No doubt Wi-Lan had enough, equipment business over the last few years has been plagued by continual pricing pressure, so even when unit shipments may have doubled, revs remained flat with decreasing margins, no wonder so many wireless plays went under.
Wi-Lan, just like PROX was not a well run company, with toxic financing to boot.
What gets me is how does TRBM acquire Proxims equipment operations and make them profitable in less than 6 months?
Wi-Fi/Wi-Max mesh is arguably the most cost effective way today to bring high speed internet to the masses, it will be interesting to see if the equipment business going forward can flourish with expected exponential growth on the horizon, BRCM and ATHR wi-fi chip unit growth suggest it can.
This ends part of a long story: WiLAN was an early developer of wide band OFDM technologies and contributed to the IEEE 802.16/ETSI standards groups which is the foundation of WiMAX. But they have pursued their commercial business and a IPR licensing business which are at odds with each other and burn up capital. WiLAN was among many companies who could not rationalize their business strategies with business realities. The hardware buusiness has required a high pace of R&D and has been consolidating around standards and lower price points. For any hardware business to survive meant that they had to reach 'critical mass' of size of operations to support the R&D and other business operations. The exact level of business depends on each company's cost structure and 'breakeven point'. And that is a very dynamic factor: as the business continues to trend towards common standards and heads into mainstream markets, the price points moves down and the necessary level of business tends to ramp up. This is accentuated by the entry of entrenched telecomm equipment suppliers who have their R&D, marketing and support costs spread over existing lines of business such as cellular infrastructure and handset sales. It is complex but those are the broad trends effecting what it takes to compete and survive in this industry (similar to most any industry).
About three 1/2 years ago I told people on this board and at WiLAN directly that they were spread too thin and should split up their products business and their IPR business and let each operate based on desired business plans. If the products business couldn't be turned into a self supporting unit then it should be dropped. I mostly got scoffed at by folks at WiLAN. The departed CEO said that R&D costs would decline as a percentage of operating costs once 802.16-2004 ('fixed' WiMAX) was finalized. I said that was not right and I expected to see development costs increase rather than decrease as -2004 was just the start of WiMAX developments.
Last year WiLAN finally split into two divisions and seemed to be doing top level marketing better. But the sales didn't materialize - I think they were on a tread mill chasing ever lower price points and struggling to support diverse business requirements.
Now they have been forced to cut the products business and trim down to the IPR licensing. We can expect to see many employees cut from the payrolls. Nasty business for some good people.. but they should find places at other WiMAX related companies.
Teamrep, thank you for continuing to update and educate the members of this board. Although I do not have a background in Engineering, I do have a better understanding of the issues surrounding wimax thanks to you. FYI... I have had my brother in law who is an Electrical Engineer look over some of your posts-- he is also a proponent of wimax technology-- confirmed that in his opinion your postings are accurate.
Ever thought of starting a subscription based wireless telecom newsletter/www site? If so, will give you contact info. One of my former employees was one of the first IT folks to convert muni to VOIP at City of Dallas.