Uncertainty over unbundling, the scramble for scarce licensed spectrum and the initial high cost of moving to WiMax is putting a kink in the uptake curve of broadband wireless, the logical alternative to strangled broadband DSL.

Meanwhile customers are demanding more than fast internet from their wireless experience. They want bundled offerings, integrated voice and data and quality of service. However, there’s a real caution about commitment. While Telecom is effectively creating demand by controlling the DSL bottleneck the question is raised, what would be the impact on wireless if the cork suddenly popped out and ISPs could get equitable access to more than a capped 2Mbit/sec asymmetrical wholesale service.

Phil Josephs Siemens business development manager says a number of ISPs are amping to get into broadband wireless but operate on a shoestring budget in an unfavourable regulatory environment. "The difficulty is not about changes but whether things will stay the same." It’s a real risk with the government talking tough with Telecom over its failure to meet broadband access targets. "If you spend $20 million on a WiMax network then discover they’re going to unbundle the local loop you would wonder if you had done the right thing. Those investing in wireless will be hard pushed to turn a buck against DSL."

Because of latency issues, existing DSL access to ISPs is not suited to quality of service, voice, video and other enhanced services which are essential to adding value and recovering revenue. That’s one reason why broadband wireless has appeal and if you own your own backbone then you can control what you do with it.

Most major equipment providers are gearing up for the WiMax revolution and many already have pre-ratification product installed. There’s no disputing the strong interest in scoping out the business case for WiMax style variations, some of which already deliver extraordinary coverage for private networks, and will throughout 2006 begin to find a larger niche as a local loop alternative, and ultimately as a big brother to wifi.

WiMax leverages the licensed 3.5GHz microwave band delivering higher speeds over a much greater range than wifi. It is more robust and geared to provide quality of service for voice, data and related services. Pre-WiMax technology is already used for point to point communications between offices, warehouses, remote branches or rural areas, and for ISPs and carriers to extend their reach or create hot spots with much wider coverage and greater throughput than wifi. It can deliver more than 100Mbit/sec of clean signal up to 50km, depending on obstacles and the number of users.

Big promises for WiMax

The emerging technology is described by Intel as ‘wifi on steriods’, and in its point-to-multi-point iteration will require CPE that could break the budget of all but the major players, although may rapidly go mass market once Intel and others release integrated chipsets for mobile devices such as laptops. While the point to multipoint WiMax is capable of delivering up to 75Mbit/sec up to 16km from a single hub its most likely individual users will be sold increments of 10Mbit/sec symmetrical or less.

As various vendor equipment is tested in laboratories and ratified over the next year there will be guarantees of interoperability between different equipment, enabling users to move between networks.

 

The main local players with WiMax compatible spectrum are BCL, Wired Country-Compass, TelstraClear and Telecom. The government auctioned off nationwide management rights for three 7MHz radio frequency slices three years ago, each having two sets of licenses. TelstraClear acquired two, Vodafone got one, BCL won three (21MHz) and Wired Country had two. Compass Communications has since acquired one set from Wired Country and Telecom snaffled the remaining two 7MHz frequency bands.

Telecom applied for a clearance from the Commerce Commission but went ahead before that voluntary process was completed, putting itself in possible breach of section 47 of the Commerce Act. In other words, the government watchdog believes in Telecom’s hands the spectrum rights could substantially reduce competition in the market. Telecom insists there are no competition issues involved, as the 3.5GHz licence in question is less than 10 per cent of the available spectrum. It has no specific plans for the management rights.

Meanwhile Callplus has begun experimenting with WiMax to a limited number of subscribers in Whangaparaoa, Kaikohe and Northland with the potential to deliver voice and data over a symmetrical 50Mbit/s service. Wellington-based New Zealand Wireless begins trials this month (January) and Auckland-based National Communications is trialing Airthernet, wireless internet at speeds between 2 -10 Mbit/sec with no data caps.

Compass Communications Ceo Karim Hussona is so confident in WiMax as the way forward that he has invested his own money. He’ll spread out from the existing customer base in Hamilton, Franklin County, Manukau and Auckland’s outer suburbs to fully leverage the 3.5GHz national frequency rights, rapidly deploying pre-WiMax base stations around the country, starting in Christchurch.

Compass has been using unlicensed spectrum for internet but growing interference in those bands, and a desire to add voice meant the only way forward was to acquire licensed spectrum. Compass uses Axxcelera wireless gear, including base stations that are upgradeable to WiMax, although it’s taking a wait and see approach on CPE and WiMax itself.

Licensed to thrill

While the unlicensed bands continue to provide massive relief in the regions and outlying areas, overcrowding and interference in Auckland, Wellington and Christchurch and contention for high locations are forcing many businesses to look seriously at licensed frequencies.

Ian Hastie, wireless systems specialist with LinkIT says wireless broadband came into its own two years ago and over the next year will move into next generation deployment. "People are becoming frustrated with 2.4GHz as it became everyman’s band. Life becomes unbearable as built up areas become saturated. The big players began moving out three years ago, they couldn’t afford to stay there."

That doesn’t worry Hastie though, he’s confident the unlicensed bands remain robust and have a lot of life left, particularly in the regions where the bands are less crowded. LinkIT bought Trango Broadband equipment here which gave Compass Communications an upgrade path from 2.4GHz to 5GHz, ahead of the recent Wired Country licensed spectrum acquisition.

With Ceragon licensed technology for example LinkIT can design and build a kilometer long 1.2Gbit/sec backbone at under $30,000 a link with 155Mbit/sec point-to-point Ethernet links using unlicensed spectrum feeding sites 16kms out from the base, in a star hub, or redundant ring configuration. "That’s the evolution of the CBD environment in Wellington, Auckland and Christchurch. There’s limited tall timber, everyone wants to work off that creating their own private networks."

From a purely economic point of view he says links with Telecom or TelstraClear are a continual drain on business revenues, but if customers hook up all nodes with their own infrastructure they are in control of their own future. "They can get an excellent return on investment. A lot of regional councils are realizing this. They can stimulate connectivity options and local business."

LinkIT says it has a ‘full dance card’ including many regional broadband initiatives like SmartLinx3 in Wellington. Its intention is to establish an open, competitive, high-bandwidth infrastructure across Hutt City, Porirua City and Upper Hutt City which it believes will create economic and social opportunities. It has engaged LinkIT to deploy Trango Broadband radio products to connect clients in the area.

DIY wireless in regions

Hastie believes a lot of the MUSH funding being provided by government to promote broadband use in local communities will end up being invested in wireless. "Many larger players are putting in their own licensed links between buildings to reduce the risk of interference over shorter paths. In the regions where there are a limited number of users it’s totally different, sites operating between 0-30km can easily attach 60-120 subscribers with up to 10Mbit/sec symmetrical per customer."

ChiliAD is also seeing significiant growth in the regions where councils and businesses are fed up with the existing offerings and doing it themselves. The Taupo District Council has a wireless network between all its sites from Taupo to Turangi and out to Mangakino. "Most organisations can only afford 2Mbit circuits and the price of a 10Mbit/sec frame relay is horrendous. We provided the council with 10Mbit/sec private wireless IP network to their main sites and saved them a fortune," says ChiliAD sales manager Mike Dagg.

"Now they have integrated all their voice traffic and use computer telephony integration to give a common service using the same PBX system despite their operation being spread physically." While the council now has a 10Mbit/sec network it’s currently only using about 1Mbit/sec.

Chris Aspros, managing director of NZ Wireless says technology is advancing so quickly everyone wants to be released from their wires. The company is gearing up to take its subscribers from public to licensed spectrum and through a multi-million dollar upgrade process deploy IP-based networks to move more confidently into voice and other integrated services. He believes this will enable him to deliver voice at 30-40 percent below traditional market prices. The biggest impact will; be on existing frame relay services.

NZ Wirless has been active for three years using unlicensed 2.4, 5.33 and 5.8GHz bands. It has just picked up a 3.5GHz licensed spectrum for Wellington central and is in the running to broaden that coverage beyond the CBD and into other parts of the country.

Partnering to grow

It is already using the 802.16d WiMax variation and a mix of Senao bridges and Orthogon equipment. "WiMax is just a marketing buzzword, we’re purchasing the equipment now and hoping to deliver a 3.5GHz service early in 2006 with a focus on 10Mbit/sec symmetrical wireless services small to medium local and suburban businesses where people are still feeling a bit lost."

Aspros believes the market is about to go through a period of consolidation. And while the Ministry of Economic Development is currently allocating licences in the 3.5GHz band for fixed wireless access (FWA) many players see partnerships and alliances as the way forward. While the new licenses can’t be transferred, a number are already setting the ground rules between themselves. "Competition is going to be fierce."

However that kind of approach has raised concerns at the MED, forcing delays in spectrum allocation. The government received over 50 expressions of interest for selected bands of 3.5MHz spectrum by March but by December it got wind of alleged underhand tactics and hidden partnerships that might give existing broadband providers unfair advantage.

It reminded applicants of the rules prohibiting the participation of those with existing fixed wire or other broadband capabilities in the areas concerned, or with broadband assets in close proximity. It threatened to reject any application found to contain false or misleading information and even withdraw disputed licenses unless full disclosure of concerns was forthcoming.

In the meantime uncontested spectrum has been temporary allocated to NZ Wireless in Wellington central and two slices to Far North went to joint venture company Top Energy and Te Rūnanga o te Rarawa.
 

Meshed wifi is another option that is attracting a lot of interest. The approach uses a network of POPs which allows users to move around a CBD or wider area of coverage. And the technology enabling that to happen can fit under the broadband umbrella with access speeds of 2Mbit/sec and beyond. Others are going for the lowest common denominator by choosing wi-fi. As dual mode wifi /GSM and wifi/3G phones becoming available, users will be able to make VoIP calls from hotspots. Roam AD already offers this option.

There’s no doubt the smart money is on wireless, with 3G delivering serious mobile data and voice for a range of business services including video on the move. Wifi is likely to expand significantly over the next year and the use of unlicensed bands in the regions will remain a liberating force from exorbitant leased lines costs for councils and geographically dispersed businesses. WiMax and its variants will rapidly bring competition to DSL extending affordable broadband into business parks and communities across the country. With 802.16e on the horizon WiMax will not only deliver the supercharged equivalent of hot spots but eventually challenge the way we view wide area and mobile networking.