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Next year 'make or break' for WiMAX

After a disappointing debut in Korea, WiMAX technology faces a crucial twelve months as the major deployment by New Clearwire gathers speed in the US.

WiMAX, the high-speed connectivity technology that is competing with cellular and fixed-line broadband, is expected to have only 103 million subscribers worldwide by 2013.

That s according to a new report on the emerging sector from telecommunications analyst company Informa.

Mike Roberts, the author of the report, says that close to 80 million WiMAX-enabled devices "“ such as handsets, high-end notebook PCs and USB dongles "“ should ship in 2013, as the technology finds its feet.

Many of those devices would be likely to feature III-V semiconductors in their power amplifier stages, but the overall number is only tiny compared with the billion-plus cell phone handsets that ship each year.

For 2008, Roberts believes that device volumes stand at approximately 2 million, following early WiMAX deployments in Korea. For WiMAX proponents, however, the Korean experience has been a difficult one:

"WiMAX has had a hard time in Korea," Roberts told compoundsemiconductor.net. This is mainly a result of the tough competition "“ as the vast majority of the Korean population already has access to either a fixed or mobile broadband connection.

Roberts figures suggest that two years after its mid-2006 launch, Korea Telecom's WiMAX service had only garnered some 200,000 subscribers. In comparison, the same company s cellular wing had signed up some 4.8 million subscribers to its high-speed "HSDPA" service over the same period.

In the short term, WiMAX should receive a major boost with the roll-out of a nationwide network by New Clearwire in the US.

Backed by communications giant Sprint, cable companies Time Warner and Comcast, not to mention Google, New Clearwire received clearance for the network deployment from the Federal Communications Commission earlier this month.

With the $3.2 billion project now also approved by shareholders and, in principle, by lenders, New Clearwire is all set to move ahead with widespread WiMAX deployment across Sprint's existing base station infrastructure in the US. The service is already available in Baltimore.

Since mobile broadband is still a relatively expensive commodity in the US, WiMAX should have a better chance of success than in Korea.

However, with the full extent of the credit crisis only now emerging, early adopters of WiMAX may be thin on the ground for some time yet.

Where Roberts sees a more compelling market opportunity for WiMAX, particularly in the longer term, is in developing countries where there is little or no existing broadband infrastructure "“ countries like India.

"There is a real pent-up demand for broadband in India," Roberts said. Because there is nothing like the level of competition that exists in more developed markets, he sees India as a hot-spot where the technology should take off.

"Our forecasts show that WiMAX will account for 24 per cent of India s total broadband subscribers by 2013, up from 7 per cent in 2008."

Four major operators are committed to rolling out WiMAX networks in India, Roberts said, adding that recent discussions showed no sign of any impact caused by credit restrictions. With huge local companies such as Tata backing the roll-out, Roberts is confident that it will remain on track.

Following in India s path could be Russia, Pakistan and various African nations, where there the focus will be on providing a broadband service for business users in the first instance.

By 2013, it is expected that about one-third of all WiMAX subscribers will be located in "developing" countries, although that proportion is very likely to grow in the long term, as most developed countries will prove harder to crack.

One exception to that general rule might be in Japan, where telecom operator KDDI is backing a major WiMAX deployment under UQ Communications, and which is scheduled to launch by August 2009.

Combined with the New Clearwire project in the US, the success or otherwise of the Japanese network should give a clear indication of the technology's prospects.

"In 2009 we will find out whether they go ahead with the full deployments as planned," concluded Roberts. "It will be the make-or-break year."

Informa Telecoms & Media s report: WiMAX "“ the best and worst of times "“ can be ordered via the company's web site here.

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