WiMax, the New Wireless Standard - Is 3G out the door?

Third generation telephone networks are currently the rage on mobile phone networks, with their ability to transfer both voice and non-voice (music downloads, files, email exchange, and instant messaging) data and video telephony. This technology is currently used by about sixty percent of mobile phones in Korea and Japan and was supposed to cover the same amount in Europe. However, despite the huge amounts of money spent on rolling out 3G networks by the European telecom giants, 3G is still not in widespread use (most likely due to the high price for its service.)

3G's main drawback was its high flat rate for connectivity, although the incremental rates are low from point of connection on. This high cost was passed on to end users as a result of the high licensing fees that the telecommunications companies had to pay when rolling out the networks, along with the high cost of the equipment used to build the backbone of these services.

3G Gets a Reprieve

According to Analysys International, a Beijing based telecoms research firm, WiMax should challenge 3G due to its higher bandwidth, but in a lot of markets where WiMax should roll out (China and Korea), the short term focus is on mobile and fixed Internet connections and not on mobile phone customers. (They will be focused on that in the long term). So most analysts project that most of WiMax's inroads into cell phones will be after 2010. In the short term, WiMax will complement 3G services. Most subscribers in China use 0G phones (pretty much just voice and not much else), however, by 2012 WiMax users in China should be in excess of ten million!

A report by Juniper Research, a London-based research company, states that as WiMax becomes more mobile its users could be around 22 million worldwide by 2012. Current 3G users will be the drivers of this surge in demand (for a technology that has not even been rolled out en masse) as they demand broadband Internet on-the-go as well as faster streaming for mobile video, mobile television, and mobile gaming.

Another reason WiMax will not quickly compete with 3G is, because so much money has been spent to roll out 3G services, there is actually no money left in the kitty to start aggressively developing WiMax services for cell phone users. This is, however, all speculation. Since WiMax is a standard, the costs of rolling it out are extremely low when compared to 3G.