Despite the delay in Wi-Max spectrum auction and issues with the Wi-Max policy drafted by the Department of Telecommunications (DoT), the technology is still a big draw.Growth forecasts for Wi-Max in India are going strong, and operators are continuing to ramp up investments.

A recent study by US research firm Strategy Analytics forecasts that India is likely to become the largest Wi-Max market in the Asia Pacific region, registering a growth rate of about 130 per cent per annum, touching a subscriber base of 14 million users by 2013. The predictions are similar to those made by research firms Maravedis and Tonse Telecom last year. They estimated that India would generate 21 million subscribers by 2014, making it one of the top three Wi-Max markets in the world.

Operator plans

BSNL
Service providers have lined up significant investment in the technology. Bharat Sanchar Nigam Limited (BSNL) is the frontrunner in this. The company, along with the other state-owned operator Mahanagar Telephone Nigam Limited, has already been granted Wi-Max spectrum in the 2.5 GHz band on a preferential basis, and has subsequently launched its tender for Wi-Max equipment. It has short-listed three global telecom equipment manufacturers –­ Huawei, Telsima and Alvarion –­ for the project, all of which have quoted L1 bids. The winner is to be announced shortly.

BSNL intends to invest around Rs 50 billion in its Wi-Max project. The company has already launched services in Ahmedabad (using US-based Soma Networks' Wi-Max equipment) and is looking to start services in Maharashtra (excluding Mumbai), Andhra Pradesh and Kerala. In the Kerala circle, the company is set to roll out broadband services based on Wi-Max technology in April 2009. A total of 450 towers will be set up in the first phase and will cover all major cities and national and state highways.

BSNL has also started work on setting up 50,000 common service centres based on this technology. It has recently granted a Rs 670 million contract to Chennai-based Gemini Communication for the supply, implementation and maintenance of rural mobile Wi-Max in Gujarat, Maharashtra, Karnataka, Andhra Pradesh, Chennai, Tamil Nadu and Orissa circles.

BSNL's plan to implement Wi-Max across India was initially delayed when the date for opening the Wi-Max equipment tenders was postponed. According to industry sources, the delay was due to the fact that many small players had allegedly failed to meet the turnover criteria, and were proposing to associate with bigger players to form consortiums. While around 28 companies including international vendors like Alcatel-Lucent India, Motorola India, Moser Baer Industrial Infrastructure, Huawei, HCL Infosystems, Intel Technology India, Larsen & Toubro, Infotech and TCIL figured among those who had bought the tender documents, there were also smaller companies like Soma Networks Software Engineering, Adino Telecom, Cals Refineries, Raasi Callnet and Vishal Telecommunications that had bid for the same.

Tata Communications
Tata Communications is also likely to emerge as a key player in the Indian WiMax space. The company has devised plans to roll out Wi-Max in 110 cities for enterprise services and in 15 cities for retail services. The company is planning to invest $2 billion over the next three years for laying submarine cable systems and rolling out Wi-Max services.

The Wi-Max spectrum auction is extremely important for this Category A internet service provider, as it plans to thereafter divest 26 per cent stake in its retail broadband unit, Tata Communications Internet Services Limited (TCISL).This will ensure prime valuation. TCISL had earlier been hived off as a 100 per cent subsidiary of Tata Communications.

Reliance Communications
Of late, Reliance Communications has been somewhat quiet on the Wi-Max front. In April 2008, the company, through Reliance Globalcom, acquired international Wi-Max operator eWave World. Reliance Globalcom has plans to launch 4G services in 50 countries in emerging markets in Asia, Europe, Latin America and Africa by 2012, at an investment of Rs 20 billion.

Bharti Airtel
In June 2008, Bharti Airtel gave a contract to Israel-based Alvarion to deploy its Wi-Max network. The contract involves Alvarion deploying its BreezeMAX platform along with its BreezeACCESS network for Airtel.Airtel will use Wi-Max to offer last mile connectivity for multi-protocol label switching, virtual private networks, internet leased lines and other data services.

Industry firsts

In a first of its kind for India, SemIndia Corporation is all set to roll out Wi-Max GSM phone chips from its manufacturing facility located in Hyderabad in June 2009. For this, the company has formed a 76:24 joint venture with JSemtech Holdings and Singapore-based Jurong Technologies Industries.

The $80 million assembly-test-managing-packaging unit has a capacity of producing 30 million GSM modules per annum. The GSM modules will work on GSM phones enabled with Bluetooth, FM radio and GPS capabilities, as well as with set-top boxes and broadband access devices.

These phone chips will significantly alter the dynamics of the industry by enabling users to access mobile internet at almost twice the power of Wi-Fi, at more competitive prices. The Wi-Max GSM module should not cost more than $20, which should keep the cost of the Wi-Max phone at around $50.

In another industry first, the Telecom Engineering Center of DoT plans to set up a Wi-Max certification laboratory jointly with an Indian partner and an international testing firm. Wipro Limited, L&T Infotech and Tata Consultancy Services are in the fray to partner with DoT in this initiative. While the Indian partner will hold 49 per cent stake in the laboratory, TEC will hold 26 per cent and the foreign partner will hold the remaining share. The Indian partner will handle day-to-day administration and management of the lab.

Consolidation

Globally, Wi-Max players have started witnessing signs of consolidation. The US wireless service provider, Harris Stratex Networks has acquired Wi-Max equipment provider Telsima for $12 million.Telsima is focused on offering Wi-Max solutions in the Indian telecom market.Interestingly, Telsima was commanding a high valuation, having raised $80 million since 2000.

Intel is also exploring options of investing in Indian Wi-Max rollouts.Acquiring stake in a Wi-Max spectrum auction winner is an option it may be considering. The company has been betting big on the Indian Wi-Max space and has already invested in several Indian organisations that make hardware and software applications which are compatible with the Wi-Max platform.

Wi-Max trends and issues

C.S. Rao, Chairman, WiMAX Forum, India Chapter, speaks about some key issues regarding Wi-Max deployment in India...

Evolution of Wi-Max in the Indian market in the coming two to three years
Seventy-five major cities in the top 12 states in the country hold about 80 per cent of the internet subscriber services potential, driven by the PC (desktop and laptop) installed base and smartphone potential. Also, these 75 cities have the maximum fibre coverage and international internet bandwidth availability. In two to three years, operators like Bharat Sanchar Nigam Limited, Mahanagar Telephone Nigam Limited, Reliance Communications, Bharti Airtel, Tata Teleservices Limited and Aircel, which have the largest installed base of towers and optic fibre cable, would naturally roll out broadband services on Wi-Max.

Wi-Max for broadband wireless access (BWA) offers an excellent opportunity to all big operators to meet the broadband needs of small and medium enterprises (SMEs) and residential and corporate users. These operators are offering Wi-Max-based wireless broadband services for approximately 250,000 SMEs and some high-end residential consumers in the available spectrum bands. The companies have been eagerly waiting for the release of spectrum in the 2.5/2.3 GHz globally harmonised bands, for which the entire ecosystem of devices (480 devices by 80 vendors) is available. The companies have been waiting for the auctions to take place and spectrum to be allocated for 10 months.

The impact of the global recession on Wi-Max deployments
There are currently more than 455 Wi-Max deployments in 135 countries, up from 400 in mid-2008. Wi-Max has already established itself in the 3.5 GHz band with deployments in every region and is being deployed in the 2.5 GHz band in countries such as the US, Japan, Taiwan, Russia and Mexico. New 2.5 GHz Wi-Max spectrum allocations are expected soon. The services have been deployed in the 2.3 GHz band in South Korea, Malaysia and Singapore and further deployments are expected in Vietnam, Thailand, Indonesia, Australia and Canada. India has recently approved the auction of spectrum in the 2.3 GHz and 2.5 GHz bands. In the UK, Wi-Max is deployed in the 3.5 GHz band.

Even with the global economy shrinking, Wi-Max deployments continue to increase rapidly. During the Great Depression, people stayed at home and listened to the radio for news and entertainment. The current mode of receiving worldwide news and entertainment is the internet and the demand for high speed services will continue to grow even in tough economic times.

Interference between BWA systems (including Wi-Max) and satellite systems
Interference can happen when any two communications systems are deployed in the same geographical area. Harmful interference can be avoided by employing a variety of mechanisms including frequency coordination between the concerned operators, frequency separation, antenna discrimination, receiver performance requirements (such as filtering), out-of-band power limits and site shielding. Each scenario should be analysed to determine the right mechanism. The WiMAX Forum is working with regulators to develop the appropriate regulatory regimes to avoid harmful interference while maximising use of the limited spectrum and accommodating both BWA and satellite systems within cband spectrum –­ 3400-4200 MHz.