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4G in the U.S.A.

WiMax is spreading in the United States, but it could soon be overshadowed by a rival technology

2 min read

Fourth-generation wireless got its official start in the United States one year ago when Clearwire Wireless made Portland, Ore., the first city to be covered by its WiMax wireless ”last mile” broadband connection. Twelve months later, the shape of wireless’s future is now clearly outlined: WiMax has the early lead but will eventually be overtaken by another technology.

With a series of recent rollouts, 30 million people in 29 U.S. cities now have access to Clearwire’s WiMax service. The company’s third-quarter financial results indicate that 173 000 subscribers had signed up as of September. That makes the United States one of the most successful WiMax markets in the world, according to Emmy Johnson, principal analyst at Sky Light Research, a Scottsdale, Ariz., research firm that specializes in wireless technologies.

In South Korea—where WiMax debuted commercially with an early version of IEEE 802.16, on which the service is based—”there were probably about 200 000 subscribers as of June 2009,” says Johnson. In Malaysia, Packet One Networks had about 80 000 at the end of August; in Russia, Yoda Communications has at least 100 000 customers and perhaps as many as 200 000, a success that came about almost by accident. ”Because of some laws there, Yoda couldn’t charge for six months. So they let people subscribe for free. Lots signed up, and many stayed,” Johnson says. It also helped Yoda that Taiwanese manufacturer HTC Corp. had just released a sexy new handset.

These early successes are much needed, because WiMax is in a desperate race to gain ground before most of the world’s mobile operators begin to upgrade to a rival 4G technology, Long Term Evolution (LTE), beginning in 2013. A few carriers, notably Verizon Wireless, will be even quicker. LTE is the 4G successor to two hitherto incompatible standards: GSM, which rules Europe and most of Asia, and CDMA, which has large pockets of strength in North America, Korea, and China.

Clearwire and other WiMax services may have a three-year head start, but LTE has the power of incumbency: the revenue streams and allegiances of a huge base of existing customers. Robert Syputa, a senior analyst at telecommunications research firm Maravedis, in Montreal, says that LTE will also have a device advantage. ”Verizon, along with DoCoMo and to some extent China Mobile, are pushing the handset makers. It sounds very aggressive, with new chips available the first of the year—Qualcomm says it will rush the product along.” Verizon in particular is trying hard to eliminate WiMax’s time-to-market advantage.

Sky Light’s Johnson says, ”WiMax will be a much smaller play than LTE; it might thrive in the markets it establishes early or even merge with LTE. The world is going toward LTE.”

Where does that leave the folks at Clearwire? ”They could also deploy LTE,” Syputa says. ”They’re an operator, they have spectrum; they’ll deploy what works.”

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