Leadership drives WiMAX innovation

05 Sep 2007
00:00

The high level of government promotion and support for the WiMAX standards and the strong local WiMAX equipment industry are expected to make Taiwan a leading market for WiMAX in Asia Pacific. Broadband wireless access (BWA) 2.5-GHz licenses have been awarded and commercial WiMAX service launches will soon take place in 2008.

Taipei is already one of the most wireless-connected cities in the world, thanks to the M-Taiwan government initiative, which kicked off in 2005. The four-year program aims to turn Taiwan into a wireless broadband island, promote the Taiwan's ICT industry, strengthen ICT infrastructure and create an ecosystem to speed up the development, manufacturing and marketing of WiMAX technology.

But WiMAX will struggle to compete directly with DSL in most areas due to the island's high broadband penetration and cheap access (~$20 per month for 8-Mbps). Broadband household penetration reached 67% at the end of first quarter of 2007, so the mass market is already broadband connected. Mobile penetration stood at 97% during the same period.

The market status, competing technologies, lack of devices and delays in network deployment will prevent WiMAX from becoming a large-scale technology in the medium term. As a result, WiMAX uptake will be slow and have more impact on the fixed broadband market than the mobile market.

The first connections are expect to be fixed WiMAX (806.16d); however, the market will soon be dominated by the mobile WiMAX standard (802.16e). Total certified WiMAX users are also forecast to reach 782,000 by the end of 2011 (see chart page 26).

Still, WiMAX poses the biggest threat to incumbent Chunghwa, which dominates the broadband market but did not gain a WiMAX license. This threat will be strongest in niche segments and strengthen as WiMAX moves into more markets, provides full mobility and more devices emerge.
Taiwan's National Communications Commission (NCC) awarded six broadband wireless access (BWA) 2.5-GHz licenses on July 26, 2007, with licensees planning different approaches.

Leading mobile operator Far EasTone (FET) was the only major operator to win a license. It plans to integrate its current wireless networks including 3G, HSPA, Wi-Fi and WiMAX to create a seamless broadband experience. It will also use WiMAX for fixed/nomadic broadband access in southern Taiwan.

Although Chunghwa and Taiwan Mobile did not gain licenses, this is not exactly a bad result for either operator because they will now be able to wait and see how the technology develops and matures, and potentially not be stuck with pre-certified equipment.

In the case of smaller mobile players, PHS operator FITEL and W-CDMA entrant Vibo (in a joint-venture partnership with manufacturer Tecom) see WiMAX as enabling them to enhance existing service offerings especially wireless broadband. For FITEL, WiMAX is also potentially its long-term next-generation technology. APBT bid but did not gain a license.

Cable company Vastar was the only media company to gain a license. WiMAX potentially enables it to offer triple-play services, either in the form of TV over WiMAX or VoIP over WiMAX.
Meanwhile, emerging broadband ISP, Tatung Telecom, is expected to use WiMAX to participate in the wireless broadband market, reduce dependence on the incumbent, and to offer an alternative to fixed-access networks.

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