Tuesday, February 17, 2009

Clearwire, Wimax, and cheap broadband

There is a interesting article in the current Fortune about the troubles Clearwire is facing in rolling out Wimax on a large scale across the US. Apparently, it is working out to be much more expensive than was hoped.

In the city of Portland, Or, about 300 Wimax towers were needed to cover the whole area. Although in principle each Wimax tower covers several miles, uneven terrain can quickly spoil this. Clearwire offers Wimax for 30 dollars a month, a price that is significantly lower than wired broadband. But with the necessity of new hardware on the user side, will it work? Especially with Telcos supporting LTE as the Wimax alternative?

The answer lies on the business model for Wimax. Wimax has the edge in terms of early deployment and heavy weight supporters like Google and Intel. The key is the ubiquity of rollout as compared to telcos' LTE. Another question is whether Wimax equipment will be bundled as standard Laptop/phone equipment . Wired Broadband also bundles services like voice and increasingly, TV. How suitable is Wimax for these value-added services?

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