Wimax or DSL – Which Comes First?

Jan Hein Bakkers
Jan Hein Bakkers

Mr. Bakkers, how does Wimax work?

Bakkers: Wimax is the name for technology based on the IEEE 802.16 familiy of standards for regional wireless networks. This technology offers radio based last mile connectivity across, similar to wireless LAN, with the key across a larger area than wireless LAN. It enables internet access at speeds comparable to current DSL services. The first deployments have been for connectivity of fixed locations (homes and business sites), later deployments will allow for portability and mobility.

Who are the main Wimax customers at the moment?

Bakkers: The deployments that do exist, are usually from alternative operators, that focus on areas with no or poor coverage from DSL and cable operators. In Western Europe, the number of deployments is still relatively small, less than five percent of households. In some countries, such as Italy, frequency licenses have not even been awarded.

How can the international Wimax Forum (www.wimaxforum.com) and its member companies drive the use of Wimax forward?

Bakkers: The forum works on interoperability and certification based on standards developed by the ieee 802.16 working groups.

The northern Swedish town of Skelleftea changed over to Wimax in 2005. How much do you estimate citizens need to invest in new equipment to be able to use Wimax?

Bakkers: Current deployments are usually such that the operators maintain ownership of all equipment, and lend the equipment to the end-user. Given the relatively high price of customer premises equipments (CPE) – still hundreds of dollars – this takes away a threshold for adoption, and also gives the operator the flexibility to change CPE when he believes his network needs to be upgraded.

Aren’t regions with a weak infrastructure and no broadband cable connection in effect forced to use Wimax? Who will benefit more from continuing with DSL in the future?

Bakkers: Wimax is one of the options that are open to these regions, and probably a good one. Nevertheless, these regions constitute only a small proportion of Western Europe. In regions in Central and Eastern Europe, Middle East and Africa, there might be more potential. Where fixed infrastructure is available, these will remain the main technologies, as capabilities of fixed technologies are improving rapidly as well. In Western Europe, many operators are making the switch to the ADSL2+ extension of the Asymmetric Digital Subscriber Line (ADSL) norm, which can accommodate speed up to 25 Megabit per second (Mbps), and are planning a next migration path towards the Very High Speed Digital Subscriber Line (VDSL2) norm, which in most deployments will bring 50 Mbps to every home. Current cable technologies are already able to provide 30 Mbps to individual homes. These operators have got the existing end-user relationships, the brand awareness and the marketing power, as well as the technological capabilities to accommodate services equally good or superior to Wimax.

Intel Mobility boss Sean Maloney already has a vision of Europe-wide fast internet access via Wimax as of 2007. Is this is an overstatement?

Bakkers: As of yet there are no operators that have committed to country wide deployment. Operators need to see a firm business case before they commit, and for that they will need to see proven, standardized technology. This will not be available on a wide scale before 2007. Therefore, operators will not commit to massive Wimax deployments before 2007 and then they need to start planning and building networks, which will take more time. And this scenario even requires no delay in certification, standardization and interoperability. We have to take into consideration that the standards are relatively young and the certification process is in their early stages. Interoperability between base stations from one vendor and equipment to another is therefore in most cases not proven yet. This will take time, until then, operators will use equipments and base stations from a single vendor – and it limits choice and keeps prices relatively high.

Let me further explain this: There is a lot of things being said about Wimax all of which are true – but not combined: It can reach 70 Mbps, it can have a reach of tens of kilometers, and it does not require line of sight.
Last but not least, there are two different standards: 802.16-2004, which was ratified in 2004, and for which the certification process is underway. This standard is aimed at fixed deployments, to either connect homes or business sites, or provide backhaul for WiFi hotspots. Especially in a region like Western Europe, where DSL coverage is well above 90 percent, we see only a small market potential, as DSL and cable operators have got a massive advantage in terms of coverage, awareness and marketing power.
The other standard, 802.16e, which was completed at the end of last year, will add portability and mobility features. This could have more impact on the market place and it is likely to provide a more interesting business case for operators. The problem is that there is no backwards compatibility or migration path between the two, leaving operators with the choice to either wait for 802.16e equipment, of which certified interoperable equipment is not likely to be available in substantial volumes before next year, or go with 802.16-2004 for now, and do a costly forklift upgrade when 802.16e equipment is available and ready for portable and mobile scenarios.
In short: Near to medium term prospects for a region with a developed fixed broadband infrastructure, like Western Europe are limited. However, the technology is much better suited for less developed regions, as it is easier, cheaper and quicker to deploy than building a new fixed line network.