WiMAX gains momentum

The recent WiMAX Forum MENA event in Dubai demonstrated that attitudes to the 4G technology have matured from the overly simplistic “LTE versus WiMAX” debate that had previously characterised the technology

Tags: 3G4GAtheeb Communication CompanyDSLJordanMada CommunicationsSaudi ArabiaUnited Arab Emirates
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WiMAX gains momentum
By  Roger Field Published  July 6, 2009 Communications Middle East & Africa Logo

WiMAX has gained significant attention in the past couple of years. And while this has led to some unreasonable expectations, particularly in terms of the technology’s commercial potential in various markets, it has also led to a sizeable amount of negativity from within the telecoms sector, as some of its shortcomings have been put under the spotlight.

But over the course of the past year, the telecoms industry appears to be looking at WiMAX with fresh eyes and more realistic expectations. And certainly, the attendance levels at last month’s WiMAX Forum Mena, which was held in Dubai, indicated the seriousness with which operators are looking at WiMAX.

One of the overriding messages from the event appeared to be that WiMAX is best suited to markets that currently have underserved internet and mobile data sectors which lack significant competition, such as Jordan and Saudi Arabia.

This message, espoused by delegates from WiMAX operators including Mada Communications in Jordan, and Atheeb Telecom and Mobily in Saudi Arabia, appeared to hold extra weight by following closely from some significant investments on the ground. For example, Mobily and Samsung signed a $100 million (SR375m) deal to roll out WiMAX services in 20 Saudi cities in June, while Atheeb Telecom started high speed internet services in Riyadh and Jeddah using the technology.

WiMAX operators in this type of market seem convinced that the technology was the right choice for them, and they are also adamant that the most important aspect of their business is the service offered to the end user, rather than the technology that lies behind it.

Most operators using WiMAX or planning to deploy it decided to use the technology for a few key reasons, including that it is currently the only feasible fourth generation technology available for deployment at a reasonable cost. It can also be rolled out extremely quickly and relatively cheaply, compared with other broadband technologies, such as fibre.

For Richard Jones, managing partner of Ventura Team, a consultancy that worked closely with Atheeb Telecom in Saudi Arabia, the success of WiMAX operations depend on “getting the strategy right, and finding the right locations.”

And much of the Middle East offers a good location for WiMAX, according to Jones. “The Gulf is perfect territory for WiMAX. You have bad quality DSL at low penetrations, bad quality copper, long distances to cover – bad DSL at low penetrations, as well as people who are desperate for broadband and sick of bad DSL connections. There is potential to sell a lot of WiMAX,” Jones said.

But Jones also brought home some of the challenges that WiMAX faces, including its limited lifespan in the fixed arena. “You will not like this,” Jones told delegates. “WiMAX can survive in a fixed area for a limited amount of time.” He added that over the next few years, fibre will increasingly take over from existing deployments, increasing the capacity of broadband connections beyond the capabilities of WiMAX.

He gave the example of Sweden, where the population had access to 100 mbps internet connections in 2004 and added that “the fastest residential broadband service available over time doubles.”

“It gets faster and faster, and it will continue to. The trouble is, in this environment I can’t do something at 100mbps with WiMAX. I can give the user 40mbps if they have their own base station but in the long term, if they have the option of good DSL or fibre for fixed purposes, they will go with that instead.”

For Jones, it is essential for WiMAX operators that are targeting mainly fixed broadband users to go to market as quickly as possible, in order to gain the biggest market share possible before other players, and other technologies, have the chance.

The WiMAX operators speaking at the event broadly agreed with Jones’ warnings to roll out networks swiftly. Dr. Ahmed Abbas Sindi, CEO of Atheeb Telecom, pointed out that his company had gained some 20,000 users in about 10 days, indicating the traction that a WiMAX operator can make in an underserved market in a short time.

Madhat Amer, CEO of Mada Communications, a WiMAX operator in Jordan, emphasised just how much potential many countries in the region hold owing to extremely low broadband penetration rates.

“Our part of the world still lacks basic internet connectivity,” he said. “In Jordan, it is 4% penetration compared to 90% mobile penetration. There is still a long way to go for WiMAX to deliver on basic customer requirements.

“Jordan has five WiMAX licences and still the penetration is 4%, so I think in our part of the world, WiMAX will work. The question is whether it will work in Europe and the US where you have FTTH. It will not work there. But in our part of the world where we lack basic connectivity it will always be a success.”

Amer also dismissed talk of LTE representing a threat to WiMAX operators. “With LTE you have to underline the question ‘when?’” he said. “Is it in two years, five years or 10 years? Mobily has chosen the right path. Buy it, build it, and if LTE comes, decide what to do to migrate,” he added.

Amer added that Mobily’s decision to roll out a WiMAX network was viewed as a significant decision by WiMAX operators around the world, largely because the company is a mobile operator that already has HSPA capability, drawing a line under arguments about whether WiMAX can compete with the mobile broadband offered by 3G.

Amer also pointed to Zain’s decision to bid for WiMAX licences as further evidence that operators are more interested in the services they can offer their customers, rather than the merits of the underlying technology.

Amer is also optimistic that WiMAX operators using the 802.16e standard will also be able to compete more effectively with rival broadband technologies owing to the mobility the standard allows.

While WiMAX might not be able to compete with fibre in terms of capacity, the ability for users to roam could be a powerful incentive for people to remain with a WiMAX network, particularly when bundled with various fixed services.

Intel’s decision to embed various devices such as laptops with WiMAX chips was also lauded by the WiMAX operators, many of which hope that the technology will gain greater traction as more devices appear on the market.

“WiMAX has deeper indoor penetration and greater bandwidth than 3G, but 3G has the advantage of having more mobile devices,” Amer said.

“When WiMAX devices are more readily available, and more are becoming available, it will benefit the technology,” Amer added.

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