Three years after the federal government issued licences allowing companies to provide broadband wireless services, the market remains nonexistent.
But MaxLink Communications Group of Companies is hoping that will change now that it has purchased WIC Connexus and 49 per cent of Regional Vision Inc. from WIC Western International Communications Ltd. for $50 million. With the purchases, MaxLink now has stakes in all three of the 1996 Industry Canada licences to provide broadband wireless services known as Local Multipoint Communications Service (LMCS).
MaxLink president Joel Bell said the deal will allow MaxLink to become a national broadband player, providing enterprises with services such as high-speed data and videoconferencing. But one Canadian analyst questioned MaxLink’s ability to become a major player given the company’s limited resources and failure to deliver any widely available services to date.
“You wonder if this will ever get off the ground or if it’s all just posturing,” said Jordan Worth, an analyst with IDC Canada Ltd. in Toronto.
At best, Worth said he believes MaxLink will be a niche player in the broadband market.
One reason for this prediction is the federal government is preparing to grant another set of broadband wireless licences this fall. Although the licences will cover a different spectrum than MaxLink’s licences, they will allow licence holders, which could include large telcos, to offer the same types of service as MaxLink (please see “Government prepares to auction air,” page 16).
Another reason for Worth’s scepticism is the state of broadband wireless in general.
“The technology isn’t there, no one’s sure if there’s a market and you’re dealing with a country where Toronto, the area where all the money is, is heavily wired,” Worth said.
Even if broadband wireless technology is up and running soon, Worth doubts it will be able to beat the broadband price points being offered in major Canadian cities.
MaxLink’s Bell said there are very few areas in Canada that are so heavily wired that broadband wireless won’t be an attractive alternative.
“Fibre can do the job very well,” he said, “but it can only do it in areas where it’s economically feasible to roll it out. So you’re looking at the downtown cores.”
If an enterprise wants all of its national users, including those in remote locations, connected to one high-speed network, broadband wireless is an ideal option, Bell said.
Broadband wireless should be especially appealing to any firm looking for a synchronous, high-speed data connection, Bell said. With the exception of fibre, most data transport mechanisms, including cable and ADSL modems, provide asynchronous connectivity. While users can download information at high speeds, sending information is a much slower process.
“I believe the way the world is going is symmetric service,” Bell said. “Once you get used to downloading at high speed, you’re going to want to send at high speed, too.”
MaxLink has had an LMCS site running in Ottawa for 14 months, Bell said. The company is also testing in Calgary and Montreal and it plans to roll out LMCS services in all three cities later this summer.
Toronto and Vancouver won’t be added until later, Bell explained, because those two cities were covered by WIC licences, and MaxLink doesn’t have any infrastructure built in either city.
