Correction
MWeb has since pointed out that its new wireless offering is technically not WiMax, but rather a solution that acts in a similar way on open frequencies. The company says the new wireless network is built off the backhaul of its WiMax trials, and can be scaled to the full WiMax specification with a few tweaks if spectrum becomes available.
The firm says while the solution it offers now does not conform to the standard WiMax specification dictated by the global telecoms standards authorities, it does have a similar net effect.
ITWeb apologises for the misinterpretation of the company's statement.
Naspers-owned MWeb has made another major move on the Internet market, releasing an uncapped WiMax offering which competes with a business uncapped ADSL solution.
The company announced this morning in a press statement that its WiMax offering will be available in certain coverage areas, including Sandton, Boksburg, Isando and Midrand, in Johannesburg; and N1 City and the Cape Town CBD.
According to MWeb, it will release the service on an open spectrum band, in anticipation of an expected scarce spectrum auction in the not too distant future, when it hopes to gain some of the spectrum in the 2.6GHz and 3.5GHz bands.
MWeb's WiMax network was implemented almost five years ago, when the process to begin the allocation of the scarce spectrum began. The company ran a trial WiMax network across the areas in which it now has a full service.
In 2007, it applied for an extension to the trial licence; however, it was abandoned when the Independent Communications Authority of SA (ICASA) could not come up with a way to allocate the remaining spectrum.
The company was also only a value-added network service provider at the time, and did not have a licence to build its own network. However, following a revolutionary court judgement instigated by Allied Technologies, all those VANS were converted to fully-fledged telecoms operators in 2009.
For MWeb, it meant the network it built would be valid under a licensed regime, giving it the opportunity to make use of the assets.
Without access to the local loop, which is wholly-controlled by fixed-line operator Telkom, WiMax has become known as the best and cheapest possible option for an alternative last mile.
ICASA has not responded to ITWeb's query on when it expects to see the local loop unbundled.
MWeb has now circumvented the regulator's slow pace in delivering spectrum to the market and lack of clarity on the local loop, by releasing the offering on the open frequencies.
Steven Ambrose, MD of WWW Strategy, says the move is a double-edged sword for the company.
He says the trouble with using an unlicensed frequency is that it is generally very noisy, which could put a damper on the network's service levels. However, he says that despite the noise, its decision to use the Alvarion wireless equipment will help to mitigate some problems.
Ambrose believes MWeb has made an excellent decision in introducing this solution now. “They made noise with the uncapped ADSL and this WiMax offering will have the same impact.”
While it is unclear how much MWeb invested in the WiMax network in 2006, it is understood that the company wrote off the investment when the spectrum allocations failed to appear.
Ambrose says the offering will allow MWeb to now monetise the assets that have been sitting dormant for so long.
“They will also now be able to use the skills they developed for the trial network that have had little to do since the trial ended,” he adds.
The offering is targeted at the small to medium business market, and is priced comparably with what it would charge for its ADSL uncapped offering. At 512Kbps, customers will pay R1 299, for a 1Mbps line customers will pay R1 999, and a 4Mbps line will cost R2 795, on par with what an uncapped ADSL offering, including Telkom line rental, will cost.
The catch is that in the open frequency, MWeb will only get a third of the coverage it would have had if it had access to the spectrum in the 2.6GHz or 3.5GHz bands. Because of the small 5km coverage area, MWeb will conduct site visits for interested customers before it implements the offering.
“Once it has been determined that a client can get good quality signal, a small antenna will be installed at the customer's premises to receive the wireless signal,” the company says.
Ambrose says MWeb is likely setting itself up to be a leader in the space, so that when the spectrum auctions roll around, it will be perfectly positioned to gain access to it.
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