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WiMAX The Business Case for Investors

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Most successful will be those who best navigate this period of uncertainty and risk ... Everyone will HAVE TO BUY FROM THEM! As exciting as the market is for ... – PowerPoint PPT presentation

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Title: WiMAX The Business Case for Investors


1
WiMAX The Business Case for Investors
  • By Glenn Poulos
  • mmwave Technologies Inc.
  • A wholly owned subsidiary of The Wireless Age

2
mmWave Technologies Inc.
  • Founded in 1991
  • 30 employees
  • Private, consistently profitable company
  • Canadas Profit 100
  • Ranked 8th in 2001 and 21st in 2002
  • Member of WiMAX forum on Broadband wireless
  • Focus on wireless, microwave and fiber optic
    communications and test solutions
  • 6 Offices
  • Montreal, Ottawa, Toronto, Calgary, Vancouver,
    Seattle
  • ISO 9000 Registered
  • Wholly owned by Wireless Age Communications Inc.

3
What We Do…
  • Turnkey Wireless Systems
  • Microwave Backhaul
  • Wireless Access
  • Hybrid Wireless/Fiber builds where required
  • Frequency planning and License application
  • Cellular/PCS/SMR Coverage analysis, optimization
    and enhancement
  • Maintenance and problem solving
  • Test Equipment Systems

4
What is WiMAX?
  • New standard for broadband wireless access
  • Worldwide Interoperability for Microwave Access'
  • WiMAX is similar to Wi-Fi
  • Spectrum Efficient
  • Flexible
  • Quality of Service

5
Is WiMAX different from Wi-Fi?
  • WiMAX is to Wi-Fi as Cellular is to a Cordless
    Phone
  • Carrier Class
  • Licensed spectrum
  • Higher Cost
  • High Power
  • Primarily consumer
  • License-exempt spectrum
  • Low cost
  • Mass market product
  • Low Power

6
What about 3G?
  • 3G is built on the foundation of a voice network
  • WiMAX (802.16e) will be much higher speeds
  • Does WiMAX help or hurt 3G?
  • WiMAX is very targeted for wireless data, not
    wireless voice.

7
More on WiMAX
  • Will primarily use licensed spectrum
  • Higher power increases distances
  • Kilometres vs hundreds of feet
  • Metropolitan area access technology
  • Quality of service
  • Triple play enabler

8
Is that it?
  • Cellular and WiFi took time to achieve
    interoperability while WiMAX will have
    interoperability from Day One
  • WiMAX will complement all existing and emerging
    3G mobile and wireline Networks.
  • 3G is optimized for mobile voice and data
  • 802.16-2000 WiMAX is optimized for providing high
    peak rates to end-users while stationary.

9
The Wireless Lifestyle
The Internet Cloud
FUTURE
10
Security
  • Security concerns are paramount
  • WiMAX when released will be secure.
  • Wi-Fi typically uses wired equivalent privacy
    (WEP)
  • WiMAX will used enhanced encryption for
  • Confidentiality
  • Access control
  • Data integrity
  • The system isnt entirely foolproof but what is?

11
Bandwidth
  • WiMAX 802.16 equipment certified by the forum
  • Support shared throughput of up to 75 Mbits/sec
  • WiMAX can thus compete with existing technologies
  • 3G cellular
  • Copper based services
  • Wi-Fi

12
Performance
  • Unlike other broadband wireless technologies such
    as early MMDS systems
  • WiMAX doesnt require a clear line of sight (LOS)
    between the base station (BTS) and the customer
    premises equipment (CPE).
  • WiMAX can serve a much broader pool of customers
    than previous LOS solutions.

13
Coverage
  • WiMAX Forum certified base stations (BTS) will
    have a coverage radius of 5 to 8 km (licence
    exempt)
  • Depends on terrain and population density
  • NLOS Non Line of Sight

14
Spectrum
  • Uses both licensed and license-exempt spectrum
    between 2-11 GHz
  • Future support for 66 GHz
  • Wider choice of deployment options based on
    geography, population density

15
Industry Support
  • More than 150 equipment vendors and service
    providers are currently members of the WiMAX
    forum, including mmwave.
  • This widespread support strongly suggests that
    the technology will go mainstream.
  • Unlikely to be a Flash in the Pan.

16
Interoperability
  • Primary appeal is interoperability
  • WiMAX does not use proprietary standards, unlike
    current technology
  • WSP and End Users alike can purchase equipment
    from different vendors.
  • Allows for competition and drives down prices.

17
WiMAX Applications
  • If you can do it on cable or DSL you can do it on
    WiMAX.
  • Backhaul
  • Cable/DSL extension or competition
  • Fixed/Mobile Convergence
  • Mobile Services
  • Video delivery

18
So what can you do with WiMAX
  • Deploy markets where wired broadband is not cost
    effective
  • Allows spread of broadband more quickly
  • Allows higher speeds farther away
  • Easier to install

19
WiMAX Blurring the lines
  • CLECs and non-dominant carriers dont need to
    re-sell ILEC facilties
  • Portability increases attractiveness relative to
    fixed-line DSL
  • People will be able to carry their personal
    broadband connection with them

20
Converged Wireless Networking
  • Wireless Service Providers can
  • Leverage existing subscriber management system
    and network management capabilities
  • Reuse infrastructure, such as towers
  • Provide additional multimedia services

21
Converged Network Reality
  • Gives Service Providers a cost-effective way to
    offer new high-value multimedia services
  • It can support the sophisticated Wireless
    Lifestyle services that are increasingly in
    demand
  • IP-based solution
  • opens up cost-effective new opportunities for
    extending bandwidth
  • delivering new revenue generating services such
    as wireless video streaming.

22
WiMAX Challenges
  • Number one is spectrum.
  • Will the volume REALLY be there to drive down the
    costs?
  • Meeting people's expectations.
  • WiMAX is on a very fast track
  • It will continue to add more and more capability
    every generation. But….
  • It will take time to get these capabilities to
    where service providers and users can really
    benefit.

23
"anywhere, anytime connectivity
  • You won't have to drive around looking for a
    connection
  • When people have a broadband connection
  • they tend to use their computer more
  • they leave it on
  • they integrate it more into their lifestyle.
  • Extends range of broadband access

24
WiMAX Rollout
  • WiMAX will be rolled out in phases
  • Pre-WiMAX
  • IEEE 802.16-2004 technology - known subscribers
    within a fixed location
  • IEEE 802.16e - mobile users
  • This is the killer app for WiMAX and what will
    drive the volume

25
WiMAX, the Business Case
  • One of the most eagerly anticipated developments
    in a long time
  • Will significantly change the telecommunications
    landscape
  • CLECs can provide a real broadband alternative
    using their own infrastructure
  • ILECs can deploy high-speed access in formerly
    unprofitable regions
  • WISPs using Wi-Fi can evolve to higher speeds
  • Will provide a carrier-class IP-based solution
    that can scale to support thousands of users, and
    provide differentiated service levels.

26
The WiMAX Debate When is it Ready?
  • The first 802.16d product certifications will be
    issued in Q3 2005
  • Early WiMAX profiles include many different
    options
  • Volume will be driven by portability/mobility
    applications, such as notebooks and PDA's which
    comes with 802.16e
  • WiMAX-certified 802.16e products are scheduled
    will be 2006/7

27
This isnt Wi-Fi all over again
  • Wi-Fi volume ramped quickly because millions made
    a small decision
  • WiMAX volume will be driven by a relatively small
    number of strategic decisions to deploy
    large-scale networks.
  • Long decision cycles
  • Large capital outlays
  • So what should carriers do today?

28
So what should carriers do today?
  • Many are deploying a pre-WiMAX solution now
  • Long-term upgrade path is a vital ingredient
  • Trade-off is risking instability to be first to
    market vs waiting for a stable WiMAX solution at
    the risk of losing market share
  • Most successful will be those who best navigate
    this period of uncertainty and risk

29
WiMAX Will Remove Roadblocks to Growth
  • Pre-WiMAX Wireless access equipment costs are
    high
  • Every broadband supplier has proprietary
    technologies.
  • Major operators will not risk large-scale
    investments without standardization
  • Line of sight (LOS) limitations overcome
  • Cost of truck rolls still high

30
Market Trends
  • Fixed Wireless shipments rising steadily since
    2002
  • Vendors and Service Providers have multi-million
    dollar contracts on the go
  • Bandwidth demands will continue to increase
  • Residential and business subscribers worldwide
    are constantly demanding faster connections.
  • Shipments of 802.16e will grow exponentially
    after 2007

31
WiMAX Trends
  • Mass production will allow economies of scale
    follow
  • Costs falling
  • Chipsets will no longer custom-built and
    expensive
  • Large volumes will drive down price for chipsets
    and other BWA components.
  • Cost reduction impact will likely be on the CPE
    in the first 1-2 years of WiMAX deployments

32
WiMAX Trends
  • Service providers need better coverage to make
    money.
  • The ability to deliver access without truck roll
  • Provides the ability to for triple play services
  • The HOLY GRAIL is Triple 50

33
Mobility Trends
  • 802.16.e aimed at providing broadband access to
    the mobile user (PDA or laptop)
  • 802.20, if it materializes, addresses high-speed
    mobility issues and could emerge as a viable
    competitor
  • Most BWA vendors are committed to implementing
    802.16e in their product roadmaps.
  • Laptops will have 802.16e chipsets.

34
Chipset Vendor Trends
  • Intel focusing on CPE and integration of chipsets
    into laptops
  • Fujitsu leads the charge for BTS development
  • They are to BTS what Intel is to CPE.
  • Canadian company Wavesat is targeting this market
    and has extensive experience developing OFDM
    chipsets
  • Can a small company triumph in this game?

35
Market Size Forecasts
  • Market growing from 430 million in 2003 to 1.5
    2.0 Billion by 2008
  • The BWA market will likely pass 1 Billion
    2006-2007
  • More multi-million dollar projects needed
  • Shipments of WiMAX chipsets will likely pass 1
    million units in 2007-2008

36
Crowded Market
  • Crowded market has pros and cons
  • Unlikely youll see the wheels fall off
  • Many Vendors however will fail.
  • Initial casualties will likely take place this
    year
  • Many smaller companies will not survive until the
    market takes off
  • None of the big guys are doing primary
    development (working with BWA specialists)

37
Equipment Pricing
  • Estimates vary these days
  • From 10K to 150K for Base Stations
  • Initial CPEs are pegged at US750 however prices
    for CPEs will ultimately fall but to where????
  • Pricing pressures will squeeze a lot of vendors
    out of the market especially those already on
    shaky financial ground.

38
Where to Invest
  • Ask yourself
  • What technology vendors are best suited to
    capitalize on the market?
  • What is the realistic timeframe for market
    development?
  • Is now the right time to jump into WiMAX?
  • Should we wait for the market to develop further
    before trying to determine who will win or lose?

39
New Market Opportunities
  • Addressing underserved subscribers beyond the
    reach of DSL and Cable
  • Providing last mile access from existing fiber
    point
  • Competing where wireline assets arent owned
  • Capturing new subscribers

40
The Killer App?
  • Is Mobile Wireless Data the new Killer App?
  • Industry participants can stake their market
    share claims
  • The outcome will be defined by what type of
    company evolves to capitalize on and provide the
    types of services, service packages required.

41
Blackberry
  • Another Canadian Wireless Success Story!
  • Blackberry is one of the top three brands of
    choice for both voice and data.
  • Can they hold this growth phase straddling both
    voice and data?
  • Will one of the huge players from either the
    voice or the data side break into the lead or
    just buy them?
  • Other companies are close behind with similar
    features

42
Batteries
  • People have dependent on their phones and PDAs
  • Combining both voice and data on one device
    creates a much a greater strain on the battery
  • Alternative Energy Cells (Fuel Cells) are
    ambivalent to whose device wins in the market
    if they can provide an alternative which drives
    longer life. Everyone will HAVE TO BUY FROM
    THEM!
  • As exciting as the market is for WiMAX in all its
    forms. A huge investment opportunity is
    available to us all in the companies developing
    the batteries of tomorrow.

43
Operating Systems
  • Will Microsoft win in this battle as well?
  • Companies want a consistent look feel across
    all devices
  • MS-Windows has won the war on the on the PC side
  • People want to see this on the wireless side as
    well
  • There is not similar support however for a single
    hardware device.
  • Microsoft is considered to be a critical player
    in this market and they can capitalize on that.  

44
WiMAX the Make-or-Break Year
  • 2005 will be the make or break year for WiMAX.
  • Every major wireless chip and equipment maker is
    now part of the WiMAX Forum.
  • Standards are ratified and the interoperability
    tests among vendors has begun
  • Redline / Alvarion / Airspan
  • WiMAX has the potential to be as big as a hit on
    Wireless since Marconi but….
  • Significant milestones must be achieved during
    the year ahead

45
WiMAX Critical Success Factors
  • Rapid certification - Certified WiMAX gear
  • The CPE price must come down.
  • Enterprise applications to drive corporate uptake
  • Spectrum policy
  • The IEEE needs to ratify new standards in a
    tiemley manner
  • Moves by major vendors.
  • Major chip vendors are on board.
  • Major equipment suppliers must also define and
    announce clear strategies.

46
WiMAX The Business Case for Investors
  • Thank you for your attention!
  • By Glenn Poulos
  • mmwave Technologies Inc.
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