To all, a great article,
June 21, 1999, Issue: 413
Section: Technology
Up in the Air -- Suddenly, MMDS is hot. But how far can its technology take it?
Meg McGinity
If ever there was an industry that needed good news, it has been multichannel multipoint distribution service (MMDS), a delivery platform that for the past couple of decades has done an adequate job of delivering video programming to those unpassed or unimpressed by the cable industry. Well, the good news has come. In September the Federal Communications Commission (FCC) signed off on two-way MMDS service. Then, this spring, the second- and third-largest long-distance companies decided that the platform may indeed be a valuable weapon in the war against AT&T.
As the industry digests those glad tidings, the vital work of testing and rolling out two-way techniques begins. These could determine if MMDS has a future as a wireless local loop (WLL) star-or if it gets relegated to a much smaller role in the high-speed access stage. For the most part, the early activity is among companies now controlled by MCI WorldCom Inc. and Sprint Corp., says Bo Fifer, analyst at BT Alex. Brown Inc. (Baltimore). These include CAI Wireless Inc. (Albany, N.Y.), invested in by MCI WorldCom, and American Telecasting Inc. (ATI, Colorado Springs, Colo.) and People's Choice TV Corp. (PCTV, Shelton, Conn.), both now flying the Sprint flag. Wireless One Inc. (Jackson, Miss.), an MMDS provider so far untouched by the big guys, is also testing two-way wireless cable service.
PCTV's wholly owned subsidiary, SpeedChoice (Countryside, Ill.), has rolled out two-way wireless in Phoenix. About 100 business customers are using the service. It will be available to the residential market in July, the company says. Business rates start at $100; residential rates will begin at just over $40. SpeedChoice is using equipment from both Hybrid Networks Inc. (San Jose, Calif.), which provides the wireless modems, and Conifer Corp. (Burlington, Iowa), which provides the transceivers. "We are right now selling in Phoenix a high-speed Internet and data networking service," says Matt Oristano, SpeedChoice's chief executive officer. "You will see wireless local loop to the home."
While analysts note that two-way MMDS is in its infancy, they see great promise. "The trials have been primarily looking at not so much capacity-seeing how many people can be on at one time-but how far out customers can be served," says George Harter, chief technology officer for broadband wireless consultants Hardin & Associates Inc. (Virginia Beach, Va.). Results, which Harter describes as "phenomenal," include coverage in excess of 25 miles, with speeds of 10 Mbit/s downstream using a 2-MHz channel and 128 kbit/s upstream, he says.
The reality is that these tests and trials will begin assessing challenges and limitations to the technology. MMDS generally requires line-of-sight access and has high attenuation, or signal loss over distance, says Peter Nighswander, vice president of competitive telecom practices at The Strategis Group (Washington, D.C.), a consulting firm. Indeed, these issues may be its Achilles' heel. "MMDS does work-it offers some advantages, like it can be deployed quickly-but it will never be a widely deployable scheme in many areas where trees or foliage or other line-of-sight factors are problems," says Ray Jodoin, senior analyst at research firm Cahners In-Stat Group (Newton, Mass.).
One of the hurdles MMDS faces, say analysts, is the dearth of two-way equipment. This will change quickly, especially if service providers agree that ongoing tests and rollouts are successful. That's not to say equipment isn't available today. In addition to Hybrid and Conifer, MMDS vendors include Adaptive Broadband Corp. (Sunnyvale, Calif.), California Amplifier Inc. (Camarillo, Calif.) and Spike Technologies Inc. (Nashua, N.H.).
The tests suggest that deployment costs will not shoot down MMDS, Harter says. Today, MMDS costs hover at $1,500 for the customer premises equipment, says Rich Valera, vice president at investment company Needham & Co. (New York), but these costs should come down once orders are filled in greater volume. "The Holy Grail is $500," he says. This price point should make economic sense to customers who want, for instance, a fractional T1 (1.544 Mbit/s) equivalent but aren't served by fiber or copper. The rural market, which is either bypassed or underserved by landline infrastructure, seems a good fit. Commercial deployment could heat up during the fourth quarter, Harter says.
Although MMDS looks as if it's finally getting some recognition, equipment manufacturers now need to offer the tools necessary to get the platform to market in an efficient and robust way.
"A few years ago, MMDS was a very bad idea," says Larry Swasey, vice president of communications research at Allied Business Intelligence Inc. (ABI, Oyster Bay, N.Y.), a consultancy. "Today it's a great idea. The prospects for MMDS are so much better now that it's two-way. It's just not the same technology."
Copyright ® 1999 CMP Media Inc.
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