WiMAX has its problems, says Network World. But it might be a better bet than Municipal WiFi.
Take St. Louis. Please. AT&T said Friday that it’s scrapping plans to provide WiFi across the city’s 62 square miles. It’s a good idea, the company said, just too expensive. Instead they will build a pilot project in the core of downtown.
Jeff Orr, senior analyst, for Maravedis, says smaller regional WiMAX providers, like Asburn, Virginia-based Digital Bridge Communications, are leasing 2.5GHz spectrum in the so-called ITFS band, originally set aside for colleges and universities to offer distance-learning TV broadcasts.
Orr says EV-DO Revision A and HSDPA could be the proving ground for mobile WiMAX services.
CDMA nets have a cost structure that’s determined in part by the royalties set by Qualcomm. But WiMAX can make use of their existing cell or wireless broadband sites, keeping property and construction costs down, while open WiMAX standards introduces competition to every component in the WiMAX network, Orr says.
Nortel says their studies show that WiMAX nets can be deployed at up to one-sixth the cost of today’s 3G nets. “You can use fewer base stations to cover the same area [compared to 2G/3G], or you can have the same number of nodes with greater performance,” says Danny Locklear, Nortel’s director of wireless product marketing. With OFDM, and wider radio channels, the capacity of each base station is greater.
Sprint CTO Barry West has made similar arguments, saying that WiMAX is one-tenth the cost per bit of CDMA. Sprint’s Mobile WiMAX network will be an overlay on the company’s existing CDMA EV-DO 1x cellular net with some 100,000 points of presence enabled by the end of 2008.
“It’s physics,” he said.
With IP-based WiMAX, Orr says, users can have multiple devices they want to use on the IP net, ranging from multimedia devices, VoIP phones, and even devices that today you have to hook to a PC such as digital cameras or iPods. “Don’t expect Kodak to introduce a device that has to be certified by Sprint before it can be used on the network,” Orr says.
According to Robert Syputa, Senior Analyst at Maravedis
The economics of muni-Fi (municipal Wi-Fi) has not changed: it has never been viable on its own.
Muni-fi has only been justifiable based on gaining a position to leverage other revenues and access to fiber optic and community support assets.
The mistake that many have made is in assuming that low cost Wi-Fi end user devices equates to a low-cost system. Cheap and pervasive Wi-Fi end user products provides a market with ease of entry but does not mean Wi-Fi is suited to be a cost effective and efficient wide area system.
802.11 is designed as a WLAN - wireless LOCAL area network. The core mechanism of Wi-Fi is a “contention based network.” That means that because it is used in unlicensed, public access (free) spectrum, every user is given the right to compete for equal access.
WiMAX is built from the ground up to be a carrier class, managed access system and highly extensible network. It has the ability to be built either simply or into an extremely complex mobile network and to evolve to become a “smart distributed wireless broadband network” that can configure itself within a flexible set of parameters to suit a variety or dynamic set of needs.
That makes sense to me. Industry analysts say it costs from $65,000 - $120,000 a mile (or more) to build a municipal network based on WiFi gear. A city like Portland or Philadelphia (around 135 square miles), costs $10-$20 million to “unwire”. Not counting the maintenance of 2000 access points and 100,000 users.
In contrast, adding Mobile WiMAX gear to 20 cell sites might cost $100,000 a pop, or $2 million.
One WiMAX tower can blanket 5 square miles (WiMAX Forum paper). WiFi needs 25- 40 hotspots per square mile.
Common sense would indicate that one $100K tower beats 125, $2,000 hotspots ($250K). Maintenance and operational expenses would be cheaper, too. It doesn’t take a rocket scientist to figure this out.
Plus you get mobility, speed, reliability and voice. It seems to me that “free” or inexpensive virtual network operators — supported with advertising — will likely choose WiMAX.
Why build infrastructure that costs more than twice as much? Without voice or true mobility.
I believe in the location-based advertising model. I believe it can support municipal networks built around WiFi. But it’s a risky endeavor, even if it is worthwhile.
Somebody’s got to pay for it. That’s a lot to ask from advertisers — before the business models are tested.
I suspect advertisers will jump ship to WiMAX in 3-5 years. Then it’s a free-for-all.
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