Unwired sings the lonely WiMAX blues

commentary You can't blame wireless carrier Unwired for feeling a little left out in the last few weeks. Several of the broadband seller's giant competitors have spent that time detailing their plans to provide mobile broadband over networks based on the 3G GSM standard, with some investigating next-generation HSDPA services on the back of the GSM networks.

commentary You can't blame wireless carrier Unwired for feeling a little left out in the last few weeks.

Renai LeMay, ZDNet Australia
Several of the broadband seller's giant competitors have spent that time detailing their plans to provide mobile broadband over networks based on the 3G GSM standard, with some investigating next-generation HSDPA services on the back of the GSM networks.

In contrast, Unwired is the principal local champion of the WiMAX standard, the mobile version of which is expected to be ratified later this year.

However in the light of the billions of dollars Optus, Vodafone, Hutchison and especially Telstra have been and will be putting into 3G infrastructure, WiMAX's position in Australia is looking a little unsteady.

In particular, Telstra's media blitz this week, which highlighted the fact the telco will consolidate its three mobile networks to a single national 3G GSM network -- appeared to have Unwired rattled.

Telstra claimed the network could eventually deliver up to 14Mbps wireless broadband speeds to customers, using the HSDPA standard which Vodafone is already basing some international services on.

But shortly after Telstra's news hit the street, Unwired fired off a statement attacking Telstra's technology base.

"HSDPA/3G is an underpowered technology which will not meet the needs of people looking for a broadband equivalent wireless service," said the statement in the name of chief technical officer Eric Hamilton.

"While in theory a [3G connection] can support 14.4Mbps of traffic, tests have shown that the real throughput is little better than 3Mbps," he added.

This, Hamilton alleged, was well under the speeds offered by WiMAX as well as Unwired's current proprietary solution from vendor Navini.

There is some truth to Hamilton's statements -- WiMAX does indeed have the potential to offer both higher speeds and more reliable connections than services based on 3G GSM/HSDPA.

However you can't ignore the sheer billions of dollars of investment that the major carriers are putting into alternatives to WiMAX. In that context, Intel's recent AUD$37 million investment in Unwired seems kind of underwhelming.

And although neither Telstra nor Vodafone, which is trialling HSDPA, are actually selling HSDPA-based services yet, neither is Unwired yet selling speeds higher than 1.5Mbps itself -- and it's not selling anything at all outside Sydney.

When the larger telcos do launch HSDPA services, they'll be launching on the back of their rapidly expanding 3G networks -- which in Telstra's and its partner Hutchison's case already reach to all the major capital cities.

But Unwired's problems don't stop there -- its survival as a profitable business is still far from assured.

The company has so far signed up only half of the customers it needs to break even on its Sydney business, let alone elsewhere. Around 30,000 Sydney customers are still needed.

Sadly, it's a well-known fact that the better technology doesn't always win. And in this case the opportunity for the larger carriers to combine their mobile phone and wireless broadband services into one network is extremely attractive.

What do you think? Will wireless broadband based on 3G/HSDPA become a significant force in Australia? Or will WiMAX win the day? Send your thoughts to renai.lemay@zdnet.com.au.

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