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Product lines retooled in preparation for next generation data networks Curt Cherewayko With the next generation of wireless communication technologies ready for deployment, wireless developers and carriers are placing their bets on which technologies will prevail in the fourth wireless age. Rogers Communications (TSX:RCI) was a clear winner in Canada’s third wireless age with its global system for mobile (GSM) standard, but many companies have retooled and are deploying new faster data delivery technologies such as long-term evolution (LTE) and WiMax. Rogers continues to dominate the Canadian wireless landscape, in part because it’s the only carrier using the third-generation GSM standard, which underlines how important it is for carriers to select the correct wireless technology to take them into the future.
Canada’s other top carriers, Telus Corp. (TSX:T) and BCE Inc.’s (TSX:BCE) Bell Canada, use the other leading 3G standard: code division multiple access (CDMA), which is considered by some to be superior to GSM for connectivity and data transfer speed. GSM, however, has more consumer-friendly features. It’s also used by 80% of network operators in the world and is the standard used by Apple’s iPhone, which increased Rogers’ market dominance when it entered the Canadian market last year. Joining wireless carriers around the globe, Telus and Bell announced last October that they will adopt the LTE standard for their 4G network, which is expected to be deployed in 2010 and cost up to $500 million to build. Consumers with LTE phones will be able to roam freely on today’s 3G networks and can expect data speeds to be more than 10 times faster than 3G phones. “There’s not going to be one big winner, although LTE will probably be one of the biggest winners,” said Jim Tocher, CEO of Tranzeo Wireless Technologies Inc. (TSX:TZT), a Vancouver-based wireless network equipment maker. From a development standpoint, Tranzeo is remaining agnostic and not betting its future on a single technology. Tranzeo is deploying 16D WiMax – a standard that has the short-range speed of WiFi but, unlike WiFi, can cover large areas. The company is also preparing to deploy 16E WiMax, a programmable and remotely upgradable standard. “We see carriers needing to deploy 16D WiMax today, because they can’t wait for the full implementation of LTE in late 2010 and 2011,” said Tocher. He noted that, because WiMax 16E devices can be programmed to communicate with LTE and WiMax networks, future network providers will be able to “flip a switch” to make the transition to LTE. Late last month, Tranzeo announced the first phase of a joint project with an Indonesian tower operator to build a WiMax network in Indonesia. The deal’s initial phase is worth US$10 million for Tranzeo, which is making the radio devices required to connect up to 1.5 million subscribers to the network. Jason Cohenour, president and CEO of Richmond-based wireless modem maker Sierra Wireless (TSX:SW; Nasdaq:SWIR), noted that because WiMax is cost-effective and easy to build from the ground up, it has become a popular standard in developing countries that have no network infrastructure. “But if you’re an existing network operator who already has lots of customers, lots of towers and lots of infrastructure, LTE is probably a more elegant evolution,” said Cohenour. In the third quarter, Sierra rolled out a number of wireless modems that are compatible with the high-speed packet access (HSPA) standard. Many carriers, including Telus, are deploying HSPA technology to bridge the compatibility gap between 3G and 4G network technologies. Cohenour said that while most GSM carriers plan to adopt LTE as their 4G standard, WiMax will also feature prominently on Sierra’s product development road map. He added that, as well as emerging markets, WiMax is an ideal or fixed machine-to-machine communications – a market dominated by 2G technologies and one in which Sierra is trying to establish a larger foothold. Last December, Sierra acquired Wavecom S.A., a Paris-based developer of machine-to-machine wireless products, for $343 million. Sprint Nextel Corp., one of Sierra’s largest customers, partnered with Clearwire Corp. to deploy the first WiMax network in the United States, although only Baltimore and Portland are thus far connected to the network. •
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Business in Vancouver February 10-16, 2009; issue 1007 |
