San Francisco-based smart meter software developer, Grid Net, is betting on WiMAX as the technology that will power future smart grids, but the odds are probably stacked against it.

According to an article by Katie Fehrenbacher at Earth2Tech, Grid Net founder Ray Bell, is convinced that the use of WiMAX is the best solution for implementing an open standard smart grid infrastructure. The company has already developed a smart meter, built by GE and powered by an Intel WiMAX chip, which Bell says is one of the first truly open-standards-based units on the market.

“You don’t need GE, Grid Net or Intel to build this meter,” Bell was quoted to say in the report.

The use of open standards will be key to the development of the manufacturing and applications ecosystems that will lead to lower costs (hence mass adoption) of the platform, Bell said, noting the the current US$36 unit price tag of WiMAX chips will probably fall to as low as $6 over the next year and a half.

According to the report, Bell chose WiMAX because of the technologies backers, GE and Intel, as well as Sprint and Clearwire, and to some extent Samsung and Motorola. And for good reason – Intel is a financier to the company.

At this point, the company hasn’t worked out the finer details of which network infrastructure it will use. The report suggests that the meters can use the national infrastructure of WiMAX operators, or private networks owned by the power utilities itself – presumably through leased capacity on Sprint or Clearwire’s networks.

As the report concludes, the success of Grid Net and Bell’s vision will rely heavily on the future success of WiMAX, a future that the author notes is far from certain.

For those of us that have followed the development of wireless industry, the odds are certainly stacked against Bell. For starters, there are numerous competing technologies out there, the most evident of which is cellular, which already offers much better economies of scale and technology maturity than WiMAX.

GSM, and its evolved forms, is used by billions of users and hundreds of operators around the world. CDMA users also numbers in the hundreds of millions. Handsets for both technologies are produced below the US$50 market, and GSM data modules are now embedded into a growing range of consumer electronic devices such as digital cameras, and expanding set of applications such as remote asset management.

WiMAX on the other hand, only has tens of millions of users in markets such as India and is struggling to take off globally.

To be fair, all these factors may count for naught when it comes to smart grids. First off, smart meters don’t have to roam, so interoperability with global standards is not necessary. US smart meters don’t have to be deployed in Japan (which incidentally do have WiMAX), so a custom-made, WiMAX-enabled device for power utilities in the US is viable – it will all come down to the applications, business model and, no doubt, Bell’s ability to convince the utility to deploy such as device.

At the same time, while the cellular chipset vendors are increasingly engaging consumer electronics makers to integrated connectivity into new products, their deployment model so far is to connect these devices directly to the operators’ network, not a smart meter model that collects information from your fridge before sending it onward – although this might change with the introduction of femtocells in the near future.

Lastly, the whole telecoms industry has so far more or less shun the energy sector. Yes, operators have been talking about their roles in supporting smart grids and many, including AT&T and Verizon Wireless in the US, have been trialling these applications with third party developers, but the massive cellular juggernaut, represented by organizations such as the GSMA and CDG, has yet to enter the fray.

This fact might changed with the emergence of the IEEE’s work on grid standards, but there’s still a window of opportunity for WiMAX to become a potential platform for smart meters, albeit a very small one.