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Good from a distance

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DQW Bureau
New Update





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With high equipment prices and no fixed frequency address, WiMax is yet to

dress up for the masses

Although termed by many as one of the hottest technologies and the only

wireless access media that can facilitate large-scale broadband deployment,

WiMax is unlikely to see a commercial deployment in India until the early next

year.

Indian operators, who are betting big on WiMax or even eyeing at it to

complement their existing DSL-based broadband offerings, cannot expect to deploy

it commercially unless they overcome the hurdles related to the allocation of

spectrum and availability of certified standard equipment that can work in a

multi-vendor environment. In fact, the two issues are intertwined and lead to

the high cost of WiMax equipment, a factor that would be a major hurdle for

operators looking at mass based business models.

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Frequencies Too Many



The availability of the right spectrum and in right amount is the key to the

success of any wireless technology, and WiMax is no exception. The case of WiMax

is a complicated one in the sense that as of now WiMax equipment are meant to

operate in a scattered spectrum environment. In other words, there's no single

frequency band common across the globe for WiMax equipment. As things stand

today, the list of frequencies that a WiMax equipment would need to incorporate

is a long one and includes 2.3 GHz, 2.5 GHz, 3.4 GHz, 3.5 GHz, 3.6 GHz, 5.4 GHz,

5.8 GHz and possibly others such as 700 MHz and 900 MHz. This scattered spectrum

environment means that issues related to interoperability cannot be sorted out

unless spectrum is harmonized. It also means that equipment vendors would have

limited ability to drop WiMax equipment prices.

WiMax Forum, a nonprofit industry organization comprised of vendors and

service providers, considers global harmonization or the uniform allocation of

spectrum worldwide as crucial for lowering equipment costs because radios are a

major cost component in developing WiMax Forum Certified systems. The Forum is

hopeful that in the next two years (through the 2006 timeframe), a reasonable

level of global harmonization for broadband wireless access can be achieved in

the 2.5 GHz, 3.5 GHz and 5 GHZ spectrum bands.

Broadband operators and vendors across the world feel that the 2.5 GHz and

3.5 GHz frequencies would be ideal for WiMax. The first of the products that

will be certified by the WiMax Forum in the months ahead will operate in the 3.5

GHz band. Certified equipment for 2.5 GHz and 5 GHz band (U.S.) are expected in

2006.

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In several countries across Asia, Europe and Latin America, operators are

building wireless broadband networks that would operate in these bands. The 2.5

GHz band is being used in some Latin American countries including Mexico and

some Asian countries and in Lebanon in the Middle East. In Europe, operators

such as Altitude (France) and Iberbanda (Spain) are building broadband wireless

networks in the band with the intent of migrating them to certified WiMax. The

3.5 GHz band is also operational in Latin America, China and Canada.

However, it would not be a cakewalk for operators to get governments and

regulators to open these bands for them. For instance in Europe, the 2.5 GHz was

set aside as an expansion band for 3G and is due to be allocated across the

continent by 2008. Even though the European Commission seems to agree with the

3G operators' contention that 2.5 GHz is exclusively meant for 3G

technologies, it's going to be tough call for WiMax operators as 3G operators

are lobbying hard to ensure the bands exclusivity for them.

India: No Frequency So Far



Despite all the noise about making broadband available to the masses, and

the Union Communications and IT Minister, Dayanidhi Maran, posing positive on

wireless broadband, WiMax has failed to gain the attention that it deserves. The

spectrum allocation for WiMax is yet to take place.

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While the Broadband Policy, announced by the government last year, recognizes

the role of wireless in the spread of broadband, there was no spice in it that

could excite WiMax enthusiasts. The policy only talked of de-licensing 2.40-2.48

GHz band and 5.15-5.35 GHz band. Operators have shown no keenness on these

unlicensed bands. Though the National Frequency Allocation Plan has made some

provisions for the use of 2.5GHz and the government has opened up 3.3 GHz,

leading broadband operators such as Bharti are more inclined towards the 3.5

GHz. This is because the first set of WiMax equipment is meant for operating in

this band.

Arguing that in a country like India, WiMax holds enormous potential to

extend broadband into areas that are underserved or not at all penetrated owing

to a variety of reasons, the Internet Service Providers Association of India

says that as most of the development for WiMax is being done in the 2.3-2.5 GHz

and 3.4-3.7 GHz bands, it would be only proper to make enabling provisions in

the upcoming National Frequency Allocation Plan for case-by-case consideration

for such systems.

High CPE Cost A Dampener



Besides the issues relating to spectrum, another major hurdle that broadband

operators would face is that of the cost of WiMax Customer Premises Equipment (CPEs)

that would account for around 50-60 percent of an operator's capex. The cost

of WiMax CPEs is likely to remain on the higher side for another two-three

years. As such, operators would find it difficult to roll out WiMax on a mass

scale. At best, they can use it to complement their existing DSL or Ethernet

based broadband offerings.

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Compared to a DSL modem that costs less than a $50, the first set of WiMax

CPE would cost $350. According to WiMax Forum, the first generation of WiMax

Forum Certified CPEs is expected to be outdoor-installable subscriber stations

akin to a small satellite dish. These are expected to be available in late

2005/early 2006 and priced around $350. The second generation of CPEs will be

indoor self-installable modems similar to a cable or DSL modem and will be

priced at around $250 and are expected to be available in 2006. Third-generation

CPEs will be integrated into laptops and other portable devices. They are

expected to initially cost approximately $100 and will be available in between

2006-2007.

Given this high cost, it is unlikely that India would see a major

breakthrough in WiMax deployment. In the current scenario, the lowest CPE cost

that an operator can offer (by working on different business models) is around

$205 that is expected to go down to $81 by 2010. Given this, even though WiMax

is on the radar of almost all the leading operators in the country with each one

either doing trials or planning, it is unlikely to gain any precedence over

their DSL or Metro Ethernet based initiatives. WiMax would take years to attain

the level of maturity that DSL and Metro-Ethernet based technologies have

attained in terms of technology and cost.

For WiMax-based broadband services to roll out without any hitch, all issues

relating to spectrum allocation would need to be sorted out before hand. On

other hand, as of now equipment prices are too much on the higher side for a

country like India. Vendors would need to work fast on reducing equipment prices

so that WiMax-based broadband services witness commercial deployment.

(Ravi Shekhar Pandey)

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