The Yankee Group and Rethink Research, the two agencies behind the three WiMAX World events scheduled this year, recently released new market research that says there will be 28 million Mobile WiMAX subscribers by 2011. What has been less certain is where most of these customers will be, who will be offering them services and how mobile operators will fit in to the future Mobile WiMAX market scenario.

The latter issue has been particularly vexing. Though Sprint famously chose Mobile WiMAX last summer as its future 4G network technology, it seems unlikely other mobile operators will go the same route. That would require them to change technology course, write off ongoing investments and invest in new spectrum. However, when Arun Sarin, Vodafone chairman, said at 3GSM World Congress last month that Mobile WiMAX would be available sooner and could be better than the 3GPP long-term evolution (LTE) standard, the mobile industry's ears perked up. (Vodafone has not actually committed to deploy WiMAX or any 4G solution.)

“These two technologies [WiMAX and LTE] are going to start looking quite similar. LTE is very powerful, but at least a year behind Mobile WiMAX, and both use some of the same technologies,” said Berge Ayvazian, chief strategy officer for the Yankee Group, in a conference call announcing the new research by Yankee and Rethink.

Caroline Gabriel, principal analyst for Ayvazian and Rethink, agreed that although many wireline carriers were among the initial operators to deploy Fixed WiMAX in order to stem mobile substitution, those successful market moves are now capturing the attention of mobile operators. They can now choose to move to a WiMAX technology that offers better performance than 3G options or sit on 3G until LTE comes along.

“The mobile operators already have investments in 3G but not much return on them,” Gabriel said. “They thought 3G was the closest they would get to real mobile broadband for a while, but they have been proved wrong.” Because of their current investments and the timing of technology availability, many mobile operators in Western Europe and North America are unlikely to invest in WiMAX, while their counterparts in Asia, Eastern Europe, Latin America and other emerging markets will more seriously consider it, she said.

“It's hard to say because some carriers may buy new spectrum seemingly for WiMAX, but they may still go with LTE,” she said. “Western Europe is the only region where Mobile WiMAX may get locked out.”

While mobile operators spend the next few years wrangling with decisions about their technology futures, several other types of companies (see chart and provider description key) will be busily deploying Mobile WiMAX. Ayvazian said these early adopters could enjoy faster-than-expected growth if market drivers such as new content application usage and volume of WiMAX-enabled devices improve.

If that's the case, there could be 28 million subscribers as early as 2010, he said. The research from Yankee and Rethink also suggests that the global Mobile WiMAX equipment market will be worth about $4 billion by 2011, with the North America portion of it closer to $1 billion.

MARKET SEGMENTATION AND STRATEGY DIFFERENTIATION

• Rabbits:
  Unpredictable new market entrants, broadband wireless ISPs, out-of-market incumbents, CLECs and power utilities

• Innovative challengers:
  Converged incumbent telcos, cable, DBS and ISPs offering fixed/nomadic wireless broadband and VoIP

• Dominant defender:
  Defensive incumbent telcos with wireless

• Regional pioneers:
  Greenfield implementation of broadband services in emerging markets

• Government and digital cities:
  Implementing Wi-Fi/WiMAX broadband networks

• Mobile operators:
  Considering WiMAX as an alternative to 3G and a path to 4G
  Source: Yankee Group