There's a lot of enthusiasm behind the developing WiMax standard for wireless broadband, but the market has seen hype before.
There are positive signs, such as Intel's backing. And there's a lot of potential. Even the skeptical eye should be watching this one.
As a result, some believe that it could slash the cost of bringing broadband to remote areas and potentially open the doors to new broadband competition, leading to lower prices and faster consumer adoption.
In a campaign speech Wednesday, Democratic presidential candidate John Kerry sang the praises of wireless broadband as a fix for the anemic state of the country's Internet fabric, which lags other developed nations such as South Korea. But the technology is still in the early test stage, and many of its claims have yet to be proven in real applications.
With Thursday's blessing from the Institute of Electrical and Electronic Engineers (IEEE), a technology that has been mostly hype finally has a chance to start proving itself.
"There is now an agreed-upon technical base for these (WiMax products), which is essential, if you're going to have interoperability leading to mass market adoption and low-cost service (for wireless broadband access)," said Craig Mathias, an analyst at research firm Farpoint Group.
Unwiring the last mile
WiMax, short for Worldwide Interoperability for Microwave Access, is the latest--and so far, the most promising--of the wireless "last mile" broadband technologies. Carriers see WiMax as a means of connecting rural or remote areas with broadband service, something that would be technically, physically or economically difficult to do by burying wire for DSL or cable connections. In congested cities, equipment makers say, WiMax products could shift traffic to help relieve heavy demand on broadband networks.
WiMax will work with other shorter-range wireless standards, including Wi-Fi, which has taken off as an easy way to provide Internet access throughout a home or business. Eventually, WiMax advocates hope to see the standard evolve into a mobile wireless Internet service similar to cellular data technologies such as EvDO (Evolution Data Only).
"This technology gives companies significant advantages when it comes to deployments, because you don't have to set up a new infrastructure...so there isn't a lot of tearing up of streets needed to set up networks," said Joe English, a WiMax campaign manager for chipmaker Intel, which has been a major backer of the technology.
The emergence of WiMax products could help reduce expenses for broadband carriers and consumers by doing what Wi-Fi did for wireless home networking--make it affordable and in turn widely used.
Thursday's IEEE decision will bring cohesion to
development efforts that until now have been pushed ahead piecemeal by a
handful of companies, including Alvarion, Redline Communications and
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Products based on prestandard versions of the 802.16-2004 specification are already on the market. British carrier BT is testing wireless broadband services in the United Kingdom, using Alvarion equipment based on draft versions of the specification.
Intel announced a deal this month with Proxim to, with base stations available by early next year.
Analysts estimate that subscriber stations for home access will initially cost up to $300. Base stations will cost as little as $5,000 but will reach $100,000, depending on their range. In some cases, consumers would lease subscriber stations from carriers the way they do with cable set-top boxes as part of their service plans.
Providing a patchwork
Analysts said the first WiMax-certified products will likely be base stations for carriers looking to expand coverage in remote areas and take on traffic burdens in congested areas. Base stations are similar to cell towers in that they send and receive transmissions. WiMax base stations can blanket an area by connecting to a wired connection or linking with other base stations.
Base stations will be able to connect to other base stations within a range of up to 30 miles with data transfer speeds of up to 75 megabits per second. Subscriber stations, the set-top box-like devices, will connect to base stations with ranges of up to three miles and transfer speeds of up to 15 megabits per second.
Carriers and service providers will also have greater control of what services and plans they can offer subscribers from a base station. A carrier offering 700 kilobit-per-second and 1.4 megabit-per-second service plans could deliver both from the same base station.
Despite its momentum, WiMax still has a long way to go, and it may yet falter in the marketplace. Sky-high expectations for wireless broadband services are not new, but neither are disappointments. History is pock-marked with dramatic wireless failures, such as those ofand MobileStar.
"The hype is way outpacing the substance right now," said Jim Smith, a general partner at venture capital firm Mohr, Davidow Ventures. "Even when it becomes widely available, I don't expect it to be the solution carriers will use in their tier-one markets; I see it more likely to be used in second- and third-tier markets, and even there, it won't be big for another three to five years."
Even Wi-Fi, embedded in nearly every new computing gadget to provide short-range networking, has not yet established a service market with significant revenues. However, the opportunities are much higher in the wireless broadband market than they are in wireless networking, making WiMax something service providers and carriers can't dismiss as just another overhyped fad.
Use of broadband connections in the United States shot up 42 percent to 28.3 million connections in 2003, according to the Federal Communications Commission. WiMax could theoretically make it easier and less expensive for carriers to entice even more subscribers.
"What we're talking about is radically affecting cost...but the question is: Will it spur the market?" Mathias said. "That's what we expect, but by how much?"
There are a number of other wireless data and broadband technologies being tested by companies looking for alternatives to wires. Power line broadband and next-generation cellular technologies such as EvDO are also being kicked around. Another standard that is considered very similar to 802.16 specifications is 802.20.
Supporters of the 802.20 envision megabit-per-second data transfers with ranges of several miles. Initial enthusiasm was behind 802.20, which was designed as a standard for mobile devices, but the shift of industry support to WiMax's 802.16 specifications have put the brakes on 802.20. In fact, some of its major proponents have joined the WiMax Forum, including.
Chipmaker Intel'sgave WiMax a significant boost over 802.20. Many observers recall that Intel's support for Wi-Fi propelled the growth of that technology, and they expect similar results for WiMax.
Intel gave the 5-year-old technology a boost when it became a member of the WiMax Forum in 2003, joining Alvarion, Airspan Networks, Nokia, Proxim, Redline and Aperto Networks, among others.
"We envision (wireless) broadband connectivity everywhere, all the time," said Ron Resnick, president of the WiMax Forum and a director of marketing at Intel. Intel is expected to have WiMax-ready chips available by the end of the year. "Through broadband, we feel we can sell more (central processing units)."
Resnick said timing played a major role in Intel's decision to back 802.16 standards, as did direction. WiMax-compliant gear is expected by early next year, but 802.20-based products aren't expected until 2006. Resnick added that 802.20 was more focused on being a cellular competitor, while Intel was looking for more of a data technology.
"We envision (wireless) broadband connectivity everywhere, all the time."
--Intel executive Ron Resnick,
president of the WiMax Forum
While 802.20 was designed for mobile devices, WiMax will include mobile features when 802.16e is completed, which is expected by early 2006. WiMax products will initially be for fixed broadband wireless services such as delivering broadband to the home, but WiMax's mobile specification, 802.16e, will allow portable WiMax devices to send and receive data over broadband wireless networks.
Still, it will probably be several years before WiMax will challenge wired services. Broadband wireless services aren't likely to, according to a report from two telecommunications consulting firms, BWCS and Senza Fili Consulting.
"This will not be an overnight transformation, and it will be tough (for WiMax) to establish itself," said Michael Cai, an analyst at research firm Parks Associates.