Cisco confirms exit from WiMAX RAN market
After entered WiMAX with its 2007 Navini purchase, Cisco's 4G focus will now be on IP and packet cores, as it is in 3G
Published: 8 March, 2010
READ MORE: Cisco Systems | Core Network | WiMAX
Cisco has confirmed that it will exit the WiMAX access network market, which it entered when it acquired Navini Networks in 2007. The company will now focus, as it does in all other wireless infrastructure sectors, on the IP core, plus transport and, after the Starent purchase, the evolved packet core. This leaves its only access network activities at the miniaturized end, in femtocells and Wi-Fi access points.
The move is logical, freeing Cisco to sell its core network products to WiMAX operators alongside any vendor's RAN, as it does at Clearwire and others. It is something of a mystery why Cisco broke with this tradition and thought it would like to play in the WiMAX RAN, and with hindsight this has proved an aberration that has been quickly put right, with limited negative impact for the IP giant. But that does not detract from Navini's value as an acquisition - it was just purchased by the wrong vendor, to whom it would never be truly strategic. In the hands of an access specialist, it could have delivered major competitive value, especially as the technology where it was strongest, beamforming, is finally coming into its own in the WiMAX market (and in LTE, to which another acquirer might have adapted some Navini technologies too).
Navini was touting the benefits of beamforming plus MIMO before this combination was incorporated into the 802.16e WiMAX standard as options, and even before WiMAX itself. Beamforming, which enhances range and data rate by targeting signals accurately, was at the heart of the firm's proprietary platform, RipWave, which was then migrated to the WiMAX standard and supported various mobile broadband operators such as Australia's Unwired and the US' Xanadoo. In combination with MIMO smart antenna arrays and OFDMA, beamforming was part of the trio of technologies that would underpin 4G systems and break the limitations of capacity and data rate of existing networks.
However, beamforming has been perceived as an expensive option, and Navini's kit was definitely at the Rolls-Royce end of the market, at a time when many WiMAX players were chasing cost sensitive deals in emerging markets like India, or stimulus funded providers. The company spent much time working on case notes that demonstrated how beamforming could reduce total cost of ownership, or cost per Mbps, but the upfront cost was often still seen as a deterrent. Ironically, as Cisco moves away, the market is coming round to the Navini way of thinking.
A recent report from SenzaFili Consulting found that beamforming lowered the overall capex and opex of a network over five years because of the lower number of cell sites. With beamforming alone, 49% fewer cell sites were required in year one, and 20% in year five. With combined MIMO and BF, the reduction in cell sites was even larger, ranging from 57% in year one to 34% in year five. This resulted in a 20% reduction in cost over five years in the former case, and 34% in the latter.
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