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June 19, 2007

WiMax report shows healthy adoption

Posted by Tricia Duryee at 2:04 PM

A report released today said 54 million WiMax subscribers are expected worldwide by 2012.

The report, released by Senza Fili Consulting in Sammamish, said the number includes both fixed and mobile subscribers.

Of the 54 million, the report said about 17 million will be in the U.S., bucking the trend that most of the adoption will occur in developing countries.

Monica Paolini, the president of Senza, said most of the people who will be interested in WiMax are those who don't currently have access to DSL or cable broadband services.

She said the U.S. is one developed nation that is likely to see faster adoption. Even though there are DSL and cable options here today, so far there's been comparatively low broadband adoption, compared with other developed countries in Europe and parts of Asia. She said generally that is because broadband is more expensive and slower here. Plus, both Clearwire and Sprint Nextel are committing to rolling out nationwide networks here.

"For a developed country, we are under provisioned. There's more of an opportunity here from that point of view, it's very much a data-oriented society. People use laptops a lot," Paolini said.

By 2012, she said 61 percent of WiMax subscribers will use the technology for mobile access. A third of them will also use WiMAX as a fixed-access technology.


Senza Fili Consulting

Estimates show that there could be 54 million WiMax subscribers by 2012.

Compared with the 230 million U.S. wireless phone subscribers, and the millions more who have broadband Internet access, that may not seem like much. But Paolini said a better comparison to WiMax is 3G, or high-speed wireless Internet access through AT&T, Verizon Wireless or Sprint Nextel. After four or five years on the market, they each have only hundreds of thousands of subscribers.

She said by 2012, WiMax could end up being a bigger opportunity than 3G. That's because it's likely to be installed in more than laptops. There are plans to install it in small electronics such as handheld video game devices and cameras.

"If you have technology that basically serves only laptops, it's a very different business case," she said. "Only so many people are willing to go around with laptops."

Asked whether Clearwire and Sprint Nextel should be happy sharing 17 million subcribers by 2012, Paolini said: "I think they should be very happy if they can get to that type of usage."

Today, Clearwire has 285,000 subscribers using a pre-WiMax network in about 35 cities in the U.S. and a handful of cities in Europe.

UPDATE: For the sake of comparison, I asked Robert Syputa, a senior analyst from Marvedis for his forecast. He said, according to a report from December 2006, they are expecting 100 million WiMax subscribers worldwide in their optimistic scenario. (In case you are curious, his pessimistic scenario expects only about 21 million by 2012. Note: In that case, he's not counting subscribers but number of CPEs (customer premises equipment), or essentially the number of modems).

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Tricia Duryee
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