With Sprint Nextel poised to go commercial in the second quarter,
WiMAX supporters are optimistic an even bigger spotlight will shine on WiMAX.
But critics aren’t so sure the technology needs any more hype.
Sprint Nextel is often overshadowed by its larger CDMA rival, Verizon Wireless. While Verizon racks up points in financial metrics, Sprint has been losing on most of those fronts.
Where the smaller operator has been able to claim some form of victory is in the risk-taking department, where it has earned a reputation for not being afraid to adopt new apps, especially in areas like location-based services (LBS) and content. Verizon might have earned its stripes for being the most closed operator over the years, but Sprint came out in favor of open access over a year earlier.
In August 2006, Sprint announced its plans for its 2.5 GHz spectrum – deploy a 4G open mobile network using mobile WiMAX. Working with Intel, Motorola and Samsung, Sprint spelled out the plan to open WiMAX up to all kinds of devices – not just handsets. Digital cameras, DVD players and more are all fair game. This past August, the carrier unveiled the brand name Xohm (pronounced zoam) and reiterated plans for a soft launch at the end of 2007 in the Chicago and Baltimore/Washington markets.
The soft launch went as scheduled, but that was after much speculation surrounding the future of Xohm. Gary Forsee stepped down as CEO in October, and Sprint’s planned collaboration with Clearwire disintegrated, leading many to speculate doom for the project that already was subject to investor pressures. At one point, CFO and acting CEO Paul Saleh was quoted as saying the carrier was evaluating various scenarios for the project, including a possible spinoff. With the arrival of new CEO Dan Hesse late in the year, analysts weren’t sure how things would shake out for the WiMAX initiative.
FIELD OF DREAMS?
Still, it was full-steam ahead for those who were working on Xohm in December, with employees starting to use data cards to test the networks. Verizon Wireless’ plan to set technical parameters and open up its network to connectivity-proven devices wasn’t lost on those who have been working closely on Xohm. “We announced open access 18 months ago,” says John Polivka, spokesman for Xohm. “This is Sprint’s Internet play. It’s not the walled garden. It’s the open Internet.”
Says Ciricia Proulx, marketing manager for the WiMAX program at Intel: “It’s been open all along,” she says, noting that it’s all IP-based from end to end. “You have no closed-off elements.” That’s important because consumers want the full Internet experience, she adds.
Of course, not everyone is stoked about the opportunities for WiMAX. Some question the investment – once estimated at between $1.5 billion and $2 billion in 2008 – when Sprint hasn’t been able to keep iDEN customers happy. It took years to build out the U.S. cellular/PCS networks, and WiMAX presumably will require years to reach a comparable footprint, although supporters say it’s a metro-area play and consumer demand will dictate how fast markets are rolled out. Sprint has not revealed how many markets it will launch in the second quarter. “The biggest problem is it’s a Field of Dreams – build it and they will come,” says Technology Business Research Analyst Ken Hyers.
But Hyers says he doesn’t believe Sprint will walk away from it because the ecosystem is too large. One of those players in the ecosystem is Motorola, which increased to 15 its number of contracts for commercial WiMAX networks worldwide. Motorola is working on the Xohm soft launch in the Chicago area.
Wright: Motorola ramping up for LTE.
In a conference call last month, Fred Wright, Motorola senior vice president of WiMAX and cellular networks, said Motorola is ramping up its investments in LTE, the 4G technology path that Verizon Wireless is pursuing. But LTE is at least two years away from commercialization, similar to where the industry was with WiMAX two years ago, he said.
Polivka acknowledges Xohm is not going to look like the traditional telecom model, and that’s by design. Sprint’s WiMAX network is built specifically for data as opposed to the CDMA network that was built for voice with data coming later. Carriers historically subsidize devices, but that’s not the WiMAX model. The same goes for the popular 1- and 2-year contracts. “PCS might be a 2-lane highway, and it works great,” he says. “WiMAX is a 10-lane highway,” offering far more capacity in a world where people will be sharing pictures, audio files, videos and doing other high-bandwidth applications.
Sprint hasn’t settled on exact pricing offers yet, but part of the vision includes tiers of service based on volume. When a consumer buys a device in a big-box retail store, he or she can choose to activate it. If a consumer adds more devices and activates them, he or she could select some kind of bundled offer. The initial wave of products likely will be connection cards and modems, with more integrated devices coming later in 2008 and 2009.
Meanwhile, Xohm engineers and others are furiously working to meet their goals. “There are several things working in parallel,” Polivka says, including infrastructure, backhaul and backoffice functions. If they can pull it off in less than two years, it could end up being the fastest new wireless network to go up. But a lot of unknowns surround the rollout.
Says telecom analyst Jeff Kagan: “WiMAX may be a great place for Sprint to go, but it’s unproven, and we don’t know how successful WiMAX is going to be five years from now.”
|WiMAX Marks Milestones|
Most of the opportunities for WiMAX lie outside the United States, where so far, the biggest operators committed to the technology are Sprint Nextel and Clearwire.
That’s why the WiMAX Forum is opening certification labs around the world – Spain, Taiwan, China and Korea, with one more close to Sprint headquarters in Reston, Va. Last month, the forum announced that the lead certification lab in Spain is now open for formal mobile WiMAX certification testing; it previously was open for testing of fixed solutions. The other labs are set to open early this year.
The forum already is seeing hundreds of devices being developed by well-known and lesser-known developers. Designs are coming out of China, Korea and elsewhere, says Mo Shakouri, vice president of marketing for the WiMAX Forum. “Everybody is doing this; that’s the beauty of the whole thing,” he says.
The opening of the test labs aren’t the only milestone WiMAX supporters are celebrating. Beceem Communications claimed a technical milestone with the completion of initial interoperability testing between its chipset and Sprint’s infrastructure. The achievement is important as it shows the commercial readiness of WiMAX equipment and chipsets in preparation for Sprint’s second-quarter launch. “It’s a continuation of us leading the charge,” says Lars Johnsson, vice president of business development for Beceem.