Canadian wireless exporters taking advantage of broadband stimulus opportunities in US

Canadian WiMAX companies are becoming major beneficiaries of the US government’s $7.2-billion rural broadband funding program, despite the Buy American provisions. Tranzeo Wireless Technologies, Vecima Networks, DragonWave, and Bridgewater Systems are four home-grown companies finding significant sales opportunities south of the border. On September 14 Bridgewater announced that it had been selected by four US-based WiMAX service providers to accelerate the launch of 4G broadband services to over 500 communities across rural America. The company also announced that it had received the United States Department of Agriculture (USDA) Rural Development acceptance for several of its products. “WiMAX is a very promising technology and it is taking off in rural areas; it can help in areas where there is no immediate access to healthcare or e-learning,” Joanne Steinberg, marketing director of Ottawa-headquartered Bridgewater tells Tech Media Reports. Given that use of Canadian gear will not deny access to US stimulus funding, the spending is beginning to kick in early. Pitt Meadows, BC-headquartered Tranzeo announced last week that its family of WiMAX subscriber units will be used by Washington State-based PocketiNet Communications and by Minnesota communications operator Nextera. Both use Tranzeo partner Aperto Networks for their fixed wireless network and, as a result, rely on Tranzeo’s subscriber units. “In the case of these two service providers, they didn’t wait for stimulus funding,” says Dave Gelvin, president of Tranzeo USA. “At present there is an aggregate of US$400 million in stimulus proposals that include Tranzeo equipment. We represent about 25% of that, or US$100 million.” Obviously, Tranzeo does not expect to achieve 100% approval, but the size of the funding and the tie-in with their gear has made Gelvin cautiously optimistic, especially given that Tranzeo’s total revenue last year was just shy of C$20 million. At the same time, some installed deployments are set to expand but need the green light, including Sempra Energy, a Fortune 500 energy services company based in San Diego, CA. “Sempra is using our equipment, and they have applied for the stimulus, but they will only accelerate their build-out if they are awarded funding,” says Gelvin. Tranzeo also OEMs to Victoria, BC-headquartered Vecima, which markets Tranzeo’s 3.5 GHz WiMAX base station and subscriber units under the Vecima VistaMAX brand. Vecima has itself been accepted by the USDA for deployment under the Rural Development Broadband Loan Guarantee Program. These Canadian companies represent a trend of sorts in response to opportunities south of the border. Not one Tier 1 wireline carrier submitted a proposal for the US stimulus, and more than half of the publically disclosed applications were for wireless. As Mike Jude, a program manager at research firm Frost & Sullivan, has written in a research brief: “the broadband stimulus bill is evolving into a wireless broadband stimulus bill”. This won’t hurt high flying base station backhaul provider DragonWave Inc., of Ottawa, which is swamped with orders from Clearwire US LLC, the new US carrier that is planning to build a WiMAX network. Clearwire generated 52% of DragonWave’s sales in the latest quarter. The Canadian government is doing its part, too. Organizations like Canada’s Communications Research Centre (CRC), which is part of Industry Canada and conducts telecom R&D, are abreast of the technological and market demands in the wireless space. “We do a lot of work with the DragonWaves of this world,” says Joe Fournier, a senior research engineer at the CRC. “We are involved in a lot of next generation wireless, because it can be a real challenge to deploy these networks.” In effect, the CRC can test for quality of service (QoS) and service level agreements (SLAs), and helps Canadian technology companies get ready for real-world deployments in demanding environments. “WiMAX is a worldwide effort,” says Fournier. “Canadian companies have to satisfy their business cases in choosing thrusts, and the reality is that the Canadian market is not enough to sustain many scenarios.” The CRC, which has hundreds of licensing arrangements inside and outside of Canada, will assist with product development and design strategy. It runs under a three-ear plan that is largely technologically driven, as opposed to being specific to the Canadian market. This looks like a good move, as global demand for next generation 4G wireless is going strong “When we look at what Canadian companies are doing, it is in the interest of the CRC to help them,” says Fournier, “whether the bulk of their business is in Canada or not.” Related articles: Canadian network gear markets get shot at US broadband stimulus projects Canadian WiMAX vendors hope to cash in on Obama's $7-billion rural broadband stimulus

Canadian wireless exporters taking advantage of broadband stimulus opportunities in US

News | September 28, 2009

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