WiMAX Provides Cheap Broadband Alternative - InformationWeek

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9/7/2005
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WiMAX Provides Cheap Broadband Alternative

As businesses outgrow DSL lines, they often find that T1 lines are too expensive. WiMAX provides a low-cost option.

The term "tween" is often used to describe youngsters of a certain age, but as wireless broadband operators have learned, it also refers to a certain type of business that needs a new type of access.

"There's a huge collection of companies that are falling halfway between DSL, which is not really enough for them, and a T1," said Caroline Gabriel, research director at Rethink Research. "It's a stretch for them to lease a T1, which is overkill. Broadband wireless fits right in the middle."

WiMAX wireless broadband has been available in pre-standard form for more than a year and standardized WiMAX could start being available before the end of the year. In addition, other wireless broadband technologies, such as Flarion Technologies' FLASH-OFDM, also are available in some areas.

Besides being a good fit for many small and medium-sized organizations, it turns out this emerging technology looks to have one other big benefit: It will bring fast access to many businesses, particularly in smaller markets, that don't have a lot of connectivity options. That means WiMAX and other types of wireless broadband, could become a true small town hero.

Much-Needed Competition

In Owensboro, Kentucky, for example, the local car dealer was nearly forced to relocate because broadband prices were too high, said Carlton O'Neal, vice president of marketing for Alvarion, a supplier of pre-WiMAX wireless broadband equipment.

Some car manufacturers have stopped sending repair manuals to dealers, instead requiring the dealers to download the manuals online. In small towns like Owensboro, where there is no competition for broadband services, the local telco often charges as much as $1,000 a month for a T1 line. But that monthly fee, especially since the dealership required more than one T1, was just too much.

Rather than loose the car dealership, the municipal cooperative electric company in Owensboro decided to build a broadband wireless network that could serve the dealership as well as anyone else in town interested in a more reasonably-priced broadband connections.

"There was no alternative," said O'Neal. Within six months, the co-op had signed up 700 customers. The business customers are paying a fraction of what it would cost for a T1 line.

In other markets, even in larger cities, broadband wireless is also proving ideal for meeting the needs of small and medium sized businesses. AirBand is a broadband wireless operator serving tier one and tier two markets. When the operator launched in 2000, airBand's key advantage against the wireline competitors was price. While the cost of a T1 has dropped dramatically since then, airBand still says that it has an edge that is attractive to businesses of any size.

One benefit airBand can offer that is particularly valuable often to small or medium sized businesses is the ability to quickly increase bandwidth for customers. "We offer other benefits like scalability," Lisa Kolczun, vice president of marketing for airBand.

In addition, many broadband wireless operators say they offer valuable customer attention.

"The large telcos were established to go after residential and large enterprises, so the small to medium businesses were left out in the cold," said Kolczun.

Often, small businesses must dial into a general customer support line when they have problems or to buy new services. While that may work for commodity types of services, it's often less satisfying for more complicated offerings such as voice over IP or an integrated electronic fax solution, Kolczun said.

"These are businesses that may not have an IT or telecom expert on site," she noted. "They need more touch then the big guys can provide." Often, the smaller competitive broadband wireless operators are willing to offer that service.

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