Monday, February 9, 2009

WiMAX Cloudy Future
In response to recent articles in Fortune (Feb 16 - Jon Fortt) and Forbes (Feb 6):

WiMAX: The Business Case Does Not Fly - anymore.

The promise of a $3B nationwide network is now more likely to cost $10B, something Clearwire does not have and Intel and Sprint would not underwrite (anymore). Current WiMAX users in the US should enjoy the spotty coverage where you have it, it's unlikely that we will see "NFL" city coverage any time soon. 

In 2003-4, Nextel envisioned a network costing $2.5-$3B with a mobile network from Flarion, a company acquired by Qualcomm in 2006. With the Sprint-Nextel merger, Intel promised to underwrite the WiMax technology and thus "WiMax everywhere" was what everyone envisioned by beginning of 2007. Then, with the issues and delays of mobile WiMAX, the vision became 2008... and here we are in 2009 and there are just a few cities with coverage. Clearwire (now includes Sprint/nextel WiMAX mobile broadband group), now realize that the "cheap" WiMAX is indeed as expensive as CDMA Do Rev A (or 3x more than FLASH-OFDM from 2005).

It is unlikely, given the economic climate, that Clearwire can deploy more cities without some serious funding or re-vector towards LTE and get economic incentives from the 3G community of vendors. But, the spectrum is indeed valuable. Maybe some major global operator will buy the spectrum in 2009-2010?

Regardless, WiMAX nationwide footprint is now a "pipe dream" and with HSDPA getting foothold with AT&T and CDMA/WCDMA operators looking to LTE commercial services in 2011-2012, the business case for mobile WiMAX has indeed failed.

MobileInsider (Twitter)

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