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July 13, 2010

Visant Strategies, a wireless industry research firm, recently noted in a report that new WiMAX specifications and overall growth in fixed and portable WiMAX deployments globally could create a fairly large market for WiMAX equipment until at least 2020, despite some claims that the technology itself could be in trouble.

In its report “Fixed, portable and mobile WiMAX: Building a market today and influencing choices tomorrow,” Visant says that new specification for 802.16m, also known as mobile WiMAX, will address a number of shortcomings with the 802.16e Wi-MAX standard, including lowering costs and providing a more appealing business model overall.

“Overall, most wireless carriers have committed to LTE (long-term evolution) for 4G, sometimes after HSPA+, but WiMAX equipment makers will still enjoy a vigorous market. Low-cost PC initiatives, falling WiMAX costs and the global availability of the 3.5 GHz band for basic fixed broadband services presents a very large opportunity for WiMAX equipment vendors,” said Andy Fuertes of Visant Strategies.

But not everyone agrees on WiMAX and some feel the technology could be in trouble.

Nevertheless, Visant still forecasts that WiMAX equipment revenues will surge to more than $35 billion by 2016 fueled by mobile WiMAX subscriber growth increase more than 8 times current levels to more than 1 billion global customers.

Visant added that wireless carriers that have recently acquired spectrum licenses in markets like India may be forced to move ahead with WiMAX due to a lack of options in the short-term, but that eventual migration to the TD-LTE standard could prove a “real challenge regarding how to manage the millions of WiMAX device users.”

“Overall, there will be a very large fixed broadband audience by 2016, over one billion according to the findings in the Visant report, and fixed-portable WiMAX will account for a good share of this audience and help fuel mobile WiMAX use as these same wireless carriers expand their coverage area in many emerging regions,” said Larry Swasey of Visant Strategies.

“We are already seeing WiMAX deployments in emerging economies that allow intra and inter-city portability, the beginning of all this fueling,” added Swasey.

For its part, In-Stat also noted in a recent report in June that WiMAX could be in for some challenges as competing technologies like LTE begin coming to market. The firm did note that it expects worldwide WiMAX subscription revenues to approach $30.2 billion in 2014, though major hardware vendors have announced they planned to stop WiMAX product developments.

New research recently performed by In-Stat suggests that WiMax broadband technology is facing increased competitive pressure that could impede its long term growth for the next few years.

In its survey, “Global WiMAX Subscribers, Base Stations and Revenues,” In-Stat notes that the future for Wi-MAX technology is a mixed bag as other wireless technologies all compete for the same market share.

A separate report from Maravedis also detected some worries as to the future of WiMAX. The company noted that while WiMAX wireless operators served about 7.2 million customers at the end of the first quarter, recent mobile service carrier defections from the standard have caused issues.

Russian wireless carrier Yota recently said it planned to abandon its WiMAX deployment plans in favor of LTE technology, while in the U.S., Clearwire Corp. has said it was looking at possibly deploying other technologies outside of WiMax.

“It appears that as one door opens for WiMAX, another one simply closes,” said Chris Kissel, an In-Stat analyst.

“In the past year, there have been some positive developments in consumer devices, including smartphones that use WiMAX for data but revert to 3G airlinks for voice. But in many other regions, regulators are postponing spectrum auctions. And several major digital communications firms are lowering their commitments to WiMAX or leaving the segment altogether,” noted Kissel.

“Overall, wireless carriers are very concerned about the perceived lack of commitment towards 802.16m,” said Maravedis Research Director Adlane Fellah.

“But even despite the hype surrounding TD-LTE, we still don't see much of an ecosystem in the near term,” said Fellah.

The research firm added that wireless carriers that have recently acquired spectrum licenses in markets like India may be forced to move ahead with WiMAX due to a lack of options in the short-term, but that eventual migration to the TD-LTE standard could prove a “significant challenge regarding how to manage the millions of Wi-MAX device users already deployed in some major markets.”

But to some industry obeservers, the wireless spectrum auction in India didn't exactly go as planned. In fact, some say it was almost a complete disaster, and there was not to be much coordination in the effort.

Maravedis, another wireless industry analyst firm expressed similar worries, noting that its research has shown that wireless carriers are concerned about the lack of support for the 802.16m standard, which could seriously hinder enthusiasm for greater WiMAX deployments going forward.

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Source: Visant Strategies.