WiMAX for the Masses?

by Colin C. Haley

Not unless companies can convince potential customers that it makes economic and technological sense, according to analysts.

BOSTON -- Companies introducing WiMAX products and services must convince enterprises and service providers that the broadband wireless technology makes economic sense, analysts at the WiMAX World trade show said here today.

Getting technology into place because it's new is difficult to justify without being able to present productivity increases, Dale Kutnick, a META Group research fellow, said.

"How are you going to get this into corporations that are already wired up?" Kutnick asked the audience. "They have Ethernet and Wi-Fi. Are they going to buy this new technology because it's nice to have?"

WiMAX could have several interesting applications. In addition to bringing broadband to rural areas, office parks and educational campuses, there are other early-adopter opportunities, Kutnick said.

For example, he said, oil companies could use WiMAX to provide large amounts of data about pipelines or rigs back to a maintenance center. If a problem arises, the company would the data needed to make a decision of how best to respond. Improving the speed of the response could save millions of dollars.

Also, WiMAX systems stationed around shipping and trucking hubs and tied into RFID and video surveillance could help eliminate "shrinkage," the industry's term for goods and services that are lost or stolen in transit.

In a more generic sense, vendors could sell against incumbent telecom carriers on cost, comparing their services with T-1 and other traditional business services.

"Don't expect that the telcos are going to roll over and let WiMAX, or anything else, go in and blow it away," Kutnick said.

The proposition could become more palatable, however, as the price of WiMAX networking gear drops over the next several years.

Others in the industry are more skeptical of WiMAX's chances of taking off in the near future. At another industry conference this week, Cisco CTO Charlie Giancarlo said WiMAX lacks a compelling application that would drive demand.

In addition to making a dollar and sense argument, WiMAX firms must do a better job of educating potential customers, said Bob Egan, president of the research firm Mobile Competency.

In a hotel elevator, a group of guests here for the John Kerry rally that never was asked Egan if he was here for the Wi-Fi conference. While the guests were not CIOs and there is a separate Wi-Fi conference across town, Egan said the interaction hints at general confusion between WiMAX, Wi-Fi, third-generation wireless and other technologies.

"I implore you to educate [customers] about what WiMAX is and what it can do," Egan said, who also suggested stressing security, integration and mobility issues.

Egan also said WiMAX companies are doing a decent job of developing standards, better, in fact, than the Wi-Fi industry did at a similar stage in its development.

For example, chipmaking giant Intel recently partnered with Clearwire, a Kirkland, Wash.-based wireless broadband services company, to advance the WiMAX standard and to support the upcoming IEEE 802.16e version.

This article was originally published on Wednesday Nov 3rd 2004