Its finally here. After months of delays, Sprint finally launched Xohm yesterday bringing an end to speculation about the brand and the service itself. As a long term sprint and WiMAX critic, one must admit being quietly surprised by what Sprint has managed to pull out. Xohm, in its initial few days after announcement evoked mixed reactions from different sections of the media. Some positive that the consumer will finally get to see wireless convergence earlier than they hoped and others neutral/negative partly because they were more concerned with cycle time of their "evolution" investments. Sprint through Xohm became the poster boy of WiMAX worldwide. Although operators in some emerging markets are betting on the technology on a much bigger scale, everyone in the ecosystem continue to link sprint's success to WiMAX's future or should we rather say WiMAX's survival.
If its about survival, then it must be said that Xohm managed to keep mobile WiMAX alive to fight another day. Yesterday, Sprint launched its first Xohm commercial WiMAX network in Baltimore with subsequent launches planned in atleast 5 other cities before the end of 2008. But as they say, the devil is in the detail. The network at launch is a notebook and home play network only with timelines still unclear about handheld Voice(with Sprint EVDO) and data (WiMAX & EVDO). The Initial launch however promises required QoS for VoIP. There is no commitment yet on Wi-Fi integration. Sprint at 2.5GHz has deployed around 170 cell sites in Baltimore alone with the number expected to go to 200 by the end of the year. Some reports say that this is 15% more than what Sprint deployed for a CDMA EVDO network. The number of sq km the network covers is still unclear but it has to be a long way off from Intel's original promise of 30 Km coverage per cell site. In building coverage is another important aspect with commitment of 2 to 4 Mbps of download speeds and upload speeds in upwards of 1Mb - and that is why Wi-Fi integration is all the more important for Xohm.
One area where Sprint surprised everyone was by removing the 5 Gb data cap. This they say goes with their strategy of positioning Xohm and WiMAX as more a "capacity" story than a "technology" or a "speed" story. This will not only differentiate it with the 3G lookalikes like HSPA or EVDO but also throw the gauntlet at LTE and its ecosystem. Once the service starts penetrating in other major cities of US, I think the likes of ATT, Verizon, T Mobile etc will do away with the download caps on their networks. At launch, mobile WiMAX service plans include a $10 day pass, $25 monthly home Internet service and a $30 monthly mobile service available on any WiMAX device and a $50 monthly service option covering two different WiMAX devices. If the network expands nationwide, this might be a good option, assuming prices will rise as coverage expands — and that the coverage is good.
For Sprint, Xohm launch could complement the Clearwire joint venture that it recently joined. Sprint will hope that Clearwire perfectly addresses WiMAX penetration concerns atleast in rural areas. What remains to be seen is if the American thirst for the Internet on the go will provide Sprint's Xohm with enough customers to pay the bills and turn it into a profitable venture. The Operators with wired access infrastructure are just beginning to realize that even wired bandwidth is not unlimited. Wireless is all about limited airwaves and it will face choc-a-bloc when subscriber numbers start growing. Further, it is also unclear what the merger with Clearwire will do to the business model, and really unclear if a data-only network, with VoIP at some point, can compete with existing networks that offer voice and data services. In the near future, a customer with a handheld will have 3 hotspots to connect to Wi-Fi, Xohm and the HSPA/EVDO base station. It would be interesting to see how much customers are ready to pay to connect to each of the 3 options. What would be more interesting to see is how Sprint succeeds in arresting its churn and ARPU decline through Xohm.
