Google “snookered” on $3.2 Billion Deal

At the Digital Hollywood Conference this week, speaker after speaker waxed poetic about the boundless future offered by the near-certain adoption of the WiMax standard in the next couple of years. Our mobile devices are going to be connected at 700megs/sec, all over, seamless service, replacing all wired, fibered, satellite or twisted-pair alternatives. It’s going to be the great big game-changing move that finally delivers on the promise of “every piece of content ever produced, everywhere, all the time.”

Well, today in TechCrunch, comes a rather more textured view
of the Big Fat Deal announced this week.

As I said before, this is a disaster waiting to happen. Sprint and Clearwire need the deal to try to salvage the billions they’ve already sunk into their money-losing WiMax networks. But putting more cooks into the kitchen with different WiMax aspirations is not going to help. Google wants more wireless broadband alternatives for its planned mobile apps and advertising. Whereas the cable companies want a way to compete against mobile phone operators encroaching on their turf.

I have to agree. This many players all fighting for the reins means that this stagecoach is headed off the cliff, pronto. The whole “don’t be evil” philosophy of Google, when it comes up against the philosophy of U.S. cellphone companies … well, that’s a clash of cultures like a partnership between a hippie day-care center and Visigoth torturers.

Meanwhile, it appears that some very, very basic pieces of the technology just AREN’T in place:

2. WiMax hasn’t proven itself elsewhere either. Even in Korea, which has had WiMax for two years and is supposed to be a broadband paradise, consumers are not clamoring for WiMax. There are only about 150,000 WiMax subscribers in Korea, well below initial expectations.

3. Before you can turn Wimax into a mobile broadband service, you need mobile WiMax equipment. Cell phones, laptops, and other devices with WiMax chips in them are a long way away. Intel is ready to sell those chips, but device makers are not going to put them in their gadgets until enough consumers want them. And most consumers are going to wait for a WiMax network to show up that they can access both where they live and when they travel. So there’s a chicken and egg problem there.

(snip – and most compellingly)

6. WiMax is not a global standard. Here in the U.S., WiMax is built on 2.5 GHz spectrum. Overseas, it is built on 3.5 GHz spectrum. That makes it harder for equipment manufacturers to achieve the scale they need to make money from WiMax devices and network equipment.

I keep coming back to a very basic problem – the promise of WiMax is that it allows the signal to go 30 klicks, meaning that even out in the boonies, you can get fatpipe internet. OK, fine. The signal from the tower to your device will probably get through.

But howinhell is a measly little handheld phone or laptop computer going to push a signal from you out to that big 200-foot high transmission tower? Huh? Riddle me that.

I had one of the very first cellphones ever commercially made. It was a Kenwood. It came in a backpack-like format, weighed about 10 pounds. Had a detachable handset and a 8-inch high, 1/2 inch thick, plastic-coated antenna. We rented those back in the day, used them to check in while we were hunting celebs & news thru the Hollywood Hills. The salesmen used to caution that “You want to keep that antenna as far from your head as possible when making a call.”

See, the thing is, the 1st Generation cellphone towers, those old analog ones that we put in starting in the late 80s, they were made to push and receive signals from phones transmitting at 3 watts or so. At 3-watt signal will travel a couple of miles, depending on the terrain and other interference.

The salesmen told me a dire tale I’ve never forgotten – they cell companies had made a handheld “brick” phone that put out about 6 watts, and gave it to a Fire Department in Indiana to test. After a fire, the Fire Captain was talking for a long time (I think it was half an hour, but not sure) on the newfangled phone. At the end of his call – ZOOOOPP! – his vision irised to black.

The high wattage of the phone had cooked his retinas.

Using a cellphone is like sticking your head into a low-power microwave oven.
Current phones transmit at about .5 watts. That’s why we’ve had to build the cell towers all over the landscape – the lower transmission power means the signal only carries a couple of blocks, not a couple of miles.

So getting back to WiMax.

How hot of a microwave signal do the devices have to put out before they can connect? Does this mean that having your laptop, you know, on your lap, is going to cook your harbls?

And man, the differing global standard is right there a deal-killer for me. I have seen how tech that only works in the U.S. is not viable in a global economy. And trying to establish a new, costly standard in the world that is incompatible with what is still the biggest market? Non-starter.

Maybe there’s some compelling reason that hasn’t yet been made clear to the rest of us civvies, but this deal sounds like a real dog, one that could strangle potentially interesting technology in its cradle. Which would suck, because as much as I hate the cellphone companies, I am REALLY hating on the cable/DSL service providers.

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