Wireless puts the wind up Telstra
The Wimax technology is going to be a big worry for the dominant telco, writes Michael Sainsbury
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July 20, 2006
IT is abundantly clear after a major speech form Telstra on future network funding that the company is - and there is no other way of putting this - scared witless of the emerging wireless technology known as Wimax.
Via a speech by senior network executive Lawrence Paratz, Telstra laid out what it thought arch-enemy Helen Conan should do with her $1.1 billion Broadband Connect Fund.
And no, it's not quite what you may think, although that was Telstra chief Sol Trujillo's initial response when Conan announced the fund last December.
Perhaps still stung by the Government's rejection of his hastily-scribbled-on-the-back-of-the-envelope proposal, which was dismissed by the Government (which has been asked to chuck in $2.4 billion), Trujillo had to be talked around by a few locals over summer last year to even take part in the scheme.
Apart from the risible suggestion that Telstra might be allowed to get the lot, Paratz made it clear that Telstra doesn't want any nasty new technology coming along to spoil its party.
The talk right now in telecoms circles is not so much whether Wimax will emerge as a potential threat to networks based on more traditional mobile technology but when, and how the two different standards might eventually work together.
To understand what is happening, it is useful to take a step back. Traditional mobile networks emerged from the voice-centric world of incumbent telecommunications companies in the 1980s, and it was not until the mid-1990s that the first data application - text messaging - took off.
Wimax, on the other hand, came out of the data-centric world of computer networking. Its older, slower sibling wi-fi was a way to replace all those cumbersome cable and blue cords connecting computers and other devices like printers, copiers and projectors.
Wimax is expected to be fully standardised by next year and is a big leap from wi-fi - it provides a much fatter broadband pipe and it has many of the mobile characteristics of traditional mobile networks.
The big advantage of the wi-family technologies is that the networks are much, much cheaper to build. Companies like Unwired, which yesterday announced it had doubled the size of its pre-Wimax network in Melbourne, and Austar have taken a bet that Wimax will provide a real alternative to fixed broadband networks that use a combination of copper and fibre.
Together with Soul, Unwired and Austar - the AUS Alliance - want up to $300 million to roll out networks in regional Australia. No wonder Telstra is worried.
UNW
unwired group limited
