2. WiMAX Adoption in Rural Areas Charles A. (Chip) Spann Wireless Business Analyst cspann@connectednation.org www.connectednation.org cspann@connectednation.org www.connectednation.org

3. WiMAX: What Is It? Worldwide Interoperability for Microwave Access 3G wireless service – based on 802.16 standards which include both fixed and mobile capabilities Common misnomer: “WiFi on steroids” Ideally suited for most rural deployments

4. WiMax Adoption in Rural America Pros and Cons Pros: Cost effective “last mile” solution Single base station can cover large areas They make great WiMAX “laboratories” Equipment is also available for unlicensed bands Cons: Limited vertical assets (elevated water tanks, etc.) Many small towns are in mountainous areas (WV, KY, AR) Excessive windshield time when encountering truck rolls

5. The “Visible” WiMAX Operators

6. WiMAX: Ecosystem at a Glance

7. Spectrum & Amount AllocationWho Has It?ProsCons 2.5-2.6 GHz (196 MHz available) 2495-2690 MHzClearwire Xanadoo DigitalBridge Communications A few rural operators (e.g. Evertek, MVTV Wireless etc.) Substantially unused Primary WiMAX band in US Commercial equipment available – operational WiMAX and pre-WiMAX systems Re-banded to improve broadband and create mobility Two thirds of the spectrum is allocated to educational entities and “not-for-profit” license holders Bifurcated GSA areas create some unusual market “patterns” AWS (90 MHz available) 1710-1755 MHz 2110-2155 MHz Verizon T-Mobile Cavalier Wireless Relatively untouched spectrum Rules written for broadband & mobility Requires significant band-clearing Spectrum was more expensive to purchase than BRS but substantially cheaper than leasing EBS 700 MHz (108 MHz available) 698-806 MHzAT&T Verizon Cox Wireless Access Spectrum Cavalier Wireless CenturyTel Rules permit TDD or FDD Flexible use Superior propagation characteristics compared to higher frequencies equals lower cost to deployments Incumbent TV station licensees have until February 2009 to vacate spectrum 60 MHz auctioned in 2007 2.3 GHz (30 MHz available) 2305-2320 MHz 2345-2360 MHz Bell South NextWave Comcast AT&T Verizon Supports TDD and FDD Secondary WiMAX band in US Commercial equipment available – AT&T conducting BETA in 10 markets Substantial interference issues with SDARS Significant OOBE limits Build-out deadline extended Coveted Spectrum

8. Where’s the “Beach Front” Spectrum?

9. Who’s On First? 1.1 st “known” mobile WiMAX system launched by AT&T in Pahrump, NV using WCS spectrum – Nov. 2006 2.AT&T soft launches additional markets (Juneau, AK) – Aug. 2007 3.1 st “claimed” mobile WiMAX system launched by Digital Bridge Communications in Jackson Hole, WY using BRS/EBS spectrum – July 2008 4.Large scale launch announced by Sprint (Xohm) in Baltimore, MD using BRS/EBS spectrum – Sept. 2008 5.Clearwire launches 54 “pre-WiMax” markets, acquires almost everyone, sets stage for national deployment.

10. BRS Spectrum: What Took So Long To Launch?  1990 – 2000: Addition of PSAs, Digital and Two Rules  2001: Mobility allocation  2004: Cellular ability  2005: Transition mandate  De Facto Lease Agreements  2006: Transitions commence

11. BRS History at a Glance: Key Drivers  1997: BellSouth enters market  1999: Sprint and Worldcom enter market  2003: Nucentrix & Worldcom bankruptcies (Sprint allows leases to lapse, 2006 BellSouth does same)  2004: Clearwire enters the market  2004: Nextel acquires assets from Nucentrix & Worldcom bankruptcies for $200 million  2004: Operators begin paying licensees based on spectrum values – not per subscriber/per channel or gross recurring revenue  2005: Sprint/Nextel merger  2006: BellSouth – AT&T merger approved with divestiture condition

12. BRS History at a Glance: Key Drivers (cont.)  2006: Intel and Motorola invest $1B in Clearwire  2006: Sprint and Clearwire push WiMAX standards  2006: Spectrum transitions commence  2006: AWS auction price per MHz/POP  2006: BellSouth – AT&T merger with divestiture condition  2007: 700 MHz auction  2007: Clearwire acquires BRS/EBS from BellSouth  2008: Clearwire and Sprint/Nextel merge wireless portfolio to create “New Clearwire” – $3.2 billion invested from “partners”

13. WiMAX: Players to Watch Vendors: Vecima, Alvarion, Redline, Motorola, Intel Operators: New Clearwire, DigitalBridge and... just about any rural WISP with an entrepreneurial spirit!