17/06/2005

| ARCchart | Blueprint : WiMAX hype becomes hysteria

| ARCchart | Blueprint : WiMAX hype becomes hysteria

Arcchart's view on why WiMAX hype has reached hysteria. Intel claiming broadband wasn't fast enough and WiMAX offering 100Mb/s was the answer.

Unfortunately what Intel don't say is that to achieve 100Mb/s you need about 30MHz of spectrum, which is difficult to get hold of. Most operators (say operating in 3.4 or 3.5GHz or in the UK even 5.8GHz) have maybe 10MHz - which supports about 30Mb/s payload.

30Mb/s isn't bad at all, but that's the bandwidth available from the basestation and it's shared between all the end users. Someone could offer it all to one customer, but then it's unlikely the economics wouldn't stack up. Offering 1Mb/s at 20:1 contention (equiv to BT's business ADSL service) that would support 600 users, at 5Mb/s it goes down to 120 and at 10Mb/s only 60 customers. Basestation equipment runs at £20K+ so the more customers you can support, the better.

Consider the wholesale price of a LAN Extension Service (LES) in Central London, about £6K install, and £1.2K pa. OK that's a point to point service with no Internet bandwidth, but it shows how wired connectivity pricing is dropping (and it can be upgraded to 100Mb/s or even Gb/s as it's fibre).

But that's not the end of the story, even taking DSL technology the ITU have just ratified VDSL2 which now supports 100Mb/s, it doesn't support long distances but there's already chipsets available. ADSL2+ is storming ahead and that offers 20Mb/s (short distances) but does better over long distances than VDSL(2), so most providers are opting for it.

Yes there may be a market for WiMAX to reach the areas DSL doesn't, but it's diminishing and the economics are not proven.
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