WiMAX has got off to a good start in the Middle East and Africa (MENA), where take-up continues to grow. By April 2009, there were nineteen commercial networks in service in twelve countries in the MENA region, according to Analysys Mason’s WiMAX Tracker.

There were a number of reasons for WiMAX’s initial success in the MENA region: latent demand for basic broadband access because of the lack of reliable (or sufficiently high quality) fixed-line infrastructure in some countries; WiMAX could operate in 2.5GHz and 3.5GHz spectrum as it became available; and WiMAX offers satisfactory QoS, good throughput and spectrum flexibility, including TDD, enabling it to support asymmetrical communications services. WiMAX has proved an attractive option both for greenfield operators and as a means for existing operators to extend or provide last-mile reach.

Existing fixed network operators, including CableOne (Lebanon), Divona (Tunisia) and Saudi Telecom (Saudi Arabia), chose to use WiMAX to offer fixed broadband access services, predominantly or exclusively catering for business customers. Saudi Telecom launched WiMAX services in March 2006 and currently operates 452 base stations, covering all major markets in the kingdom. It offers enterprise customers a 2Mbps symmetrical connection, priced at $1,500 per month (which delivers one of the highest ARPUs in the world), and had approximately 1,200 subscribers at the end of March 2009.

WiMAX has also enabled a number of MNOs, including Mobily (in Saudi Arabia), Umniah (in Jordan) and Zain (in Bahrain), to enter the fixed market with multi-play offerings. Zain Bahrain launched a national WiMAX network in June 2007, offering fixed broadband over WiMAX as a complement to its mobile broadband over HSPA service. Zain offers the Zain@Work business service and the Zain@Home residential offering, with a choice of four volume-based packages, as well as bundles of free mobile calls, SMS and MMS. One year after launch, Zain Bahrain had 10, 000 subscribers, but its subscriber base had doubled to over 20,000 subscribers by March 2009.

However, as an access technology, WiMAX now faces growing challenges in the region: its position in the residential market will increasingly be squeezed by mobile broadband, particularly HSPA. For existing WCDMA operators, HSPA is the natural upgrade path. It is quick to deploy, costs are incremental, the operator benefits from vendor continuity and CPE costs are lower. There are only four markets in the MENA region in which 3G licences have not yet been awarded: Algeria, Iraq, Jordan and Lebanon. Mobile operators, wishing to exploit a first-mover advantage, have set aggressive WCDMA/HSPA rollout targets and are experiencing strong interest from consumers, particularly where they have also introduced flat-rate data tariffs at launch. For example, Mobily (Saudi Arabia)’s 3.5G network now covers 70 percent of the country’s population and supports over 18.5TB of data traffic per day.

WiMAX has allowed some operators in the MENA region to develop revenue streams other than last-mile access, including vertical applications that require nomadic coverage and high bandwidth. Commercial deployments are various, ranging from relatively low-bandwidth applications, such as command and control of infrastructure elements (including meter-reading applications for oil and gas pipelines) to bandwidth-intensive applications, such as video surveillance.

For example, in Turkey The Turkish National Police in the city of Kütahya have launched a high-capacity video surveillance network in a challenging RF environment where there was much interference from urban obstacles, necessitating the use of many non-line-of-site network links. In Yemen, the oil company Canadian Nexen Petroleum Yemen deployed WiMAX in support of its the East Al Hajr oilfield operations, including transmission of SCADA information and surveillance. In these applications, the main advantage of WiMAX is that it allows the user to move the terminal end of the equipment. This attribute lends itself well to CCTV coverage in cities, for example, as the camera can be moved frequently in order to maintain an element of surprise.

WiMAX’s flexibility and mobility, combined with its high-bandwidth capability, make it also of interest for emergency services applications and for outside broadcasting, both of which need mobility and high data rates to carry video signals back to a network gateway. These are emerging applications of WiMAX.

Looking ahead, will WiMAX max out in the MENA region? The jury is still out. The progress of WiMAX will depend largely on the commitment of the players in the value chain (such as Intel) to subsidise its growth until it reaches a critical mass. The ability and willingness of investors to support greenfield operators, despite the economic downturn,  will also play a key role in the coming year. In the longer term, we will see expansion of existing networks and a number of current trials will progress to commercial deployment. We also expect that, as the spectrum becomes available, there will be increasing numbers of WiMAX 802.16e deployments at 2.5GHz, which offers improved propagation characteristics; for the reasons we have discussed, however, fixed applications are likely to continue to prevail over mobility offerings, at least in the next couple of years. The future for WiMAX in the MENA region may not be as bright as was initially anticipated, but it certainly has a role in the region’s emerging telecoms market.

This article was written by Helen Karapandzic, an analyst with Analysys Mason. To find out more about Analysys Mason’s WiMAX Tracker, or its recent report entitled ‘Strategies for WiMAX operators in growth markets’, contact [email protected].

Get a detailed understanding of the status of WiMAX in the MENA region at WiMAX MENA in Dubai 23-24 June – download the agenda at www.wimax-vision.com/mena today and reserve your place – 20 regional WiMAX operator speakers confirmed!