WiMAX Destined for Iridium Fate?

Some believe WiMAX services will be the next best thing since sliced bread. Others, clearly, do not. In fact, some analysts are predicting that mobile WiMAX is destined to follow a similar path as Iridium - the global satellite-phone service that went bankrupt - did before it.

According to Jane Zweig, CEO of The Shosteck Group, mobile WiMAX supporters are ignoring the fact that existing mobile and residential broadband technologies are maturing, evolving and already enjoy a formidable foundation of users and scale. Like Iridium - which went south because it failed to anticipate cellular's evolution into an inexpensive and widely terrestrial service - the WiMAX crowd isn't considering how established technologies will improve over time.

Iridium "failed to take into account the competitive environment in which (it) would be operating," Zweig said. "By the time Iridium could launch, conventional cellular would have captured almost all of its potential market."

Further, she said, WiMAX can only be successful by "cannibalizing the revenues" of other providers. "This makes the current business model for mobile WiMAX inherently undeliverable in the terms being discussed today," Zweig said.

However, if WiMAX can deliver what it intends to, others believe cellular data and Wi-Fi hot spot providers will face serious competition for lap-top users who want internet services on-the-go. If this is the case, U.S. WiMAX providers like Sprint and Clearwire could be well-positioned to offer wireless mobile and residential broadband service