opinion


WiMAX and the regulator

WiMAX supporters can claim with some justification that telecom regulators, in some of the world’s key markets, are dampening the technology’s growth prospects in the near term through overlong periods of ‘consultation’.

India is an obvious example. Ongoing disputes between different government departments, blurred divisions of responsibility between the regulator (TRAI) and the Department of Telecommunications (DoT), have all contributed to repeated delays in the BWA (broadband wireless access) and 3G auctions.

That’s not to say that WiMAX has completely been stymied In India. Aside from the large fixed WiMAX projects undertaken by Tata and Reliance in the 3.3GHz frequency band, BSNL, as a state-owned operator, already has 20MHz of spectrum at 2.5GHz at its disposal and is now reportedly weighing up its vendor choices for nationwide mobile WiMAX rollout.

To create a vibrant BWA marketplace, however, it is surely better to have competition. And if BSNL and its sister company MTNL were allowed to have a significant head start in both 3G and BWA (WiMAX), the licences that eventually do come up for auction will inevitably be less attractive.

Brazil is another key growth market where WiMAX supporters have been frustrated by a lack of licensing movement at 2.5GHz and 3.5GHz as Anatel, the country’s regulator, embarks on repeated rounds of public consultation to gauge the merits and fairness of rubber-stamping kit in these bands capable of offering mobile and nomadic services. While Anatel stresses the need to be mindful of the country’s 3G licence winners, the arguments of Neotec (which represents Brazil’s cable operators holding 2.5GHz spectrum) that it wouldn’t make economic sense for its membership to offer true mobility in the next few years anyway, appear to have fallen on deaf ears – at least so far.

Neotec also makes the argument that WiMAX and 3G are complementary and not competitive. To be fair to Anatel, and regulators in general, the merits of this argument may not necessarily be apparent. Arguably, more WiMAX lobbying work needs to be done in this area to persuade regulators this is the case, which would go some way in removing any mobile WiMAX objections made by cellular operators on the grounds of ‘unfair’ competition.

South Africa is another key market where the national regulator, ICASA, appears to have contributed at least in some way to the stalling of broadband (and WiMAX) growth. ICASA is currently embarking on another round of industry consultation on 2.6GHz and 3.5GHz licensing after its initial proposals in May 2008 drew howls of protest from some industry players. One of the most controversial licensing issues relates to ICASA’s stipulation that bidding consortia for 2.6GHz spectrum, in accordance with the Broad-Based Black Economic Empowerment Act of 2003, should be at least 51 percent black-owned. Some local commentators have expressed concern that building a WiMAX network from scratch will be out of the financial reach of black-owned groups, which, in turn, would slow down broadband rollout with spectrum going unused. ICASA has also been under fire for allowing the incumbent Telkom, as well as Sentech (a broadband provider), to sit on large chunks of spectrum without making much use of it.

There are occasions, however, when a ‘failing’ regulator can paradoxically enhance WiMAX prospects. In countries where the regulator does not force the incumbent to open up its local loop to competitors at reasonable cost levels, it can boost the business case of broadband wireless solutions, especially in urban areas, simply because they can circumvent the incumbent’s fixed-line ‘last mile’ infrastructure. But this is scant consolation for WiMAX supporters, particularly if spectrum is not available in those countries.

Although regulators clearly have a tough task (and can become easy targets of criticism as a consequence), it is hard not to conclude that WiMAX – in some cases – has been held back unnecessarily. This, of course, is an advantage to the 3G/LTE camp, as commercial ‘4G’ equipment from both the 3GPP and 3GPP2 communities is not yet ready.

While WiMAX supporters may argue that 3G/LTE lobbying efforts are putting the brakes on 2.5GHz licensing in some countries, there is still ample opportunity for strong broadband growth via WiMAX this year, particularly in the US, Japan, Russia, CIS, and the Middle East. If this transpires, along with evidence that increased broadband penetration can spur economic growth, that will increase the pressure on regulators elsewhere to release unused BWA spectrum sooner rather than later.

Tags: ,

Leave a comment

Your email address will not be published. Required fields are marked *

Events

There are no upcoming events.

Polls

What is your name?

Loading ... Loading ...