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Doubts Over Intel's WiMAX Service Pricing Claim 69

Ian Lamont writes "An Intel executive has suggested in a blog post that WiMAX could lead to massive savings on broadband Internet, mobile voice, and mobile data service prices. His post lists a WiMAX-based package of services including home broadband, mobile voice and broadband, home phone service (including international) and even video phone service for $50 to $100 total. It sounds great, but unfortunately for Intel and consumers, it's unlikely to happen any time soon, thanks to factors ranging from costly WiMAX buildouts to the telcos' lucrative business models based on existing wired and 2.5G/3G infrastructures. There are also questions about WiMAX's actual range following a messy Australian rollout, although the vendor there claims the Australian service provider under-provisioned the network."
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Doubts Over Intel's WiMAX Service Pricing Claim

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  • by mrbluze ( 1034940 ) on Friday June 20, 2008 @10:15PM (#23881731) Journal

    .. lucrative business models based on existing wired and 2.5G/3G infrastructures

    Now there's an understatement. I would call the business model 'ludicrous' rather than lucrative. 3G is priced way out of reasonable range for any serious use.

    Nobody pretends that wireless broadband will be available in mountain crevices, but 3G has been quite disappointing IMO.

    As for $50/$100 plans, that will depend on competition, which in Australia, at least, is totally lacking.

    • by zappepcs ( 820751 ) on Friday June 20, 2008 @10:42PM (#23881881) Journal

      In North America and many other places (not all, obviously) the network business plan is basically one of build out the basics which are often guided more by equipment functionality or protocol functionality than anything in the marketing brochure. Once basic services are built, then increase bandwidth where required, spread coverage where there are customers to pay for it.

      Generally this is done without a proven adoption rate for new services like 3G or WiMax. That's the gamble part. So prices will initially be steep and will stay steep if there is no adoption or bundling plan to offset the costs. DSL had initial problems this way, but stuck it out long enough for adoption to catch up. Deals with Yahoo etc. helped boost DSL adoption. Cable was an incumbent, people already had the service in their house and only needed the modem to use it.

      One thing in common of all these is the necessary part of the plan to oversell the service. That is to force time-sharing by sheer volume of users. So they sell every household in Seattle 6Mbit/s service while betting average usage is generally less than would have been seen with DSL service. This lets them charge more, but not have to build out their infrastructure, and more or less none of the Mr or Mrs Seattle's ever notices. Then the Internet really got more useful, so more usage was the result. Congestion was the result because of bad network/infrastructure planning. If all users in Seattle want to use all 6Mbit/s of their paid for service, the ISPs start wondering if they are being DDoS'd. The ISPs are, in a word, fucked.

      WiMax will suffer from the same self-defeating strategy. It will be great if you are within 1/2 mile of the tower. Anywhere else will suck bad.

      Interesting point about the overselling: It is P2P that gets picked on and Newsgroups now because these protocols are generally being used when the consumer is not around, so are not user driven traffic. They are just eating bandwidth that was not counted in the initial infrastructure planning. With dial-up and DSL there were not many people using unattended downloads etc. so they are being blamed for the bad planning. The real problem is that they have to figure out how to explain to share holders that they just can't provide the triple-play and quadruple-play services they have been promising. At least not while all these GooTube and ESPN and Vonage people are using the network.

      Anyway, because of how business works, WiMax is doomed to fail. If it's being touted as a cure for any current ills, I guarantee that it will fail. That marketing speak is the same as the run up to the war with Iraq. All lies and falsely reported intel.

      If a large ISP were to slowly begin augmenting their network with WiMax where it makes sense, you can bet WiMax would take off slowly, but solidly. That's not what this looks like.

      • Re: (Score:3, Funny)

        Anyway, because of how business works, WiMax is doomed to fail. If it's being touted as a cure for any current ills, I guarantee that it will fail. That marketing speak is the same as the run up to the war with Iraq. All lies and falsely reported intel.
        Yeah. Just the other day I saw Colin Powell in an Intel Wi-Max commercial pushing the idea of mobile wi-max labs on trucks that would be almost impossible to find.
      • Re: (Score:3, Insightful)

        by raehl ( 609729 )

        You do realize that a half mile is pretty far, right?

        And what is the comparative cost of putting up a tower that covers every house within a half mile and running wires to every house within a half mile?

        WiMax infrastructure could very well be cheaper to provide than wired infrastructure.

        The real problem WiMax has is that the wired infrastructure is already there. They're 10 years too late.

        • Re: (Score:3, Interesting)

          by BKX ( 5066 )

          You must not live in the US. I have to go 1.5 miles just to leave my neighborhood. There's only 100 houses in it.

          • by Hucko ( 998827 )
            Heh, I'm Australian, I have to go 1.5 miles just to reach the next house on my block...
        • by ahfoo ( 223186 ) on Saturday June 21, 2008 @09:55AM (#23884451) Journal

          The Australian ISP that was whining about their deployment said they were expecting to get full strength at two kilometers and that's not even part of the spec for current generation customer premise equipment. Moreover, their VoIP problems were apparently aggravated by a shaky upstream connect at the ISP.

                WiMax is not really a homogenous entity, it's more like a collection of protocols that work at different service levels according to power requirements and distance and are totally different for the sending radios and the base stations. Overall it's a system that works out to seem like a homgenous entity but that's sort of an illusion because the gory details are reserved for the ISPs. But with the power levels that are going into current customer premise equipment there are technical reasons related to amplifier performance that limit the sending power of the field radios to about a kilometer for a full strength signal and the drop-off comes pretty fast as you go beyond that.

              Having said that, it's still completely true that this is no doubt much cheaper than any kind of wired infrastructure. Even if you had to put in a base station for a single user --which actually would not make sense-- you've got to compare that to the cost of a kilometer of wire and the cost of installing that wire.

          But, again, it wouldn't make sense to install WiMax for a single user because the base stations have a sort of minimum density of downstream clients to make them cost effective. You basically will only see WiMax in areas where there are at least fifty users in a kilometer sized circle. That will change when the amplifiers in the base stations can be increased in power but that will not happen for several years if it does happen at all.

          Still, the costs are minimal for an ISP and it does enable a new generation of small ISPs focused on remote local communities. It may not be a perfect solution for the remotest locations, but consider that you can use directional WiFi line-of-site for literally hundreds of miles as a feed into a small town and then cover the entire town with one or two WiMax base stations. If you allow users to set up their own directional WiFi with line-of-site to more remote locations you can extend that network at better than DSL upstream rates far into remote areas surrounding small towns at very low costs.

          Within cities, there's no reason WiMax shouldn't cost far less than DSL or cable. Wholesale bandwidth costs are like nothing compared to what ISPs are charging in the States.

      • I'm curious as to how you can claim that cable was incumbent but DSL had to roll out new stuff. The two technologies are essentially identical as far as required additional infrastructure. In both cases, the wires were already there but new equipment had to be installed at the user end and big expensive new equipment had to be installed at each central office at the provider end.

        • by mr_matticus ( 928346 ) on Saturday June 21, 2008 @12:21AM (#23882263)

          Well, one possible explanation is that DSL required replacement of older telephone wiring from junctions to homes. It required significant overhaul to main backbone lines in a large number of cities. It required new technology at each service office, and it was severely range-limited. Then, even after all of that, line filters were needed to be connected within homes to allow voice telephones to function at the same time.

          Cable, on the other hand, required new hardware at central offices, a fraction of the number required for DSL.

          Cable companies were able to provide broadband service to more customers while simultaneously spending less money (both per-subscriber and overall) and offering greater peak bandwidth. Cable was far more successful in suburbia, and it was cheaper to deploy in urban locales. Unfortunately, they squandered their infrastructure head start, and are now losing the scalability race. Comcast in the Bay Area just recently (finally!) launched a handful of sorely-missed HD channels, but they still don't have anywhere near the satellite offerings, and they're now triple-packing most of them, so the picture quality has decreased significantly, which previously was their advantage over satellite. The DSL providers and Verizon are both pumping out fiber and providing packet-based, rather than broadcast-based, television technology, and the cable companies are screwed--except that fiber deployment is slow and expensive.

          If the cable companies had any sense, they'd move their entire distribution method to On Demand, instead of pumping out all the channels, all the time, freeing up bandwidth for other services while they start replacing their infrastructure as well. The digital transition was a good opportunity for them to do just that, but they watched that pitch sail by, too.

          • Re: (Score:3, Informative)

            by grumling ( 94709 )

            Cable companies had a lot of upgrading to do before they could add high speed internet service. First, they had to upgrade the system to handle 2-way services. Then, they had to reduce the amount of coax between the headend and customer, otherwise troubleshooting would be next to impossible. Third, they had to increase their maintenance standards to keep ahead of problems. The system I worked in when @Home was new started out with 3 "line techs" and very quickly increased that number to 7 to keep up with th

    • by nchip ( 28683 ) on Saturday June 21, 2008 @05:28AM (#23883357) Homepage

      The posts like your make the mistake of assuming that 3G pricing has anything to do with the price of 3G basestation. Wimax basestation might be cheaper than a 3G basestation, but the backbone infrastructure costs are still similar.

      Now some wimax fanboy is going to jump in and claim that wimax infrastructure will be cheaper because you need less basestation. Which is, exactly what that Australian rollout tried to do, with disappointing results. For microwave based communications, if you want blanket coverage, you need dense network of basestations regardless of technology.

      High 3G pricing is purely due to lack of competition (or cartelling...), not technology. In some markets entrance of wimax competitors will bring competition and thus prices down.

      In .fi all operators offer unmetered 3G plans beginning from 9.9eur. Undercutting that with a wimax network will be hard.. Roaming abroad OTOH still remains ludicrously priced. I don't see wimax fixing that thou.

    • Depends on the country. In Britain, 3G internet plans are comparable in price to ADSL at around £15/month. It works out cheaper than ADSL if going 3G enables you to ditch your landline, and internet is the only reason many people have landlines these days.

  • 16e versus 16d (Score:5, Informative)

    by sg3000 ( 87992 ) * <> on Friday June 20, 2008 @10:25PM (#23881815)

    There are also questions about WiMAX's actual range following a messy Australian rollout, although the vendor there claims the Australian service provider under-provisioned the network."

    To provide some context here -- since they used Airspan's equipment, the Australian operator probably deployed the older variant of WiMAX, based on the IEEE 802.16-2004 standard (called 16d or Fixed WiMAX). The majority of the industry on the other hand has shifted to the newer 802.16e-2005 standard (mobile WiMAX). Fixed WiMAX is essentially a near line of sight technology, not intended for non line of sight or mobile applications.

    Mobile WiMAX uses a different physical layer than 16d, and it supports radio features to improve link robustness (such as convolutional turbo coding) and smart antenna technologies (2x2 MIMO to increase capacity and beam forming to increase cell range). In short, you can't gauge the performance of a mobile WiMAX network based on the results from a 16d network. The results I've seen in trials have matched radio propagation estimates fairly well, with the range being roughly what you see you traditional 2G/3G cellular -- 0.5 to 2 miles for non line of sight conditions. I've heard anecdotally of longer ranges of up to 30 miles for line of sight.

    The rest of the industry has been fairly pleased with the performance of WiMAX during trials and early market deployments. Consider the number of service providers spending capital dollars to deploy. The WiMAX Forum recently announced there are more than 300 service providers deploying WiMAX in 118 countries worldwide []. With Sprint's XOHM network going commercial later this year, we should have a better understanding of the benefits of WiMAX in a few months. The biggest concern I've heard of is the lack of devices today, but hopefully that will be alleviated late this year or early 2009.

    • Re: (Score:2, Insightful)

      by brinko99 ( 140880 )
      Yes, Mobile WiMAX (802.16e) will have a very difficult time competing with 3G. LTE is being rolled out on upgrades of the existing GSM-WCDMA infrastructure. The momentum of LTE is unstoppable.

      Now Fixed WiMAX (802.16d) is interesting. We're always complaining of the lack of competition at the last mile. Sure it's line of site but that only means a minimum of one tower in each 30 mile radius. The question is how many subscribers can each tower handle (sharing 75Mbps per channel). I know what you're
  • by Brett Glass ( 98525 ) on Friday June 20, 2008 @10:41PM (#23881875) Homepage
    Due to massive hype -- much of which is false -- by the WiMAX Consortium, much of the public doesn't understand one simple thing: WiMAX is just another kinda radio. One that's only slightly better than some of the other kinds. There's nothing particularly wonderful about it. But it does have one real drawback that doesn't really have to do with the nature of the standard itself. That is that it's intended and manufactured for use on licensed spectrum, which -- due to poor spectrum management policy -- is expensive and scarce. So scarce that even many of the big telecommunications providers failed to win it in recent auctions. And so expensive, due to speculation and pre-emptive bidding, that once you've bought the spectrum you're unlikely ever to break even on that investment no matter what kind of radio you use. So, WiMAX is at best slightly better than other kinds of radios and is tied to an impossible business model. WISPs that ignore WiMAX and use other technologies will do better.
    • by mr_matticus ( 928346 ) on Friday June 20, 2008 @10:56PM (#23881927)

      much of the public doesn't understand one simple thing: WiMAX is just another kinda radio.
      Every kind of wireless is just another kind of radio.

      But it does have one real drawback that doesn't really have to do with the nature of the standard itself. That is that it's intended and manufactured for use on licensed spectrum
      No long-range service can rely purely on unlicensed spectrum in most developed areas. All portions of the spectrum are expensive and scarce these days, and unlicensed spectrum is increasingly cluttered.

      WISPs that ignore WiMAX and use other technologies will do better.
      Such as? UMTS? How is that cheaper? "4G"? It doesn't exist yet. HiperMAN/WiBro? Those are just rebranded WiMAX variants.
    • So, I suppose the question of the day is- do you happen to know of a technology that operates in unlicensed spectra that provides nearly the same range, throughput, or scalability that WiMAX does?
      • by Dan541 ( 1032000 )

        Why not open an unlicensed WiMax spectrum?

        Do what we did with WiFi and let the people operate the hotspots

      • Re: (Score:3, Funny)

        by Brett Glass ( 98525 )
        Believe it or not, properly engineered 802.11a has the same or better range, throughput, and scalability.
        • I suppose I'd need to see that to believe it. WiMAX hits 4-5 miles with obstructions and 10 in a NLOS configuration. I've yet to see 802.11A hit 1000 yards. Do you have anything indicating the means by which that might be accomplished?
          • but here's the kicker. . . using nothing but an 18" satellite TV dish from a thrift store for six bucks and a Linksys router with an external antennae taped onto the feedhorn.

            Works just fine and I have hit base stations thirty miles away with full strength signals while I was getting it set up.

            So, you're misinformed about 802.11a. It's a microwave signal and it's as good as the gain of your antennae in line-of-site configuration.

            • 30 miles... I trust you'll forgive me if I say that that's hard to believe. Source, pictures, anything?
              • by ahfoo ( 223186 )

                Line of sight --look it up. If you are elevated on a mountainside on the coast with a nice view and you look way up the coast at another mountainside at the end of a long bay then, in my case, you are looking at a major military installation about thirty miles away. It's line-of-sight. If you can see it, you can connect to it with a microwave and an antennae. Basic concept, nothing fancy or newsworthy. Nice view, but not really newsworthy. As for how I know I'm hitting the base, well you can tell when you h

                • I hear you- but you still have to contend with being in unlicensed spectrum, which limits your peak gain. Those fancy shootout rigs get dispensations or sublease spectrum, as do the satellite rigs, and all are point to point. WiMAX is point to multipoint, and operates more efficiently inside of its spectrum allocation, thus allowing more total throughput and more total users. The range on WiMAX scales better than does 802.11a, requiring less power and lower gain for the same throughput, and in the real worl
                  • by ahfoo ( 223186 )

                    I don't know what point you're looking for. I think you're looking for someone to debate a point that isn't being made. My point was simply to explain what I'm using for an antennae and how far it goes and you doubted it worked but I'm using it and it works. That's the only point being made here.

                    You seem to be fishing for debate on the superior performance of 802.11a to WiMax. You'll have to go down the hall for that but keep trying and you might get lucky and find someone willing to give it a shot.

                    • Believe it or not, properly engineered 802.11a has the same or better range, throughput, and scalability.

                      That was the original post, to which I replied. I understand that any radio technology can, with unlimited gain and/or power, be delivered at any range. I still haven't seen anything indicating that 802.11a can match the range of WiMAX in their common application- point to multipoint- without breaking FCC regulations. Throughput is undisputedly WiFi's, but scalability goes to WiMAX without question. If that's what we're arguing, let's argue it out, if not, don't be a jackass.

                    • by ahfoo ( 223186 )

                      Well Dood, check it out: That's not my post you're quoting.

                      So why am I even replying?

                    • No idea; force of habit, perhaps? You pretty much jumped in on a point somebody else was making.
            • if you use specialised antennas it could be improved even more, BTW why is everyone thinkin' Wi-Fi phones, I think this was supposed to be a cheaper last-mile infrastucture. that geek-run ISP is getinnng closer i think.My $0.02.

          • There are dozens of commercial, FCC approved (not homebrew) 802.11a-based radios which work well at distances up to 40 miles.
  • by xt ( 225814 ) on Saturday June 21, 2008 @12:05AM (#23882173)

    I am typing this through a WiMAX connection in Greece, so let me clarify a couple of things...

    The technology itself is proven and works, both for data and VoIP. You do need to have a proper backbone though; it just doesn't scale to use WiMAX everywhere. A better idea is to use Ethernet microwave links for the backbone and WiMAX stations locally. If you couple this with a multiservice access node (MSAN) you can service remote areas that have local copper lines installed, but lack a proper backbone (eg fiber is too expensive to install and maintain in a mountain side). Right now, this is the killer application for this technology, as this is how it sells itself with most countrys' incumbent telecommunications providers.

    The range is just fine, we have tested successfully with distances up to 30Km. Mind you, this is line of sight, the first generation (called fixed WiMAX) is not very good in urban conditions, but for semi-urban and rural areas it performs as advertised. The second generation (called mobile WiMAX) is supposed to give as 2G penetration and coverage, but I have not played around with it yet. This is also supposed to be the killer application for the second generation; broadband everywhere, even on the go.

    The available spectrum is limited, but proper planning goes a long way. I can't get too specific, but in our trials we have been quite limited with spectrum with no real problems.

    I don't see prices to be dirt cheap though; licensed spectrum costs money. On the other hand, stations and terminals are getting cheaper all the time. I think that WiMAX services' cost will follow the same general trend; slightly more expensive that the equivalent fixed line broadband at first, getting cheaper as it catches on.

  • by Sarusa ( 104047 ) on Saturday June 21, 2008 @02:10AM (#23882737)

    I work for a wireless company, developing WiMax and WiFi. It's pretty hard to beat the raw speed we can get out of 802.11 (WiFi), and we can stretch WiFi to fairly long distances as we can with WiMax.

    However, WiMax has one huge advantage for system design - because transfers are a mix of scheduled and free-for-all instead of only free-for-all like WiFi, you can actually guarantee service. You can lock clients down to a fixed bandwidth _without_ letting them flood the channel, or you can guarantee minimum throughput, and you can classify packets into multiple service flows at the protocol level (prioritizing ACKs as an example). WiFi has 4 levels of service with WME, but the client gets to decide and can lie for advantage.

    With WiFi you can throttle flows at the gateway, but you can't stop some greedy dick from completely swamping the channel. With WiMax you can throttle at the client. Some of you are obviously going to think that's a bad thing, but if we want to set up a public deployment we really need to be able to make sure that someone torrenting with 512 connections open isn't going to knock everyone else off the air and make it unusable for everyone. WiMax does a far superior job to WiFi of sharing the bandwidth so more total clients get at least a reasonable amount of throughput even if one greedy S.O.B. _really_ wants to eat up the entire channel and then more. And this is the assurance provisioners need when deciding they're going to offer the service.

    I don't know about Intel's claims, but you are certainly able to guarantee a better experience with WiMax than you are with WiFi as long as your product doesn't suck.

    To be fair, a major WiMax disadvantage is that there's really no equivalent of mesh networks. It's all server/client, no useful ad-hoc like WiFi has. You can simulate it with each node having a server and a client, but they're very asymmetrical, so it's currently pretty wasteful to do so.

  • >Home Broadband (WiMAX)â¦â¦â¦â¦â¦â¦â¦â¦.Included >Cell Phone Service (WiMAX Mobile VoIP) â¦â¦Included >Home phone service (WiMAX VoIP) â¦â¦â¦â¦..Included >Mobile Broadband (Mobile WiMAX)â¦â¦â¦â¦â¦Included This might work for singles but for people with families or just girlfriends all that cant be in one dev
  • We already use WiMAX at work (and have been for over a year). WiMAX is only available here because the monopoly telco charges so much for leased lines (five times the going rate elsewhere. Yes, five times) that it was economical for a firm to start up and offer WiMAX business class internet service.

    It's been every bit as reliable as the equivalent wired service. However, we aren't using cheap 'consumer grade' kit to connect, we have a fairly expensive and solid transceiver mounted very solidly to the wall o

  • I have to think that Big Telco is going to charge a premium rather then discount you. Don't even think for a second the FCC is going to let small telco pop towers down. Unless then have 10 billion to whip out their wallets. This means you still have to rely on the old providers like Sprint with their WiMax project to get the data to you. If you think they are going to price this service CHEAPER then their line service, you may want to think about quitting the pipe.

    I see base WiMax starting at 69.99 (for l
    • You can guess all you like, but there is plenty of information out there that you can also use to inform yourself. Your guess misses the point that WiMax is inherently symmetrical service. The reason for this is that the limit on the service is not in the ISPs sending radio but in the customer premise equipment (CPE) and the amplifiers in these little customer owned boxes are the limiting factor. However, within a kilometer they're rated at least 10mpbs upstream. That's a completely different game than DSL

    • AFAIK, Sprint and Clearwire and other WiMax wannabees are providing an alternative to cable and DSL and also cellphones. Sprint doesn't care about undercutting DSL prices, because they don't really do that anyway, (at least in most markets)?
  • Maximum information rate is bandwidth times the log2 of (1+signal/noise).

    Signal/noise ratio is mainly determined by things like the type and number of antennas and how you use them (to do beamforming, etc).

    Bandwidth is a fixed quantity, you can only get so much from the government.

    So given that with modern 3G protocols, we get pretty close to the Shannon limit for a given antenna technology, how are huge gains available by switching to WiMAX? They can get big bandwidths for a single user by eating u

  • The problem with WiMAX IMO is nothing really to do with the technology on a technical level, as it actually uses the same modulation scheme as LTE, but rather with the WiMAX Consortium. The WiMAX Consortium has set things up so that only a couple large companies make the money. This goes all the way down to the device testing side. Here, you have AT4 wireless in Spain whom the manufactures like R&S must GIVE equipment to "validate". We are talking more than 1 million for a WiMAX RF test system. Lots of

Loose bits sink chips.