wi-fi, wimax, why care? sandy teger and david j. waks system dynamics inc. sandy@system-dynamics.com

Wi-Fi, WiMAX, Why Care?

Sandy Teger and David J. Waks

System Dynamics Inc.sandy@system-dynamics.com

Wireless Technologies for Different Ranges

LAN MAN WANPAN

Wi-Fi WiMAX

3GUWB/ZigBee/Bluetooth

Telephony: Shift from fixed to personal

7

Presented to the FCC on May 19, 2004 at the Broadband Wireless Conference

The shift from fixed communications to personalcommunications expanded the communications market

Personal daily communications: 10 years ago

Home Commute Work (office) Work (Meeting room) Car Home

POTs Pay phone Centrex Centrex Cellular POTs

8:00 AM 8:00 PM

Personal daily communications: now

Mobile phone (primary communications access)

Home Commute Work (office) Work (Meeting room) Car Home

Source: Personal Broadband Industry Association

Telephony Spending Shift to Wireless

0%

5%

10%

15%

20%

25%

30%

Wireless Wired Video Internet

% Consumer Spending on

Telecommunications

• Balance of spending for telephony has now moved to wireless

• Wireless telephony is largest share of consumer wallet - and only one growing

• Is broadband next?Source: TNS Telecoms, 2nd Qtr 2004

Personal Broadband Next

10

Presented to the FCC on May 19, 2004 at the Broadband Wireless Conference

The shift from fixed connectivity to personal broadband

connectivity will expand the digital media market

Internet access: Today

Home Commute Work (office) Work (Meeting room) Car Home

POTs, DSL, Cable

WiFi T1/DS3 T1/DS3 GPRS POTs, DSL, Cable

8:00 AM 8:00 PM

Internet access: Tomorrow

Personal Broadband (primary Internet access)

Home Commute Work (office) Work (Meeting room) Car Home

Source: Personal Broadband Industry Association

Solutions For Personal Broadband Deploying Now

• Wi-Fi Hotspot Bundles– SBC: DSL adder for $1.99– Dual Wi-Fi/cellular handsets from

SBC/Cingular for hand-off to hotspots and “roam to home”

• “Pre-WiMAX” Risk From 2.5 GHz band holders – Clearwire and Nextel already launched

• 3G: Verizon, Sprint • Municipal wireless using Wi-Fi

– Chaska, MN; Cerritos, CA; Philadelphia, PA; …

WiMAX – 802.16

• Broadband Wireless Access – Metropolitan Area Networks

• Fixed (and nomadic) access: 802.16-2004 (8/2004)

• Mobile access: 802.16e (expected 5/2005)

• Maximum cell size ~30 miles, 1.5 to 5 more typical

• Maximum speed 100 Mbps (64QAM/20 MHz)

WiMAX: Great Expectations

• Addresses deficiencies of previous BBW– Interoperability– Cost of base stations and CPE– Shared bandwidth up to 100 Mbps– Line of sight not required– Coverage 3-5 miles, more like cellular – Licensed and unlicensed spectrum

• Many DOCSIS-like features including QoS

• Milestone to “broadband everywhere”

WiMAX Bandwagon Effect

• WiMAX Forum: ~160 members and growing– Complete value chain– Many chip companies, including Intel, Fujitsu– Many major equipment companies, including

Motorola, Alcatel, Siemens– Many service providers, including BT, France

Telecom and Qwest

• Analogous to Wi-Fi Alliance for 802.11– Product certification through formal conformance

and interoperability testing against “profiles”– Promotion, promotion, promotion

WiMAX Status

• “Pre-certification” products shipping now– Based on earlier 802.16a standard– Expensive base stations and CPE – enterprise

focus

• Certified products in 2005– Based on 802.16-2004– Licensed 2.5 GHz (U.S.) and 3.5 GHz (ROW)– License-free 5.8 GHz– “Plugfest” interoperability testing started 2004– Formal certification testing ~1H05

• “Mobile WiMAX” expected late 2006– CPE bundled in laptops by 2007

Other Mobile Broadband Wireless Technologies Deploying Now

• FCC just restructured 2.5 GHz band from video to broadband service

• Band holders not waiting for WiMAX– Nextel running large-scale market trial

in Raleigh-Durham– Clearwire launched in Jacksonville, FL

and St. Cloud, MN– Sprint also owns spectrum, deferring

decision

Nextel in Raleigh-Durham

• Flarion “Flash-OFDM” technology

• Mobile within RDU area• Downlink 1.5 Mbps

(burst to 3Mbps)• Service starts at

$34.99 (750/200)• Combo Wi-Fi/Flarion

device: Netgear & D-Link

• Developing technical & market knowledge

Clearwire in Jacksonville, FL

•NextNet “pre-WiMAX” technology

•“Up to 1.5 Mbps”

•Starts at $24.99 (512/128)

•Easy self-install•Licenses in >80

markets

Metro Wi-Fi

• High-volume, low cost, low margin• Based on off-the-shelf consumer Wi-

Fi adapters• Not “carrier class” service• Disruptive to MSOs?

Wi-Fi Gaps Being Filled

• Issue– Spectrum usage– Security– QoS– Interference – Roaming performance– Throughput – Mesh techniques– Range– Connection

persistence

• Progress– 802.11a– 802.11i/WPA, WPA2– 802.11e/WMM– 802.11h, 802.11k– 802.11r– 802.11n– 802.11s

Specifics

City-wide “Hot Zones”

• Already deployed in some smaller cities• Big cities preparing to deploy soon• Public safety a major driver, “digital

divide” another• Near-term threat and opportunity for

MSOs

Rapid Pace of Innovation and Market Entry

• Mesh Networking– Tropos Networks– MeshNetworks– PacketHop– Nortel– Motorola– …

• Smart Antennas– Vivato– 5G Wireless– …

City-Wide Wi-Fi in Chaska, MN

• City operated, 16 square mile coverage area• Public safety, low-cost residential broadband service• 7500 homes passed, 1100 pre-registered• 200 cells, <$500,000 CapEx

Is Metro Wi-Fi Disruptive?

• “Disruptive Technologies”*– Simple, cheap– Target lower performance markets – Commercialized in emerging market– Fast technological progress

• Subsequently become performance competitive against established products

* The Innovator’s Dilemma, Clayton M. Christensen

Is Your City Next?

PhiladelphiaPhiladelphia

JacksonvilleJacksonville

Grand HavenGrand Haven

SpokaneSpokane