Vodafone Takes A Cautious View Of Mobile WiMAX

Vodafone Takes A Cautious View Of Mobile WiMAX

Vodafone, the world’s largest wireless service provider by revenue, provides new insight into the carrier’s current assessment and future direction for next generation wireless technologies. In a talk at the April 20th IEEE East Bay ComSoc meeting, entitled, “Visions from a Global Carrier’s Crystal Ball,” Dr. Stanley Chia, Senior Director of Vodafone’s US R&D Group, made several observations about Mobile WiMAX and how it might be positioned against 3G data technologies like HSDPA (WCDMA) and EVDO (CDMA).

The theme of the talk was how 3G might co-exist with all the rapidly developing technologies (mobile WiMAX, mesh WiFi, VoIP, mobile broadcast).

Since their recent reorganization, they decided to make it clear that they must join their forces with FMC in a race where the main goal is sustainability. Their margins need to be sustained over time as they are trying really hard to avoid getting sidelined into becoming just a mere mobile operator. That is why they will take it easy on the main idea to combine their technology with a wireless network such as WiMAX. It can deliver the most effective way of getting wireless connection. It is not yet completely sure as to what will be their final decision.

Here are the key points of Dr Chia’s presentation, as they relate to the mobile WiMAX market:

– CAPEX is a very large barrier to entry for new wireless service providers. Huge sums must be invested in base stations, access nodes, other wireless infrastructure, core network switches and routers, billing systems and operations software, land, and lease hold improvements.


– Wireless access technologies will include: 3G data evolution, mesh WiFi, and mobile WiMAX.

– Mainstream vendors supporting mobile WiMAX include: Samsung (WiBRO in Korea), Intel, Alcatel, Siemens, Nortel, and Motorola. Cautious vendors include: Lucent, Nokia, and Ericsson. [He did not mention Cisco, which is apparently on the fence with respect to WiMAX].

– Being committed to their proprietary version of 3G, China will not likely push mobile WiMAX. Hence, the worldwide market will exclude the country with the most market potential.

– An optimistic projection was for mobile WiMAX metro networks to be in place in 2008 along and the technology would be integrated into PCs (like WiFi today). Handsets might be available in 2009, but VoIP would need to be ubiquitous and roaming would be an issue (unless dual mode phones were commonplace).

An article from the February 1st, Financial Times was cited to support Vodafone’s cautious stance on WiMAX. Here is a quote from that article (with some editorial modifications):

Vodafone“Is mobile WiMAX a credible substitute for 3G? Probably not. Its practical speed should be 2-10Mb/sec. But most 3G networks are already upgrading to an adequate 2Mb/sec. Spectrum is also a problem: most of the world’s existing 700 odd licences are regional, and some currently permit only fixed services. WiMAX avoids expensive royalty payments to Qualcomm, which owns most of 3G’s intellectual property. Still, building a ubiquitous Wimax network would be far more expensive than buying wholesale access to 3G with a virtual operator agreement.

“That leaves mobile WiMAX’s main potential as giant hotspots. The concentrated nature of mobile usage – three quarters of most peoples’ activity occurs in three locations – means this threat cannot be totally ignored. Dual mode handsets, which permit switching between networks (mobile and WiFi), are being developed by Nokia (and Motorola), among others. Qualcomm seemed to concede 3G’s potential inadequacies by buying Flarion, which specializes in a rival but similar technology (Flash OFDMA) to WiMAX, last August. The basic strategy of most mobile operators of being married to 3G, but being open minded about flings with other technologies, thus looks correct.”


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