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January 09, 2009

Nokia to Stop Making its Only WiMAX-Enabled Device

By Michelle Robart
TMCnet Editor

Mobile phone supplier Nokia has announced that it is going to stop manufacturing its N810 WiMAX Edition handheld computer.
The N810 WiMAX (News - Alert) Edition was first introduced last April as Nokia’s only WiMAX-enabled device. The WiMAX Edition uses the same hardware and software as the previously introduced N810, which uses Wi-Fi to connect to the Internet. The devices are bigger than standard cell phones but smaller than laptops and run the maemo Linux-based OS2008 operating system.
 
When Nokia (News - Alert) unveiled the WiMAX Edition, the company expected to start selling them in the middle of 2008, around the same time that Sprint was set to launch its Xohm WiMAX network. But Sprint (News - Alert) changed its launch plans, and introduced service in its first market at the end of September. Many online reports now point to October as the month when Nokia will make its WiMAX devices first available.
 
However, according to Nokia Spokesman Doug Dawson, Nokia has now stopped creating the WiMAX products because they have reached the expected end of their lifetime. The N810 platform is approximately18 months old, he said. Dawson did not disclose whether the Wi-Fi enabled N810 would also be taken off the market.
 
The WiMAX Edition models that are already in the sales channel will be available for consumers to purchase, Dawson said. Consumers can still buy both the WiMAX and Wi-Fi versions of the N810 on Nokia's Web site.
 
It is unclear if Nokia is preparing to launch other WiMAX devices, but Dawson said the company would “continue to follow the market.”
 
IDC Analyst Godfrey Chua believes that the N810 WiMAX Edition was probably introduced too early. So far, Sprint has launched WiMAX only in Baltimore, Maryland. This has resulted in most WiMAX customers using the network as a home Internet connection via laptops or desktops rather than as a mobile network they can access on the road.
 
Nokia may have also realized that the market for WiMAX users in the U.S. is just too small right now.
 
"They play a volume game, and I just don't think the volume would be there," Chua explained.
 
But the decision to cut the WiMAX device could be a sign of a significant shift away from WiMAX at Nokia, said Nadine Manjaro, an analyst at ABI Research.
 
"They struggled with the network so maybe they decided because of the downturn to change their strategy," Manjaro said.
 
She's referring to Nokia Siemens (News - Alert) Networks' loss of a contract to build the Xohm network in Dallas, Texas. Sprint first announced that Nokia Siemens would create the network but Samsung ended up completing the project in the end. Observers wondered if Nokia's equipment wasn't ready in time so Sprint gave the contract to Samsung, according to Manjaro.
 
"Nokia Siemens did struggle with their product so they might say they'll put their efforts on LTE (News - Alert) rather than try to do both," she said.
 
LTE (Long-Term Evolution) is the next-generation mobile technology that most mobile phone operators are planning on transitioning to.
 
Nokia Siemens would not be the only mobile operator shifting its focus away from WiMAX. Altcatel-Lucent, which Manjaro considered a leader in the market, recently said it planned to cut back on its WiMAX spending. Both companies may be falling victim to the declining economy by choosing to play it safe and not take any big market risks right now.
 

Michelle Robart is a contributing editor for TMCnet. To read more of Michelle's articles, please visit her columnist page.

Edited by Michelle Robart


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