In last issue of the Ariadne Capital Journal we started a series of basic introductions to the different broadband access technologies on the market.
We decided to focus on this subject because the last mile represent the last big hurdle in the way to the broadband-everywhere dream we are all anxiously waiting for.
The market is dominated by broadband access through DSL or cable, but some of the most promising development is the creation of wireless local loops also known as broadband wireless access (BWA). BWA holds the promise of getting high-speed, competitively priced services to enterprise sites, remote offices, and, well, just about anybody really fast.
Two primary technologies are being rolled out to enable BWA: LMDS (Local Multipoint Distribution Services, addressed in last Ariadne Capital Journal issue) and MMDS (Multichannel Multipoint Distribution Service).

MMDS

It is a proven wireless technology, which has been used for TV signal transmission for more than 30 years, as such has been more widely known as wireless cable. 
This application never really took off, but when the FCC made clear that it would approve two-way communications over this spectrum, the possibility to use fixed wireless technology to deliver broadband access became an interesting option. In underserved markets including rural areas, MMDS can serve as the first broadband "pipe" into small businesses and homes. In other markets, MMDS can be a competitive broadband alternative to DSL or cable modem services. WorldCom spent $400 million, and Sprint more than $800 million on these acquisitions. The deals gave each provider 35% of all the MMDS licenses available in the U.S. Sprint, Worldcom, BellSouth and Neucentrix collectively hold approximately 90% of the US MMDS licenses.
From a centrally located base station, an MMDS site beams signals to customers as far as 35 miles away. The customer premise typically is equipped with a very small, pizza box-sized dish installed on the roof of a building. Coaxial cable is then hard-wired from the dish to an MMDS-capable modem, which connects like any other modem to the customer's PC. 
Using technologies such as wireless LANs it offers customers added flexibility. An MMDS signal to a wireless LAN enables portable high-speed wireless connectivity for the last 1,500 feet to connect users in residential neighbourhoods, apartment or office complexes and schools via a wireless modem card installed in laptops or desktops.
MMDS operates in the 2 GHz to 3 GHz band, this is less susceptible to interference than LMDS, and has no line-of-sight requirements. MMDS can support greater distances than LMDS. The tradeoff is that MMDS is slower, delivering downstream speeds in the neighbourhood of 10M bit/sec. 
Typical service offerings provide downstream transmission rates of 1 Mbps or higher, scaleable up to 10 Mbps, and upstream speeds up to 512 Kbps. 

Despite the shortfalls of MMDS, Schroth predicts there will be 87,000 subscribers by year-end. This demand is driven by users' need for fast, affordable Internet access service. 
But MMDS users will likely never match the number of DSL or cable-modem subscribers. The Yankee Group estimates there will be 890,000 MMDS users by 2006. According to a recent FCC report, there were 2 million DSL customers and 3.6 million cable-modem customers at the end of 2000. Nevertheless, MMDS still has a place in the market because DSL and cable are not available to all users. DSL service reaches 45% of the consumer market, and cable-modem services reaches 66% of the consumer market, according to the Yankee Group.