WiMax v LTE

DFN: Wimax = wireless facilities backbone versus LTE as traditional interoffice facilities backbone. Internationally, WiMax maybe more appealing internationally than the US. The US has a well established interoffice backbone and it would be a hard sell economically to offer 4G in the US on a totally Wireless basis, its more likely to be an extension of the existing network, thus giving LTE an edge.

The Company That Might Destroy WiMAX
By Tim Beyers
February 17, 2010

Each year, at the Mobile World Congress in Spain, executives at leading telecom companies unite to talk about the Next Big Thing on your phone.

For Verizon (NYSE: VZ), that’s LTE, or Long-Term Evolution, a 4G wireless broadband alternative to the WiMAX technology backed by Intel (Nasdaq: INTC) and Comcast (Nasdaq: CMCSA), among others, and delivered by Clearwire (Nasdaq: CLWR) and Sprint Nextel (NYSE: S).

Verizon Chief Technology Officer Dick Lynch on Monday said that his company’s LTE deployment is on track to go live this year, News.com reports.

Why this matters
A broadband battle between LTE and WiMAX has been brewing for years, with WiMAX rolling out faster internationally, thanks to global equipment suppliers such as Alvarion (Nasdaq: ALVR). In October, a collaboration of vendors successfully tested WiMAX roaming in Taiwan.

Here in the U.S., it’s a different story. WiMAX hasn’t caught on as fast domestically, because there’s already so much wired broadband infrastructure, unlike the developing world. WiMAX networks also have to be built from the ground up, whereas LTE is being built upon existing carrier networks — Verizon’s, for instance.

The net impact of Verizon deploying LTE first may be negligible. We’ve known its plans for a year.

Meanwhile, AT&T (NYSE: T) is also planning an LTE rollout — in 2011. As my Foolish colleague Anders Bylund points out here, the former Ma Bell is taking her time to ensure a smooth upgrade from her existing 3G network.

Verizon is upgrading first, betting that customers will add equipment to try LTE even as the carrier works on building a bridge to its older 3G EV-DO network, for areas where its fastest connections are unavailable, News.com reports.

In short: The move is an experiment. But if Clearwire and Sprint Nextel can’t do more than rely on combination routers, Verizon’s LTE leap of faith could stunt the growth of WiMAX.

Who will win the broadband war, LTE or WiMAX? Does there need to be a winner?


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