I drew some criticism for declaring that NextWave Wireless is pushing a proprietary WiMAX strategy in one of last Monday's headlines. The criticism was lobbed because NextWave, which wants to go public, filed documents with the SEC indicating that it will develop an end-to-end mobile WiMAX network that is compliant with the 802.16e mobile WiMAX standard.
But dig down further in the filing and you'll see the word "proprietary" used in several descriptions of NextWave's technology, and you'll begin to understand that what NextWave has developed is not the same WiMAX other vendors are building. NextWave is making WiMAX ASICs and other related network and device products with some proprietary additional functions, such as QoS support across multiple bands and scalability, that fall under the WiMAXplus name. Although it's unclear in the filings, sources say WiMAXplus will pass WiMAX Forum certification. The WiMAX Forum has established several profiles of the standard, certain types of which NextWave will offer. NextWave is in a quiet period so it can't exactly clear this up.
But here's what NextWave says in its SEC filing: "We intend to develop the key elements of an end-to-end mobile WiMAX network solution that includes proprietary chipsets and related network and device products compliant within the 802.16e WiMAX standard. We anticipate that by incorporating our proprietary technologies on both sides of the radio connection, we will be better positioned to commercialize our WiMAXplus network performance technologies."
While the technology will pass WiMAX Forum specs, vendors will actually have to license WiMAXplus chipsets, network components and device technologies directly from NextWave to do business with NextWave or offer the same network-performance technologies developed by NextWave to other operators. Further, NextWave is going to be aggressively marketing this proprietary way of doing things worldwide. In fact, NextWave says in its filing that "similar to other proprietary wireless technologies, we believe that the sale or licensing of our WiMAXplus chipsets, network components and device technologies will generate a long-term, recurring revenue stream for our company."
A question to ask is this: Can NextWave offer the benefits it is touting such as QoS and scalability with WiMAXplus through the standard implementation of WiMAX equipment from the likes of a Nortel, Motorola or Alvarion? If yes, then why is NextWave developing its own network solution that it wants to license?
One of the problems with this "proprietary" issue is that the IEEE 802.16e standard is not very specific when it comes to defining some requirements. It defines the basic characteristics of the Physical and Medium Access Control layers, and it doesn't address the upper layers. The WiMAX Forum is addressing the upper layers and is establishing various profiles. One might argue that WiMAXplus is similar to South Korea's WiBro. A WiBro profile is likely to be the first Mobile WiMAX profile that is certified by the WiMAX Forum for the 2.3 GHz band. NextWave may meet WiMAX Forum specifications, but it sure looks like the company is toeing the line. - Lynnette