Thinking big at WiMAX Congress Asia

Michael Lai, the charismatic CEO of P1, a 2.3GHz WiMAX operator in Malaysia, is candid about the size of the challenge facing the WiMAX community. “This year is a defining year for WIMAX,” he says. “It’s got to happen and it’s got to happen big.”

I was speaking to Lai at the WiMAX Forum Congress Asia event, held in Singapore, last week. And he was optimistic, as were many of the Congress Asia delegates, that WiMAX could indeed make it ‘big’ through the large-scale WiMAX projects, such as Clearwire (US), BSNL (India), Yota (Russia) and UQ (Japan). This would, of course, generate better economies of scale for the smaller players and help persuade investors to give WiMAX greater financial backing.

For its part, P1 anticipates it will have 250,000 subscribers by the end of this year, which would be pretty good going as it only launched service in August 2008. One of the main reasons for Lai’s optimism is better performing 802.16e networks compared with the current crop of cellular technologies, including HSPA. “Performance is the big differentiator and key for subscriber acquisition,” says the P1 CEO.

The ‘better-than-cellular’ argument was heard loudly at Congress Asia, but at this year’s event delegates could draw upon examples of 802.16e rollout to make their point. “In our demonstration at service launch, our WiMAX service far exceeded the performance of 3.5G, achieving up to 10Mbps on the downlink and 3Mbps on the uplink,” Peter Yen, president of Tatung Infocomm, told the conference delegates in Singapore. “3.5G, on the other hand, typically offers 2Mbps on the downlink and 1Mbps on the uplink.”

Tatung Infocomm is the first of Taiwan’s six WIMAX licence holders to launch commercial service (27th April). Yen is confident that WIMAX will provide the network platform that will turn Tatung Infocomm into a ‘full service digital provider’ – which includes offering TV services – to compete against the island’s cable and DSL providers, as well as the 3G operators.

Delegates from Congress Asia – as well as members of the press – were also given the opportunity to see mobile WiMAX in operation at first hand. During a bus trip through an urban area of Johor Bahru (JB), Malaysia’s southern capital, various applications were demonstrated using P1’s mobile WiMAX network, which delivered between 5.6Mbps and 6.4Mbps on the move during the course of the demo (although the P1 demo people said the top speed they had achieved on the move was 9.6Mbps).

Using a dongle from Green Packet (Malaysia), a software and hardware provider for wireless networks – as well as being the parent company of P1 – bufferless video clips from YouTube and uninterrupted VoIP (over the P1 network) were both demonstrated on the bus. Live video streaming, using ‘PacketEyes’, a remote video surveillance application developed by Green Packet, was also showcased. The Intouch connection manager software, developed by Green packet for its USB WiMAX dongle, enables seamless connection between wifi, WiMAX and 3G networks without dropping the call session (P1 also provides a free wifi service in Kuala Lumpur), which Green Packet says is a unique aspect of its mobile broadband software solutions portfolio.

It was indeed an impressive demo, although it would have been more impressive if the bus were not moving at snail’s pace through JB’s rush-hour traffic, although I was assured by Green Packet staff that performance would not be impaired at faster speeds with base stations spaced no more than 1km apart in JB’s built-up areas.

Takeshi Tanaka, president of UQ Communications, which is undergoing mobile WiMAX service trials in Japan in preparation for commercial launch on 1st July 2009, was adamant that WiMAX would underline the shortcomings of the cellular mobile internet experience. “People are beginning to think that cellular internet is fake,” he says. “The browser is limited, the content and performance are limited, and so are the screen sizes. This is our opportunity to differentiate from the 3G style.”

Japan is home to a high amount of cellular internet users: 87 per cent of the country’s 106 cellphone customers regularly going online. If UQ could demonstrate that WiMAX provides a much a better mobile internet experience than the likes of NTT DoCoMo, and arm itself with a wide range of attractive devices, then it would put UQ in a strong marketing position. But to compete effectively against cellular, as it intends to do, the operator says it needs widespread coverage (eschewing the city-by-city approach of Clearwire). By the end of its fiscal year 2012 (31st March 2009), UQ plans to cover more than 90 percent of Japan’s population nationwide.

According to Tanaka, UQ has been achieving up to 16Mbps on the downlink and up to 3.9Mbps on the uplink since free trials of the service began in February 2009. The trials are taking place in Tokyo (all 23 wards), Yokohama and Kawasaki using some 600 Samsung base stations, which are compliant to WiMAX Forum Wave-2 Phase-2 specifications.

But if the Congress Asia delegates could agree that WiMAX mobile broadband was a much better performer than cellular, there was less clarity on how important voice would be to the WiMAX business case. Wayne Sun, CIO at Global Mobile, a WiMAX licence holder in Taiwan, says he is looking at the possibility of using VoIP solutions, such as Skype. Dr Teddy Huang, president and CEO of Vmax, another Taiwanese licence holder, says he is also looking at VoIP, but is keen to see affordable dual-mode cellular/WiMAX devices come onto the market as quickly as possible. The thinking is, of course, that customers will find it inconvenient to carry around two devices and so voice is seen as important by some WiMAX operators as a way to attract subscribers (rather than as a revenue stream in its own right).

P1’s Lai, however, is not convinced that Skype-like solutions, which use the public internet and have no QoS, can add much value. “Were not going after mobile voice market,” he says. “You are going to be competing with the GSM players if you do that, which have been in that market for many years. They also have the coverage.” P1 will, however, be offering en ‘end-to-end’ voice service over its WIMAX network by the end of this year, which will have some QoS attached. “If you provide a poor quality voice service, there is a danger you damage the brand,” says Lai.

Some concerns were also raised in Singapore about the high prices of CPE. “The upfront cost of CPE is still an entry barrier,” says Rizwan Tiwana, CTO at Wateen Telecom, an operator in Pakistan which is using 802.16e to offer fixed and nomadic services (it is prohibited by the regulator from offering mobile services). At currently over $100 per CPE unit, Tiwana would like to see the unit price come down to as low as $60 for Wave 2 compliant CPE. There are signs, however, that prices are coming down to this level. “I think it’s possible to get simple WiMAX CPE [no voice or wifi] below $70 by the end of this year,” says CC Puan, CEO, Green Packet Malaysia.

Global Mobile’s Sun also expressed ROI concerns about delivering high-speed access to feed bandwidth-hungry applications and the financial consequences of simply playing the role of a bit-pipe provider. “YouTube and Skype eat into [network] costs,” he says. “The big challenge is how to monetise [those applications].”

But the WiMAX mood in Singapore was upbeat, despite some of the concerns. Sun again: “WiMAX is proven, while LTE is still in the labs. Do you want to wait another three years for proper broadband?”  It was a sentiment repeatedly heard during the Congress Asia event.

But if Verizon can launch LTE in 20 to 30 US markets next year as it has said it will do, this might force a rethink of the time-gap between WiMAX and LTE. In the meantime, WiMAX appears to be enjoying some momentum, but it still needs a boost from the WiMAX ‘big guns’ to underline its mobile broadband credentials.