Credit crunch hits WiMAX

Worldwide sales of fixed and mobile WiMAX equipment, as well as phones/Ultra Mobile PCs, fell by 21 percent to $245m in 3Q08 compared with the previous quarter.

The figures come from an updated report from Infonetics, ‘WiMAX and WiFi Mesh Network Equipment and Devices’, in which the research firm expects WiMAX sales to continue to slide down through 2009 due to the economic recession.

According to Infonetics’ report, fixed WiMAX already had reached its plateau prior to the economic downturn, having its third consecutive quarter of revenue decline. Mobile WiMAX overtook fixed WiMAX spending in the first quarter of 2008 and now makes up almost three-quarters of worldwide WiMAX equipment sales.

“With less cash available for network rollout – and possibly less spectrum being auctioned until the current financial crisis passes – WiMAX deployment will be inhibited for the next 12 months,” says  Richard Webb, wireless analyst for Infonetics Research. “Infonetics expects revenue growth to return to the overall WiMAX market in 2010, with growth being driven by mobile WiMAX, as a growing number of WiMAX networks are being rolled out based on 802.16e, even if initial services will be fixed CPE-based broadband.”

Despite the downward sales trend, there has been notable movement in the WiMAX supplier community. In 3Q 2008, Alvarion overtook Alcatel-Lucent and Motorola in the mobile WiMAX market, having its best ever quarter for WiMAX revenue; the three revenue leaders together accounted for over 60 percent of worldwide mobile WiMAX revenue. Alvarion, Alcatel-Lucent, Motorola, and Samsung together have nearly three quarters of all publicly announced mobile WiMAX customers. In the fixed WiMAX segment, Telsima and Airspan are neck and neck for the lead with almost identical revenue in 3Q 2008.

However, while Infonetics says the global recession will likely cause some consumers and enterprises to postpone WiMAX adoption, demand for personal broadband services continues to grow. The number of worldwide fixed and mobile WiMAX subscribers is expected by Infonetics to top 76 million in 2011 as demand, albeit slower, will continue through the recession. Asia Pacific leads by far in mobile WiMAX subscribers, accounting for roughly two thirds of the worldwide total in 2008 driven by South Korea, India and Pakistan. The Sprint-Clearwire WiMAX merger (Xohm) closed in December 2008, paves the way – says Infonetics – for potentially rapid WiMAX subscriber growth in North America. Developing countries still remain the engine for WiMAX market growth, adds the analyst firm, with hotbeds of activity in Central and Eastern Europe, the Middle East and Africa, Central and Latin America, and emerging parts of Asia Pacific.