The only publication dedicated to OSS     Volume 2, Issue 5 - October 2005
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3G is Dead: Long Live WiMax
An Analyst's Perspective


By Paul Budde

As we have consistently predicted since 1998, there is no need for 3G, beyond efficiency upgrades required in situations where mobile operators are running out of network capacity. Up until now this has been limited to a few cities in Europe – beyond that there has not, to date, been an economic need to upgrade the current 2G systems.

Mobile data has not delivered the extra revenues needed and, after seven years of flogging more than a dozen different mobile data flavors, it has now become clear that only wireless broadband will be able to deliver the much-needed break to move into the wireless personal area network market (WPAN).

Technologies such as WiMAX, Flarion and UWB will become more prevalent; the key issues here are high speed and low cost. The current mobile technologies are unable to deliver on both. Furthermore, the entry levels to these frequency agnostic new technologies for newcomers are low, which makes it much easier for competitors to undermine the mobile operators. The surviving WiFi operators have seen significant consolidation over the last few years, and they are now in a prime position to also aggressively move further into the WiMAX market.

Mobile operators are presently scrambling to find new directions. However, most of them are like slow-moving elephants, and it will be almost impossible for them to halt their current 3G roll-outs in order to replace them with wireless broadband.

This is further complicated by the fact that commercial wireless broadband services are still one or two years out, and for UWB this might take even longer. On top of that, once these systems are available you can deliver VoIP over them at a fraction of the cost of mobile calls (at least 90% cheaper than mobile calls). This means cannibalisation of their mobile network, something they are certainly not looking forward to.

 


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