By Cintia Garza, Market Analyst with Maravedis. Cintia obtained a Bachelor degree of International Commerce from TEC de Monterrey, Mexico with a specialization in International Business from HEC Montreal and Carleton University, Ottawa. She focuses in market research for BWA/WiMAX applications. She has recently completed with Maravedis a database with information of telecom service providers and regulators worldwide. She speaks fluently English, French and Spanish and is based in Mexico.

Tell us Who is Axtel?
Axtel is a Mexican telecommunications company that provides local telephone services, national and international long distance services, data, Internet, virtual private networks, and value added services.

Axtel has brought to the market various access technologies that include fixed wireless telephony, point-to-point radio links, point-to-multipoint radio links, and fiber optics, all of which are offered to match the communication solutions that its customers require. The company has 2,940 employees. As of the end of 2005 the company's revenue accounted for $4967 millions of Mexican pesos, and net income of $284 million of Mexican pesos. Revenues and net loss for year ended 2004 were $3989 and $(80) millions of Mexican pesos respectively.

On December 7, 2005, the company began trading publicly on the Mexican Stock Exchange completing an initial public offering of $3,360 million pesos with a very positive response from the financial community, reflecting the company's operational and financial strength and providing an extraordinary foundation for a profitable and sustained growth.
The company also signed agreements with Intel and the Mexican Federal Commission of Electricity (CFE) to develop WiMAX and Power Line Communications (PLC). The deployment of these technologies will complement and empower Axtel's portfolio of services by providing internet broadband services in a multi-service approach and will also strengthen Axtel's position in the Mexican market.

In how many markets are you active today?
We currently operate in 17 cities in Mexico. Our 3 main principal markets are Mexico City, Monterrey and Guadalajara, but we also have a strong presence in Puebla, Leon, Toluca, Queretaro, Aguascalientes, Ciudad Juarez, Tijuana, La Laguna, Veracruz, Celaya and Hirapuato.

Market segments
We provide our services to the residential market and business market. In the business market we go from small and medium business to large business, and Corporations and the Wholesale market.

Number of lines: 696, 968 lines from which 60% are from the residential market and the remaining 40% are from the business market. However only few thousands have 386Kbps or more.

In which cities have you deployed WiMAX?
We are using this technology just in Monterrey city. Axtel's plan is to launch new services based on the 802.16e version, but due to the delays of this standard we are just offering fixed WiMAX services 802.16d in Monterrey to provide broadband internet services and some services of VoIP. Our plan is that once standard "e" is available, we will offer services to the remaining markets in 2007, and we want to create a nationwide WiMAX network..  But again, everything will depend on the equipment availability.

Which customers are you currently addressing with WiMAX?
We are offering this service only to residents and small business, just in some areas of Monterrey city. Since our foundation in 1999 our company's technology and infrastructure has been wireless, to date we have a complete infrastructure of antennas and base stations, over this same infrastructure we are deploying WiMAX. So for us it has been very simple to adopt WiMAX since we already have the infrastructure and the inversion is much more less than if we had copper cable infrastructure like other companies.

Talking about equipment suppliers& Which equipment are you using? And from which supplier?
We are evaluating several suppliers; we currently didn't have any contract with a specific supplier. We have been testing Alvarion technologies. But for WiMAX "e" we are still evaluating which technology to use for our nationwide deployment plans.

When it was the first time that you introduce WiMAX in Monterrey?
We started to commercialize WiMAX in October of 2005. In November of 2005 we included a press release with Intel, we signed with this company a co-marketing agreement of WiMAX, in that moment we were one of the first 13 companies in the world to commercialized WiMAX and the first one in Mexico.

What have been the advantages of using this new technology?
Since our inception we started using Proximity antennas from Airspan. These antennas give you 2 phone lines and Internet access of up to 99kbps. This technology operates under the 3.4GHz frequency; we are the only company with the license to use this frequency nationwide. The interesting thing for us is that WiMAX also use this frequency, and uses spectrum in a more efficient way, this means that if more example with our currently technology we can offer services to 100 clients, with WiMAX we are able to offer services to 250. That's why we pretend to move our clients from our current technology to WiMAX.

Another advantage is that WiMAX provides broadband; Axtel didn't have wireless broadband before, so now we can offer high speed internet of up to 2Mbps and this is what customers are looking for, customers are demanding broadband.

On the other hand, some smaller service providers that have been trying to launch services with WiMAX have been using "free use" frequencies in some equipment. The main problem they face is that since it is a free use frecuency it is likely to present problems of interference. Since we are the only company in Mexico with the 3.4GHz license, none of those service providers can offer services at a level of Axtel. So this is our main advantage that we have this private frequency and we will avoid those problems of interference.

What are the main challenges?
The most important challenge is to migrate from the traditional telephony technology VoIP. All our clients that use WiMAX will start using VoIP.

However for other companies in Mexico, the main challenge will be to migrate from the cable infrastructure to wireless to implement WiMAX, while for use this is infrastructure has been our original way of working.

Future Plans
We are the only company in Mexico that belongs to the WiMAX forum. We are currently working and evaluating equipments to determine who will be our suppliers. Our plan is to migrate nationwide to Mobile WiMAX in 2007. If it wouldn't be that WiMAX "e" is not yet available all our markets would be already addressed with WiMAX.

What are the expectations about WiMAX?
WiMAX will complement Axtel's services. WiMAX will allow us to reach economies of scale, thus reducing prices in technology and infrastructure.

The VoIP service is the main source of revenues for the company, however the company considers that multimedia services are for the moment the only ones to be included in this proposal and later on they will consider including portability and mobility as complements.

What speeds and distances do you expect to reach with those equipments?
We expect that spectral efficiency will be between 2.5 and 3bps/hz. Through a channel of 1.75 MHz we should reach the 4.4 Mbps and 5.25Mbps. Currently our cell sizes are of 2.5 Km we don't expect that this size varies significantly, however in the trails deployed we have reach between 12 and 20 Km with LOS.