Russian mobile operators stop WiMAX roll out

Late last week, Russian WiMAX (Worldwide Interoperability for Microwave Access) operator Yota made a surprise move. The company said it will now deploy LTE (Long Term Evolution) technology as it continues its wireless broadband rollout. The operator had been an early WiMAX proponent and recently rolled out WiMAX service in Nicaragua and Peru.

Yota said that instead of moving ahead with its original plans to roll out WiMAX in 15 new markets, it will roll out TD-LTE in five new markets this year. In a press release Yota’s CEO, Denis Sverdlov said, “Yota is a services company; for us technology is an instrument. It’s clear that the LTE standard is becoming the main trend in wireless communications.” TD-LTE is widely used in China, but is relatively rare in North America.

In the US, since it was founded by cell phone entrepreneur Craig McCaw, Clearwire has been the major proponent of WiMAX. During Clearwire’s start up, McCaw convinced Intel to put in $600 million to back his ideas for a worldwide implementation of WiMAX. Intel’s plans were to offer WiMAX chipsets in all of its laptops. Along the way, Clearwire and Sprint had an on-again, off-again relationship. In 2008, that relationship evolved into Sprint’s majority stake in Clearwire. Sprint now resells Clearwire’s WiMAX infrastructure. Sprint recently announced its Android based , HTC Evo 4G WiMAX capable smartphone for shipment later this summer.

Last fall, it was estimated that Clearwire could need up to $3 billion in new funding to complete its current build out plans covering 120 million potential customers by the end of next year. That funding was expected to come from Sprint Nextel, which owns 51 percent of Clearwire, and the rest likely to be from either its cable partners or possibly from T-Mobile USA. Clearwire has WiMAX live in 27 markets while LTE hasn’t launched yet commercially in the US. However, Verizon and AT&T have committed to LTE for 2011.

Last year at Intel’s IDF keynote speech, David Perlmutter, VP of Intel’s mobility group, said in part: “We have (WiMAX) networks being built in North America, in Russia, in Japan … We are building with our partners’ networks in other places like India, Malaysia, Taiwan. And many, many other places have all sorts of mobile and fixed WiMAX all over the globe.”

Just a few weeks ago, Intel and Clearwire revised their WiMAX technology agreement giving Clearwire the option of also adopting LTE. The original Intel agreement required Clearwire to exclusively use WiMAX. Clearwire CEO Bill Morrow said Clearwire had not made any decisions regarding LTE. But, it has an RFP (Request For Proposal) that has many options including how to run both LTE and WiMAX on the same network.

The Indian WiMAX market was, up until recently, looked at as one of the easy prizes for WiMAX to win. Last week after 34 days of 183 rounds of bidding, India concluded the auction of its 3G mobile spectrum. This week, the next phase of India’s BWA (broadband wireless access) is in full swing. The contenders for the 4G spectrum are companies backing either LTE or WiMAX. Earlier this year everybody thought WiMAX would take home most of India’s 4G BWA spectrum. Now, maybe not.

Yota’s decision may have a profound impact on India’s 4G auction. Monday’s RCR Wireless has an excellent analysis of the Indian BWA. They said that, “What looked like a sure thing for WiMAX, suddenly looks anything but …”

Professor Willie Lu, Director of US Center for Wireless Communications in Palo Alto, California, has been a leader in mobile radio theory. Lu has six axioms of wireless communications. The first is “No single Radio Transmission Technology (RTT) can do both Broadband High-speed and Seamless Mobility in a commercial environment.” The background of “Lu’s Laws” will be fully explained at an upcoming conference in San Francisco.  

Yota’s decision can be seen as the next evolutionary step as more and more wireless carriers are moving in the direction of 4G dual-mode topology. However, Intel might see it as poking a hole in its WiMAX life raft.