Telecom Timeout

Oct 12 2009   4:34PM GMT

New report declares WiMAX a “niche technology” in emerging markets

Kate Gerwig Kate Gerwig Profile: Kate Gerwig

A couple of years ago, WiMAX was going to be the winner in emerging wireless broadband markets…so said the pundits. Now a new Ovum research report is relegating WiMAX to “niche” technology status. Why niche? Ovum analyst Angel Dobardziev says it’s a combination of technology cost, coverage, vendor support and service provider choices.

The key stumbling block is the cost of customer equipment, which will limit WiMAX use outside business customers, he said.

“WiMAX will play a role, but it will be a far smaller one than many WiMAX players would accept today, WiMAX will fall short of the grand hope of being a mass market broadband technology in emerging markets,” Dobardziev said, estimating that WiMAX will account for less than 5% of the 1.5 billion fixed and mobile broadband access connections in the emerging markets in 2014.

The original hope was that in areas with little existing infrastructure, WiMAX would be the logical Greenfield choice for wireless broadband, but Ovum questions whether there is a really big market for WiMAX in emerging markets. A full two-thirds of the world’s WiMAX networks will be in emerging markets in Africa, Asia, Eastern Europe, the Middle East and Latin America, but they will have low uptake, Dobardziev said.

“On a non-subsidized basis, it is currently priced and positioned as a broadband option only for businesses or wealthy consumers,” he said. “The cost of customer equipment (CE) remains the key stumbling block for WiMAX operators, where both DSL and HSPA outperform WiMAX with significantly greater economies of scale.”

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