WiMAX in EMEA - New services, new markets to expand reach of operators.

 

Paul Sergeant - Motorola Inc

 

The arrival of WiMAX to the European market is being met with much fanfare and excitement. Operators who, only a few years ago, were contemplating how to squeeze data revenue out of a voice network are lining up to be part of WiMAX trials with the hope of entering new markets and providing new services. Markets both emerging and mature are looking at WiMAX as the answer to many of their problems, and manufacturers are not shying away from using the term “convergence” to explain the joining of voice, data and the Internet.

 

New technology always struggles with the delicate balance between the hype of a technology and its reality. Even though there is some mystery to what WiMAX will become, European operators are not getting cold feet. Currently, operators around Europe are actively engaging Motorola in network development and trials for WiMAX.

 

Andy McKinnon is responsible for WiMAX business development for Motorola in the regions of Europe, the Middle East, and Asia (EMEA). In his estimation, hype may be driving interest in WiMAX, but honesty and education are what separates Motorola from other equipment providers.

 

“The market to operators is no longer a voice telco market, it's a data market,” McKinnon says.”

Motorola has a running start with WiMAX in the European market: it has decided to bypass the 802.16d (or 2004) standard and move directly to 802.16e. This strategic jump will help simplify the end-to-end vision to the operator market.

 

Much of the excitement around WiMAX focuses on its portability features. However, more than 80 percent of the 3.5GHz licenses in Europe are for fixed access. While this will change in the future, the implication is that for the time being most of the EMEA-based rollouts of WiMAX will be fixed, but it likely consumers' need for mobility will reward forward-thinking operators.

 

WiMAX from the perspective of an operator is something of a chameleon. In developing markets an operator with a WiMAX plan will have a strong case for growth and the ability to gain market share quickly. In developed areas, WiMAX turns into an opportunity to compete with enhanced services and move into markets that were previously out of reach.

 

Many European operators invested heavily in 3G network licenses. Rather than competing with 3G, WiMAX can offer complimentary technology to these operators, which will keep them from losing their investment in their current network and also extend its range. One of the early key opportunities for these operators is using WiMAX as a backhaul. Primarily, WiMAX can offer operators the benefit of reducing the cost of backhauling cell sites, especially their 3G networks. Secondarily, WiMAX backhauls are also an efficient method of extending the coverage of WiFi hotspots, which provides more revenue-generating opportunities like gaming, streaming video and other applications.

 

For wireline and cable carriers, WiMAX offers a cost-effective method of network expansion. For a fraction of the cost of new copper, cable, or network infrastructure, a WiMAX play will offer operators security and redundancy in their networks. Operators will be able to leverage much of their existing technology and reach customers in other competitive or rural areas. And in many areas around Europe, operators will benefit from government assistance in network build-outs or subscriber subsidies.

 

Services that a wireless operator could consider with WiMAX are broad. For example, small or medium enterprise customers can use WiMAX to replace their PBX systems. Everything a company could get out of a PBX can be IP-based and personalized. From the business to the home, seamless mobility products will bridge the wireline/wireless divide. Service providers in developed areas will have few limits on the types of entertainment services they can offer, including music, online gaming, and more.

 

Within developing countries that may not have 3G licenses or where 3G spectrum is not allocated, WiMAX will give them the ability to offer VoIP (Voice over IP) services and other data-driven services such as online gaming and web access in areas that may not even have wireline telephone service.

 

Revenue streams will come from a number of initiatives. Services are a large part, but operators may see even greater economies through their ability to simplify their networks. McKinnon sees a future where large tier-one operators around Europe would reduce their operating expenses by “offering all their services with through WiMAX.” With WiMAX reducing their network costs, they could focus on services and other revenue generating growth opportunities. As the technology hardware landscape changes, WiMAX base stations allow operators to install networks in days rather than weeks.

 

Many members of the service provider industry are cautiously optimistic touting the coming of convergence. McKinnon suggests we consider WiMAX a component of a greater technology model, rather than a replacement or competitor to technologies like 3G, or even 4G. With that in mind, WiMAX technology appears to be on the cusp of offering the types of solutions throughout EMEA that will bind voice service with data service and the Internet. Convergence indeed.