WiMAX: Challenging the Status Quo — An Executive Summary
A report by InStat
WiMAX is a standards-based technology enabling the delivery of last-mile wireless broadband access. Conformance and interoperability testing for the fixed variant, 802.16-2004, will lead to commercial deployment of WiMAX-Certified gear in early 2006. Equipment for the mobile variant, 802.16(e), is expected in 2007. WiMAX was designed to: a) improve wireless’ ability to compete with cable and DSL, and b) introduce a next generation alternative to voice-centric cellular technology. If they choose, WiMAX service providers will be able to straddle fixed and mobile markets, threatening incumbents on either side.
WiMAX advantages in cost, flexibility and portability, combined with standards-influenced equipment cost declines, will allow 802.16-2004 service providers to both expand the broadband access market and to take market share from operators using proprietary wireless or wireline technologies. These gains will be governed by the WiMAX industry’s ability to capitalize on new business models in the face of stiff competition from incumbents. Its biggest challenge will be worldwide harmonization of spectrum, sufficient to allow manufacturers to mass-produce equipment at ever lower prices.
How well the industry deals with these issues leads to aggressive or conservative forecasts of equipment and subscribers. The aggressive forecast for pre-WiMAX-Certified 802.16-2004 equipment subscriber units and basestations is $42 million in 2005, growing to $3.2 billion in 2010. The conservative forecast is $19 million and $2.1 billion, respectively. The aggressive forecast relies on subscriber units, currently about $500, falling to less than $100 by 2010. In the aggressive scenario, In-Stat forecasts 42,000 pre-certified 802.16-2004 subscriber units shipping in 2005 and 16 million certified units shipping in 2010. The electromagnetic wave frequency of these units will be dominated by licensed 3.5 GHz and, to a lesser extent, unlicensed 5.8 GHz during the forecast period. Most shipments will go to Asia.
The 802.16(e) standard offers new and existing mobile operators performance and economical improvements over 3G technologies, especially in its ability to deliver ARPU-attractive, multimedia services. To the extent that mobile devices will be affordable to millions in the developing world (e.g., China and India), the number of 802.16(e) subscribers will dwarf the 802.16-2004 market. 802.16(e) will encounter resistance from proprietary technologies and the mobile operators, regulators and vendors who advocate them.
The full report is available from Instat Research. The report number is: Report No. IN0501954WN. For further information or to order this report, use this link: http://instat.com/