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Posted by: Kenji Hall on June 08, 2009
Intel is betting big on a Japanese company that will soon launch the world’s fastest wireless broadband services using WiMax technology. On June 7, Intel Capital said it plans to invest $43 million in Tokyo-based UQ Communications, which also has financial backing from Japan’s second-largest wireless operator, KDDI.
In recent months, UQ Communications has been building a network of WiMax transmitters in Tokyo and neighboring cities of Kawasaki and Yokohama and aims to reach 90% of Japan’s population by 2012. Today, UQ and KDDI formally announced plans to start offering WiMax services to businesses from July 1.
The promise of WiMax isn’t that it offers another phone network for voice calls. Rather the network is expected to let make wireless e-mail and Internet-surfing available from more places. WiMax resembles Wi-Fi but WiMax can reach up to 30 miles compared to Wi-Fi’s far more limited range of a few hundred of feet. That means anyone with a laptop computer or other portable gizmo that comes with WiMax technology can tap into the Net wirelessly over a zippy wireless network without a Wi-Fi router or a cable connection. (Calls made over online telephony outfits such as Skype are possible but it’s still unclear whether UQ and other WiMax service providers will try to steer users to their own packaged services.)
UQ enters Japan’s market for wireless data-transmission services as manufacturers unleash an array of wireless gizmos: everything from touch-screen mobile phones resembling Apple’s iPhone to netbooks which are smaller than laptops but can tap cellular networks to do e-mail and Web searches. UQ Communications applied 18 months ago for a license to offer WiMax services.
The company won’t have the WiMax sector all to itself. Japan’s number one wireless carrier, NTT DoCoMo, will begin offering similar services—albeit at much slower speeds than UQ’s--in the coming months. UQ will also have to compete against a crop of other companies known as mobile virtual network operators, or MVNOs, that lease the major cellular networks to offer tailored data and voice services targeting specific kinds of users.
The first WiMax-enabled gizmos will be laptops. Three manufacturers--Toshiba, Panasonic and Onkyo—showed off laptops today that will run on Intel chips with WiMax capability when UQ’s services start. WiMax download speeds in Japan will be as fast as 40 Mbps, comparable to Wi-Fi connections already in use and faster than broadband Internet connections over a land-based line in most other countries. (Upload speeds are slower at 10 Mbps.)
Besides Intel and KDDI, other big-name supporters are behind UQ: Kyocera, railway operator JR East, Tokyo Mitsubishi Bank and Daiwa Securities. That should help in landing deals with businesses and perhaps even give UQ a chance to test new services in conjuction with JR East, which runs commuter and bullet trains from Tokyo to major Japanese cities.
BusinessWeek’s team of Asia reporters brings you the latest insights on business, politics, technology and culture from some of the world’s biggest and fastest-growing economies. Eye on Asia’s bloggers include Asia regional editor Bruce Einhorn, Tokyo reporter Ian Rowley, Korea bureau chief Moon Ihlwan, Asia News Editor and China Bureau Chief. Dexter Roberts, and Hong Kong-based Asia correspondent Frederik Balfour.