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How Much is WiMAX ARPU?

by Cintia Garza, Market Analyst, Maravedis Inc.

Can operators make money with WIMAX? The answer is: yes. Based on the data collected for WiMAXCounts, most WiMAX operators generate ARPUs for business customers that would make mobile operators envious. These WiMAX operators offer fixed and portable services that generally provide comparable ARPUs to cable and DSL.

According to our research for WiMAXCounts, we found that APAC has the lowest ARPU for residential customers. BWA/WiMAX operators in the Asia Pacific region (APAC) offer residential customers the highest speeds, yet APAC have the lowest ARPU at US$30.45. The low revenue is the result of aggressive price promotions and programs offered by operators to draw customers toward broadband wireless internet services. Korean operators, for example, have service offerings as low as US$16 (KRW 15,000).

ARPU vs Downstream!

Europe and North America have the highest ARPUs for the residential segment. Although the ARPU is higher in Europe, operators in this region offer the highest average downstream speed at 2.035 Mbps. Russia has the highest BWA/WiMAX ARPU among European countries.

The CALA region exhibits an average downstream speed of 1.067 Mbps at an ARPU of US$41.99 for residential service. Markets in this region are highly monopolistic, with most of the services being offered by state-owned incumbents, which drives up the price of BWA/WiMAX.

There is a clear relationship between downstream speed and ARPU for BWA/WiMAX business offerings. North America offers the highest average downstream speed at 3.7 Mbps and the highest business ARPU at US$209.65. At the other extreme, CALA’s average downstream speed is 0.9 Mbps at an ARPU of US$99.94.

Some examples making up the high North America ARPU are TowerStream, at US$600 and Covad, at US$450. North America is followed by Europe, with business ARPU of US$154.42, and APAC, at US$118. CALA’s low ARPU is due to operators such as Axtel and Telmex Chile that offer business WiMAX at rates as low as US$39 per month.

WiMAXCounts also reveals that although WiMAX service rates can be lower or higher than for DSL, their prices are likely to be competitive. Most operators that offer both technologies have a very small price gap between offerings.

Cintia Garza, Market Analyst, obtained a Bachelor’s degree of International Commerce from TEC de Monterrey, Mexico with a specialization in International Business from HEC, Montreal and Carleton University, Ottawa. She contributed primary and secondary research toward the realization of the WiMAXCounts and ClearSpectrum databases.