Nortel Wimax plan reveals new pattern of 4G business

Caroline Gabriel/Rethink Research
15 Oct 2008
00:00

Only a few weeks ago Nortel was reportedly poised to get out of wireless networking, but the Canadian firm does not throw in the towel easily, and managed to make a splash at this month's Wimax World show even though it no longer plans to make its own Wimax products.

The company has always preached the importance of building a broad ecosystem around Wimax at an early stage, in order to differentiate it from other networks through a well differentiated choice of devices and applications. Now it is stretching the ecosystem concept so far as to rely on a third party - Alvarion - even for the RAN infrastructure itself, but still insists it can play a pivotal role as integrator and as the hub for an innovative line-up of partners.

The Nortel Wimax ecosystem was expanded two weeks ago to include such diverse partners as IBM, core networking specialist WiChorus, Quanta Computer and Accton Wireless Broadband. Between them, and with the addition of a group of device makers, Nortel says it will offer an end-to-end platform, and that this best of breed approach - with the key supplier not actually providing the hardware - represents a blueprint for next generation networks, that many will emulate.

Logically, this would mean that infrastructure would become increasingly commoditized and the preserve of a few vendors, either with the scale to thrive in the hardware game, or with specialist expertise in an emerging air interface technology - and vendors would gain value and differentiation from providing software, services and integration. This is a trend that has already been clearly seen in the enterprise computing and networking fields, with even hardware majors like IBM now primarily focused on services.

Nortel has OEMed Airspan gear for fixed Wimax for some years and earlier this year abandoned its own Mobile Wimax development plans for a similar agreement with Alvarion for 802.16e. This was widely seen as a downgrading of Wimax' importance in the Nortel strategy, which had initially rested on stealing a march in 4G - having exited W-CDMA - by creating a unified OFDMA platform for Wimax and LTE. LTE then moved to the center of the Nortel roadmap, though even this was put in doubt last month when CEO Mike Zafirovski announced his intention to sell off various units, possibly including wireless, and focus on areas where Nortel can still lead the market, like enterprise unified communications and carrier VoIP.

'For Nortel, our sweet spot is the integration of a complete solution,' said Scott Wickware, Wimax general manager at Nortel. 'Backhaul, applications like VoIP, professional services, devices and enterprise offerings are all part of a Wimax build and where Nortel excels.'

One of the most strategic areas of Nortel's portfolio is unified communications, and particularly its alliances with IBM and Microsoft. Now it is extending its UC strategy to new networks, including Wimax, and is working with IBM to deliver Lotus Notes capabilities over 802.16e. This will support a range of services including IP telephony, instant messaging, web conferencing, video chat and unified messaging, regardless of location and device.

Other new partners include WiChorus, for its Home Agent, which provides operators with sub- scriber and content management. On the device front - where Nortel was an early mover in terms of attracting Taiwanese ODMs into the Wimax fold to boost the economics - the vendor is working with Quanta and Accton in Taiwan to deliver Nortel-branded 802.16e devices including PCMCIA cards, USB adapters, indoor gateways, window mount antennas and outdoor gateways working in the 2.3 GHz, 2.5 GHz and 3.5 GHz bands.

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