Wireless Fidelity’s (WiFi’s) so-called ‘big brother on steroids’, the Worldwide Interoperability for Microwave Access (WiMax), has finally hit South African shores, and, in the not-too- distant future, those deploying the tech- nology believe that local notebook computers and personal digital assistants will be ready to operate off the platform.
It sounds intimidating, but WiMax, in nontechnical terms, means that Internet and mobile users can now move within a few kilometres of their wireless Internet trans- mitter, rather than a few hundred metres, and have their data transmitted at faster speeds.
This offering is exciting consumers but, behind the scenes, there is a veritable battle among Internet service providers (ISPs) and telecoms providers to position themselves for a slice of the WiMax spectrum. The reason for the aggressive competition is that the WiMax realm, and allocations certificates that the Independent Communications Authority of South Africa (Icasa) will be issuing will be limited, meaning that only a few industry participants will be able to provide services on the back of WiMax.
WHAT IS WIMAX?
In technical terms, WiMax is a telecom- munications technology developed on the IEEE 802.16 standard, which allows wireless broadband service delivery anywhere. This, according to the WiMax Forum, is done so as “to deliver non-line-of-sight connectivity between a subscriber station and a base station with a typical cell radius from three to ten kilometres”. In fact, the WiMax Forum, which was established in 2001 in an effort to enable and encourage the compatibility and interoperability of broadband wireless products, created the name ‘WiMax’.
Altech Group CTO Steve Sidley explains that WiMax belongs to a set of radio access technologies that use a particular smart modu-lation technique called orthogonal frequency division multiplexing (OFDM) for the air interface and uses a flat architecture in the core, besides other innovations. The two types of WiMax available are the 802.16E, for mobile, and the 802.16D, which is fixed.
Further explanation by Telkom executive for technical product development Steve Lewis reveals that the base stations from where WiMax signals are being transmitted provide a wireless connection to multiple subscriber units, which can be fixed or mobile.
“In essence, the wireless air interface uses OFDM or enhanced orthogonal frequency division multiple access. From the base station, a back-haul technology is used to connect to the core network. In the fixed scenario, the subscriber unit (SU) acts as a bridge where the device behind the SU establishes the Internet Protocol (IP) connectivity to the core network by means of fixed IP allocation, dynamic host configuration protocol, or point-to-point protocol over Ethernet,” Lewis adds.
WIMAX VS WIFI
Some South Africans have become used to seeing the signage for ‘WiFi Hot Spots’ at hotels, restaurants and airports in and around South Africa, where those equipped with an interface have been able to surf the Internet. The problem, though, has been that the footprint of these hot spots has been rather limited in area.
“WiFi, much like WiMax, is a radio tech- nology and is IP based. The difference between WiFi and WiMax is that WiFi takes place in the relatively small radio footprint, which is located close around the base station, and, depending on the power of the antenna, reaches a couple of hundred metres, at most. WiMax, on the other hand, is a wide-area initiative, which means that the distance from the base station is in the kilometres range, and not in the metre range,” explains Sidley.
Lewis adds that WiMax is a long-range system which enables the metro area network that uses licensed spectrum (although it is also possible to use unlicensed spectrum) to deliver a point-to-point connection to the Internet from an ISP to an end-user.
WiFi’s shorter-range system enables the wireless local area network, and uses unlicensed spectrum to provide access to a network, covering only the network operator’s own property. WiFi, by contrast, is used by an end-user to access his or her own network, which may or may not be connected to the Internet. Put another way, if WiMax provides services similar to a cellphone, WiFi is similar to a cordless phone.
“WiMax and WiFi have quite different quality of service (QoS) mechanisms. WiMax uses a mechanism based on setting up connections between the base station and the user device. Each connection is based on specific scheduling algorithms, which means that QoS parameters can be guaranteed for each flow. WiFi has introduced a QoS mechanism similar to fixed Ethernet, where packets can receive different priorities based on their tags. This means that QoS is relative between flows, as opposed to guaranteed,” says Lewis.
THIRTY SA APPLICANTS FOR WIMAX SPECTRUM
But while WiMax has been making a mark globally, its influence is yet to be felt in South Africa. It is described as a direct competitor to 3G, and it is understood that South African ISPs are fully alive to the fact that it could open up a suite of new business opportunities.
“WiMax’s entrance into the South African market is a very recent development, and, therefore, Icasa has not yet allocated WiMax spectrum under the new Electronic Communications Act to any ISP as yet, although some ISPs have been allocated WiMax test licences,” Sidley explains.
In fact, Icasa held hearings on how to allocate WiMax spectrum in March last year and Icasa spokesperson Sekgoela Sekgoela says that there have been more than 30 applicants and expressions of interest in the technology. “After successfully completing WiMax trials, broadband Internet access over fixed WiMax was launched commercially in August,” says Lewis.
It is understood that Icasa is considering licensing national and regional systems, and will take into consideration the available radio frequency spectrum. Given that constraint, close observers believe the final number of licences nationally should be between four and six.
“We have not yet decided on the criteria for application approvals. The hearings held during 2007 were meant to determine the best way of awarding the spectrum. At the moment, we are deliberating on the written and oral inputs from the public in order to determine the best way of awarding the 2,6-GHz and the 3,5-GHz spectrum,” adds Sekgoela.
Companies that have been allocated full licences include Neotel, Telkom and iBurst, and Sentech and Altech have test licences.
Sidley tells Engineering News that Altech has had positive results from its testing. “Altech’s testing station is located in Midrand. We have been testing the WiMax technology for the past six months and the results are exciting. We are testing mobile Voice-over-IP (VoIP), video data and quadruple play,” he adds.
Meanwhile, Neotel executive head of networks Pravir Dahiya says that the com- pany views WiMax as “another means to reach customers and is a vehicle that will connect us to more customers”. “The important part is the service layer behind the vehicle, and what it offers.
“Many future plans will still be announced, but we are planning on incorporating our existing portfolio of products into WiMax,” Dahiya says.
Telkom has taken a further step towards ensuring it receives continuous updates on WiMax progress. “In 2004, Telkom and Intel Corporation entered into a memorandum of understanding for the interchange of information in order to keep abreast of WiMax developments,” Lewis reports.
He adds that Intel has been a key enabler for Telkom’s knowledge base for WiMax through access to subject-matter experts, technology information sharing, industry trends and operator adoption worldwide.
“Telkom’s association with Intel was seen as a key success factor in getting broadband wireless access services at an accelerated time to market. Intel Corporation further assisted with technical issues in support of Telkom’s WiMax trial.
“It should be noted that the agreement preceded an equipment trial with Alvarion (represented by Grintek Telecom, now Saab Grintek). The support received from the local Intel office was exceptional. After a successful commercial pilot throughout the first half of 2007, Telkom launched broadband Internet access based on WiMax tech-nology in August 2007,” says Lewis.
Vodacom has not applied for WiMax licence rights as it holds a licence under WBS Holdings in which it has 10% shareholding.
Vodacom CCO Dot Field says that the company will offer WiMax to small, medium-sized and large businesses as a carrier grade, shared and dedicated access service at competitive rates.
“Vodacom moved from a pure mobile operator to a broadband service provider and, thus, intends to provide all viable access technologies to its customer base. Fixed-line solutions will soon also be added to the portfolio.
“WiMax is, therefore, an important technology to Vodacom as can be seen in the WiMax network already under construction,” Field adds.
Altech’s Sidley remarks that even though there are many commercial players interested in providing WiMax to their customers, the real constraint relates to spectrum.
“We expect Icasa to open up applications for spectrum this year, and there are a whole bunch of us out there hoping to get a piece of the spectrum.”
It is understood that the African Telecom-munications Union has allocated spectrum in the 3,5-GHz and the 2,5-GHz spectrum range, which have mostly been taken up, leaving a further 120 MHz for allocation.
“In order to put up a national network, a provider needs at least 30 MHz, and the implication of that is that there is enough space for about four to six ISPs to fill,” he adds.
WHAT ABOUT AN AUCTION?
BMI-TechKnowledge director and head of telecommunications research Brian Neilson believes one way for Icasa to deal with the vexed issue of spectrum allocations is to auction it off to the highest bidder, as has been done elsewhere.
“Mobile operators, especially in Europe and locally, are excluded from the frequency band allocation for WiMax, because there is generally a view that they have more than enough spectrum, and, therefore, they should not be given more,” says Neilson.
Dahiya concurs that South Africa does not have a spectrum glut, compared with some other spectrum-scarce countries.
“One of the policy objectives is to allow more competition into the market, not less. More players should be allowed to have spectrum and, therefore, Icasa is likely to give spectrum to the fixed wireless ISPs who are not the big powerful mobile operators,” Neilson asserts.
Traditionally, South Africa’s regulator has shown a preference for the “beauty contest” type licensing process, as it has allowed Icasa to bring other policy considerations into play rather than selling off the spectrum to the highest bidder.
“Icasa needs to consider who else, other than the big ISPs, needs spectrum for whatever reason, and bear in mind whether the fixed-line ISPs are considering becoming wireless players as well, and whether they ultimately also want them to become mobile players,” Neilson adds.
As a greenfield player, and a fresh entrant into the telecommunications industry, Dahiya argues that Neotel will need more spectrum than players who have been in the industry for a long time.
“What established incumbents do with copper, we would like to do with wireless. As it is, we are reaching a stage where we will probably need more spectrum soon. Many of our customers will be wireless based and, therefore, we are spectrum hungry,” he says.
Dahiya remarks that allocations for spectrum should be considered on the basis that the service provider has a concrete business plan and fully uses the spectrum it is allocated.
“We support Icasa for withdrawing spectrum from operators who do not use spectrum efficiently. If it is not utilised effectively nor show results, then it should be withdrawn,” he adds.
BUILT TO LAST?
But even though many have applauded the move to introduce WiMax, some reservations have already been expressed about whether the technology is truly built to last.
Sidley explains that even though WiMax has a wider area than WiFi, it still lacks the capacity provided by general packet radio service and 3G. Notably, 3G penetrates walls better than WiMax does, however, it is more expensive and complicated to run than WiMax.
It has also become apparent that WiMax’s sensitivity to interference may lead to illegal communication devices entering its spectrum areas quite easily.
Dahiya notes that potential crossover interference may occur on the WiMax spectrum. Because spectrum frequencies are allocated so closely together, a crossover from one ISP to another ISP’s spectrum is inevitable.
“The current allocation [has ISPs] adjacent to each other so there is potential interference issues. We have been in talks with Telkom regarding solutions.
“Current discussions are leading towards both parties not using the last two MHz at the end of their spectrums to avoid crossover. The problem with this is that it will cause both parties to lose a great deal of its spectrum to avoid the clash,” he adds.
Frost & Sullivan industry analyst Lindsey McDonald says fixed WiMax has also produced some challenges as there have been difficulties in finding appropriate real estate to place antennas on that are high enough to avoid interference from WiFi.
BMI-TechKnowledge’s Neilson says that Mweb, which has one of the biggest WiMax pilot projects, with more than 1 000 trialists, could only get high enough service by placing transceivers on the wall, rather than using in-door customer premises equipment.
Internationally, Motorola and Intel have taken to the streets in buses to test satellite reception with mobile devices. And, notably, they have been achieving fairly good results, which, Neilson adds, is finally steering mobile WiMax into a direction where it might actually work well.
One possible explanation is that the technology being used for
trials in South Africa may be an earlier version of WiMAX compared with
that used in the international demonstrations, which may be employing
technology that has not yet been commercialised.
Neilson notes that a big problem also exists locally within the municipal broadband environment, which is caused by regulatory barriers to municipalities entering into public –private partnerships.
Further fuel to the range of problems experienced by WiMax currently being experienced by ISPs is the delay in the allocation process.
Icasa has to follow strict protocol in assuring the correct ISPs get WiMax spectrum. This is causing a short-term problem for ISPs who are currently working on testing licences. ISPs with testing licences have to keep reapplying to extend their licences, and, owing to the fact that spectrum allocations might still take a while, confident ISPs will have to wait before they can go commercial.
Exhausting the process is the seemingly limited amount of WiMax spectrum that can be allocated to ISPs.
“While there is actually spectrum available, a lengthy licensing process is slowing the awarding of these licences to the operators,” says McDonald.
“Operators will accelerate the deployment of the mobile broadband infrastructure if they have the flexibility they need to be able to implement the technologies that will support the services demanded by their subscribers. A forward-looking regulatory attitude will hasten the day when the widest possible segment of consumers will benefit from WiMax technology and true mobile broadband access,” adds Field.
Already another technology is lurking that might put paid to WiMax’s broadband aspirations.
It’s still on paper, and not a realised tech- nology yet, but Long Term Evolution (LTE) is set to be bigger and better than WiMax.
“LTE is the next generation of technology from the people who brought us 3G. The technology will be directly competitive with WiMax. It uses the same base technologies as WiMax and it is probably a year or two behind in terms of its specification, codification, deployment and manufacturing,” says Sidley.
A plus point for WiMax, though, is that its costs will be one-sixth of current cellular technologies, but LTE’s infrastructure costs are expected to be the same.
A research study conducted by market research and analysis firm Maravedis revealed the opportunities and challenges for broadband wireless and WiMax in the US. The report found that LTE will be the dominant mobile broadband technology in 2012. Trials on this technology are expected to start in 2010.
Neilson says that the Global System for Mobile communications (GSM) group of players considers LTE to be sufficient for the future and that WiMax will not be the last word in fourth-generation networks, as LTE will provide the same benefits that WiMax provides in terms of technology, and more.
“They have a strong argument and they have a huge following and marketing muscle and thorough penetration globally in the mobile space, because the entire mobile space is dominated by GSM and 3G.
“The competitive side, the IEEE players that are against LTE and for WiMax, comes from the other side of the Atlantic, from America, where the WiMax standards emerged.
“It is just a question of who will win the race.
“Currently WiMax is more real than LTE, as LTE is still a concept. WiMax is something that is already being deployed, although it has taken a few years to get to this stage.
“It could always be leapfrogged in the long run by LTE, or the two paths could even converge, but it won’t be complete a ‘winner takes all’ situation like VHS versus BETAMAX, when VHS dominated the market.
“WiMax will grow up [in the midst of] the GSM evolution among other things, but may never achieve the same degree of prominence by becoming the dominant next-generation technology,” he adds.
THE BROADER ARENA
But, despite the naysayers, current research reports tend to lean towards the technology staying, rather than disappearing.
In Latin America, broadband markets are standing at 12-million subscribers, but WiMax subscribers in the region currently do not surpass a few thousand.
According to an analysis compiled by global growth consulting company Frost & Sullivan, WiMax adoption is expected to grow at a huge compound annual rate of 97,7% between 2006 and 2012.
The analysis revealed that the Latin American WiMax market comprised 20 700 subscribers in 2006, which is estimated to reach 1,2-million by 2012.
“Operators are increasingly resorting to WiMax, as it significantly reduces the cost of deploying a broadband network, either to expand its capability or to reach underserved areas,” says Frost & Sullivan telecoms services team leader Ignacio Perrone. “Other drivers include portability and the potential for multiple devices.”
The major restraints for WiMax include the high cost of customer premises equipment, its inability to support advanced services, such as Internet Protocol television, and the lack of defined standards.
Further, a delay in the frequency licensing process in countries such as Brazil and Mexico is also providing a barrier to WiMax expansion.
“In Brazil, the regulatory body, Anatel, is likely to open a bidding process to distribute new WiMax frequencies to telecoms com- panies.
“Although the bidding was scheduled to take place in 2006, Anatel decided to prohibit the incumbents from participating in the auction, since they already offer digital subscriber line (DSL), resulting in a judicial case that is still being tried in the Brazilian courts,” Peronne adds.
Overall, Argentina has the most favourable elements for the deployment of WiMax. This market is divided between two incumbents, namely Telecom Argentina (owned by Telecom Italia), which is responsible for the northern half of the country, and Telefónica, which is responsible for the southern half. Currently, the country’s telecommunications regulation does not allow unbund- ling, making the entrance of new competitors a very expensive venture.
WIMAX GOING FORWARD
A large percentage of South Africans that do not have the Internet, or pay high prices to ISPs for Internet access and VoIP, will be able to have a relatively cheap option once WiMax has been launched.
“WiMax will be able to expand the reach of telecommunications into areas where people are not connected to the Internet and will reduce costs for those who do have access to telecommunications but think the costs are too high,” says Sidley.
“Applications to be offered over fixed WiMax in the future include voice and virtual private network access capabilities. Telkom is also con- sidering the mobile version for future product offerings,” says Lewis.
Frost & Sullivan says that, for entrants, WiMax can be a great opportunity to overcome distribution issues, which is the most significant barrier to market entry. WiMax offers the possibility of reaching a large number of clients without having to invest in expensive wired infrastructure.
Frost & Sullivan also adds that since the number of voice services is significantly decreasing every year, broadband providers based on DSL are looking for new technologies to maintain their position in the market. Addition-ally, WiMax provides a good opportunity to follow the current global mobility trend.
WiMax implies a long-term view for mobile operators and the primary reason for a mobile operator to be interested in this technology is to start preparing to offer VoIP services. This apart, since GSM and code division multiple access technologies are proving inefficient for data services, WiMax would allow them to achieve high data transmission speed.