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WiMax: To WiMax or Not To?
The WiMax opportunity is one which no solution provider can ignore. The question here is how to make an entry into this niche segment and sustain profitability
Nelson Johny
Friday, April 27, 2007

It is beyond suspicion that WiMax is the most wanted technology waiting to be deployed across India. Tipped as the last mile solution, vendors as well as service providers are conducting pilot trials across the country. Finally, WiMax is ready to arrive with BSNL, India's largest telecom service provider, deploying what it claims to be India's first certified WiMax network in the next few weeks. WiMax equipment vendor Aperto will be deploying its base stations at the same time in Kolkata, Bangalore, Chennai, Ahmedabad, Hyderabad, Pune and four rural districts in Haryana.

While the world talks about the potential that WiMax offers to a country like India, not many have talked about the potential that it offers to solution providers. Here's how the solution provider community can leverage on this big opportunity.

Using the Opportunity?
While every new technology carries along with it tremendous potential, on the same line it also has its pitfalls. We asked network integrators one simple question: Does WiMax present an opportunity for this community? The answer was, "Yes". But the answer was also followed by many questions. Most solutions providers are aware of this opportunity but are not sure how to go ahead with it.

Solution providers are currently facing a situation in which revenue from traditional sources are either declining or reaching a saturation point. Therefore, for ensuring their success, a quick return on investment and the ability to drive profitable service across a diverse customer base are critical. "The solution providers have no other choice but to embrace this new technology, thereby giving them more reason to be in this business and be profitable," says Harsh Vij, CEO, SD Computers, who has already mastered the art of deploying WiMax technology.

According to Vij, WiMax is an emerging technology, a technology which promises to profitably deliver high-throughput, broadband-based services like VoIP, high-speed Internet access and video, to business and residential users who previously could not be economically served. "So there is no option, nor is there an intent, of remaining aloof from such a promising and potentially viable technology. We have already started deploying this technology and hope to enhance its usage day-by-day," adds Vij.

WiMax has the potential to provide India with widespread broadband access to Internet services which can usher in economic growth, better education and healthcare and improved, affordable entertainment services. A recent report from Motorola stated that there are only about 2 mn broadband subscribers in India, which is less than 2% penetration. This against the Indian broadband target of about 9 mn broadband subscribers by 2009 and 20 mn broadband subscribers by end of 2010.

This target is achievable only if operators invest on wireless broadband access. Wireless will be the main medium of delivery given that we have very limited copper assets that are actually in good condition, capable of being upgraded to deliver WiMax type broadband services. Moreover, such assets are confined to top cities thus proving no option but to use cost effective wireless technologies such as IEE 802.16e WiMax for rapid and widespread reach of such broadband services.

The above opportunity is significant and so are the associated challenges, given the low penetration levels of broadband in our country today. Motorola, as a WiMax equipment vendor, believes there is a definitive and important role that each stakeholder of this industry, needs to play to make the broadband vision a reality.

WiMax vendors generally are MNCs. Their focus is more on the technology side. So, naturally, they would like to spend more time on developing technology rather than in deploying the technology.

Apps that Drive WiMax
For solution providers to take up WiMax the first thing that needs to be taken care of is an understanding of the applications that will drive WiMax. Until recently, the 2G networks delivered fantastic performance to the voice user. What is expected in the next generation mobile networks is the ability to deliver on-demand pervasive broadband, ie hyper connectivity.

Checklist For SPs

Here is a small checklist of the know-how a solution provider should have before getting into WiMax deployment

  • Basic understanding of wireless data communication

  • Wireless

  • Field testing, including the full network and all the equipments

  • Installing radio access networks (RANs)

  • Connecting the RANs to the service provider's backend infrastructure

"We believe video is going to be the next big wave and it will change the way networks are deployed. 3G networks get exhausted if only six percent of subscribers view video, so you need a technology which meets on-demand pervasive broadband requirements," stated Mallikarjun Rao, director, WiMax, Nortel. "We see WiMax as the first 4G mobile broadband access technology to go commercial, transforming the network landscape. WiMax, with its inherent technology advantages of OFDM (orthogonal frequency division multiplexing) and MIMO (multiple input multiple output), and its strong ecosystem has potential to meet the hyper connectivity challenges," he adds.

Main applications driving WiMax, as of now, are all sorts of 'corporate connectivity'. These include corporate VPN connections, Internet lease lines, and international lease circuits among others. There is huge requirement for corporate data connectivity. These applications will continue to drive the market till mid 2008. From 2009 onwards, residential usage will start driving the market.

Dr Lil Mohan, MD, Emerging Markets, WiMax Program Office, Intel summed applications driving WiMax as three: Internet connectivity (web browsing, e-mail, etc), voice over IP and media and entertainment (audio, video clips, etc.) "The first two are targeted equally at both corporations and consumers, while the third is targeted more towards the consumer," he says.

Beneficiaries?
According to Yadav of Aperto Networks, everyone in the chain will benefit from this very promising opportunity. "Vendors like us will benefit in terms of more business. System integrators, network integrators and resellers will generate more business and get good margins. Operators can expect to get a loyal base of customers because of reliable technology."

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