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As Nortel puts together its plan to emerge from bankruptcy protection as a new-look vendor, there is rising speculation that it will exit the pressurized wireless infrastructure business and focus on enterprise systems and IP. So its announcement yesterday that it will pull out of the Mobile WiMAX sector could either be the first step in a broader strategy, or simply the first in a likely series of decisions to offload activities where Nortel lacks critical mass.

Mobile WiMAX was once a centrepiece of the Nortel strategy to leap ahead of its rivals on the road to '4G'. Having pulled out of W-CDMA, it took the line that it would take an early position in WiMAX and LTE, with a unified development plan for both platforms. However, it lost out in the flagship Sprint Nextel WiMAX contract - to Motorola, Samsung and Nokia - and failed to gain market momentum compared to WiMAX leaders like Alvarion. So last year it ended its own development of 802.16e and said it would rely on a partnership deal with Alvarion.

Now that agreement has also ended, though Nortel says it remains committed to its fixed WiMAX business (where it uses Airspan kit) and also to its LTE roadmap, though with the major vendors gearing up for early LTE roll-outs from the end of the year, it is questionable whether Nortel will have the resources to ensure its R&D program keeps pace - or whether early LTE adopters will feel secure trusting a high risk endeavor to a company in Chapter 11. However, Nortel is involved in LTE trials by Verizon Wireless and T-Mobile, and is providing LTE core network systems to KDDI in Japan, along with Hitachi.

Nortel said that it was pulling away from Mobile WiMAX in order to "narrow our strategic focus", and its customer base will be transferred to Alvarion. Insiders at the Israeli firm said the end of the Nortel deal would not make a significant impact on its revenue expectations. On the core side, Nortel business will be transitioned to WiChorus.

The leading players in Mobile WiMAX are Samsung, Motorola, Alvarion and Alcatel-Lucent (which, despite hints it would also defocus on this platform, said this week it was still "very much in the game").

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