The WiMax sector’s overall efforts were rebuffed at the 2007 World Radiocommunication Conference, but with some governments around the globe continuing to support WiMax and international mobile telecommunications (IMT) players and use of the spectrum within their borders, the relationship between the terrestrial technology and satellite communications players continues to evolve. In the immediate aftermath of the decision, it appeared that WiMax deployments were going to chug along unimpeded, regardless of the interference they might cause to C-band satellite networks, however, that momentum has lost some its steam. Why have worldwide deployments of WiMax systems slowed? What does the future look like for future WiMax deployments? Are there situations where satellite and WiMax can work together side-by-side as complementary technologies?
Understanding WiMax
WiMax (Worldwide Interoperability for Microwave Access) is a telecommunication technology using RF devices to transmit data. WiMax (IEE 802.16 standard) initially was envisioned as a last-mile solution to deliver broadband solutions but has taken on a broader scope over the last few years. “WiMax is a versatile technology which is very adaptable to the circumstances,” says Terry Norman, principal analyst for the London-based business consultancy Analysys Mason. “It can be used as a backhaul technology in point-to-point situations, or it can deployed as a wireless ISP. It can even be used together with Wi-Fi and GSM to create a hybrid cellular type of service. It has different personalities in different countries. As such, it faces competition from many fronts, including traditional cellular carriers, cable companies offering services on fiber and coax, microwave vendors with point-to-point radios and satellite broadband services.”
WiMax players envisioned a huge market for the services even without the global C-band capability. But the takeoff off the WiMax business has been slow, and in August, Analysys Mason issued a report that cast doubt on the future of the WiMax business in established markets such as North America and Europe. ”The business case for a WiMax network hinges on the customer paying enough money to make a profitable business,” Norman says. “You have a large number of variables, each different in every country. Some of the variables included: the availability of bandwidth, quality of service provided, how many customers there are, their education level, their ability to pay, the local demand, will that demand be different in different parts of the country, and the population density. Government subsidies add another degree of complexity to the equation. For instance, ‘Is the government prepared to pay to ensure rural areas get the same quality of service as urban dwellers?’ As you cans see, there is quite a list of variables in the commercial world we live in. You aren’t simply rolling the dice; you are actually rolling a whole handful of dice. Every one of these variables has to be explored and addressed to build a successful business case.”
The loss of the global C-band frequency hurt WiMax players more than expected, as vendors and service providers do not have a single global frequency the industry can claim as its own. “The lack of a single frequency requires the vendors and service providers to go about things in a piece meal fashion,” Norman says. “Jumping from one available frequency to another is problematic. WiMax deployments are orders of magnitude fewer than UMTS (Universal Mobile Telecommunication Systems) handsets and, therefore, do not have the same economies of scale.”
If the existing challenges are not enough for the WiMax sector to overcome, Norman also points to the looming development of Long Term Evolution (LTE) by the wireless industry. GSM cellular continues to evolve to provide higher data speeds. GPRS Edge networks will evolve into UMTS networks. The next phase after UMTS is LTE, which sometimes is referred to as 4G and offers virtually the identical features that the 802.16M (WiMax Mobile) standard offers, bringing the two wireless networking standards into head-to-head competition. When that happens WiMax vendors and service providers will have to compete with the likes of AT&T, Verizon and other large carriers. “There is significant overlap of the target markets of both WiMax and LTE,” Norman says. “ WiMax has the benefit of being first to market but the wireless carriers bring massive economies of scale. Although both segments say they aren’t going to compete with each other, in reality, they are going to try to sell to the same customer base.”
Source of Interference
Despite the grim news for North American and European WiMax markets, Analysys Mason believes that WiMax will continue to play a role in developing countries “because of the limited potential of the [developing] markets, there will be some consolidation of vendors and providers along the way,” says Norman.
David Hartshorn, secretary general of Global VSAT Forum, notes that hundreds of licenses to operate WiMax systems have been approved, primarily in developing countries. As anticipated, the terrestrial systems are causing significant interference issues. “In certain countries, C-band satellite terminals are virtually impossible to operate anymore due to interference,” he says. “In numerous instances, the interference has been reported to have been caused by WiMax-certified equipment. In another, we have a letter sent from a national regulatory body telling the WiMax operator that they are causing interference with an FSS satellite operator. In another country, a national communication administration independently tested and confirmed the interference problem. We have shared this type of information with the WiMax industry in an effort to demonstrate that their devices are causing interference, and we are trying to find mutually agreeable solutions.”
The key to solving the problem may be cooperation rather than continued fighting, says Hartshorn. “You have to keep in mind the commercial side of the equation. People are simply trying to do business,” he says. “Many major cities in Africa have WiMax networks utilizing extended C-band frequencies. Once WiMax operators have saturated the urban markets, they will want to seek new subscribers in the suburban and rural markets. These areas often have no terrestrial infrastructure, so satellite backhaul will be the perfect fit for their needs. There is a significant commercial synergy between satellite and WiMax.” Hartshorn points out that most African wireless providers are looking to use satellite for their backhaul needs. The symbiotic relationship has progressed to the point where WiMax vendors are starting to buy satellite operators and bring them in-house. A good example is Vodacom, the largest wireless provider in Africa, purchasing Gateway, the largest satellite service provider in Africa.
Developing Solutions
The symbiosis between satellite and WiMax has not been lost on Newtec, says CEO Serge Van Herck “WiMax operators have unique needs and satellite technology is ideally suited to backhaul traffic. Most of the WiMax systems which have been deployed are in urban environments, and there are hundreds, or thousands, of end users generating traffic. All of this traffic must be routed over a single satellite link, and it requires a large amount of dedicated bandwidth. Satellite circuits in the 10 to 20 megabits-per-second-range are common.”
Over the last few years, Newtec has purchased several software companies and have integrated their offerings into a comprehensive suite of products which help both satellite and terrestrial wireless carriers. Newtec’s Elevation product line provides traffic shaping, acceleration, and encapsulation, all of which enhance network performance. Newtec’s FlexACM product allows satellite operators and satellite service providers to optimize satellite links used as IP trunks. ACM technology is incorporated into the DVB-S2 standard, providing increases in bandwidth efficiency for satellite applications and allowing modification of modulation parameters of a satellite signal during almost any form of interference, without interrupting the transmission or losing data.
Other companies are making inroads into the WiMax sector as well. In April, Norsat International Inc. acquired Ireland-based WiMax provider Bluemoon 4G Ltd. in an all-stock transaction. “With the acquisition of Bluemoon, we accelerate our entry into the WiMax market and expand our geographic reach into markets in emerging countries. We believe this acquisition is aligned with our strategic diversification into the commercial sector and will deliver long term growth and increase Norsat’s profitability,” says Norsat CEO Amiee Chan. Some satellite companies have made WiMax investments in North America as well. During the 2008 fourth quarter, the U.S. Federal Communications Commission granted a petition by Globalstar to use the WiMax protocol as an ancillary terrestrial component to its mobile satellite services network.
A Role in Oil & Gas
Since hydrocarbons often are found in jungles, deserts, mountain ranges, and oceans, oilfield services provider Schlumberger has developed a global communications network which incorporates satellite. The company was an early leader in the development of Ku-band satellite hardware and was a leading industry voice when the U.S. Federal Communications Commission was considering whether or not to offer blanket licenses to Ku-band satellite networks in the 1980s. Based on its heritage as a pioneer in the satellite industry, it came as no surprise when Schlumberger’s Global Connectivity Services entered into an exclusive agreement in January 2009 with League City-based WiMax service provider ERF Wireless. The agreement covers North America and includes service support in the United States and Canada. “We identified a critical need in the market, and are pleased to be able to offer WiMax services to our clients with remote connectivity requirements,” says Deryl Rice, Schlumberger’s North American global connectivity business manager. “Satellite still makes up the core of our services, particularly offshore, but WiMax provides excellent bandwidth, especially for land operations.”
Schlumberger will light up a geographical area with WiMax coverage where there is a concentration of drillers and operators, and Schlumberger has its finger squarely on the pulse of oil and gas producers, Rice says. “Schlumberger tracks leases, rig counts and other data on a weekly basis. From this data we can see where we need to expand our coverage in the future. Potential radio towers and possible frequencies are investigated as well as any potential interference issues. Market intelligence is critical. For instance, the Marcellus Shale in the Appalachian Basin covers seven states. We can’t blanket all seven states with WiMax coverage. Over time we will typically see the majority of the rigs working in a basin concentrated in certain areas. WiMax is ideal to provide services in that type of setting and that is where we focus our efforts with WiMax,” he says
Rice, a veteran of the satellite industry, notes that WiMax services offered several advantages over a satellite solution. “WiMax is a bit more stable than Ku-band satellite because you don’t have to deal with rain fade. Although rain fades are short, they still interrupt business processes. WiMax allows us to deliver a significantly higher amount of bandwidth to remote locations. We typically deliver 1.5 megabits per second of bandwidth to a drilling rig instead of a 128 kilobits per second satellite circuit. Drilling companies and operating companies welcome the additional bandwidth,” he says.
Network latency also is critical when running a real-time drilling operation, and while the latency on a satellite link typically is in the 600-to-700-millisecond range, the WiMax link can provide latency of just 60 milliseconds, says Rice. “Drilling data from the rig is transmitted to an offsite geoscientist who is monitoring the drilling process. By reducing the latency to just 60 milliseconds, this drastically improves the delivery of the data. The latency introduced by a satellite link doesn’t sound like much, but it is enough to possibly delay the transfer of data and, under certain circumstances, data could be lost. WiMax will be an important tool for us moving forward, as it is a complimentary communications technology,” he says.
The Future for WiMax
A year ago, it appeared that WiMax networks would proliferate around the world very quickly, but that has not turned out to be the case. While there have been successful WiMax rollouts, notably on the African continent, the future for WiMax is anything but clear. Facing direct competition from entrenched competitors offering broadband services via cable, wireless and satellite, WiMax faces an uphill battle. The lack of a global frequency standard forces WiMax vendors to cobble together a disjointed group of frequencies, thereby preventing manufacturers from achieving economies of scale
It is highly unlikely WiMax will gain enough traction to overtake competitive technologies; however, it is still has its place in the telecommunication world, even if it serves in a mop up role. The WiMax Forum and satellite sector have had friendly discussions regarding the interference that WiMax networks are causing. To date, nothing concrete has been resolved, but it is important that the dialog continues. The potential is there for WiMax and satellite technologies to collaborate, harnessing the power of last-mile and long-haul wireless communications, creating a homogeneous network offering the benefits of both technologies. Although the relationship between the satellite and WiMax sectors has been contentious at times, WiMax players could become a major market for satellite hardware and space segment.
Greg Berlocher has been active in the satellite industry for twenty five years and is the President of Transcendent Global Networks LLC.
Greg Berlocher has been active in the satellite industry for twenty five years and is the President of Transcendent Global Networks LLC.
