COMPARISON WITH COMPETING TECHNOLOGIES

At some point current 2G and 3G network operators will migrate to a 4G network technology. Mobile WiMAX is likely to face competition from 3G and 4G technology enhancements. They include the code division multiple access (CDMA) variants CDMA2000 and wideband-CDMA (WCDMA) and their enhancements which are 1x evolution data optimized (1xEVDO) and HSDPA, respectively. Unlike in the early days of the CDMA vs. GSM competition, this higher generation competition will be quite different and fruitful because for these new generations networks; the applications are separated and do not depend on each other. 4G networks will go far beyond 2G and 3G by mainly improving three parameters:

• Interface technology: 4G standards will make a radical change and will use OFDM [9]. The new modulation itself will not automatically bring an increase in speed but very much simplifies the following two enhancements:
• Channel bandwidth: 4G systems will use a bandwidth of up to 20 MHz, i.e., the channel offers four times more bandwidth than channels of current systems. As 20 MHz channels might not be available everywhere, most 4G systems will be scalable, e.g., in steps of 1.25 MHz. It can therefore be expected that 4G channel sizes will range from 5 to 20 MHz.
• MIMO: The idea of MIMO is to use the multipath phenomena. Although this behavior is often not desired, MIMO makes active use of it by using several antennas at the sender and receiver side, which allows the exchange of multiple data streams, each over a single individual wave front. Two or even four antennas are foreseen to be used in a device. How well this works is still to be determined in practice but it is likely that MIMO can increase throughput by a factor of two in urban environments.

Increasing channel size and using MIMO will increase throughput by about 8–10 times. Thus speeds of 40 Mbps per sector of a cell are thus possible. Using a commonly accepted evaluation methodology for 3G systems, mobile WiMAX has been simulated against the 3G enhancements [23]. These simulations have shown that

• Mobile WiMAX peak data rates are up to 5x better than 3G+ technologies.
• Mobile WiMAX spectral efficiency is 3x better than any 3G+ technology.
• Lower equipment cost for WiMAX due to certified products (compare with WiFi).
• WiMAX requires new infrastructure while high-speed packet access (HSPA) rides on UMTS.
• Roughly the same coverage (average ~5 km).
• Roughly the same performance (average ~2 Mbps per user).
• HSDPA launched in 2006 while HSUPA will come in 2008.
• WiMAX standard set end of 2005 and first products in 2006.
• HSPA has a higher acceptance with mobile operator.

APPLICATION PROVIDERS & WIMAX CUSTOMERS

APPLICATION PROVIDERS

WiMAX has already revolutionized the broadband wireless market by standardizing broadband wireless access market, by opening up new service opportunities and by creating the environment for ubiquitous broadband services.

The aim is to provide the service that best fits the individual’s needs. Applications can be developed in house by the service providers, outsourced from other companies or developed and sold directly to the end user by an independent applications development company.

Applications are based on IP, and IP applications are sent back or forth via WiMAX. This allows the users to develop applications independently from the underlying network infrastructure. Some applications will still be developed by operators but the vast majority will come from those working directly in the Internet crowd. For them and for the end users competing wireless technologies are very beneficial. Competition spurs network roll outs, offers possibility for new players in the market, and creates competition between device manufacturers. Also, new applications will be introduced more easily and much more quickly as they are no longer forced into a tight framework that takes long time to develop and from which it is difficult to get out again.

WIMAX CUSTOMERS

Prospective WiMAX customers can be grouped either geographically or by the level or volume of services. Geographical categories range from urban to rural customers, while categories according to size include individual customers and the corporate customers. Urban areas offer the highest density of customers with more business establishments. In such cases a higher number of cells which are small in size are required to meet the capacity requirements. These are the areas where more competition is expected. Rural areas are expected to have a lower penetration of customers, less corporate customers, and bigger cell sizes because emphasis is on coverage rather than capacity. Individual subscribers will use WiMAX for music downloads, interactive gaming, and personal broadband Internet, and will form a large percentage the total subscribers.

Corporate subscribers are also expected to contribute to revenues of WiMAX, and their interest will be in applications and services which will enhance their organizations apart from the basic telecommunications services.

Companies are poised to compete with each other in WiMAX network deployment, which will ensure that the prices will be competitive

WIMAX SERVICE PROVIDERS

As IP networks become faster (higher bandwidth) and more responsive (lower delay), the set of services implemented on IP-based networks has grown. This growth generates more revenue opportunities for service providers, and thus next-generation networks are all migrating toward IP technology. From an operator standpoint, services can be broken into four billable classes: 

(1) basic Internet services which are typically billed at a flat rate, 

(2) premium Internet services which are important not only to improve ARPU, but to add new services, 

(3) VPN services which can be billed by QoS level, and 

(4) operator premium services which are applications provided on the operator’s network.

The service providers are expected to gain profits through the sale of the different services and applications that WiMAX is capable of carrying. The different services that can be offered on WiMAX networks include best effort VoIP, carrier class IP telephony through the IP multimedia core, music, video conferencing, streaming video, interactive gaming, mobile instant messaging (IM), IP television (IPTV), basic broadband wireless Internet, and other application-based services to corporate customers. The concept of unbundling the network reduces the barriers of entry into the mobile telecommunications industry because a provider does not need to own the whole network.

The business aspect of the service providers can also be looked at from two perspectives. The first one is where the service provider owns the whole system including the core network and the access network. The second option is the unbundled option where the access network and core networks exist as independent business entities.

In emerging markets such as Africa, and South Asia where telecom investment is still nascent and 3G yet to be launched, WiMAX makes complete business sense even at equal cost, better speeds, better spectrum utilization, and the promise of broadband to a much sparsely spread population. For developed economies, the United States for instance, the 2.3 spectrum band is believed to be more capex efficient and hence better than 3G and high-speed uplink packet access (HSUPA). More importantly, the phase in the capex cycle of a telecom operator will determine each operator strategy—whether to embrace WiMAX or stick to its existing technology. The WiMAX industry entered the year 2007 as a year for ecosystem buildup in the preparation for regional and nationwide deployments of WiMAX services. It appears that 2008 will be a make-or-break period for WiMAX. Figure 1 shows a global WiMAX deployment by region.

 

Figure 1: Global WiMAX networks. APAC = Asia Pacific, CALA = Caribbean and Latin America.