WiMAX's momentum hits a big bump

News that Russian WiMAX operator Yota has decided to build out the rest of its markets with LTE technology couldn't have come at a worse time for the WiMAX Forum.

Late last week, Yota, one of WiMAX technology's strongest examples, announced 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 (see the article below).

"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," chief executive Denis Sverdlov said in a statement.

The timing of Yota's announcement is bad because it comes on the eve of India's broadband wireless auction (BWA), an auction the WiMAX Forum has been lobbying hard for during the last few years. India has delayed the auction process many times, and now the head start WiMAX once enjoyed over LTE is not so wide. Bidders will certainly look to Yota's move and recent comments from Clearwire (NASDAQ:CLWR)and Sprint (NASDAQ:S). Clearwire has indicated an interest in deploying TD-LTE but not likely until 2012. Sprint, which resells WiMAX from Clearwire, has indicated it is looking at LTE as a possible next-generation solution for its core CDMA network (see the story below). Moreover, Qualcomm (NASDAQ:QCOM)is participating in India's BWA with plans to deploy TD-LTE with an Indian partner if it wins.

If WiMAX loses out in a big way in India, it could spell disaster for the technology's future. Yota and Clearwire don't appear to have plans to rip out WiMAX any time soon, but both see LTE as the future. Robert Syputa, senior strategic analyst and advisor with Maravedis, now paints a dire picture for WiMAX: "The decline of growth in WiMAX and shift to tier one suppliers who are prepared for a transition to LTE as it becomes widely available now signals a rapid deterioration in WiMAX and its chances of achieving mainstream market momentum."--Lynnette