Doubts Over Intel's WiMAX Service Pricing Claim

Ian Lamont writes "An Intel executive has suggested in a blog post that WiMAX could lead to massive savings on broadband Internet, mobile voice, and mobile data service prices. His post lists a WiMAX-based package of services including home broadband, mobile voice and broadband, home phone service (including international) and even video phone service for $50 to $100 total. It sounds great, but unfortunately for Intel and consumers, it's unlikely to happen any time soon, thanks to factors ranging from costly WiMAX buildouts to the telcos' lucrative business models based on existing wired and 2.5G/3G infrastructures. There are also questions about WiMAX's actual range following a messy Australian rollout, although the vendor there claims the Australian service provider under-provisioned the network."

Comments

Hard for WiMAX NOT to be cheaper.

[mrbluze]

.. lucrative business models based on existing wired and 2.5G/3G infrastructures

Now there's an understatement. I would call the business model 'ludicrous' rather than lucrative. 3G is priced way out of reasonable range for any serious use.

Nobody pretends that wireless broadband will be available in mountain crevices, but 3G has been quite disappointing IMO.

As for $50/$100 plans, that will depend on competition, which in Australia, at least, is totally lacking.

Re:Hard for WiMAX NOT to be cheaper.

[raehl]

You do realize that a half mile is pretty far, right?

And what is the comparative cost of putting up a tower that covers every house within a half mile and running wires to every house within a half mile?

WiMax infrastructure could very well be cheaper to provide than wired infrastructure.

The real problem WiMax has is that the wired infrastructure is already there. They're 10 years too late.

Re:Hard for WiMAX NOT to be cheaper.

[mr_matticus]

Well, one possible explanation is that DSL required replacement of older telephone wiring from junctions to homes. It required significant overhaul to main backbone lines in a large number of cities. It required new technology at each service office, and it was severely range-limited. Then, even after all of that, line filters were needed to be connected within homes to allow voice telephones to function at the same time.

Cable, on the other hand, required new hardware at central offices, a fraction of the number required for DSL.

Cable companies were able to provide broadband service to more customers while simultaneously spending less money (both per-subscriber and overall) and offering greater peak bandwidth. Cable was far more successful in suburbia, and it was cheaper to deploy in urban locales. Unfortunately, they squandered their infrastructure head start, and are now losing the scalability race. Comcast in the Bay Area just recently (finally!) launched a handful of sorely-missed HD channels, but they still don't have anywhere near the satellite offerings, and they're now triple-packing most of them, so the picture quality has decreased significantly, which previously was their advantage over satellite. The DSL providers and Verizon are both pumping out fiber and providing packet-based, rather than broadcast-based, television technology, and the cable companies are screwed--except that fiber deployment is slow and expensive.

If the cable companies had any sense, they'd move their entire distribution method to On Demand, instead of pumping out all the channels, all the time, freeing up bandwidth for other services while they start replacing their infrastructure as well. The digital transition was a good opportunity for them to do just that, but they watched that pitch sail by, too.

Re:WiMAX isn't magic. It's just another kinda radi

[mr_matticus]

much of the public doesn't understand one simple thing: WiMAX is just another kinda radio. Every kind of wireless is just another kind of radio.

But it does have one real drawback that doesn't really have to do with the nature of the standard itself. That is that it's intended and manufactured for use on licensed spectrum No long-range service can rely purely on unlicensed spectrum in most developed areas. All portions of the spectrum are expensive and scarce these days, and unlicensed spectrum is increasingly cluttered.

WISPs that ignore WiMAX and use other technologies will do better. Such as? UMTS? How is that cheaper? "4G"? It doesn't exist yet. HiperMAN/WiBro? Those are just rebranded WiMAX variants.

Re:16e versus 16d

[brinko99]

Yes, Mobile WiMAX (802.16e) will have a very difficult time competing with 3G. LTE is being rolled out on upgrades of the existing GSM-WCDMA infrastructure. The momentum of LTE is unstoppable.

Now Fixed WiMAX (802.16d) is interesting. We're always complaining of the lack of competition at the last mile. Sure it's line of site but that only means a minimum of one tower in each 30 mile radius. The question is how many subscribers can each tower handle (sharing 75Mbps per channel). I know what you're thinking... one tower per subscriber sounds about right!

See also: The New Last Mile Broadband: WiMAX

This is great except...

[hyperz69]

I have to think that Big Telco is going to charge a premium rather then discount you. Don't even think for a second the FCC is going to let small telco pop towers down. Unless then have 10 billion to whip out their wallets. This means you still have to rely on the old providers like Sprint with their WiMax project to get the data to you. If you think they are going to price this service CHEAPER then their line service, you may want to think about quitting the pipe.

I see base WiMax starting at 69.99 (for like 3/768 unlimited data). Then again this is all just complete guess work until someone rolls it out and say this will cost $xx.x