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4/7/2006
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WiMax Won't Be Everywhere Anytime Soon

A community wireless hotspot is a nice idea, but it won't be applicable in the U.S. for at least a few more years.

THE HOPE
A community wireless hot-spot, giving laptop users roving broadband access at a fraction of today's cost.

THE CATCH
Mobile WiMax won't arrive in the United States until 2008 at the earliest.

Thinking of building a Wi-Fi network or subscribing to a third-generation cellular service, but wondering if WiMax will make them obsolete? Rest easy. As a high-speed wireless system, WiMax is going to have its impact on the world. But it's more likely to be felt in an Indian suburb than a U.S. city.

The first officially certified WiMax products came out in January. The WiMax Forum, which certifies products that pass interoperability tests, touted it as a milestone, but the initial products have some serious limitations. The standard is intended for fixed access--that is, beaming broadband into a receiver in a house, not a laptop on the go. The PC adapters are too large to fit inside a laptop and sometimes even require an antenna on the outside of a building. Also, the current standard requires dedicated 3.5-GHz spectrum, which isn't available in the United States.

WiMax will be useful everywhere, but its biggest potential is in developing countries. The main customers so far are carriers in India, where voice and data networks have failed to keep up with the booming economy. WiMax lets operators offer DSL-like services without the expense of laying wires. "The business model isn't video on demand. It's getting a dial tone in places where there are only two phones per 100 people," says Manish Gupta, VP of alliances at Aperto Networks, one of the four vendors whose WiMax gear was certified in January.

The technology's greatest potential in the United States is as a competitor to DSL or as an extension to it in remote areas where broadband isn't available. The FCC's DSL deregulation rules go into effect in August, so phone companies such as Verizon and AT&T no longer will have to let independent Internet service providers such as AOL and EarthLink run DSL services through their wires. Those ISPs will need an alternative access pipeline, and WiMax is the most likely.

Satellite TV companies also are interested, as WiMax could let them offer voice and Internet services like their cable competitors. Equipment due out later this year based on newer versions of WiMax can be used with the spectrum in the United States.

No Free Lunch

Most of the pre-WiMax systems in the United States--using gear that isn't officially certified yet--utilize the free, unlicensed 5.8-GHz band. That's the same frequencies as some Wi-Fi networks, and since anyone can use it, operators risk interference from competitors and home or business wireless networks. Truly mobile WiMax will require licensed spectrum, just like cell phones.

Mobility is on the WiMax road map. Vendors expect a standard to be finalized by year's end and the first products built to the spec next year. But the need for licensed spectrum limits the number of potential service providers. At present, Sprint owns nearly all the spectrum at 2.5 GHz, the only band the FCC has licensed for WiMax, so it's a major force in whether mobile WiMax gains momentum.

Sprint won't tip its hand, but as a company that already offers cell phone services, it's likely more interested in fixed access that competes with DSL than cannibalizing its own mobile business. It's testing WiMax equipment and joined the WiMax Forum last year. But in January, it invested in a small company called IP Wireless, which has 3G-derived technology that's incompatible with Wi-Max and that Sprint has been testing for five years.

The problem of spectrum availability in the United States won't change soon. The FCC plans to shut down analog broadcast TV and reallocate its frequencies to wireless networks. That's targeted for early 2009. So set up your Wi-Fi network and wish the emerging markets well with WiMax for now.

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