Redline starts up broadband wireless unit

Fixed wireless vendor Redline Communications Inc., based in Markham, Ont. has reorganized its operations, starting a broadband wireless infrastructure business unit.

“It’s a reorganization of the majority of the team,” said Kevin Suitor, vice-president of marketing and business development at Redline, whose product line includes the AN-80i, which is said to provides transfer rates of 108 Megabits per second in the 5.8 GHz frequency band.

The new business unit will be led by a vice-president, Elik Jaeger, who was hired late last year.

No products will be discontinued as a result of the reorganization, Suitor said, adding the new unit’s mission will be to sell Redline’s RedConnex and RedAccess point-to-multipoint products.

Redline last year announced major deals with carriers in Africa and the Middle East, and recently announced it sold WiMAX equipment to Atlanta-based One Ring Networks, which is using the 3.65 GHz gear to provide broadband services.

WiMAX, which stands for which stands for Wireless Interoperability for Microwave Access, is based on the Institute of Electrical and Electronics Engineers (IEEE) 802.16 standards and is designed to allow transfer rates of up to 40 Mbps per channel over a wide-area.

About half of Redline’s revenues from the broadband wireless unit are from customers outside North America, Suitor said, adding the forecast revenue growth rate is 10 to 15 per cent for North America but higher in other continents.

Although Redline has announced deals in Tunisia, Cameroon and Tanzania, Suitor said deployments in North America have been slower than originally predicted.

“We would have expected it to move quicker, however we see positive signs that during 2008 these – deployments should accelerate,” he said. “I think the biggest contributing factor to a lack of rollouts was delays in mobile WiMAX technology becoming market ready.”

But a Montreal-based industry analyst says other factors have contributed to a lacklustre interest in WiMAX among North American customers. Brownlee Thomas, principal analyst for enterprise telecom services at Forrester Research Inc. of Cambridge, Mass., said WiMAX technology is “very much a niche play” in North America because densely populated areas already have broadband Internet access for consumers and businesses.

“If I am a telco and I’ve already invested and looking at my broadband capabilities, if I don’t have to have a heavy investment, I’m not investing,” Thomas said. “So if 1 Mbps for consumers is fast enough, I’m fine with that.”

She added WiMAX networks are expensive, requiring large investments from carriers or service providers.

“Bell and Telus own landline and mobile so they don’t want to cannibalize their revenues on either side,” she said. “Their incentive to invest will be in places where they don’t have that coverage today and where you’ve got Rogers or Videotron or Shaw or Cogeco coming into your markets and stealing you customer base.”

Thomas said it’s a different story in other areas of the world, where many places lack wired telecommunications infrastructure.

“It makes huge sense to go wireless because you don’t have to dig up roads and lay fibre,” she said, adding in North America, some municipalities may want to buy WiMAX base stations to install on towers.

“The concern I have is how tall are those towers?” she said. “Nobody wants these big ugly huge towers put up in the middle of nowhere unless we’re going to use it for wind generation.”

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