Views from MWC: WiMAX to gain traction in emerging markets?

I recently discussed here the relative merits of and prospects for 3.5G mobile and WiMAX networks in India. A number of news items emanating from this week's Mobile World Congress prompt me to widen the discussion out to the question of how much traction WiMAX backers can expect the technology to gain in emerging markets worldwide.

The first of these items comes courtesy of the telecoms.com, whose correspondent caught up with Wei Yuan, Senior Director of Global Marketing for ZTE in Barcelona. "We anticipate a boom in WiMAX take-up for fixed applications in emerging markets this year," says Wei Yuan, who believes that Russia, the CIS, the Middle East and Africa hold out the best prospects for WiMAX growth for the Chinese telecommunications equipment and network solutions firm.

In terms of serving mobile operators, Wei Yuan believes the '4G' market share will be 80/20 in LTE's favour, but feels that the WiMAX opportunity is still a sizeable one, especially in light of recent announcements by Alcatel-Lucent and troubled Nortel that they are no longer focusing on WiMAX mobility. The article adds weight to this last point, noting that ZTE's WiMAX momentum is highlighted by In-Stat, a market research firm whose recent report states that out of the 94 new WiMAX 16e commercial networks deployed last year, ZTE had 15 of them or 16% of all the networks established worldwide. This apparently sets the Chinese company among the top two WiMAX equipment vendors in 2008. According to the telecoms.com article, the report goes on to say that with ZTE's industry-proven WiMAX terminal solutions and a significant number of commercial WiMAX networks the company is planning to install in the years to come, "there is a high probability that the company can assume the number one spot as WiMAX equipment vendor worldwide."

Just before the Congress, Sean Maloney, Chief Sales and Marketing Officer of Intel provided an update on recent WiMAX developments, a summary of which you can read at WiMAX.com. "WiMAX is a global story," said Maloney. "The technology is real, here today and has a 2-3 year advantage over other competing technologies."

What stood out for me was Maloney insisting that big deployments in the most highly developed markets are only part of the WiMAX picture. "Too much focus has been placed on developments in the US and Clearwire," said Maloney. "This is a global story; to understand how it is doing you must take a global perspective. From the very beginning, we wanted to have a global, ultra-fast, low-cost wireless internet solution that would help bridge the digital divide and last mile."

Maloney flagged up some of the more notable deployments, including Scartel and Comstar launching services in Russia with up to 10Mbs performance. For Intel, Moscow and St. Petersburg have leapfrogged 3G services to 4G. In the case of the Russian capital, I wonder how damaging this will be for the country's three leading mobile operators MTS, Vimplecom and MegaFon, which have all rolled out 3G services in major cities except Moscow. There have been long delays with the the Russian military freeing up UMTS frequencies and I have discussed here in previous posts the argument that this frustrating 3G launch delay in the country's most lucrative market has created a window of opportunity for the likes of Scartel and Comstar. In the case of the latter, however, it is worth mentioning that the Comstar-UTS group, a leading provider of integrated telecommunication solutions in Moscow and other cities, is controlled by Sistema, which is also the parent company of mobile market leader MTS.

Scartel, says the WiMAX.com article, plans services in over 40 Russian cities and launched the world's first GSM/WiMAX phone with HTC. This has not remained the sole GSM/WiMAX device on the market for very long. WiMAX.com reported on Tuesday this week that Quantum Telecom had unveiled at the Mobile World Congress in its first Ultra Low Cost GSM-WiMAX handset. I assume this is aimed primarily at emerging markets.

Other emerging markets and middle income countries which have seen WiMAX deployments include:

• Pakistan, where Wateen Telecom has launched the largest WiMAX network in the world covering 26 cities with plans to grow to over 70 cities; mobile operator Mobilink also launched WiMAX services in August 2008.
• Venezuela, where MobileMax has deployed WiMAX in Caracas in June 2008 with up to 20K users
• Brazil, where Embratel, part of Telmex, is operating a WiMAX network covering over 20 cities

It will be interesting to see which emerging markets are home to further WiMAX deployments. I know less about developments in Africa and SE Asia, but Intel and ZTE certainly seem to be vocal, powerful backers of WiMAX as a useful option for service providers in developing countries.

Views from MWC: WiMAX to gain traction in emerging markets?