WiMAX is about making the Internet mobile. That was the key takeaway from FierceMarkets' WiMAX Strategies 2007 conference, held yesterday in conjunction with NXTComm in Chicago.
"This is not another voice network," Barry West, CTO and president of Sprint Nextel's 4G business, said during his keynote address. "This network is about mobilizing the Internet. That's probably the most important statement that I will make today."
West, probably the WiMAX industry's biggest evangelist, laid out several imperatives to this mobile Internet, and all of them are at odds with the traditional way operators have done business. One imperative is unsubsidized devices.
"In order to keep costs down, you can't subsidize the device," West said. "Subsidized devices are why we have walled gardens. They're why operators have to have contracts."
But without walled gardens, how will operators make money? Panelists offered a variety of possibilities. West talked about using WiMAX's QoS features to offer limited throughput to lower-spending customers and completely open pipes to higher-paying customers. It's clear that service needs to move away from a per device model to a per consumer model if WiMAX chips are going to be embedded in a variety of devices, ranging from portable media players to digital cameras. That means operators must look at ways to charge for perhaps a group of devices.
"We're open to many different realms of possibilities since people are going to be carrying multiple devices," noted Praduman Jain, director of 4G WiMAX, during a session about content. "We're exploring different options around pay-as-you go models and hourly rates to make things more flexible."
Jain also noted that WiMAX operators can keep from being a dumb pipe by not only offering open access but content and services that are unique to the service provider. "Customers want openness but they also want safety and security and a good experience... There are plenty of elements that keep an operator from being just a dumb pipe."
Scott Richardson, chief strategy officer with Clearwire, gave some interesting user statistics about the company's pre-WiMAX fixed wireless offering during his keynote address. He said Clearwire reached 10 percent penetration in 70 percent of all its markets in the first quarter. One in five users are also using Clearwire's residential VoIP service in addition to ISP services. The operator offers VoIP services in certain markets for $30 per month. Meanwhile, 59 percent of new users in the first quarter came from cable or DSL. -Lynnette