Friday, January 9, 2009

WiMAX Vs LTE - which will win through?

Opposing technologies are a historical feature of the technological evolution of the World, take BetaMax Vs VHS, Blu Ray Vs HD DVD or Mac Vs PC as prime examples. Unsurprisingly, technical arguments are almost never the deciding factor in such contests; it almost always comes down to cost and simplicity or adoption of open standards.

With the tremendous impact of Broadband Internet over the last decade and the overwhelming success of the mobile phone, today is all about Mobile Broadband and therefore it is not all surprising that LTE (Long Term Evolution) and WiMAX (Worldwide Interoperability for Microwave Access), are the focus of interest and are fuelling a new breed of pundits arguing over which technology is best.

LTE and WiMAX are commonly referred as 4G (Fourth Generation) technologies. They are aimed at overcoming previous 3G (Third generation) technological and speed limitations. Within the framework of International Mobile Telecommunications (IMT-Advanced umbrella), 4G is broadly defined as any mobile technology that can deliver over 100Mbps (megabits per second) throughput over an 'all IP' based infrastructure.

WiMAX and LTE are officially recognized as IMT-2000 technologies while their respective evolutions, namely WiMAX 802.16m and LTE Advanced are expected to meet the IMT-Advanced requirements and therefore officially be referred to as 4G technologies. Using 4G to describe a technology today is essentially a marketing positioning.

With more than 100 commercial contracts worldwide and the first large scale mobile WiMAX deployment with Sprint in the USA, WiMAX has already been brought to market and the success of the Sprint roll-out will have tremendous influence on further adoption worldwide.

From a technical standpoint, LTE and WiMAX are very similar with IP and OFDM (Orthogonal frequency-division multiplexing) as core component. Beside LTE and WiMAX, WiFi as well as DSL are also using OFDM technology. The standards themselves are still in specification phase and should be completed by 2010. However, WiMAX has a slight advantage as 802.16e has been standardize for some time while LTE standards are close to completion. Tere are however some other significant differences, such as the fact that WiMAX is based on IEEE while LTE is a 3GPP development. IEEE has a proven history of being more supportive of open standards than 3GPP although a lot of efforts have been made towards open standards in 3GPP.

The main practical difference between WiMAX and LTE is the deployment strategy. WiMAX requires a new network to be built whereas LTE is an evolution of existing WCDMA/HSPA networks and therefore has the footprint advantage with close to 80% of subscribers worldwide. Both CDMA and GSM operators are therefore naturally heading towards LTE.

The other key issue is with spectrum availability. More than fifty percent of the World's population now lives in an area where a license for WiMAX is available. But LTE, on the other hand, offers more flexibility than WiMAX and all 3GPP operators already have spectrum that can be used for LTE. In both cases, the amount of spectrum available and channelisation attached will strongly influence the quality and bandwidth they will be able to offer customers.

So, even if licenses suitable for both technologies are available, a technology choice may ultimately depend on which license affords the more attractive end-user service relative to cost. In the past year, the WiMAX industry has passed a string of key milestones including product certification, the launch of services by major operators such as Sprint Nextel, commitments by key internet players such as Google, and the long awaited arrival of WiMAX notebooks and other devices.

But despite early successes, WiMAX rival HSDPA has become a runaway success in many markets worldwide, and emerging technology LTE has accelerated and gained the backing of most of the world's major mobile operators, including Vodafone and China Mobile.

Mobile WiMAX also faces challenges because it is entering its capital intensive deployment phase in the midst of the global financial crisis, which will make it harder for operators to secure funding for new deployments.

However, Mobile WiMAX still has a significant head start over its OFDMA rival LTE, which will launch commercially in 2010. The bottom line is that WiMAX will take a significant share of the converging broadband market in some regions, but will struggle in others due to competition from HSPA and LTE.

According to a recently published report by Dell'Oro Group, the worldwide mobile WiMAX infrastructure revenues nearly quadrupled in the third quarter of 2008 (the most recent quarter with available market information) over the third quarter of 2007.

"With LTE still a couple of years away, WiMAX has, in fact, become the first next generation technology with commercial service," commented Scott Siegler, Senior Analyst of Mobile Infrastructure research at Dell'Oro Group.

"Mobile WiMAX revenues were very strong in the third quarter of last year, and we anticipate revenue for the fourth quarter to set another record. However, as we look into 2009, we expect the WiMAX market to be hit rather hard by the economic downturn. Building out brand new networks from scratch requires tens, if not hundreds, of millions of dollars of capital. Compounding the tightening in the credit markets, the increasing cost of capital and the decrease in demand for broadband data as consumer spending weakens, we anticipate many network buildouts will be put on hold or delayed into 2010. With initial LTE rollouts coming in the 2010 to 2011 timeframe, these delays will shorten the time to market advantage WiMAX currently has over LTE," Siegler continued.

The report also shows that the top four Mobile WiMAX vendors in the quarter - Samsung, Motorola, Alcatel-Lucent and Alvarion – represented nearly 90 percent of the total market.

Meanwhile in the UK, Ofcom will auction 2010-2025 MHz and 2500-2690 MHz bands on a technology and service neutral basis. In total, 205 MHz will be available when Ofcom open up this spectrum next year. It was originally scheduled for this summer, but was delayed. Current WiMAX operations in the UK use the less ideal (and less mobile) 3.5GHz band.

It will be the UK's single-largest release of radio spectrum to date, suitable for a range of new services such as mobile broadband and advanced wireless services delivered using WiMAX and 3G technology.

The incumbent telco, British Telecom, has no mobile arm, which makes it likely to bid for a license. If it does and it wins, BT is likely to adopt WiMAX rather than LTE to take advantage of the headstart WiMAX would provide, say some observers. Five mobile operators are potentially bidding to hoard WiMax spectrum (at 2.6 GHz).

Ofcom has allocated a certain amount of licensed spectrum for time division duplex (TDD), or unpaired spectrum, and a certain amount FDD, or paired spectrum. Analysts and WiMax players expect the UK's mobile operators to buy up the TDD spectrum to keep out new Mobile WiMax competitors.

Labels: , ,

0 Comments:

Post a Comment

Subscribe to Post Comments [Atom]

Links to this post:

Create a Link

<< Home