For the first time in its history, vendors including Airspan and
Alvarion have made yet modest but positive cash flows. Further broadband
wireless has evolved from an obscure acronym to the next big thing
thanks to Intel?s marketing machine and the formidable progress made by
the WiMAX forum, growing membership to the extent that WiMAX is now
synonymous with broadband wireless.
We have been following the industry long enough not to fall into the
trap of using WiMAX as representing the whole story. WiMAX is an
important, highly visible part of the evolving fixed/portable field but
not all of it! Other technologies including DOCSISbase, TD-CDMA and
802.20 merit to be analyzed as well.
The fundamentals for continued growth remain sound. Broadband is
becoming a necessity for many residential and business subscribers
worldwide. There were close to 130 million broadband subscribers
worldwide at the end of 2004, a 30% growth from 2003.
Although DSL and Cable are poised to remain the dominant technologies
for access in urban and developed areas, pre-standard wireless access
technologies are already becoming reliable and cost effective
complements or alternatives to providing voice and data services.
Some Key Findings include:
- Some 785,000 broadband CPEs and over 40,000 base station sectors were
shipped in 2004;
- Alvarion remains the market leader with 26% market share followed by
Motorola Canopy and IP Wireless;
- EMEA which represented 32% of the overall 2004 equipment sales
continues to represent the largest market opportunity but Asia will
outpace it by 2007;
- The carriers market segment with 68% of all sales represented the
largest segment followed by Wireless ISPs and Public entities;
- The access and backhaul applications represented respectively 81% and
19% of total sales in 2004. However backhaul will represent 27% of
equipment sales by 2010;
- 3.5GHz, the most allocated frequency band for BWA, represents the
largest opportunity for BWA with over 40% of total sales followed by the
5.2-5.8Ghz band. We believe those bands will continue to dominate
equipment sales especially in light of the fact that they are two of the
initial WiMAX profiles. The 2.3 and 2.5-2.7Ghz market share will grow as
Korean (WiBro) and US operators start deploying WiMAX equipment some
time in 2006-2007
- The shipments of proprietary Fixed Indoor/Portable equipment already
accounted for 21% of 2004 sales Shipments of OFDM based product already
represents 18% of all shipments and that proportion will grow with the
adoption of 802.16-2004 to close to 60% by 2008
Service Provider Trends
It is estimated that close to 1 million subscribers worldwide had some
form of fixed broadband (+256Kbps bi-directional) wireless access. We
estimate total service revenues in 2004 to be US$1.4 billion.
In developing countries, representing most of the worldwide population,
the potential for BWA/WiMAX growth is most pronounced. In rural areas,
governments at all levels are driving the growth of broadband wireless
through continuing frequency allocation and subsidies to make the rural
business case more attractive in order to reduce the digital divide. Our
research indicates that a tipping point that will drive increased unit
demand is likely to occur due to effects of standardization:
commoditized IC/SoCs will help drive the price equation, stimulate
increased awareness and market driven demand, and provide increased
supply stability and compatibility across similar equipment profiles.
This year, operators will explore the challenge of growing broadband
ARPU. There will not be a single solution: faster speeds and VoIP will
work for some; content and IPTV services for others. There will be a
growth in commercial bundles driven by telcos' responses to cable
operators' triple play services. We expect VoIP services to continue to
show strong growth and continuing acceleration in subscriber base in
both the consumer and enterprise segments.
We surveyed operators to understand their greatest expectations vis a
vis upcoming WiMAX equipment. The results of the survey are presented in
the report. In essence, the number one expectation for service providers
is lower CPE equipment cost, ideally in the sub $300 range. This is not
a surprise when considering the impact of CPE subsidies in the total
business case. The second highest priority expressed is for base
stations to deliver "more throughput", a response that came ahead of
benefits such as "Interoperability", "ease of installation" or
"coverage". Responses changed noticeably depending on service class:
business or residential customers.
We also looked at BWA operators? strategy towards mobility. The majority
of service providers are excited about the prospects of mobility but
concerns about regulation and network complexity alter the excitement.
Whether it is 3 G or 802.16 e,/WiBro the success of mobile broadband
will be driven by the development of user friendly applications and
handsets. In this section, we provide an overview of what are the
applications driving the mobile broadband market including mobile
gaming, multimedia messaging, gambling and other applications such as
ring tones. The mobile consumer market represents the lion's share of
mobile data services revenue due to gaming.
Who Should Use This Report:
- Operators that need to understand how WiMAX will improve their bottom
line and which vendors to consider;
- Equipment Vendors who want to strengthen their knowledge of their
competitors and the overall spectrum and market trends;
- Financiers who want to understand the revenue potential of WiMAX and
the emerging vendors;
- Consultants and Others who want to develop a strategic understanding
of Broadband Wireless in general and WiMAX in particular.
Benefits of the Report :
Based on extensive research and accumulated experience, this report is
the most valuable set of information needed for key product and
marketing decisions that lead to success in the emerging wireless
broadband space. This report provides a clear and present competitive
edge to decision makers. |
