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Industry News

Xohm goes live, but is NSN defocusing on WiMAX?

October 16, 2008
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Speculation that Nokia Siemens Networks (NSN) will defocus on the WiMAX market has gained new weight, with Sprint Nextel defecting to Samsung to supply the Dallas-Fort Worth build-out for its Xohm service. The operator insists this is just a practicality, because the Texas city became ready for its equipment ahead of schedule, and there was existing inventory of the Samsung gear, which has been used in the first Xohm territory to go live, Baltimore. Nearly two years ago, Sprint chose three vendors to supply the infrastructure for Xohm, and each gained an initial city to build out and put WiMAX systems through their paces. Motorola won Chicago, Samsung Baltimore/Washington DC, and the surprise third supplier was NSN (then still Nokia), which at the time had WiMAX kit only on paper, and was far behind other candidates like Nortel in developing the technology. However, Sprint clearly wanted to sign up companies that could also make innovative devices, such as the Nokia N810 Internet Tablet for WiMAX, and NSN boasted that its flagship 3G range, the Flexi Base Station, could be easily adapted for WiMAX and for low-cost roll-out into the bargain.

Despite the clear competitive advantages of the compact, modular and multi-network Flexi - which could be a breakthrough product for NSN in the usually problematic US, with T-Mobile USA choosing it for 3G - NSN's commitment to WiMAX remained under question, especially as Nokia is such a fervent champion of, and likely beneficiary from, LTE. It would surprise very few people if the Texas change is the first step in a quiet exit from Mobile WiMAX for NSN, especially as its Finnish parent will still be able to pursue the primary agenda, gaining increased US market share for its handsets. Participation in Xohm was seen as a possible weapon in this fight, but in reality, as Verizon and AT&T move towards LTE, Nokia is likely to see those operators, and the direct channel, as the most important vehicles for pushing its devices across the Atlantic.

In a research note when Nokia won the Dallas deal, analysts at Dresdner Kleinwort wrote: "Nokia, we infer, views the WiMAX experiment mainly as a vehicle to regain handset share. A recovery of the North American mobile device operations has long stood, and continues to stand, on the top of Nokia's strategic agenda. Whether Sprint Nextel constitutes the right vehicle to effect a positive change is more debatable [given low volumes in the early years]." All NSN would officially say about the Xohm decision in Dallas was that it understood the reasons for the change, given that the city's launch was ahead of schedule (though no date has been given).

"Xohm's Dallas market was ready for deployment ahead of schedule, so it made sense that they would use existing inventory to accelerate the deployment," said Chantal Boeckman, NSN communications manager. She insisted that Flexi is performing well in Xohm trials and has embarked on the certification process. "We continue to be an active member of the WiMAX ecosystem," she said. "We're confident Nokia Siemens will be part of the new Clearwire deployments moving forward."

This week sees the official launch of Xohm in Baltimore, though some users gained early access to the service a week ago. There was real excitement surrounding a relatively small launch that could, nonetheless, be the starting point for an important roll-out, in terms of bringing true mobile broadband and open access to the US, and shaking up the traditional telecoms landscape, so dominated by AT&T and Verizon. There is even talk of Android devices making it on to Xohm as early as mid-2009, which would be logical, given Google's work with Sprint on the user experience for the network, and its planned investment in the new Clearwire. A WiMAX Android device would, however, carry symbolic and marketing weight, emphasizing that Xohm aims to accelerate, and grab the reins of, the move towards a fully open mobile internet, where any terminal and application can run on the network, and a wholesale model can support small and innovative services.

Nonetheless, Baltimore is a game changer with very modest beginnings. It is offering DSL-class fixed or mobile broadband services on a month-by-month, not contract basis, with speeds and prices that are comparable to many of the emerging HSPA or EV-DO offerings from other cellcos. It is available in Maryland's largest city and the surrounding county, via, initially, just two devices, a $60 Samsung laptop aircard and an $80 ZyXel USB modem.

More famous early WiMAX devices, the Nokia internet tablet and the Intel WiMAX/Wi-Fi Centrino for embedded laptop wireless, should follow soon once they are through WiMAX Forum, FCC and carrier certification. Other Xohm markets will follow later this year and early in 2009, led by Boston, Chicago, Dallas Fort-Worth, Providence, Philadelphia and Washington DC. Service plans for Xohm, which do not require a long term contract, include a $10 day pass, a $25 monthly home internet service and a $30 monthly mobile service, with rates of 2Mbps-4Mbps. More details of the devices and services plans will be announced at the official launch. Sprint has been an early cheerleader for the fundamentals of the mobile web vision - open access, flat rate tariffs, unfettered roaming, freedom to go beyond a carrier's portal. But so have many other companies, large and small - the difference is that Sprint now has a network on which to demonstrate that this vision actually works in reality, and is actually usable and attractive to consumers and businesses.

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