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WiMAX: Andrew Seybold reads the writing on the wall

Intel will pull out of WiMAX next year. Not completely, but definitely, suggests Andrew Seybold.

He put it pretty simply in his blog:

Over the past several weeks, I have written a number of articles speculating about Intel's intention to exit the WiMAX space and cited its first volley when its VP of marketing suggested that WiMAX and LTE should become one and the same.

It's a thesis which is not much shared in public, and Seybold gets credit from many for saying aloud what many have whispered behind their hands. But when approached by NewsWireless for actual on-the-record quotes, it's amazing how these sceptics turn into enthusiastic boosters of the technology.

Seybold's arguments aren't simple sound bites. He has three major arguments

On the first point, Seybold observed: "I thought that would be bad for the smaller WiMAX companies that have been gearing up for a new wireless market with new players (not incumbents) because they would have to compete with all of the existing major players that will be in the LTE space."

His point is that if Intel backs out of WiMAX it will hurt these smaller companies, the ones that are making device and base station chips, radios and devices for WiMAX. "If they have to obtain IP licensing rights to include GSM/UMTS/CDMA/EV-DO or any combination of these, they will no longer have any advantage and will be competing with the largest chip and wireless companies in the world."

His main argument won't get universal agreement, but it's one which has been proposed on NewsWireless in the past:

Intel got into the WiMAX business because it would have had to pay for IP rights for either GSM/UMTS or CDMA/EV-DO. WiMAX looked like a good deal because it might remain royalty free and Intel could compete on a playing field on which it was the 900 pound gorilla and everyone else was a puny guy getting sand kicked in his face. But if Intel does go the route of WiMAX/LTE and doesn't build backward compatibility into its chips, it will end up with a warehouse full of chips no one wants. If it does decide to build backward compatibility into its chips, even if it is only LTE, it will need to make IP agreements with the appropriate companies and that will put it on the same footing as everyone else in the chip business-no advantage, except that it is Intel.