TMCnet - World's Largest Communications and Technology Community





[February 15, 2005]


WiMAX: Nirvana Delivered?


What is WiMAX?

“100Mbps over 100 miles to your PDA“! This is how WiMAX was first described to me over two years ago. The technophile in me said “AWESOME”, the skeptic in me said “Yeah, right“, and the businessman in me said “Hmmm…let’s take a look”.

WiMAX, a very hip name that elicits images of a Keanu Reeves movie, actually stands for “Worldwide Interoperability for Microwave Access”. Interestingly, WiMAX is not really a technology, but a forum to ensure interoperability within an existing standard. That standard is IEEE 802.16, which comes in two flavors: a fixed-wireless standard, commonly referred to as 802.16-2004, and a mobile wireless standard, referred to as 802.16e. While reports vary on the actual speeds that WiMAX can support, research suggests it can handle fixed-wireless speeds for non-line-of-sight cells around 6 to 10km apart at about 70-75 Mbps. The mobile version of WiMAX reportedly supports data rates of 15 Mbps from a tower 2-5km away. Other reports suggest even faster speeds for both fixed and mobile WiMAX.

Not surprisingly, WiMAX licensing differs by geographic region. Licenses have been granted in the United States at the 2.5 GHz spectrum and outside the United States at the 3.5 GHz spectrum. Additionally, the first products will likely use the unlicensed 5.8 GHz spectrum in the United States and abroad. Both the 5.8 GHz and 3.5 GHz will likely be used primarily for fixed wireless applications, whereas the 2.5 GHz spectrum will likely be used for mobile products. This 2.5 GHz spectrum is 80% owned in the U.S. by Sprint and Nextel, who have announced plans to merge. It is possible, however, that Sprint and Nextel will wait for mobile wireless application (802.16e) to deploy usage of the spectrum.

From a rollout perspective, the recent 6-month delay in WiMAX certification will probably not be critical or have any serious long-term effects on WiMAX success; WiMAX will be reckoned with over the next 5-7 years, so a 6-month delay should not make a pivotal difference, although it will be important for the WiMAX Forum to prevent further delays in order to avoid investor frustration and maintain momentum. In 2005, we should expect to see the first fixed wireless outdoor antennas for WiMAX-certified CPE, with CPE costs ranging from $200 to $600. In 2006, indoor fixed-wireless should become available and CPE prices should begin to drop. By 2007, PCMCIA laptop cards for mobile WiMAX should hit the market and CPE costs will likely drop below $200. By 2008, we’ll start to see 802.16e chips included in mobile devices and CPE costs dropping below $50-100. By 2010, we can expect WiFi and WiMAX to be ubiquitously deployed in mobile devices.

Perhaps the most encouraging aspect of WiMAX is not the bandwidth but rather the WiMAX Forum, a group of companies that seems to be “doing it right” in terms of preparing for the rollout of 802.16 equipment and services. The WiMAX Forum is similar to the WiFi alliance for 802.11; it is comprised of over 150 manufacturers, carriers, and software developers working together to ensure worldwide interoperability of the IEEE 802.16 standard. This is the group that will provide the WiMAX certification test. The consortium has as its members the likes of Intel, Siemens, Lucent, Motorola, Nortel, Time Warner Telecom, Samsung, AT&T, and SBC, among others. But the beauty of the forum is that it is organized into work groups that represent all of the critical aspects of a successful WiMAX roll-out. These include working groups focused on marketing, regulatory, service provider, technical, and certification. They have done a good job covering WiMAX adoption, supply chain, and legal issues, and, of course, standards and interoperability issues. Interestingly, the WiMAXforum members represent over 75% of < 11 GHz broadband wireless equipment sales.

VoIP and WiMAX

As mentioned above, it is likely that one of the first uses of WiMAX will be backhaul for WiFi hotspots. By 2006 at the latest, we should see hotspots being converted into so called “hot zones”, especially for users of WiFi VoIP phones, such as the VoiceLine XJ100 by Net2Phone. This WLAN hotspot backhaul will probably be the first usage of WiMAX beyond the fixed wireless broadband for emerging and/or rural markets. Over time, coverage from WiMAX and WiFi should allow VoIP phone users to seamlessly communicate over metropolitan areas, large outdoor hotspots, or campuses covered by WiMAX. Finally, as mobile WiMAX becomes available beyond 2007-2008, we should see VoIP phones served via WiMAX spectrum, especially in rural or hard-to-reach areas. One thing is for certain: VoIP and WiMAX will be complementary to each other over the next 3-5 years.

WiMAX Threats

One of the main threats to WiMAX success is a competing standards group called “Super 3G”. This consortium is made up of companies like Vodafone, NTT DoCoMo, and about twenty others (including some members of the WiMAX Forum) and expects its commercial launch around 2009-2010. This “Super 3G” standard will be based on an upgrade for W-CDMA and is reported to support speeds ten times faster than UMTS. However, the fact that Samsung has joined the WiMAX camp is a setback for the Super 3G group; Samsung had recently developed the OFDM-based Wi-Bro standard in Asia, but recently has harmonized Wi-Bro with WiMAX.

Although hotspot growth and municipal WiFi will serve as a significant complement to WiMAX, especially in the early years via backhaul connections and for VoIP phone users roaming off a WiFi hot spot, they also pose a threat. Municipal WiFi endeavors, such as the recently announced $10 million, 135 square-mile city-wide hot zone in Philadelphia, will potentially make mobile WiMax redundant inside the city limits. However, as mentioned above, WiMAX may be used to tie together these municipal WiFi “mesh networks” so that a VoIP phone user traveling from, say, Philadelphia to Trenton, NJ (which may also deploy a WiFi network in the future) would never lose coverage.

Finally, we all know that the carriers, like Verizon Wireless and Cingular, are not going to sit idly by and let a new high-speed network standard encroach on their turf. MSOs and telcos are also going to fight to ensure that they do not lose share for high-speed data services. Luckily, both the carriers and MSOs/telcos have a good 2-3 years to prepare their response. Perhaps this threat of entrenched competition on the defensive is the most daunting and formidable for WiMAX.

Business Models

As we all know, an access technology is only as good as the business models that support it. One company that has capitalized on WiMAX is TowerStream, which has launched enterprise services using pre-WiMAX equipment in Boston, New York, and Chicago. The company, which is already operating at a profit and has hundreds of customers, offers T1 and above fixed-wireless speeds to business customers. TowerStream targets mostly small- and medium-sized businesses, offering up to 1Gbps delivery at prices competitive with the LECS and IXCs. They are also looking to the future and experimenting with WiFi SIP phones and expects to transition at some point from WiFi to WiMAX as mobile 802.16e handsets come online.

Certainly, other business models will arise. It is not far-fetched to imagine current VoIP providers partnering with an emerging WiMAX provider to deliver data and voice services over the network. And, companies that can figure out a viable economic model for offering video, data, and voice via fixed-wireless to the home (FWTH?) will also be in a position to compete for share in the consumer market. These firms will have a viable value proposition by offering VoIP, plus all DBS capabilities, plus upstream data. Layer on other IP services, and voila … a real threat to the satellite/telco partnerships emerges, especially in rural areas. Furthermore, as in the TowerStream example above, service providers seeking to serve the SME or enterprise sector who can provide the appropriate service levels will be able to steal share in those markets as well. Lastly, once mobile WiMAX is viable, more business models will surface to serve the consumer market; we’ve only seen the tip of the iceberg in terms of business models to support this burgeoning standard.


We all know that VoIP is going to drive new revenues and business models in the decade to come. Certainly, WiMAX will capitalize on this and further support the proliferation of VoIP devices and IP-based services. WiMAX has been touted as the 4G technology that will win in the marketplace. Whether or not the putative threats to WiMAX materialize or not, all players within our space must seriously consider the impact on their businesses that will result from WiMAX implementation.


  • “WISPs blaze trail for WiMAX”; Wireless Watch; 11/12/04
  • “Super 3G Group flexes its muscle”; Wireless Watch; 1/10/05
  • “WiMax to steal 3G and DSL market share”;; 12/10/03
  • “Mobile players look beyond 3G”;; 1/5/05
    Internet Telephony Magazine; Volume 7, Number 12; December 2004, p. 23.
  • “In-depth analysis of WLAN, cellular and broadband wireless markets”; Wireless Watch; 1/20/05
  • “Down to the Wire”; Phildelphia Weekly; Gwen Shaffer; 1/19-25, 2005
  • Conversations with Yankee Group Analysts Lyndsay Schroth (1/31/05) and Phil Marshall (2/1/05)
  • “Positioning WiMax for success in the global broadband market”; Lindsay Schroth; Yankee Group
  • “Wireless access network technologies: a guide for the perplexed”; Ovum; Jeremy Green; Nov. 2004
  • “Intel’s WiMAX Broadband Wireless Strategy”; Randy Trost; Intel; Intel Communications Group
Barat T. Dickman is a Senior Manager in Accenture’s Communications & High Tech Strategy Practice. He has over 10 years experience working with global communications and media companies. He can be reached at

Purchase reprints of this article by calling (800) 290-5460 or buy them directly online at

Respond to this article in our forums!

Technology Marketing Corporation

2 Trap Falls Road Suite 106, Shelton, CT 06484 USA
Ph: +1-203-852-6800, 800-243-6002

General comments:
Comments about this site:


© 2021 Technology Marketing Corporation. All rights reserved | Privacy Policy