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Is sceptical of WiMAX

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Having joined the WiMAX Forum recently, and made no secret of its desire to acquire an 802.16 specialist, Cisco is now having doubts. Its CTO Charles Giancarlo told the Next Generation Networks conference in Boston last week that his company has "not invested in WiMAX" beyond providing backbone infrastructure for potential WiMAX networks in future.

Giancarlo argued that DSL and cable are already in place, and it will be hard for WiMAX to penetrate their base, and that by the time WiMAX is mobile, 3G will be well established. "Why would anyone build two parallel [wireless broadband] networks?" he asked - ignoring the fact that many cellcos lack sufficient spectrum to deliver all the capacity their customers will require in future, particularly in the enterprise, and may seek to offload traffic to more efficient WiMAX or to build high throughput overlays for specific applications. This will be particularly attractive with the advent of multi-network base stations and devices.

The only application for which Giancarlo could see much hope was as a better basis than Wi-Fi for large capacity hotspots, such as those at airports, or for metro area hotzones.

His comments seem to fly in the face of Cisco's recent thinking, and the fact that Cisco, perhaps more than any other vendor, stands to benefit from the shift to all-IP wireless broadband that WiMAX could accelerate. Cisco has been in the forefront, with Intel, of lobbying for new spectrum for broadband wireless, including below 2GHz, and the Intel model of open IP access from mobile devices, rather than closed cellular walled gardens, is clearly at the heart of the networking giant's interests.

In the shorter term, it could supplement its current outdoor Wi-Fi and proprietary gear for ISPs, enterprises and metro operators with WiMAX, and would be well positioned to provide equipment for backhaul and enterprise bridging - even before 802.16e gives it the opportunity to move into mobile markets. Cisco has been increasingly visible in hotzone projects, often in collaboration with Intel, and many of these - such as the UK's London Westminster program to link up security cameras across the city - have a clear roadmap to WiMAX.

It has been burned by broadband wireless before of course, notably by its acquisition in 1998 of Clarity, a maker of metro area systems, which performed so badly that the range was cancelled three years later with few sales notched up. Giancarlo perhaps had this, and other broadband wireless failures of the turn of the century, in mind when he said: "This is what went wrong with MMDS and LMDS, if you all remember that. The economics became very bad very quickly."

He was making the same assumptions that many currently do - that WiMAX, just because it is a broadband wireless technology, is directly comparable to the platforms underpinning roll-outs such as that of Teligent and NextLink in the late 1990s, which ended in bankruptcy protection. This ignores the fact that Wi- MAX has significant advantages, notably low cost, standardized CPE, support for non-line of sight and greater flexibility of deployment. Also, that MMDS and LMDS are spectrum types, not technologies - ones in which WiMAX can operate. Carrier business planning and equipment economics are important, not acronyms.

While, despite its CTO's thoughts, we expect Cisco, in the medium term, to put WiMAX in a central position in its IP strategy, Giancarlo has his eyes on a different - and even more risky - new wireless technology, UltraWideBand. Once an investor in XtremeSpectrum, the UWB pioneer acquired last year by Motorola, Cisco is likely to be looking for new UWB targets.

Copyright © 2004, Wireless Watch

Wireless Watch is published by Rethink Research, a London-based IT publishing and consulting firm. This weekly newsletter delivers in-depth analysis and market research of mobile and wireless for business. Subscription details are here.

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