Sprint Confirms WiMAX Tests on Schedule

Sprint Nextel has hired a new CEO and confirmed that it plans to begin field-testing its Xohm-brand WiMAX network within the next two weeks. Several hundred Sprint employees in the test markets – Chicago and Washington, DC/Baltimore will get WiMAX adapter cards for PCs in phase one. A second-test stage will add more employees in the first quarter.

A commercial rollout is expected in the last half of 2008 and will include devices that have WiMAX embedded in them. Intel is not expected to have its WiMAX/Wi-Fi chipsets ready for shipment until sometime in the second quarter of 2008.

New Man at the Helm
This week Sprint Nextel hired Dan Hesse as its new president and CEO. He replaces Gary Forsee, who resigned under stockholder pressure in October. Hesse has been chairman, president and CEO of the wireline phone company Embarq since it was spun out of Sprint in 2006. He worked for AT&T for 23 years, including a stint as president and CEO of AT&T Wireless Services from 1997 to 2000.

Sprint and Hesse face financial and operational problems. Its 2005 merger with Nextel resulted in the continuing loss of subscribers. It decision to bet the house on WiMAX has been questioned because WiMAX as a mobile phone service is still an unproven technology. The turmoil caused Sprint’s deal with Clearwire to build a compatible but not overlapping national WiMAX network to fall through. There are those that predict the deal will be resuscitated in late 2008, once Sprint’s plans are in place – such as whether to spin out the Xohm WiMAX operation or to bring a deep-pocketed company or companies in as partners. Intel, Samsung, Motorola and Google have vested interests in seeing the Xohm effort succeed.

Compatibility Testing & Certification of WiMAX Mobile Devices Starts

It is certain that mobile devices with WiMAX built-in will begin coming to market in 2008.

The WiMAX Forum this week opened its lead certification lab for formal Mobile WiMAX certification testing and evaluation of Mobile WiMAX products. WiMAX Forum vendors may begin immediately submitting their 2.3 GHz and 2.5 GHz Mobile WiMAX equipment for testing.

The WiMAX Forum’s lead certification lab is headquartered at AT4 Wireless in Spain. The Forum expects its four other certification labs in the US, Taiwan, China and Korea to open for formal Mobile WiMAX certification testing shortly.

The organization said certified Mobile WiMAX products are projected to reach the commercial market in early 2008. It expects hundreds of products to be submitted for testing.

“This important milestone in our WiMAX Forum certification program culminates years of development of our certification process and signifies the success of the WiMAX ecosystem’s progress and market lead relative to alternative mobile broadband technologies such as LTE which are several years behind WiMAX technology,” said Ron Resnick, president, WiMAX Forum. “The beginning of Mobile WiMAX certification enables our member companies to deliver on their business commitments, and ultimately moves WiMAX service providers closer to bringing the mobile broadband Internet experience and new applications to consumers around the globe next year.”

Equipment that passes conformance and interoperability testing will receive the WiMAX Forum Certified designation, thus, assuring service providers that when buying equipment from more than one company the products are interoperable.

“Certification facilitates Xohm’s model for open access,” said Barry West, president of Sprint’s Xohm Business Unit. The move, he said, would “encourage device innovation in anticipation of Sprint’s WiMAX network launch in the US.”

Throughout 2008, service providers are expected to expand current Mobile WiMAX deployments to broader populations in their regions. The WiMAX Forum currently estimates that more than 300 operators in over 65 countries have deployed Mobile WiMAX pilots and trials.

“In Korea, WiMAX technology is the cornerstone of our mobile broadband deployment because of its vast and thriving ecosystem of equipment and solution providers that share our commitment to address the needs of the Korean market and redefine the mobile broadband experience for Korean businesses and citizens,” said Hyun Pyo Kim, director of WiBro planning for Korea Telecom. “Today, with more than 100,000 active Mobile WiMAX users and 410,000 subscribers projected for 2008, the availability of WiMAX Forum Certified mobile equipment will enable us to significantly expand our customer base and mobile broadband service offerings.”

Based on the proliferation of certified equipment, the WiMAX Forum will conduct additional product interoperability activities for new Mobile WiMAX profiles and features, such as testing for the planned certification for 3.5 GHz and 700 MHz profiles and core network certification through Mobile WiMAX PlugFests in 2008.

Beceem’s Mobile WiMAX Chips Test Out

Beceem, which is developing WiMAX chips for mobile devices, has finished its initial interoperability testing with Sprint’s WiMAX infrastructure.

266 Companies Apply to Bid on Wireless Spectrum

– AT&T, Google, Verizon Wireless Head the List
– 4 with Pay-TV Connections

Barron’s reports that the FCC has received applications from 266 potential bidders in the upcoming 700 MHz spectrum auction. Among the more prominent and recognizable are:

– Advance/Newhouse*, owner of the Florida-based Bright House cable TV service

– Alltel, privately owned by TPG and Goldman Sachs

– AT&T Mobility Spectrum

– Cablevision bidding as CSC Spectrum Holdings

– CenturyTel Broadband Wireless

– Chevron

– Cincinnati Bell Wireless

– Cox Wireless*

– EchoStar under the name Frontier Wireless

– Google Airwaves

– Iowa Telecommunications Services

– MetroPCS 700 MHz LLC

– National Datacast, 88.6% controlled by PBS Enterprises, a for-profit operation of the not-for-profit Public Broadcasting System and 10% owned by Gemstar-TV Guide

– Qualcomm, which operates the MediaFLO mobile TV service that Verizon Wireless sells as V CAST Mobile TV and which AT&T has said it will soon start selling.

– Towerstream, which sells WiMAX to businesses

– Verizon Wireless, bidding as Cellco Partnership, of which Verizon Communications owns 55% and Vodafone the other 45%

– Vulcan Spectrum, one of Paul Allen’s many Vulcan investment vehicles. Allen is also the majority shareholder in the US cableco Charter Communications.

Sprint Nextel previously said it would not bid.

* Cox and Advance/Newhouse are two of the four cablecos (the other two being Comcast and Time Warner Cable) that are involved in a joint venture with Sprint called Pivot, which is intended to let the cablecos sell mobile service in competition with AT&T Mobility, Verizon Wireless and other US cellcos.

Two other pay TV services – Cablevision and EchoStar – also applied to bid. The cablecos need a mobile phone service to sell so they can more effectively compete with Verizon, which has promised to “blend” the Verizon Wireless service into its bundles, and AT&T. EchoStar needs desperately a broadband service, as does DirecTV, to compete with the cablecos and telcos.

The winning bid will be determined by who has the most money and the most to win or lose. On that count, Google, AT&T and Verizon would seem to be the favorites.

Intel Takes WiMAX to Russia with Comstar

Intel continued to show its worldwide interest in all things WiMAX by partnering up with Russian outfit Comstar to build a citywide WiMAX network, and then expand to other cities in Russia. The network is scheduled to launch by the end of 2008. It will allow access to users of laptops and mobile devices that have embedded Intel’s WiMAX/Wi-Fi chipsets. Intel is helping fund WiMAX deployment in high growth markets in Asia and Latin America plus Clearwire in the States and Pipex Wireless in the UK. Anyone think Intel and Google aren’t very, very interested in seeing the Xohm WiMAX network that Sprint is building succeed?

WiMAX to Hit Stride in 2013

It’ll take a couple of years before mobile WiMAX will begin to take off, according to a Juniper Research report, which says there’ll be over 80 million WiMAX subscribers globally by 2013.

“Mobile WiMAX will represent a single-digit proportion of the global mobile broadband base by 2013. This will be a tremendous achievement for this new technology platform,” said Howard Wilcox, the report’s author. He said the largest WiMAX markets will be the US, Japan and South Korea.

Cisco: WiMAX to Drive Broadband Penetration

“WiMAX for Cisco is not just about selling WiMAX radios but about driving broadband penetration and about our ability to deliver a set of services across all devices, all access technologies and across all market segments,” said Brett Galloway, general manager of Ciscowireless networking business unit in explaining the company’s pending acquisition of Navini Networks to analysts, as reported in Wireless Watch. Galloway positioned Cisco’s WiMAX push as a way to enhance the existing Cisco next-generation network initiatives and accelerate the spread of broadband, which then drives Cisco’s broader portfolio of products.

Wireless Watch says that all vendors of mobile networking gear know that in countries where there is limited wireline build-out, GSM will often be the primary communications network, paving the way for wireless networks and devices to be the main basis of both broadband and voice services, as well as broadcast TV and radio. So the stakes are far higher than in the traditional broadband wireless market in underserved areas, though the initial Cisco/Navini contracts may look very similar to those from the proprietary days, with the focus on fixed and nomadic, rather than wide area mobile, access, and on relatively localized operators. Over time, though, it is clear that Cisco’s ambitions will be far larger, and it will aim to stake its claim in the mobile broadband market of the next decade by planting small acorns in key territories in this one.

New Captain on Deck at Sony Ericsson

In a Wireless Watch report on a new CEO taking over Sony Ericsson, Caroline Gabriel says: Sony Ericsson’s new man, 64-year-old Hideki Komiyama, has a hard act to follow, taking the reins from Miles Flint last month.

Like Nokia, Flint focused on branding, and made Sony Ericsson the most successful handset maker on this front by leveraging the Sony Walkman and Cybershot tags. His successor aims to make even greater capital out of those brands, and possibly also Sony’s PlayStation Portable (PSP) gaming device, while also copying Nokia’s shift into multimedia Web services.

Komiyama, a Sony veteran, faces “a daunting challenge,” as consultancy CCS Insight puts it. The area of the market where the company has thrived – multimedia smartphones – is now one of the most competitive, and the move to low-end models remains high risk for a company that, despite its 35% increase in earnings in the first three quarters of this year, cannot leverage the economies of scale or the efficiencies of Nokia.

Komiyama’s initial decisions will focus around software and services, as he bids for an influential position in the evolution of mobile Internet platforms. The Web services strategy has been launched around the PlayNow music system, and will make strong use of the Sony brands, but needs further refining in functionality if it is to compete with Nokia Ovi. The new CEO will also need to streamline the operating system policy – it uses Symbian OS in only 18% of phones, in contrast with Nokia’s 53%, which gives the latter an advantage in efficiency, developer support and time to market. However, Sony Ericsson also needs to make decisions about what to do about Linux and other emerging factors like Google Android, while also chasing a more prominent position for its UIQ user interface, which it shares in a joint venture with Motorola, and which needs to be more aggressively enhanced and marketed to operators and licensees, if it is to make an impact on the ambitions of Nokia Series 60 to be a de facto standard.

Nokia Accelerates Change of Pace in Mobile Industry

– Bridges the Divide between Mobility and Internet
– New Music Service to Make Applesauce of iTunes

After the unfolding of Nokia World 2007, held this week in Amsterdam, it’s apparent that the Finnish handset maker is prepping to become a key player in the overall mobile market. “Consider all the new words that became part of the industry lexicon in the past 12 months: N95, iPhone, Android, Ovi. They are words that represent new directions and new competition in our industry, which is ultimately great for the consumer,” said Nokia president and CEO Olli-Pekka Kallasvuo in his keynote to a crowd of approximately 2,700. “We are at the dawn of a new era in mobile communications driven by the rapid convergence of the Internet and mobility, and Nokia is setting the pace of change.”

The conference featured a host of announcements that included the introduction of its new Comes with Music service, the expansion of additional services for its Ovi portal, the launching of the eco-friendly Evolve handset and a partnership with Telecom Italia. Overall, the event served as a means for Nokia to announce its vision for the mobile industry – and to warn those companies who stand in its peripheral vision.

Comes with Music Hopes to Make Applesauce of iTunes
At the event, Nokia launched Comes with Music, an app that offers a selection of unlimited music for a year from a variety of current and past artists. Comes with Music is pre-loaded onto newly purchased devices and is a result of a partnership with Universal Music Group International, Nokia is currently in talks with the remaining major labels about getting them to participate. After the 12-month period expires, users can opt to purchase a subscription to the service. Interestingly, and unlike any other subscription service, listeners can still keep the tracks that they’ve downloaded regardless of whether or not they pay for the service.

“We set out to create the music experience that people are telling us they are looking for – all the music they want in the form of unlimited downloads to their mobile device and PC. Even if you listened to music 24 hours a day, seven days a week, you would still only scratch the surface of the music that we’re making available,” said Anssi Vanjoki, executive VP and general manager of multimedia for Nokia. “Comes with Music fulfils our dream to give consumers all the music they want, wherever they want it, while rewarding the artists who create it.”

Additionally, Nokia will expand its Ovi portal to PCs and the Internet. Previously, Ovi’s features, which include music access, games, social networking, content sharing and mapping, were only accessible through an on-device WAP portal. Now, users will be able to access Ovi through personalized mobile and PC Web-based portals, or “dashboards,” which will offer integrated access features like contact list synchronization.

Mike Grant, head of broadband and media at telecommunications research company Analysis Mason Group and a conference attendee, said the implications of Nokia’s launchings are extremely important to operators. “Should Nokia successfully execute these developments and attract even a small proportion of their current one billion customers to this service, both operators and other OEMs will have a mountain to climb to offer the same compelling proposition. Nokia is laying down the gauntlet, saying effectively that Apple have got it right, and they intend to compete for consumer loyalty across mobile, PC and the Internet. Moreover, while Apple have a strong presence in the US, Nokia’s global market reach and scale make it a powerful competitor to all in this space,” said Grant.

Partnering with Carriers
Nokia also announced that it will be partnering with Telecom Italia to provide mobile services to customers by enabling Ovi and additional Telecom Italia services on select Nokia handsets. Nokia’s N95 8GB and N81 will be the first models whose menus will be customized to provide access to both services. “Ease of use has always been at heart of Nokia devices and this collaboration is an important step in creating the same for Internet services,” said Jyrki Salminen, senior VP of Nokia multimedia. “Nokia devices and services are based on open standards making it easy for us to work with forward thinking operators such as Telecom Italia to provide consumers with a choice about which internet services they want to access from their mobile device.”

Last month, Nokia and Vodafone collaborated to integrate a number of Vodafone’s Internet and software services with Nokia’s Ovi portal. According to Faultline, the Telecom Italia deal and a previous partnership with Vodafone Italy enable Nokia to access more than 80% of the Italian market as well as significant sections of Western Europe.

Bridging the Mobility-Internet Divide
The event also announced the acquisition of Avvenu, a US-based start-up whose services let consumers access and share files stored on their PC on their handset over the Internet.

Finally, Nokia addressed its commitment to environmental issues by launching the Evolve 3110, a candybar-style handset composed of bio-covers made from approximately 50% renewable materials. The device’s energy-efficient charger uses 94% less energy than the Energy Star requirements and comes in a small, 60% recycled content package.

Overall, companies like Apple need to heed Nokia’s battle cry to the mobile industry. Even though Apple has seen success with its products like iTunes and the iPhone, customers still aren’t completely satisfied with their overall mobile experience, one which Nokia hopes to rectify – and take some additional mindshare away from Apple while it’s at it. “Nokia has stepped out ahead of the rest of the industry in bridging the divide between mobility and the Internet. Successful execution appears to be their one remaining challenge,” said Analysis Mason’s Grant. “We shall watch the company’s progress in 2008 with interest.”

Verizon Wireless to Support Google’s Android

– An Open Access Cellular Network Followed by Selection of LTE for High-speed Wireless Broadband
– Integration of FiOS and LTE: Wireless Meets Wireline
– Verizon Could Offer Seamless High-speed Wired & Wireless Broadband Services

Last week Verizon Wireless said it would open its network to third-party devices and Internet applications and services. Then it said it would begin testing a wireless networking technology called LTE next year that will directly compete with WiMAX. This week the cellco said it will support devices that use Google’s new Linux-based Android operating system on its current and future cellular network.

Verizon Wireless, 55% owned by Verizon, is the second-largest US mobile phone service in market share, barely trailing AT&T, and is the most profitable. It is the largest mobile phone service to publicly promise support for Android. Adding to Verizon Wireless’ clout is that Vodafone, the world’s largest mobile phone operator by revenue, owns the other 45%.

Android competes directly with operating systems for mobile devices such as Microsoft’s Windows Mobile, Nokia-backed Symbian, Palm and several Linux-based operating systems. Apple in its iPhones and RIM in its BlackBerries use proprietary operating systems that they developed, own and control. Apple recently promised to open up its iPhone operating system to third-party developers.

Google promised that any mobile device maker can use Android for free as long as the general rules of open source software are followed, such as making improvements available to other developers for free.

Verizon Wireless CEO Lowell McAdam told BusinessWeek that once the company decided to open access to its cellular network, it made sense to support Android. “We’re planning on using Android,” McAdam said in the magazine. “Android is an enabler of what we do.”

Despite Verizon Wireless’ promises, there is still doubt in the industry as to how much the company is really opening its network. One reason for the doubt could be that the company has been among the most restrictive, the most closed to third-party devices, by creating a walled garden around the sites that its subscribers could access. Its transition from closed access to open access is as remarkable as mankind’s transition from a constant and continuous hunt for food and warmth to, seemingly, full-time search for media.

Two events may have prompted Verizon Wireless’ moves. One is Apple’s announcement that it will open the iPhone to third-party developers. That’s particularly alarming considering how much success Verizon Wireless rival AT&T has had selling iPhones. Then there’s Google’s statement that in January it will bid on spectrum that can be used to build a wireless network. Whether Google would build and operate its own network or farm it out to a more experienced wireless network operator remains to be seen. Verizon Wireless may think that by making its cellular network open and supporting Android that Google will have less incentive to build its own wireless network.

There’s also the threat from WiMAX technology, which Sprint is using to build an open access network that will provide subscribers access to any and every Web site and online service plus allow any WiMAX-certified device to connect.

One difference between the Sprint and Verizon Wireless approaches is that WiMAX gear will be certified by an industry group that Sprint does not control, but Verizon Wireless will certify devices in a $20 million certifications lab that it’s building and will control. In a world of level playing fields, Verizon Wireless would turn its testing over to an industry body or contract it out to an independent lab.

BusinessWeek reported that Verizon Wireless has spent upwards of a year considering and planning its move to open access. The magazine said McAdam held numerous meetings with the chairman of the FCC and many late night sessions with top executives at Verizon and Vodafone.

Reportedly, McAdam kept with him at all times a well-worn piece of paper that listed seven bullet points that defines what an open-access policy would mean to Verizon Wireless. BusinessWeek said that Verizon Wireless decided that moving to an open access network would allow it to continue growing but hold costs down. One of its biggest costs is customer support. Verizon Wireless operates 25 call centers, each of which has about 1,000 employees. Additionally, 20,000 employees in its 2,300 stores are estimated to spend only about 10% of their time signing up new subscribers. The other 90% is spent assisting existing customers with such things as technical support and billing issues. The magazine quotes McAdam as saying that the current business model is not sustainable. “If we get to 150 million customers, boy, that’s a lot of overhead,” he said.

Open Access
When most people think of open access, if they think of it at all, they think about what they have at the office and at home – the ability to use any PC or other device that can connect to the Net and the ability to access any and every Web site and run any and every Web-based service (like search) or software (like instant messaging). The mobile phone companies have by and large prevented that from happening with their cellular networks.

There are downsides to open access networks. If there’s a problem, consumers have to call the device maker. The broadband service only has to verify that there’s live broadband at the router but doesn’t have to check to see if the devices that are connected to it are functioning properly. Verizon Wireless’ plan for its open access approach means that it will only confirm that an open access device can connect to its network, not that every feature on the device works or that every third-party application and service is working.

The device makers will have to spend the money to support their products, not Verizon Wireless.

Verizon Wireless will test each model of a mobile device before it certifies the device for use on its network. Beyond that, McAdam said its subscribers would “have to talk to their handset provider or their application provider if they have particular issues.”

Another major difference between Sprint’s planned WiMAX network and Verizon Wireless’ current approach is that Verizon Wireless subsidizes every handset that it sells so that the user pays in many cases less than what Verizon Wireless paid for the handset. The company said it does not intend to subsidize open access devices. This would give it the benefit of having thousands of devices with wide variances of capabilities available for use on its network – without the burden of testing, inventorying and subsidizing them. That, plus the reduction in its customer support operations, could be worth billions.

Wireless Meets Wireline as LTE Connects to FiOS
There’s another major piece in the remaking of Verizon Wireless that involves its adoption, at least for testing purposes, of LTE (Long Term Evolution) as its future network technology – the so-called 4G network that would be the equivalent in speed and access of what consumers now have in their wireline broadband at home.

Verizon Communications is considering integrating LTE into its fiber-optic based FiOS network. According to Verizon CTO Dick Lynch, LTE offers speeds fast enough that Verizon could offer on Verizon Wireless’ network what had previously been only available over wireline broadband.

“We don’t expect people are going to download [high-definition] video over the LTE network, but there will be other services that tightly integrate with FiOS,” Lynch said. “This is a Verizon ‘big picture’ decision. One of the reasons I made the move from Verizon Wireless to Verizon is because there is this belief that the future is about the converged network.”

Vodafone and Verizon Wireless won’t begin testing LTE until late 2008, with a full-blown rollout not expected until the 2010 to 2012 time frame. Sprint says it’s on schedule to begin testing its WiMAX network by year-end (only a few weeks away) in the Chicago and Washington, DC-Baltimore areas.

Verizon’s LTE announcement, according to Lynch, is not a sign of an immediate launch, only a signal to device makers of where Verizon and Verizon Wireless are headed.

“4G is not about voice services,” Lynch said. “It’s not about ‘light’ broadband services. It’s about high-speed IP data services.” He expects hundreds of consumer electronics makers to develop a variety of devices that offer different functions. By announcing now, Lynch said, the telco is enabling the device and network gear makers to develop future products to a specific standard, one that they know Verizon, Verizon Wireless and Vodafone will support.

It’s much the same strategy that Samsung, Intel, Motorola, Google, Sprint and others have used to make WiMAX the world’s most-awaited mobile network.

Nortel, Alcatel-Lucent, Ericsson and Nokia Siemens are expected to be the big winners to supply LTE network gear to Verizon and Vodafone.