Can WiMAX Challenge 3G? Performance, Economics, and Opportunities
Pyramid Research, Inc, November 2006, Pages: 126
In a survey conducted by us, 78 percent of operators stated that they have considered investing in WiMAX.
WiMAX has gained significant momentum over the last year. Its standardization is complete, vendor and operator ecosystems are expanding, and the hype is getting louder, often justifiably so. In this report, we move beyond the hype and theoretical discussion; we look at real-world examples of pre-WiMAX deployments and review practical issues such as time-to-market, business models and pricing, device availability, economics of scale and spectrum availability, with an emphasis on a number of key questions, most notably, can WiMAX challenge 3G?
The answer will eventually be determined by the operator community, so we surveyed about 100 operators to tune into their views, investments plans, expectations and concerns in respect to WiMAX. With 78 percent of the surveyed operators considering an investment in WiMAX, we believe the promise of WiMAX is compelling and the technology warrants further examination.
The result is an in-depth, case-study based analysis about the viability of WiMAX, and the potential threat it poses to 3G. We include over 20 pages of specific market forecasts, case studies, analyses of competitive landscapes by region, and overview of current deployments. Finally, we include a regionalized breakdown of operators responses to 23 questions about their plans for WiMAX.
List of Exhibits
Acronyms and Abbreviations
Companies Mentioned in This Report
Executive Summary
Section 1: WiMAX Reassessed
The Sprint Effect.
1.1 Why WiMAX?
1.2 WiMAX vs. the Competition: Not a Straightforward Call
1.2.1 Breaking Down the WiMAX Value Proposition
WiMAX as a Broadband Wireline Replacement
More Cost-effective than DSL and Cable?
Mobile WiMAX: Looking Beyond 3G
Mobile WiMAX: More than Mere Broadband
The Intel Factor: Scale for Chipsets, Support, and Money
1.2.2 WiMAX vs. 3G Performance: Looking Beyond the Hype, We See No Clear Winners.
No Future for Fixed WiMAX
Mobile WiMAX: The Throughput Case is more Ambiguous
What about Voice and Video over WiMAX?
1.2.3 Is WiMAX Ready? Look to Late 2007
1.2.4 WiMAX Time-to-Market Advantage: It’s All Relative
1.2.5 WiMAX Network Economics: The Jury Is Still Out on WiMAX vs. 3G.
The Fuzzy Economics of WiMAX vs. 3G: Looking for Cost-savings
WiMAX vs. 3G: Lower WiMAX CAPEX Not a Sure Thing
Why WiMAX’s IPR Costs Will Matter
WiMAX vs. 3G: We See Lower OPEX for WiMAX.
1.2.6 WiMAX CPE Economics: Innovation Can Lead to Rapid Scale
802.16d CPE Economics Are Not Compelling
3G+ Devices Will Be Cheaper
1.2.7 Spectrum Allocation: Still Somewhat of a Mess.3
Lack of Spectrum Harmonization Will Negatively Impact Costs
Look Out for the 700 MHz Band…
…and for Regulatory Protection for MNOs
1.2.8 WiMAX Licenses: Not Quite Cheap, but Still Cheaper Than 3G
1.2.9 The 3G Community vs. the WiMAX Community
1.2.10 And Our Bottom Line Is
1.3 Who’s Deploying It, and Why?
1.3.1 Fixed Network Operator Business Models: Primarily an Alternative Where
DSL Does Not Go
1.3.2 Mobile Operator Business Models: Backhaul Solution or Substitute for the Lack of 3G License?
1.3.3 Egypt Showcases 3G Licensing Gone Bad, Paving the Way for WiMAX
Adoption
1.3.4 Alternative Operator Business Models: It’s the Cost and Speed of Deployment .
Section 2: Survey Findings: Operators Reflect on WiMAX
2.1 Scope and Methodology
2.2 Operator Investment Plans, ROI Expectations
2.2.1 Operators Are Considering a WiMAX Investment
2.2.2 Operators Are Attracted to WiMAX for Its Business Case
2.2.3 WiMAX Investments to Grow in 2–3 Years
2.2.4 Expected Payback Periods Vary by Operator Type and Region
2.2.5 Perceived Importance of Time-to-Market and Projected Timetable for
Mobile WiMAX Availability
2.2.6 WiMAX: To Complement or to Substitute?
2.3 Examining the Business Landscape.
2.3.1 Who Will Deploy Mobile WiMAX?
2.3.2 Likely Geographies for WiMAX Deployment
2.3.3 Operator Perceptions on Drivers for Mobile WiMAX Success
2.3.4 Operators Rank Obstacles to Mobile WiMAX Success
2.3.5 SMEs Emerge As the Most Likely Customer Segment for WiMAX.
2.3.6 Operators Expect Consumers to Adopt Mostly Based on Price.
2.3.7 Operators Point to Primary Applications for Mobile WiMAX.
2.3.8 Can Mobile WiMAX Deliver Chargeable Voice Revenues?
2.4 How Does WiMAX Fare Against 3G?
2.4.1 WiMAX vs. 3G: Performance Comparison
2.4.2 WiMAX vs. 3G: IPR Structure
Section 3: The Mobile WiMAX Opportunity
3.1 US Mobile WiMAX Forecasts
Spectrum Allocation and Likely WiMAX Players
Mobile WiMAX Service and Equipment Availability
Competitive Landscape
3.2 Mexico Mobile WiMAX Forecasts
Spectrum Allocation and Likely WiMAX Players
Mobile WiMAX Service and Equipment Availability
Competitive Landscape
3.3 France Mobile WiMAX Forecasts
Spectrum Allocation and Likely WiMAX Players
Mobile WiMAX Service and Equipment Availability
Competitive Landscape
3.4 India Mobile WiMAX Forecasts
Spectrum Allocation and Likely WiMAX Players
Mobile WiMAX Service and Equipment Availability
Competitive Landscape
Section 4: WiMAX Activity in Selected Markets
4.1 Africa and the Middle East.
4.1.1 Egypt: With Spectrum Licensing Looming, Intel Makes a Move
WiMAX vs. 3G: Vodafone and Mobinil Have Different Views
4.1.2 Nigeria: Market Rife with Proprietary BWA, Ripe for WiMAX
WiMAX vs. 3G: WiMAX Will Threaten MNOs, unless They Buy into It
4.1.3 Pakistan: Targeting 1m+ WiMAX Subscribers
4.1.4 South Africa: WiMAX Finds a Place in a Variety of Networks
WiMAX vs. 3G: A Complementary Solution
4.1.5 Turkey: Promoting Competition with WiMAX
WiMAX vs. 3G: MNOs Will Stick to 3G.
4.1.6 United Arab Emirates: Still Testing
WiMAX vs. 3G: The UAE Will Go for Whatever Works
4.2 Asia Pacific
4.2.1 China: No WiMAX here
China prefers McWill.
WiMAX vs. 3G: 3G Gets Preferential Treatment.
4.2.2 India: Looking to the 700MHz Frequency Band
Deployments
WiMAX vs. 3G: WiMAX Will Need Voice
4.2.3 Japan: One Part of a Bigger Mobile Broadband Vision
Deployments
WiMAX vs. 3G: Primarily a Threat
4.2.4 Korea: Home of WiBro
WiMAX vs. 3G: Government Pressure Will Sustain WiBro
4.2.5 Philippines: A Solution to Low Broadband Penetration
WiMAX vs. 3G: WiMAX Going against 2.5G
4.3 Europe
4.3.1 Austria: WiMAX Telecom Leads the Way
4.3.2 Denmark 113
4.3.3 France: Only One National WiMAX License
4.3.4 Germany: An Alternative to DSL Emerges
4.3.5 Poland
WiMAX vs. 3G
4.3.6 Russia: A Flurry of Activity
Deployments
WiMAX vs. 3G
4.3.7 UK
WiMAX vs. 3G
4.4 Latin America
4.4.1 Brazil: Will The Fixed Operators Qualify for WiMAX Auction?
Licensing.
Deployments
Development
WiMAX vs. 3G
4.4.2 Chile
Deployments
WiMAX vs. 3G
4.4.3 Colombia
Deployments
4.4.4 Mexico.
Deployments
WiMAX vs. 3G
4.4.5 Venezuela
WiMAX vs. 3G
4.5 North America
4.5.1 Canada
Deployments
WiMAX vs. 3G
4.5.2 USA
Deployments
WiMAX vs. 3G
List of Exhibits
Exhibit 1: Global Wireline Voice and Internet Revenue
Exhibit 2: Wireless Revenue Composition: Voice vs. Data.
Exhibit 3: Sample WiMAX Applications
Exhibit 4: Intel Capital’s Publicly Announced WiMAX Investments
Exhibit 5: Fixed WiMAX vs. Other Broadband Technologies
Exhibit 6: Spectral Efficiency: Mobile WiMAX vs. 3G
Exhibit 7: Mobile WiMAX vs. 3G Performance Comparison
Exhibit 8: VoIP and Multicasting Capabilities
Exhibit 9: WiMAX Timetables: From Standardization to Commercialization.
Exhibit 10: Mobile Broadband Technology Timetable
Exhibit 11: Projected WiMAX CPE Evolution
Exhibit 12: The Current Picture for WiMAX Spectrum Allocation
Exhibit 13: WiMAX Licenses Issued through Beauty Contests
Exhibit 14: WiMAX Licenses Issued through Auctions
Exhibit 15: GDP Per Capita vs. Price/MHz Per Capita
Exhibit 16: HSPA vs. WiMAX
Exhibit 17: WiMAX Business Models by Company Type
Exhibit 18: Comparative Analysis of BellSouth’s Pre-WiMAX and DSL Services
Exhibit 19: Selected Mobile Operators Not Doing 3G in 3G Markets
Exhibit 20: Countries Yet to Introduce WCDMA
Exhibit 21: DBD vs. T-Online: Pricing Schemes for Residential Broadband
Exhibit 22: WiMAX vs. 3G Home Modems: DBD, O2, and Vodafone
Exhibit 23: WiMAX Telecom vs. Telekom Austria: Residential Broadband Pricing
Exhibit 24: WiMAX Telecom vs. Telekom Austria: Business Broadband Pricing
Exhibit 25: Irish Broadband vs. eircom: Residential Broadband Pricing
Exhibit 26: Irish Telecom vs. eircom: Business Broadband Pricing
Exhibit 27: Orbitel vs. ETB and Colombia Telecom: Service Pricing
Exhibit 28: Operator Respondents by Region.
Exhibit 29: Operator Respondents by Company Type
Exhibit 30: Operator Respondents’ Company Size in Revenues
Exhibit 31: Operator Respondents by Job Function
Exhibit 32: “Has your business considered investing in WiMAX?”
Exhibit 33: “Has your business considered investing in WiMAX (by operator type)?”
Exhibit 34: “Has your business considered investing in WiMAX (by market type)?”
Exhibit 35: “What factors contribute to the interest of operators in WiMAX?”
Exhibit 36: Factors Contributing to Interest in WiMAX by Operator Type
Exhibit 37: Factors Contributing to Interest in WiMAX by Market Type
Exhibit 38: ”How much will your company invest in WiMAX equipment?”
Exhibit 39: Investments in WiMAX Equipment by Operator Type
Exhibit 40: Investments in WiMAX Equipment by Market Type
Exhibit 41: “How long will it take your company to break even on a WiMAX investment?”
Exhibit 42: Payback Period on WiMAX Investments by Operator Type
Exhibit 43: Payback Period on WiMAX Investments by Market Type
Exhibit 44: “Is broadband wireless technology time-to-market important for your company?”
Exhibit 45: “When do you expect commercial launches for mobile WiMAX devices?”
Exhibit 46: Perceived Timetables for Commercial Launches of Mobile WiMAX by Operator Type
Exhibit 47: "Will WiMAX Substitute or Complement Other Broadband Technologies?"
Exhibit 48: WiMAX: A Complement or Substitute (by Operator Type)
Exhibit 49: “What types of operators will deploy mobile WiMAX?”
Exhibit 50: “What types of operators will deploy mobile WiMAX by market type?”
Exhibit 51: “Where will mobile WiMAX be deployed the most?”
Exhibit 52: Mobile WiMAX Deployment Locations by Operator Type
Exhibit 53: Mobile WiMAX Deployment Locations by Market Type
Exhibit 54: “What are the main drivers of mobile WiMAX’s success?”
Exhibit 55: Main Drivers of WiMAX Success by Operator Type
Exhibit 56: “What are the main obstacles to mobile WiMAX’s success?”
Exhibit 57: Main Obstacles to the Success of Mobile WiMAX by Operator Type
Exhibit 58: “Which customer segments will be addressed by mobile WiMAX?”
Exhibit 59: Customer Segments Addressed by Mobile WiMAX by Operator Type
Exhibit 60: Customer Segments Addressed by Mobile WiMAX by Market Type
Exhibit 61: “What factors will impact consumer uptake the most?”
Exhibit 62: Factors Impacting Consumer Uptake by Operator Type
Exhibit 63: “What kind of applications will be enabled by Mobile WiMAX?”
Exhibit 64: “Will mobile WiMAX deliver chargeable voice revenues?”
Exhibit 65: "Will mobile WiMAX deliver chargeable voice revenues (by market type)
Exhibit 66: “Which performs better in the following categories, WiMAX or cellular?”
Exhibit 67: “Which performs better in the following categories, WiMAX or cellular?” (by market type)
Exhibit 68: “Will WiMAX IPR costs be higher or lower than CDMA/EVDO IPR costs?”
Exhibit 69: “Will WiMAX IPR costs be higher or lower than CDMA/EVDO IPR costs?” (by operator type)
Exhibit 70: “Will WiMAX IPR costs be higher or lower than CDMA/EVDO IPR costs?” (by market type)
Exhibit 71: Positioning Mobile WiMAX across the World
Exhibit 72: Mobile WiMAX Subscriber Uptake and percentage of Mobile Broadband Subscriber Base, 2007–2012
Exhibit 73: Mobile WiMAX ARPS and Revenues, 2007–2012
Exhibit 74: 3G/4G Penetration of Population, 2005–2012
Exhibit 75: Broadband Penetration of Households, 2005–2012
Exhibit 76: Mobile WiMAX Subscriber Uptake and Percentage of Mobile Broadband Subscriber Base
Exhibit 77: Mobile WiMAX ARPS and Revenues, 2007–2012
Exhibit 78: 3G/4G Penetration of Population, 2005–2012
Exhibit 79: Broadband Penetration of Households, 2005–2012
Exhibit 80: Mobile WiMAX Subscriber Uptake and Percentage of Mobile Broadband Subscriber Base
Exhibit 81: Mobile WiMAX ARPS and Revenues, 2007–2012
Exhibit 82: 3G/4G Penetration of Population, 2005–2012
Exhibit 83: Broadband Penetration of Households, 2005–2012
Exhibit 84: Mobile WiMAX Subscriber Uptake and Percentage of Mobile Broadband Subscriber Base, 2007–2012
Exhibit 85: Mobile WiMAX ARPS and Revenues, 2007–2012
Exhibit 86: Status of Licensed WiMAX Spectrum Bands
Exhibit 87: 3G/4G Penetration of Population, 2005–2012
Exhibit 88: Broadband Penetration of Households, 2005–2012
Companies Mentioned in This Report
ACCA Networks
Acom
Aircel Business Solutions
Airspan
AlanDick
Altitude Telecom
Alvarion
Anatel
Aperto Networks
AT&T
Axalto
Axtel
Beceem Communications
Bell Canada
BellSouth
Bharti Tele-ventures
Bollore Telecom
Bouygues Telecom
Brazil Telecom
BSkyB
BSNL
BT
Cable centro
Cable Union de Occidente
Cell C
Chello
China Communications
China Netcom
China Telecom
China Unicom
Cingular
Clearwire
Cofetel
Colombia Telecom
Comcast
Comcel
Comstar
Cosmofrecuencias
Cox Communications
CPqD
Crowley Data
Danske Telecom
Deutsche Breitland Dienste
DirecTV
Du
EBT
EchoStar
Eircom
Entel
EPM
Enforta
Entel
Ertach
ETB
Etisalat
Exatel
Globe Telecom
Golden Telecom
GTV
Hanaro Telecom
HDDR
Hua Tong Electricity
Iberbanda
iBurst
Iliad
Image Wireless
Infoseti
Innove Communications
Intel
Inukshuk
Irish Broadband
Irish Telecom
IUSAcell
KDDI
Korea Telecom
Look TV
lusacell
Mais TV
Maxtel
McWill
Megafon
Meridian Telecom
Milmex Systemy Komputerowe
Mobinil
Motorola
MTC
MTNL
Multimedia Polska
MVSNet
MyTel
Navini Networks
Neotel
Neovia
Net
Netago Networks
Netia
Can WiMAX Challenge 3G? Performance, Economics, and Opportunities
©2006 Pyramid Research www.pyramidresearch.com Reproduction Prohibited
16
Companies Mentioned in This Report
(continued)
Neuf-Cegetel
New Communications
NEW Energie
NextNet Wireless
Nextel
Nortel
NTT DoCoMo
Ofcom
Omnivision
Orange
Orascom Telecom WiMAX
Orbitel
Pipex Wireless
PLDT
Prestige Internet
Procempa
Proxim Wireless Corp.
Redline Communications
Reliance Infocomm
Rogers Communications
Samsung
Sasktel
Sentech
SFR
Siemens
Sify
Sistema Group
SK Telecom
Skycable
Skylink
Smart Communications
Softbank
Sogetel Communications
Spectrum Co
Sprint Nextel
SR Telecom
Start Telecom
Startech Connections
Swift Networks
Synterra
T-Com
Telabria
Telcel
Telco Bancom
Telecard
Telcomp
Telefonica
Telekom
Telmex
Telsur
TEM
Time Warner
Tkt Teleconsult
T-Mobile
TPSA
Turbonet
Turk Telecom
UK Broadband
Unefon
Univision
Unwired
Vant
Vectra
Velecom
Verizon
Vimplecom
Vodafone Egypt
VTR
Wateen Telecom
Worldmax
Xanadoo
Yozan
ZOMA Telecom
ZTE Corporate
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