SPRINT DECIDES TO PUT MMDS ROLLOUT ON HOLD

B postponing additional multichannel multipoint distribution service (MMDS) deployments, Sprint jammed a dagger into the heart of an already-struggling U.S. broadband fixed wireless industry. But by saying it would continue to support its 52,000 wireless customers and closely monitor second-generation developments, Sprint applied salve to a wound that many thought would be worse.

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"We were expecting to hear MMDS is dead; all we hear is they’re not going to have any new markets until they get new equipment," said Peter Jarich, analyst for The Strategis Group. "I’d heard that before."

Len Lauer, president of Sprint Global Markets Group, stated the obvious: Sprint  is being" hampered by line-of-sight issues, high installation costs and unforeseen technical challenges."

It’s the same for everyone using first-generation MDS technology, said Russell  Wiseman, senior vice president of Internet operations for fixed wireless operator Nucentrix Networks, which also has stopped deployments until 2G gear is ready.

"In the face of the limitations of 1G technology, it’s just not good business to continue expanding those networks," Wiseman said.

Fixed wireless was never par t of Sprint’s core business strategy any way, said Cristian Parrino, marketing vice president for Spike Broad band Systems, a fixed broadband wireless gear developer based in the Boston area . Mobile wireless—including third-generation cellular—"makes sense from Sprint’s perspective."

It also makes sense based on the FCC’s recent ruling that lets MMDS license holders investigate mobile services.

"Everybody—we, Sprint, World Com—has to decide how this changes the business model," Wiseman said. "Some of that will be a function of just how quickly this 2G technology materializes."

If it materializes quickly, Sprint won’t bother with 3G because using MMDS spectrum for mobility is "a long and difficult path ,"and Sprint PCS doesn’t need spectrum, said Todd Rowley, vice president of spectrum management business development for Sprint.

Meanwhile, Rowley said Sprint Broadband Direct continues to evaluate its options, which are focus ed on gear that overcomes line-of-sight hassles and home installation boondoggles.

"That stuff, candidly, is not ready yet, but the rate of progress and what we’re seeing out of these young technologies is very promising," Wiseman said. Like Sprint, WorldCom is waiting for 2G gear and evaluating 3G mobile. The carrier remains on pace to roll out to 13 MMDS markets this year, a spokeswoman said.

But it won’t matter for many fixed wireless vendors.

"We’re going to see a lot of consolidation, " said Parrino, noting that Sprint’s freeze will make investors less willing to fund start-up vendors.

That is an unfortunate side effect of the business decision by Sprint, which has fueled the fixed wireless industry, Rowley said. At the same time, Rowley wouldn’t say when Sprint’s patience for 2G technology will expire.

"We’d really hoped it would be here by now," he said.