Just how far can WiMAX go?

Last month's WiMAX World conference further raised the profile of a technology that's gotten a lot of attention for years, despite the fact that the standards are only now starting to gel. WiMAX is seen as a kind of broadband for the masses, a form of fixed wireless that will break the monopoly of wireline broadband players. Municipalities are looking to WiMAX as the basis for their own broadband infrastructure, companies see it as a campus strategy and vendors of portable device see it as the driver for future markets.

Not all these hopes are realistic, but the truth may in some ways be more exciting than the fiction. WiMAX is a form of wireless technology that combines fixed and mobile/portable support, making it a functional replacement (in theory) for pretty much any other kind of broadband, from DSL to 3G. In practice, WiMAX has some limitations that make it unlikely to replace other technologies at the fixed and mobile ends of the market spectrum.

The standard form of WiMAX is limited to about 50Mbps, which is fine for providing a population of users with Internet access but too slow for content delivery. AT&T's U-verse offers about 25Mbps per subscriber, and in WiMAX hundreds or thousands could share only twice that speed. In the mobile space, WiMAX standards might work up to perhaps the speed of a car in suburban traffic, but freeway speeds? No way - expectations based on the wireline- or 3G-substitute extreme could lead to credibility problems for WiMAX.

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Last month's WiMAX World conference further raised the profile of a technology that's gotten a lot of attention for years, despite the fact that the standards are only now starting to gel. WiMAX is seen as a kind of broadband for the masses, a form of fixed wireless that will break the monopoly of wireline broadband players. Municipalities are looking to WiMAX as the basis for their own broadband infrastructure, companies see it as a campus strategy and vendors of portable device see it as the driver for future markets.

Not all these hopes are realistic, but the truth may in some ways be more exciting than the fiction. WiMAX is a form of wireless technology that combines fixed and mobile/portable support, making it a functional replacement (in theory) for pretty much any other kind of broadband, from DSL to 3G. In practice, WiMAX has some limitations that make it unlikely to replace other technologies at the fixed and mobile ends of the market spectrum.

The standard form of WiMAX is limited to about 50Mbps, which is fine for providing a population of users with Internet access but too slow for content delivery. AT&T's U-verse offers about 25Mbps per subscriber, and in WiMAX hundreds or thousands could share only twice that speed. In the mobile space, WiMAX standards might work up to perhaps the speed of a car in suburban traffic, but freeway speeds? No way - expectations based on the wireline- or 3G-substitute extreme could lead to credibility problems for WiMAX.

So what might WiMAX be good for? One answer may be the hot-spot market, which some estimate at about $1 billion per year worldwide. Wi-Fi has been suitable for hotel, airport and café wireless, but WiMAX could offer more reliable service and has lower power requirements, enabling longer battery use. These subtle advantages probably wouldn't be enough were it not for a key trend: walk-band appliances.

Consumer electronics is getting smarter and more PDA-like every day, as the Wi-Fi-equipped Microsoft Zune proves. Video on iPod-like gadgets is here. Portable gaming devices are getting more popular all the time, as is online gaming. How long will it be before a whole generation of users is walking around with content-ready, broadband-hungry little gadgets? Because these users range for tens of miles, not tens of feet, they quickly escape the range of Wi-Fi hot spots. They're ready spenders, the focus of the social networking, video-downloading future of Internet marketing.

The true opportunity for WiMAX is in supporting the emerging market for broadband that you can walk around with, broadband that permits electronic socialization while not constraining a user's ability to socialize in the conventional physical sense. Mobile phones could offer some of this, but it is clear that mobile communications and mobile entertainment are related but not completely congruent. People love small phones and big video screens, and while it might be more efficient to compromise on a single instrument size (such as a Treo or BlackBerry), this isn't a market that worries much about efficiency.