WiMax vs. LTE: Part 3

by [Published on 2 Feb. 2010 / Last Updated on 2 Feb. 2010]




In my previous two articles I presented WiMax and LTE, the two giants competing for market share in the 3G telecommunications space. In this article I will compare and contrast the two from a technological and a business perspective. First, let's review the two standards.

WiMax review

WiMax, which is also known as IEEE standard 802.16, is a 3G wireless broadband access standard developed and maintained by the IEEE. As its name suggests, WiMax can be thought of as an extension of WiFi to the fully mobile telecommunications markets. Like WiFi version 802.11n, WiMax also contains support for Multiple Input/Multiple Output (MIMO) antennae, which is critical for supporting multiple simultaneous users. Also like WiFi, a major supporter and promoter of WiMax is Intel. Unlike WiFi; WiMax is designed for hundreds of users per base station, the users are highly mobile often switching from base station to base station throughout a single communication cycle, and the base station ranges are measured in kilometres not metres.

LTE review

Long Term Evolution (LTE) is also a 3G wireless broadband access standard though it is developed and maintained by the 3rd Generation Partnership Project (3GPP). The 3GPP is an organization responsible for the development, maintenance, and promotion of the GSM family of standards. LTE is the latest in the family of GSM standards which have been evolving from GSM's roots as a circuit switched architecture to an all-IP based architecture. Starting with the General Packet Radio Service (GPRS) standard and including the Enhanced Data Rates for GSM Evolution (EDGE) and High Speed Packet Access (HSPA) standards the GSM standards have been marching slowing but confidently towards an all-IP architecture. 


As the LTE standard has moved the GSM standards towards what is more traditionally thought of as a computer networking standards, WiMax has moved traditional computer networking towards what has traditionally been thought of as mobile telephony standards. So you can see that the two standards are coming from different backgrounds (with different strengths and weaknesses) and converging on common ground. 

As you might have guessed, the industry players backing each technology reflect the history of each standard. WiMax's most significant backer, as I mentioned before is Intel. Intel has a very strong history in the computer industry and was also a major supporter of WiFi. Likewise the major supporters of LTE are, in general, the telecommunication service companies and the traditional mobile handset makers (like Ericsson). Largely, this is due to the fact that people like to work with what they are comfortable with. Intel, as a result of its history, is comfortable with traditional computer networking and so has naturally drifted towards WiMax. Ericsson, among others, is comfortable with GSM technologies and so it is quite natural and understandable that they would be drawn towards the LTE standard.

The consumer

It Is not only tech companies who like to work with what they are comfortable with. This sort of thinking also infects consumers decisions. Due to the name WiMax consumers quite naturally think of WiFi which has for many years been a part of the home networking world. Consumers will immediately think that WiMax is something used to network a computer. LTE, though not having a strong name association with GSM, is closely associated with GSM (from a consumer's point of view) through its supporters and the telecommunications services companies like AT&T. So consumers will immediately think that LTE is something used to network their mobile phones; though this link is likely not as strong as the link WiMax has to WiFi.

So there exists two consumer preconceptions for the two 3G standards. I am of the opinion that the standard which ultimately gains more widespread acceptance (and therefore wins) will be the standard with the most advantageous consumer image. Now, a preconception does not make an image. However, as the saying goes you only get one chance to make a good first impression. While a good advertising campaign for a good standard with a good roll-out strategy can make a difference, competing against a strong competitor having a strong first impression is always difficult.

That's the exact situation we have here. Both of these standards are excellent, both have an impressive list of industry heavy weights supporting the standard, and both have excellent roll-out plans. There should be no doubt that both standards will soon be in the hands of very capable advertising professionals. So to me, this whole competition (barring a massive mistake, or genius maneuvering) comes down to who has the favourable first impression.

Who wins?

So which technology has the advantageous position? This is where the debate lies. While LTE invokes the impression of mobility, WiMax invokes the impression of computing. I think that the question we are really trying to answer is whether consumers want a phone which is networked to the Internet, or do they want a computer they can carry with them like a phone? The lines are obviously very blurred here. As the iPhone has shown, there is a very large and significant portion of the market which want a computer they can carry with them like a phone. This view has been strengthened by the fact that many handset manufacturers have responded to the iPhone's success by introducing handsets themselves that are much more computer like (and yes, some handset manufacturers even did this prior to the iPhone). Is this portion of the market the majority? It's difficult to say, though I think it is. Another advantage which WiMax has is that children use, and are comfortable with, computers long before they are of the age to purchase or use a mobile phone. So young people soon to enter the mobile phone (or should we say mobile communication device) market will already be familiar with computers, but not as much with traditional mobile phones. This differs from the market today as the majority of adults are comfortable  with both mobile phones and computers.

Who wins? If I was a betting man my money would be on WiMax. I know many people think differently but as I have laid out I believe WiMax is starting out with a huge advantage which will be quite difficult for LTE to overcome. Separate from my "positive preconception" argument, I also believe that WiMax has an advantage in its history. That is that coming from the computer and computer networking side of things WiMax has supporters from those industries. In my opinion this is an advantage because it seems that the computer industry has a very strong history of tough competition and strict, never-ending development cycles, while the traditional handset makers do not seem to be as hardened to this type of competition. As always, if you have any questions or comments on this article or any previous article don't hesitate to email me and I will do my best to respond promptly.



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