Subject: [NEXTEL-1] The Five Barriers To Success For Nextel Wireless Broadband

From: [email-masked]
Date: Mon, 19 Apr 2004 01:42:29 -0400

April 15, 2004
The Five Barriers To Success For Nextel Wireless Broadband

Nextel Wireless Broadband has taken their Broadband Wireless Internet
Access system trial to the next stage - "will they really pay for it?".
Nextel is now accepting paying customers onto their BWIA system in the
Raleigh, NC metro area. So... will they pay for it?

Posted by Steve at 7:00 AM

My educated guess is that Nextel will experience a reasonable take rate,
but that it won't be spectacular for five reasons.

1) Fear of Failure. Nextel is clearly delineating this as a trial to the
target audience, and "big" broadband wireless rollouts don't exactly
have a good reputation to date given high-profile failures such as
Metricom Ricochet, Sprint Broadband Wireless, and AT&T Project Angel.
(Yes... I know that there are many, many BWIA success stories, but the
public has only heard of the high-profile failures.)

In essence, Nextel is asking customers of this system to gamble that
Nextel will keep it going and not pull the plug, stranding them from the
work they put into their web pages, going through the pain of email
address changes, etc. To many, the risk/reward isn't high enough to
switch another form of broadband or take a chance on "newfangled"
wireless broadband.

2) Poor branding. Nextel Wireless Broadband?!?!?! Some clueful branding
talent needs to weigh in on NWB for fear of damaging Nextel's brand
identity. It seems to me that "Wireless" is simply integral to the
Nextel brand; it's assumed; Nextel equates to Wireless. By putting
"Wireless" alongside "Nextel", you're confusing the customer - "Um,
wait, isn't Nextel wireless... is there a 'Nextel Wireline' service?"
Nextel should just use Nextel (walkie-talkie voice + slow data/Internet)
and "Nextel Broadband" (high speed Internet and voice).

3) Buzzword Non-compliance The technology that Nextel is using in the
trial isn't buzzword compliant. There's nothing wrong technologically
with Nextel's choice of Flarion's FLASH system; on the contrary - it
gives Nextel a number of compelling advantages. But, Intel is pumping
tens (more?) of millions of dollars into advertising and PR that WiMAX
is the wireless technology of the future to all who will listen (and
especially to those in the press desperate to seem technologically
literate... but aren't). Flarion FLASH isn't currently WiMAX
compliant... nor will it be in the forseeable future until the 802.16
standard upon which WiMAX is based is extended to includ full mobility.
Again, this isn't a technological issue - it's "only" a marketing / PR
issue, but that can hurt and hinder (just ask Metricom.)

4) "Mostly" Portable/Mobile? From what I've observed, NWB is being
marketed primarily as a portable/mobile service and not a "fixed"
service. Even though NWB offers a "NWB Modem" that allows computers to
connect with Ethernet or USB, the "primary marketing message" is that
NWB is for laptop users. Doing so, Nextel is missing a very large part
of its potential market - home and very small business users that can't
get DSL or cable modem service, those that can get DSL or cable modem
but don't want to, or the rapidly growing population that is tired of
getting treated poorly by the telephone and cable companies and will
leap at an alternative.

5) No Voice??? The absence of Voice Over Internet Protocol (VOIP)
telephony / intercom (who, in the world, better to offer a
next-generation "intercom" feature???) as a feature/service in NWB is
really puzzling. The Flarion FLASH system is fully capable of VOIP.
Nextel has a fully-developed telephony back-end. For Nextel to offer
VOIP would seem to be a no-brainer, and would substantially increase the
value proposition of NWB. All I can guess is that Nextel is suffering
from "Disruptive Technology" syndrome and sees NWB/VOIP as a threat or
competition to their "real" business. Yes... of course it is... but
better that Nextel be the one to offer such competition, than leaving it
for a competitor to offer such competition.
I'll be exploring Nextel Wireless Broadband in depth in an upcoming
issue of FOCUS On Broadband Wireless Internet Access. FOCUS subscribers
will read about several "must have" uses for NWB, which, if positioned
properly would all but insure that NWB would be an overwhelming success.

Steve Stroh

http://www.corante.com/bwia/archives/003019.html
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