Asia’s leading WiMAX ops intent on going down swinging

Guilty secret: My all-time favorite movie is Rocky IV. I watched it last week with my two sons, aged five and seven, and had to discreetly shield my tears as Rocky made his stirring, against-the-odds comeback against Ivan Drago to score a heroic last-round knockout.

Maybe it is that love of the underdog that makes me such an admirer of Asia’s WiMAX operators, who, despite knowing that their technology will ultimately be overwhelmed by LTE, battle on regardless against their bigger and stronger opponent.

Of course, there will be no Rocky Balboa-style comeback for Asia’s WiMAX operators. Everyone knows that LTE will ultimately triumph, but that does not mean that these operators should just lie down and die. They have plenty of options before they have to bow to the inevitable adoption of LTE.

This spirit of defiance was very much to the fore at the one-day WiMAX Asia conference in Taiwan on June 6, where senior executives from the likes of Japan’s UQ Communications and Malaysia’s YTL Communications and local players Global Mobile and Vee Telecom promised delegates that there was plenty of life left in them yet.

TD-LTE not ready yet
The most combative of the speakers was by far Ali Tabassi, the CTO of YTL Communications, who told delegates that although plenty of hype had surrounded the defection of several WiMAX operators to TD-LTE (including fellow Malaysian operator P1 Networks), it did not match the reality.

“They are really just ‘putting lipstick on their pig’ by announcing they will move to TD-LTE,” he said. “It is just a means to raise money from their investors.

“None of the people that have announced for TD-LTE are actually anywhere near launching commercial services of any significant scale, because the ecosystem is not ready yet and won’t be for a couple of years at least.

“As a result, there is still big window of opportunity available for people to get a sizable first-mover advantage in the mobile broadband market by launching with WiMAX.”

Tabassi urged fellow WiMAX operators to stop letting themselves be defined by their access technology and realize that technology is largely irrelevant to subscribers.

“We are not a WiMAX operator,” he said. “We are a mobile broadband operator.

“Whatever happens in the future, you can be sure that, for a good number of years, there will be a coexistence between WiMAX and TD-LTE networks.”

Finding the right niche
Next to weigh in was Masanori Arita, executive vice president of Japanese WiMAX operator UQ Communications, which, with about 2.6 million subscriptions at end-May, is probably the biggest WiMAX operator in the world.

He said it was important for WiMAX operators to focus on their best market targets rather than trying to service all sections of the market.

“There is no point trying to compete with mobile operators in the smartphone market,” he said. “You are not going to win that battle.

“We focus our services at people who want high-quality mobile broadband access for their laptops, netbooks and tablets. They are the people who will pay for a service like ours.”

The company’s strategy was endorsed by Wayne Sun, CTO of local WiMAX operator Global Mobile. Sun said his firm was aiming its service at corporate users prepared to pay a premium for high-quality 4G data services that are superior to those available from 3G operators. Another target is home users who do not require a more expensive fixed-broadband connection.

Global Mobile has about 120,000 subscribers and is aiming for an ambitious 1.5 million by end-2014. Sun said the figure was achievable if the company focused on its core competencies and did not get distracted by fighting battles it could not win.

“The only defense we have as a company is to go out and win subscribers,” Sun said. “The way we do that is by supplying a better all-round service than they are getting right now from the 3G and fixed-broadband suppliers.

“That’s not just about supplying faster speeds but also about providing far better customer service by having better customer-relationship-management systems in place and having better billing systems than the incumbents.”

The M2M opportunity
UQ Communications’ Arita said that although its consumer-facing service was progressing well, the firm was taking an increased interest in the M2M market.

Arita said that UQ saw particular potential in M2M markets such as digital signage, mainly because of the large bandwidth required to provide these services. Other M2M applications, such as servicing vending and ticketing machines, were also of interest, he said.

He also said that UQ’s WiMAX network was providing backhaul capacity for parent company KDDI’s own growing Wi-Fi network, a strategy he said other bandwidth-rich WiMAX operators should seek to provide to operators in their own markets.

Global Mobile’s Sun agreed that M2M was a big opportunity for WiMAX operators but added that regulatory restrictions made it impossible for his company to use the same MVNO model in Japan that UQ Communications is deploying in the country.

WiMAX 2/802.16m: Will we ever see it?
The other big issue debated by the WiMAX-operator panelists was the future of the much-hyped WiMAX (802.16m) technology. The new technology’s backers claim it will revolutionize the market by enabling WiMAX operators to offer the types of speeds currently available to FTTH subscribers only, with peak speeds of 150Mbps downlink and 50Mbps uplink.

The problem is that, with TD-LTE looming as such a tantalizing prospect, none of the major WiMAX operators has so far made a binding commitment to deploying WiMAX 2, meaning the vendors themselves are wary about putting products into actual development.

Alex Sum, vice president of marketing and business development for local chipset vendor GCT Semiconductor, told operator executives that his firm would be releasing the first 802.16m chipsets in August. But the executives cautioned that several key barriers to deploying 802.16m remained.

YTL’s Tabassi said a major problem for his firm was that to launch 802.16m it would need either to deploy additional base stations or acquire new spectrum, both of which would be costly. What’s more, the company would have to persuade its subscribers to upgrade their modems and hardware to exploit the newer technology.

“The industry is in a chicken-and-egg situation,” Tabassi said. “Vendors are not working on 802.16m because operators are not ordering it, and operators are not ordering it because there are no products available.

“Meanwhile, all of the rival technologies are making progress and being deployed in the market, which from the YTL point of view makes us wonder: Should we choose evolution with 802.16m, or revolution with TD-LTE?”

This point of view was echoed by Arita of UQ Communications, who said his firm was keen to launch the new technology but could not use its existing spectrum. It would have to wait until it was allocated new spectrum by the government, he said.

“Ultimately, we will launch 16m when we are convinced that subscribers want and are prepared to pay for these kinds of services,” Arita said.