full commercial launch later this summer.  For now, residents of Atlanta are only able to order service at www.clear.com

The coverage maps are extensive and indicate that most of the metro Atlanta area has been covered.

This is great news and a significant milestone for the industry.  Atlanta is an enormous geographical area and comes with its own unique RF (radio frequency) planning challenges with its topography and numerous trees and hills.  As with any new network build-out, I'm sure it will take time to fine-tune the network.  For those in the Atlanta area, please let us know your experiences with the service!

Wednesday, May 06, 2009 in Deployments  | Permalink |  Comments (1)

Samsung to Provide WiMAX Infrastructure for YTLE in Malaysia

WiMAX provider YTL e-Solutions and Samsung announced today that they have entered into an agreement to build a nation-wide WiMAX network in Malaysia. Under the agreement, Samsung plans to provide WiMAX base stations, end-to-end IP Multimedia Service (IMS) solutions, and a range of Mobile Internet Devices (MID)

In addition to infrastructure equipment, Samsung plans to provide WiMAX-enabled handsets, allowing subscribers to have access to a high-quality, converged voice and high-speed broadband network throughout Malaysia.  Samsung appears to be the only WiMAX vendor that is supplying radio equipment, modems and hand held devices.

In a previous announcement, Malaysia's YTL Group (YTLS.KL), the parent of YTL e-Solutions, had reported that they plan to invest 2.5 billion ringgit ($688.7M USD) over five years to roll out the network.  YTLE is planning to begin commercial WiMAX based voice, data and multimedia services in the next 6 to 8 months, with the network planned to be completed in 14 months, according to YTL Group Managing Director Francis Yeoh.  In May 2007, a licence for a 2.3 GHz spectrum was awarded to YTE e Solutions by the Malaysian Communications and Multimedia Commission (MCMC).

YTLE also plans to work closely with Samsung and its other partner Cisco in developing Malaysia as a hub of WiMAX development, encouraging investment and growth in Malaysia through the development of new local facilities, professional resources, training, manufacturing and logistics support.  In November last year, YTLE announced that Cisco would be the systems integrator for its Malaysian WiMAX network and would be providing the "WiMAX core network" - which includes IP CORE, Operating Support Systems, Billing Systems, Proactive Network Operating Center (PNOC), and Interoperability Testing labs.

"Having invested the time and resources, I am confident that we have found the right solution for Malaysia which is a combination of nationwide implementation, with proven world class partners, to create a center for WiMAX excellence and investment.  We will bring seamless converged mobile internet service which includes high-speed data, messaging and voice to Malaysians, any place, anytime and anywhere throughout the country," said YTLE’s Executive Chairman and Managing Director, Tan Sri Dato’ (Dr) Francis Yeoh.

In other WiMAX Malaysia news, ZTE Corp announced earlier this month that it had clinched a one-year agreement with Packet One Networks (P1) to help expand its nationwide WiMAX network in Malaysia, now on its second phase, throughout the country.  Under the agreement, ZTE will provide technical assistance to P1 including the provision of WiMAX equipment, network planning and design, engineering services and network optimization.  Packet One is planning an ambitious goal to achieve a target of 30% to 35% population coverage by end of 2009. 

 

Thursday, April 23, 2009 in Deployments  | Permalink |  Comments (2)

Commercial WiMAX Network Planned for Silicon Valley

In addition to Clearwire's earlier announcement on the development of a WiMAX developer's testbed, the San Jose Mercury reports that Clearwire plans to make fixed and mobile WiMAX service commercially available in Silicon Valley sometime next year.

The cities and total area to be covered by the WiMAX network are still being worked out, said Todd Lewellen, market-launch director for Clearwire.  But he said details about that should be forthcoming in a few months.

Once connected to the mobile WiMAX service, "you can be on a bus, your kids can be in the back seat of a car watching their favorite video, there are just a lot of cool things you can do," Lewellen said.  Although the cost of the service here hasn't been determined, Lewellen said it probably would be comparable to what people pay in Portland, Ore., where basic mobile service costs $30 a month.  In addition, WiMax customers will need to buy a $49.95 network connector (often called a "USB dongle"), which plugs into a USB port on their notebook PC or gadget, unless the end point device has a built-in WiMAX adapter. 


Fixed WiMax service, that only connects a person's home to the Internet, may cost about $20 a month.  We would assume the speeds offered by Fixed WiMAX would be comparable or better than the "business class" DSL service AT&T offers here (this author pays $30 per month for 2.6M bit/sec downstream and about 800K b/sec upstream).  Cable based Internet from Comcast is much more expensive, unless you have a triple play service.  Hence, Clearwire's fixed WiMAX service should be quite competitive with wired broadband access.


Comment and Analysis:

We believe the following will happen if WiMAX does get deployed in Silicon Valley within the next year:

- Comcast will be a MVNO for mobile WiMAX, but not fixed WiMAX (which competes with its cable modem based internet access).  Sprint will probably only resell mobile WiMAX, as they do not have much of a presence here outside of cellular services.

- More mobile WiMAX gadgets will be announced as the service becomes more available.

- Fixed WiMAX will take market share away from AT&T's DSL service for residential users.  It appears likely to be more cost effective, but we need to see the deployment details from Clearwire to be sure. 

Clear Spot portable Wi-Fi Router


- The Clear Spot portable Wi-Fi router will be a big seller, allowing most Wi-Fi-enabled devices and PCs to connect to Clearwire's WiMAX network.  The list includes smartphones (including the Apple iPhone, some RIM BlackBerry devices, Windows Mobile phones, the T-Mobile G1, and the Palm Pre), Wi-Fi-enabled game and music devices, as well as Wi-Fi-ready digital and video cameras.  The Clear Spot can also be used to replace the residential Wi-Fi Access Point/Router that connects to a DSL or cable modem, while keeping your home Wi-Fi network intact.


 

Friday, April 10, 2009 in Deployments  | Permalink |  Comments (5)

WiMAX Operator Nth Air Finds It's Niche Serving Business Customers

Can a small start-up carrier change the telecom world? US operators are leveraging 3.65Ghz WiMAX solutions to offer broadband service at lower costs and better customer service. Interview with Craig Niemeyer, CEO & President of Nth Air.

Craig Niemeyer is the quintessential salesman.  After 13 years in the Marine Corp and several sales positions at a number of wireless telcos, Niemeyer formed Nth Air Corp.  in 2005 to "sell customers what they need" - something Niemeyer would buy himself.  That would be broadband wireless infrastructure services, with a specific focus on WiMAX technology.  Today, the company offers a mix of solutions, including microwave radio, leased fiber, and fixed WiMAX.  Niemeyer sees WiMAX accounting for 85% of his company's sales going forward.

As Nth Air's CEO & President, Niemeyer is responsible for establishing the strategic direction for the company while managing daily operations and technology initiatives.  He believes that broadband wireless will "level the playing field" for small and medium sized business customers, which have been mostly neglected by the ILECs.  According to Niemeyer, fixed WiMAX offers better coverage without repeaters than do proprietary broadband wireless technologies or mesh Wi-Fi.  3.65GHz "lightly licensed" WiMAX is attractive because of the low license fee (a few hundred dollars for 10 years) vs.  the many thousand dollars to acquire 2.5GHz spectrum.

Currently, Nth Air sells and services two types of digital private line replacement services:

- T1+ replacement via Fixed WiMAX, at an average speed of 3 M bit/sec
- T3+ replacement via Microwave radio links at an average speed of 100 M bit/sec

Nth Air's WiMAX Service is available in several U.S.  cities including Las Vegas, Los Angeles, San Jose, San Francisco and Denver.  Nth Air provides integrated, end-to-end wireless broadband solutions from business class connectivity to transport access, disaster recovery, broadband properties solutions, professional services, and managed services.  Nth Air provides VoIP and security services as an "overlay" on their broadband wireless network.  More information at nthair.com.

The company also leases part of their network on a wholesale basis (to other carriers or utilities) and supports a range of connectivity options for Multiple Dwelling Units (MDUs), school districts, and government agencies.  Barracuda Networks, Park Merced, SF (MDU), Centrix Marine, and McKesson are a few of Nth Air's satisfied customers.  (There are other customers who do not want their names divulged).

As for equipment, Nth Air utilizes Airspan's 3.65GHz Fixed WiMAX gear, purchased under an OEM agreement from Fujitsu for its T1+ replacement service.  Equipment from other WiMAX vendors is also being evaluated.  There are several suppliers of microwave radio equipment, including Loea, Bridgewave, and Dragonwave, for the higher speed T3+ replacement offering. 

Niemeyer clearly states "I'm not going to sell a service to a customer who doesn't need it." On occasion, he has advised potential customers not to buy from Nth Air, when there was a more cost effective solution available elsewhere.  But he won't work for free either.  Niemeyer's rule of thumb is to require a ROI payback of < 8 months, before he will begin a network build-out.  Nth Air's average monthly recurring charge per customer (sometimes referred to as ARPU) is $4,500 - not bad at all for a start up carrier serving small to medium size business customers.

Nth Air's WiMAX evangelist is William Butte.  With the official title of Executive Vice President of WiMAX, Will has extensive experience in marketing, strategy and successful network deployments.  He worked in Asia the last five years, where he developed business plans and models for broadband wireless networks - all of which were successfully deployed.  Will seems to have a "fire in the belly" to get WiMAX deployed globally and is leading Nth Air into global alliances - initially in the U.S., Asia and Europe (more later in this article).

Nth Air's Calling Card

- Solid track record of delivering 3.65GHz fixed WiMAX based services to a variety of customers.  WiMAX at other frequencies is planned for fixed and nomadic broadband wireless access.
- Provides a viable alternative to ILECs for digital private line replacement, campus networks, MDU aggregation, backhaul from Wi-Fi hot spots, wholesale leasing, and overlay services.
- Very responsive to customer requests for quick installation, especially compared to ILEC provisioning of wired private lines. 
- Collaborating with other carriers to expand WiMAX deployments to underserved/rural areas in the U.S.  as well as to Asia and Europe.  For example, Nth Air is working with Green Packet (owner of Packet One in Malaysia) to deploy its communications manager software.

Whats next for WiMAX?

Nth Air sees several current directions and future trends for fixed/nomadic WiMAX:

- Campus networks, particularly for Wi-Fi backhaul are growing now and will continue to do so.  The Park Merced MDU complex in San Francisco is such an endeavor. 
- Cellular backhaul, particularly for CDMA, is a good fit for Fixed WiMAX if there is sufficient capacity available on the P2P or P2MP WiMAX links between cell towers.
- Global co-operation between WiMAX network operators/service providers will demonstrate the wireless industry is meeting the broadband connectivity needs of the current large number of underserved users.

Philosophy turned into Reality

The enthusiasm, missionary zeal and customer caring exhibited by these two executives is palpable.  They believe that a lack of wireless broadband competition in the U.S.  gave the ILECs no incentive or motivation to innovate.  Hence, business customers were not offered a wireless alternative to digital private lines or broadband Internet access.  To realize this objective, the company has joined a consortium that will apply for U.S.  broadband stimulus money (grants or loans) from NTIA and RUS.  The goal is to get fixed and nomadic wireless broadband services quickly deployed to underserved and rural areas. 

Conclusion

The U.S.  needs more privately funded companies like Nth Air, in order to stimulate innovation and competitiveness.  They are filling a need that is not now met by the ILECs, providing much more cost-effective connectivity options than with wire-line networks.  It's companies like this that could light a fire under the ILECs to be more responsive and competitive to their business customers. 

The company has a string of announcements planned in April.  We will check back with them at the end of the month to get you the inside story.




 

Sunday, April 05, 2009 in Deployments  | Permalink |  Comments (11)

Ben Wolff's CTIA 2009 Keynote: The Future of Wireless Broadband is "Clear"

During a keynote address earlier today at CTIA in Las Vegas, Cleawire's Co-Chairman Ben Wolff outlined the advantages of the nation's first 4G network and announced the development of a Silicon Valley WiMAX testbed for developers.

Wolff took the opportunity of the wireless focused audience to reiterate the need for new, all IP based 4G networks. 


Clearwire's Ben Wolff, CTIA 2009

"In the past, the focus of wireless networks was on coverage.  With the dramatic increase of data and demands of new applications, the focus is now on capacity.  If fact, Cisco has predicted that data usage on wireless networks will double every year for the next few years, and will increase an astonishing 66 times between 2008 and 20013.  The existing 3G networks are just not capable of handling this traffic."

Wolff then revealed the results of a recent Clearwire drive test comparison between its WiMAX network in Portland and other current 3G offerings available.  The WiMAX network reported an average download speed of 6.5Mbps, compared to 700Kbps for the 3G networks.  The WiMAX network also had 1/3 the latency experienced with the 3G networks.

Wolff also announced the development of the WiMAX Innovation Network, a west coast WiMAX testbed for developers.  Scheduled to launch this summer, the Innovation Network is designed to accelerate the development of 4G applications and devices by offering free service to qualified developers for one year.

The WiMAX Innovation Network will initially cover more than 20 square miles in Silicon Valley and bring 4G wireless service to campuses of some of the world's leading technology innovators including early participants Google Inc., Intel Corporation, and a leading educational institution in Silicon Valley.  Cisco Systems, Inc.  will provide core Internet Protocol Next-Generation Network (IP NGN) infrastructure equipment in support of the WiMAX Innovation Network.  Service is expected to be available to developers by late summer of this year giving them a head start on commercial service launching in the Bay Area in 2010.

Seeding a core group of early adopters is a smart move by Clearwire and should help evangelize the performance advantages of WiMAX networks.





 

Thursday, April 02, 2009 in Deployments  | Permalink |  Comments (2)

Towerstream Releases Fourth Quarter & Full-Year 2008 Earnings: Reports Strong Increase in Revenue & Improving Margins

US based business WiMAX broadband provider Towerstream released earnings Wednesday reporting double-digit revenue growth and improving margins and cash flow. Feature interview with Jeff Thompson, CEO Towerstream.

Fourth quarter revenue was $3.3M up 12% from the third quarter and up 68% from the year prior.  Full year revenue was $10.6M, up 56% from the year prior.  The company also reported continued improvements in gross margins and EBITDA cash flow.  A few weeks back we had the opportunity to sit down and talk with Towerstream's CEO Jeff Thompson.

Towerstream is a leading WiMAX service provider in the U.S., delivering high-speed internet access to businesses.  Founded in 2000, the company has established networks in nine markets including New York City, Boston, Los Angeles, Chicago, the San Francisco Bay Area, Miami, Seattle, Dallas-Fort Worth, and the greater Providence area where the company is based.  The company was the first carrier selected to join the WiMAX Forum to assist leading vendors in establishing industry compliance with international broadband wireless access standards and cross-vendor interoperability.

The company provides service to a wide range of business customers.  "Every vertical has bought from Towerstream," says Thompson.  "We have financial, health-cares, large brands, small brands and start-ups."

Ask Thompson what is driving increased demand for higher bandwidth services and you will likely get the same three word reply - "Video, video & video.  With the increased use of video, T1s are no longer enough and some customers may not need or be able to afford the additional cost of a T3," says Thompson.  "Wireless technologies provide the flexibility to dial-in the amount of capacity that the customer needs."

"If you are a business and you are trying to use the internet to save money, you have to have a high-quality bandwidth connection," says Thompson.  "A lot of these business applications require a lot of upstream capability which means DSL is out the question and cable as well.  It really gives us a competitive edge."

Towerstream provides 3 tiers of service using a variety of technologies over both licensed and unlicensed frequencies depending on the customers needs.  For customers requiring T1 type service, Towerstream offers a 5Mbs service utilizing standard WiMAX equipment.  For customers that need more than a T1, but less than the 45Mbs of a T3, Towerstream offers a mid-tier 5-15Mbs service using radios from Alvarion and Redline over different channel sizes.  For customers with even higher bandwidth requirements, the company utilizes P2P (point to point radios) at higher frequencies.

In addition to the flexibility in the type of service plans allowed by wireless broadband, WiMAX also offer the advantage of being able to be provisioned quickly to the customer.  Customers requesting changes to their fixed line services must often have to wait weeks, while WiMAX services can typically be provisioned in a few days depending on the operator.

For the most part, customers seem to be satisfied with the service.  Towerstream's churn is reportedly less than 1.3% and is able to offer guarantee throughput with its contracts.  "We have these service-level capabilities and that is what our customers like about the service.  Our churn rate is low and is a reflection of that," says Thompson.

Towerstream also appears to be making some head-way on its profitability targets.  Just last month, Towerstream announced that their Los Angeles market had reached EBITDA profitability (earnings before interest, tax and depreciation/amortization - a non-GAPP approximation of operational cash flow).  "Six of our nine markets are now EBITDA profitable, including the three largest markets in the U.S., said Thompson.  "Our continued progress demonstrates the leverage of our business model and the predictability of our revenue stream."

Thompson comments that the company has learned much as it has built out its markets - putting in a few POPs (points of presence) and then building out from there based on customer demand.  "It's a very physical business.  Coverage is key and you have to be smart in how you cover a market and continue to execute," says Thompson.

In NYC for example, the third market entered, Towerstream reportedly has coverage in 90% of the city.  "You never have enough coverage.  We try to get to over 90% of coverage in each market - that is out goal.  Is almost impossible to get to 100% based on certain limitations of the city, such as limitations with a small section of a town."

"What is great about WiMAX is that I can take this base station and put it anywhere.  I can put in a Rural base station and will make a certain amount," says Thompson.  I can then take that same base station and put it up on the Empire State building.  You want to make sure you put those base station where they are going to get filled up on customers.  Eventually you get good coverage with the more you build out.  We have a controlled roll-out - each market is different."

When asked about other technologies such as LTE, Thompson takes a pragmatic approach.  "There are real deployments with WiMAX and the equipment is shipping today.  LTE and WiMAX are different business models.  WiMAX is more of an open model and not controlled by who operates the network.  As for deployments, It took Wi-Fi 5 years to get the adoption and WiMAX is just in the first year."

Needless to say, being able to execute in the current economic environment is an accomplishment and Towerstream appears focused on its model.  The company also has the resources to grow and ended 2008 with $25M in cash on its balance sheet.  "We are well financed and have the money we need to execute our business model and get the overall company profitable," says Thompson.



 

Thursday, March 19, 2009 in Deployments  | Permalink |  Comments (4)