Global Economics

Malaysia's Stalled WiMax Rollout


Despite the hype, the wireless broadband technology will not go mainstream until 2009, says a local operator

Michael Lai, CEO of PacketONE International, said there is still some way to go before mobile WiMax can be seen as a mainstream offering.

"We believe next year will be the start of the WiMax era [for Malaysia], but the true year for [mobile] WiMax [to grow] will be in 2009, or at the very latest 2010," Lai told ZDNet Asia in a recent interview. "This is when devices embedded with WiMax will be readily available."

The Malaysian Communications and Multimedia Commission (MCMC) in March 2007 awarded WiMax licenses to four lower-tier telcos--including PacketONE--which have until the end of the year to roll out their services to designated areas.

PacketONE has started conducting WiMax technical trials, Lai said, and while the results have been "a pleasant experience," he acknowledged that "things are not there yet".

Lai conceded that it is only when WiMax is readily supported in handheld devices as common as the mobile phone is today, that the technology will spur true ubiquitous mobile broadband in Malaysia.

This, he said, would likely happen next year or 2009, when WiMax chipsets become widely available as prices fall to about US$100.

The MCMC had said in March it expects license holders to roll out WiMax services to 25 percent of the population by end-2007, with a service provision of "at least 1Mbps at affordable rates".

Eight months have passed, however, and all of the licensees have yet to roll out their services and are currently still conducting trials to evaluate the technology.

Krishna Baidya, industry analyst with Frost & Sullivan, said WiMax rollouts in Malaysia are only expected to commence toward the second half of next year.

According to Krishna, these initiatives are not expected to make any significant impact on the country's wireless space, or pose an immediate threat to incumbent broadband providers.

Why the delay?

Industry sources familiar with several WiMax trials taking place in the city have attributed the delay partly to technical issues related to the wireless technology. Some have laid claims that the extent of its provision for speed and coverage, may not be as promising as advertised by WiMax gear makers.

"Based on some of the trials I've seen, achieving speeds in excess of 1Mbps while on the move in real network deployment is not a reality yet," said one senior engineer familiar with the trials, who spoke to ZDNet Asia on the condition of anonymity.

"Also, it's hard for WiMax signals to penetrate buildings due to its high operating frequency between 2.3GHz and 2.5GHz. This signal loss could result in problems for the operators [in terms of providing seamless coverage]."

Asked if PacketONE have experienced such issues, Lai said: "On a small-scale trial, it's been proven that we can attain speeds of 1Mbps. We believe that since the frequency of WiMax is close to that of 3G, we can attain whatever speeds 3G is capable of.

"As to the indoor penetration problems, no one can deny that there are challenges... The nature of physics dictates that the higher the frequency, the poorer the penetration," he said. "But, for PacketONE, it's a question of how we can best address these issues along with our vendors, which are working on technologies such as smart antenna and beam penetration, to help ease these challenges."

Despite these issues, Lai revealed that the operator is still on target to launch its WiMax service to the public by the second quarter of next year. It also plans to reach 25 percent of the population by end-2008, he added.

PacketONE will extend its trial to include members of the public early next year, Lai said, noting that the operator will be "ready to launch commercially" by mid-2008.

According to Frost & Sullivan's Krishna, the rate of WiMax adoption in Malaysia will be determined by performance, availability and pricing.

"Besides that, operators will also have to contend with the lack of affordable WiMax user devices and issues, such as device battery life and processing power, before they can hit the mass market," he said.

Ray Owen, Southeast Asia head of technology at Motorola Home and Networks Mobility, said: "We believe by using an IT-based standard such as WiMax, and leveraging on the IEEE standards for Wi-Fi and Ethernet, WiMax will offer an attractive consumer pricing proposition as well as a DSL-like experience."

According to Motorola, which has been testing WiMax, the technology averages at speeds of between 3Mbps and 4Mbps, with cell radii of 1km to 2km for indoor devices in dense urban environments.

Provided by ZDNet Asia—Where Technology Means Business

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