In the first clear indication of a slowdown in the wireless broadband market, Alvarion, the world’s largest WiMAX products company on Monday said it will shed 11 percent of its workforce and slash management salaries.

The Tel Aviv, Israel-based firm, which has about 1000 employees, said it has embarked on a number of cost reduction moves to lower its expense base in a slowing global economy.

The cuts, which will come before the end of the year, are expected to result in savings of about $15 million and the company will take a one-time charge of about $3 million in the fourth quarter 2008.

Company CEO Tzvika Friedman said the cost-cutting is pre-emptive since the firm has not yet experienced unusual levels of order cancellations. And except for the one-time charge its fourth quarter projections remain the same.  

“It is too early to have a reliable forecast but we want to guard against setting our plans too low just because we are in a period of confusion and unsettlement,” Mr. Friedman said at an investor conference. (Intel, Alvarion Take WiMAX Kit to Africa)

He said the company is heading into the future with a backlog of orders valued at more than $100 million.

“We believe the primary risk in 2009 comes from potential delays of new projects and the slowing of deployments from existing customers and generally longer sales cycles,” Mr. Friedman said.

The downturn comes at a precarious time for WiMAX product vendors. The technology, which will ultimately compete with LTE, an emerging wireless broadband standard, has a two-year window before LTE appears on the scene.

If the credit crisis extends much beyond six months, carriers could postpone or cancel their WiMAX plans. Those plans are already being affected by the credit crunch, and the resulting postponement of spectrum auctions around the world.

Startup carriers are having problems raising the funds to purchase spectrum licenses and governments, most recently the government of India, are postponing their auctions as a result.

That means trouble for WiMAX backers.

But analyst Joe Nordgaard, director of wireless consulting firm Spectral Advantage, says the slowing economy and the credit crisis are not the only problems WiMAX faces.

“This is not just about the downturn. WiMAX has not sold as well as many had hoped,” he said. “The credit crisis is not helping, but WiMAX is a me-too technology so it is unlikely to cause a stampede of adoption, particularly in a downturn.”