Last week, Craig Mathias wrote a piece on 802.21, a convergence standard promoted by the likes of InterDigital (NASDAQ:IDCC) and Intel (NASDAQ:INTC). The people at 9to5 Mac immediately saw the iPhone connection, and hatched what I thought was a highly speculative story. That Apple (NASDAQ:AAPL) will push this yet official standard to include WiMAX into its impending 3G iPhone, based on convenient interpretation of a series of events, is the work of a very creative mind.
For the uninitiated, 802.21 is one of the various standards being promoted for convergence. So, if the infrastructure is in place, devices using this standard will perform ‘vertical’ handovers across the standards such as WiFi, WiMAX and 3G.
Before I move on to argue why I don’t see signs of a WiMAX-enabled iPhone yet, I should mention that as a fan of the convergence movement, I would love for one of the convergence standards to succeed. The idea of an iPhone enabling this seamless mobility does sound very appealing to me. It is just that I don’t see the impending 3G iPhone implementing it to include WiMAX.
Let me dissect the evidence that the 9 to 5 Mac article presents to defuse the speculation:
In March, that company revealed it has signed-up Apple (and RIMM) as a licensee for its 3G technologies….. This news generated sparks of speculation that InterDigital’s SlimChip architecture might be deployed in products from Apple.
The license agreement between Apple and IDCC is perhaps two-fold. Firstly, it is for the 3G intellectual property. Secondly, as I wrote in an earlier article, the iPhone will most likely have Infineon’s 3G chipset. Infineon (IFX), in turn, uses InterDigital’s 3G stack for which the latter gets a per-unit royalty. I think that Infineon’s solution has InterDigital’s contribution to the baseband design. But to think that the SlimChip will be central to the iPhone based on these signs is a stretch. In any case, 802.21 support or WiMAX is independent of SlimChip. You can read more about my iPhone 3G speculations here.
..we know Apple has aggressive sales targets for this device, and that the company plans to introduce iPhones into more territories this year; we know that some of those target countries, Russia, for example, are moving to adopt WiMax;..
This argument perhaps makes sense when the networks are more mature. In my opinion, a WiMAX-enabled iPhone this year will have limited value if you look at the bigger picture. Putting in a WiMAX solution not only hits its margins but also delays the product launch due to the additional logistics. That does not make economic sense to Apple, and may in fact counter its aggressive sales target.
Apple’s success in bringing new technologies to market was made most clear when it single-handedly popularised WiFi technology (AirPort) when it introduced the iBook in 1999….InterDigital’s move to join the WiFi Alliance this year, followed by its move to license its 3G modem technology to a shadowy (unnamed) Asian fabless semiconductor company also passed under the radar.
Promoting a mobile standard is a much more complicated task. With WiFi, you are talking about interfacing with the consumer directly. With mobile-phones, the effort needs the confluence of the chipset vendor, handset vendor and the carrier. Also, InterDigital joined the WiFi alliance because of the technology’s role as a key component for 802.21. Neither this nor its modem technology licensing moves should relate to the iPhone.
While the idea of WiMAX+3G is great on paper, the logistics involve high-levels of risk that Apple will be unwilling to take. Platform stability and testing issues will limit Apple’s short-term options for iPhone. Hence, Infineon and most others who have already been designed into the current iPhone will retain their places. We will perhaps see GPS capabilities, but WiMAX, in my mind, is a non-starter for this version.
This does not however preclude a convergence standard/implementation like 802.21 from being included in the iPhone. I can see utility in having mobility between WiFi and 3G as a possible trend, and perhaps as the only real seamless mobility possibility for the 3G iPhone. But even this will be met with resistance from the carriers who will fear cannibalization of their revenue stream.
In summary, based on the current evidence and the inherent technical challenges, I will have to reject any suggestion of a WiMAX-enabled iPhone in 2008. I don’t see it, even with the InterDigital connection. To be fair to Andy Space who wrote the 9 to 5 Mac article, he has made it amply clear that this is pure speculation. While I did not find his central idea or his reasons as strong, I did enjoy reading the article for what it is – another out-of-whack and sensational iPhone rumor.
[Thanks to Dan Butterfield from iPhonAsia for directing me to this article.]
Disclosure: The author was long InterDigital at the time of writing.