Samsung Explains Its Global Focus on WiMAX

In an Informative series of questions and answers Samsung details its thoughts on the terrific opportunities WiMAX offers

WiMax.com: When did Samsung first enter the mobile cellular market and what percentage of your business does that account for globally? Can you give us some idea of the scope of your mobile business?

Samsung does not break-down it's financials by product line, but the mobile systems division contributes the majority of the sales revenue of the telecommunications division.

WiMax.com: Is Korea Samsung's biggest market for mobile wireless (voice or broadband) or is the US or Europe your leading customer base?

Over 84% of Samsung's sales revenue is from sales overseas, (vs. in Korea). Note the significant increase in exports from 2003 to 2004:


WiMax.com: What lessons has Samsung learned by delivering successful CDMA, WCDMA, GSM and UMTS solutions to the marketplace that other mobile vendors will have to achieve a learning curve on? Basically tell us please, how Samsung's track record positions it uniquely with Mobile WiMAX, WiBro or other broadband wireless technologies?

Samsung was the world's first to commercially deploy CDMA2000 1X & 1xEV-DO and the first to demonstrate 1xEV-DV. We have already demonstrated our WiBro system and are currently deploying this technology in S.Korea with commercial service expected by April 2006. We have modified our existing CDMA2000/WCDMA base stations to support this new technology, so the systems are market proven. Samsung is uniquely positioned as it offers both handsets and infrastructure. It is easy to demonstrate leading edge technology in a lab or trade show environment, to successfully deploy this technology in a commercial setting is much more difficult.

WiMax.com: Samsung has reportedly been a big fan of the OFDMA® approach (sometimes called SOFDMA), and reportedly lobbied hard for it to be included in the 802.16e standard---is this technology the one developed by Runcom? Also, why does Samsung prefer this technology for Mobile broadband wireless versus OFDM 256FFT?

I do not have this information.

WiMax.com: When did Samsung join the WiMAX Forum" and why? What driving forces or strategies led Samsung to become involved in WiMAX? Where does Samsung see its position and participation in the Forum evolving toward during the next three years?

Samsung is very involved in industry forums and standards bodies to ensure global standardization. Samsung is a board member of the WiMAX Forum and chairs the Mobility TG & is the vice chair of the Network WG.

WiMax.com: Does the WiBro standard pre-date the 802.16e standard? How did WiBro come about? And what was the need for a separate Mobile WiMAX type standard---was it because of a need to deploy in Korea much faster?

WiBro is the "Wireless Broadband" service in Korea. WiBro is based on Mobile WiMAX technology and Mobile WiMAX is fully compliant with IEEE 802.16e TDD OFDMA Standards. The 802.16e standard is expected to be ratified by 4Q2005 and certified products available by 3Q2006.

As shown in the following slide, the Wireline broadband market is reaching market saturation, (at 79%) and the wireless operators have able to consistently increase their ARPU through offering Wireless Broadband applications & services to their customers:

samsung-pic1

WiMax.com: What are the advantages of the WiBro approach versus the (perhaps) more feature rich 802.16e Mobile WiMAX complete standard debuting soon?

WiBro is being deployed with the frequency and channel bandwidth that is available in that country.

WiMax.com: Was the WiBro initiative a major reason why OFDMA® technology profiles were chosen for Mobile WiMAX in Samsung's view? Also, if, for example, the Forum had chosen to use an OFDM 256 FFT approach would Samsung have gone forward with marketing WiBro products in Korea and the US?

I do not have this information.

WiMax.com: Does Samsung have any interest developing or marketing in Fixed WiMAX products and why?

No, we feel that the mobile market has a larger revenue potential. Mobile WiMAX has several advantages over Fixed WiMAX:

Mobile WiMAX supports VoIP
Handover is supported in Mobile WiMAX
Mobile WiMAX supports many power saving features such as: awake, idle & sleep modes

WiMax.com: Does Samsung believe that the WiMAX initiative is weakened by having two separate standards for Fixed and Mobile WiMAX---something the Forum initially set out to avoid?

No, different applications require different solutions optimized for the unique characteristics of each.

WiMax.com: Does Samsung believe that with two separate standards for Fixed WiMAX and Mobile WiMAX that the economies of scale that Mobile WiMAX and/or WiBro should ultimately achieve will trickle backwards to the Fixed WiMAX (802.16-2004) technology?

I do not have this information.

WiMax.com: Samsung recently announced a testing and development agreement with Sprint for Mobile broadband wireless products---will the gear being tested be WiBro specific gear with a different spectrum range or will Samsung instead offer the more option rich 802.16e Mobile WiMAX product line to Sprint?

Sprint Nextel has agreed to conduct lab trials at their company facilities and field trials with customers with our prototype terminals and supporting core network equipment to help substantiate next generation wireless network infrastructure requirements for future wireless interactive multimedia services.

WiMax.com: Samsung is a successful player with universal mobile telecommunications system (UMTS) designs for broadband wireless systems along with WCDMA---How much influence has your design experience with these technologies influenced your WiMAX designs? Also, how do you compare the relative trade offs between the two types of technology?

We are modifying the design of our existing CDMA2000/WCDMA base stations to support Mobile WiMAX. CDMA will continue to offer wireless operators with a solution for basic voice, mobility and reasonably high data rates. In contrast, Mobile WiMAX offers greater data rates with a decrease in mobility, (limited to 120km/h) and coverage.

WiMax.com: Is spectrum range much of an issue for a company like Samsung? And what ranges do you see being most likely used in the US beyond 2.5 GHz as well as globally? Also, on a global scale but particularly in the US, where does Samsung see additional spectrum being freed up---or would like to see freed up to facilitate the adoption of WiMAX products?

No, spectrum range is not a technical issue for Samsung, (it is a commercial issue).

WiMax.com: Do you see WiMAX being disruptive to 3G technologies or supportive---and why? Is WiMAX the future of broadband wireless?

The technology is supportive, (3G will continue to offer wireless operators with a significant revenue opportunity), however may be disruptive as it may allow other companies (satellite, cable & wireline operators) to enter the wireless market and directly compete with existing wireless operators.

WiMax.com: What question are we not asking about Samsung's approach to its position in the WiMAX ecosystem that we should be? Essentially, please tell us what we are missing about Samsung and its approach to WiBro or Mobile WiMAX?

Samsung will give a trial performance of this technology at the Asia Pacific Economic Cooperation (APEC) Summit this year.

OFDMA® is a registered trademark of Runcom.