Alvarion grabs WiMAX market in South America

THERE IS A RACE to deploy wireless broadband using Wimax -technically IEEE 802.16- in Argentina, with two ISPs already boasting about having an operating network in the metropolitan Buenos Aires area, and the two currently engaged in the active deployment and extension of their networks to different cities. In this year’s Expocomm exhibition, both players in the Wimax game had their gear on display and one conclusion was obvious: Motorola is -so far- still looking for buyers for its kit.

The companies offering Wimax service are Ertach and Velocom. Both companies confirmed this correspondent that they’re currently using kit from Alvarion, which you can see below. There was also Wimax sales leaflets with the Intel logo at the booths, so clearly La Intella is behind the move as well. Strangely, Motorola was also at the exhibition, promoting their “Canopy Platform”. When I INQuired Motorola’s representative about why both ISPs deploying Wimax in Argentina have chosen Alvarion’s product, he hinted that being “first” was probably Alvarion’s biggest advantage, but he also hinted that one of the two ISPs was also testing Motorola’s Canopy platform, which he said can be Wimax compatible. He refused to say which of the two ISPs is evaluating Motorola’s gear, though. Of the two ISPs, Velocom seems to have a pricing edge, at least in Buenos Aires city, yet at the same time, Ertach’s network appears to currently span more locations -both companies are actively expanding their respective networks so this is a moving target-. For a Wimax-based, 1Mbit link in the B.A. metro area, Velocom quoted me (verbally) “around $500 pesos a month” (that’d be $170 US dollars/mo). Ertach on the other hand quoted their dedicated 1Mbit service at $1185 pesos (around $407 greenbacks per month). A two megabit link on Velocom was quoted at “around $700 pesos” – or $240 us dollars per month. Velocom on the other hand charges an installation fee of around $134 US dollars, which was not mentioned by Ertach. All Wimax links are symmetric, dedicated links, unlike “residential” broadband services (ADSL or Cablemodem).

Ertach, a company formerly known as Millicom Argentina and which landed in the country five years ago when the telephony service was deregulated -the incumbents lost their voice monopoly- is now owned completely by the local group Comercial del Plata (BCBA: COME), after they bought the remaining 65% from Millicom International two years ago. The company began building their Wimax network last year -they used fixed-wirless WLL technology until now-, and also announced earlier this year that they’ve been awarded as the main provider in a government contract to build the “single data and phone network” for the province of Buenos Aires, which will link 100 municipalities together in a single unified network providing data and voice services to the city halls, police stations, school boards, and municipal public hospitals, among others.

Velocom, in addition to their Wimax deployment, is also running a promotion using their previous WLL-based “fixed wireless” technology (with a 128/512k speed) geared towards students, at only ~$48 pesos a month – or about $16 dollars. This seems to be a great deal, yet be warned that the old technology was known to downgrade considerably during heavy rain, thunderstorms, and also to suffer from congestion problems at certain times of the day. Still, this deal must be one of the more affordable broadband offerings you can find.

Back to Wimax, both companies organized their booths with “speed” as the main theme, and apparently car racing is the only way to show the idea of “higher speed”. Velocom/Silica had a “slot cars” track on display, where the visitors were invited to play and enter a competition with other players. Ertach has a car racing video game where even old ladies played their hearts out. In short: Ertach seems to have the most extensive network right now, and seems to have chosen a “we’ve built this huge network, now we’re going to recover the costs” pricing model, and Velocom seems to be betting on a risky “let’s put an agressive pricing in place and attract as many customers as possible in the shortest period of time” approach. Who will win? Only time will tell. As always, it depends on the quality of the service, the quality of the underlying network, the redundancy -or lack thereof-, the SLAs -if any- involved in each given service contract, and lots of other details. I’ll do my best to test the services -in case each company agrees to provide me a sample test link-, and if so, you’ll read about the Wimax experience here on the INQ as well.

Why is Wimax important in this market? Well, down here the incumbents charge you an arm and a leg for fixed links, and they have restricted the ADSL upstream to ridiculous low levels – I suspect so they can sell their expensive hosting and housing services-. And after you’re robbed at gunpoint -figuratively speaking, of course- you’re supposed to reply with a smile, as if they’re doing you a favour.

Other fiber-and-copper based providers sometimes aren’t much of an option, even if their networks pass a few blocks from your location. Take Impsat for instance. This telecommunications giant used to offer one of the best dial-up services you could get -back in 1996/98- then suddenly one day they decided they no longer cared about home users and dumped them. They now continue selling dedicated IP links to corporations but seem to be extremely annoyed with the idea of serving residential customers or small business. When earlier this year I asked an Impsat company representative about the chances of getting an internet link for my home office, the his first reply was: “We don’t serve residential customers, only corporations” and his follow up said: “our leased internet links start at $550 us dollars a month, plus 21% VAT, and can go up to $25,000 us dollars a month, plus 21% VAT” (!).

Another fiber-based network providing both VOIP and internet connectivity, IPlan -which has otherwise a great network and pricing, but seems to have no interest in expanding its network two blocks- replied: “Our fiber optic backbone passes two blocks away from your building. We’d have to extend our network 200 metres to reach you, and we’d have to charge you about $7,000 us dollars for the cost of the work”. You can see how Wimax can -and hopefully will- invigorate this market and bring decent symmetric connectivity at a lower price to lots of people who badly need it.


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