WiMAX is not Cellular

Implications: BT has a backhaul network second to none, the mobile operators do not. It is currently spending close to £8bn on its 21CN all IP network, with this it has all the capacity needed for a data centric LTE deployment. Second LTE could serve both voice and data without cannibalising existing revenue streams. BT does not need to protect an existing cellular voice investment - it can move all its MVNO customers across to LTE. Thirdly it can satisfy its shareholders with a real significant strategic move and ensure it has a future in mobile as well as fixed. The only question does BT have the £1bn+ to make it happen.

Analysis: If you look at this objectively, yes WiMAX could and would make a good move for BT, it would enable a Triple-play mobile deployment to all its customers and be able to offer comparable services to the mobile operators. Though at the same time it could be left open to defending that move, especially from attacks by the mobile operators saying WiMAX is dead, etc.

However, if BT did indeed go down the LTE route it would gain a significant win over the incumbent mobile operators and leave them all trying to play catch up. This is where BT would really win, already 2 (if not 3) out of the 5 mobile operators will be dependent on BT's 21CN network for backhaul for 3G and LTE in the future - those contracts are already signed.

BT Mobile already has an existing cellular installed base, mainly with corporates and enterprise users with wholesale MVNOs with both O2 (who it used to own) and Vodafone. These users and customers could be very quickly migrated to an LTE network. In addition as LTE has voice as a primary service, those customers would see an easy transition.

Now BT would have the same technology, an already enormous installed customer base to market to, a backhaul network ahead of the competition and NO legacy network to protect.

With regard to financing such a move, BT has already re-allocated £1.5bn from its 21CN budget to attack the FTTN/FTTH market and stave off criticism from industry and government that it is not doing enough to take Britain forward into the fibre age. The £1bn+ would cover the spectrum, build and equipment. Obviously it would need to then spend on marketing and sales, however that spend is going to be a lot less as it has most of the machinery in place.