Walker Wireless thinking big with telecom trial

By PETER GRIFFIN

Walker Wireless says it will be a major force in telecoms and broadband within the next 12 to 24 months, using wireless technology to deliver high-speed internet and voice services.

Executives from shareholder Clarity Partners, a California-based telecoms investor, were in Auckland this week to check on a trial of the wireless technology involving 400 people.

Clarity managing general partner Rudolph Reinfrank said the $6 million trial by Walker Wireless and Vodafone was an ideal test bed for larger markets. "The competitive landscape here is good to try this product. It's a new paradigm - always on, cheap and portable [internet access]. People talk about finding the 'killer app'. The killer app is voice and getting to the internet."

So far Clarity, which controls a US$800 million ($1.7 billion) investment fund, has put $5 million into Walker Wireless. It will bump that up to $15 million in about six months if the trial runs smoothly.

Vodafone too will look to take an equity stake in Walker Wireless at the trial's successful conclusion.

Investors who put about $20 million into the company in July 2000 include Stephen Tindall, Craig Heatley and Todd Capital.

Reinfrank said the increased investment would give Clarity a stake of more than 20 per cent, which it plans to cash in on in three to seven years.

Walker Wireless said the "non-line-of-sight" technology from US company IP Wireless would deliver data download speeds of up to 3Mbps (megabits per second) at a range of up to 30km "in clear air" from its base stations.

But the company is equally pushing the ability to deliver "carrier quality" voice calls.

That will require Walker Wireless to negotiate interconnect agreements with Telecom and TelstraClear. A hub installed in users' homes would connect the IP Wireless modems to conventional systems supporting services like voicemail and caller ID.

Walker Wireless will run the system on radio frequencies bought at Government spectrum auctions.

The IP Wireless modems will be at the centre of tenders Walker Wireless will pursue as part of the Government's Probe initiative to deliver high-speed internet to all schools.

Walker Wireless and Vodafone have won the first contract, to provide a wireless service in Southland.

Walker Wireless is expecting to begin providing services in Southland and the main centres in the first quarter of next year. Managing director Bob Smith said a nationwide network could be built relatively cheaply - reaching more than 80 per cent of the country for between $80 million and $90 million.

Unlike TelstraClear, which has set itself the task of picking off Telecom's business customers, Walker Wireless' focus is on the residential and small to medium-sized businesses. Price will be a major factor as Walker Wireless goes head to head with Telecom's phone services and broadband (Jetstream) services.

"The cost proposition will be similar to what's out there in terms of DSL [Telecom's Jetstream], but we're going to deliver a lot more value [such as portability]," Smith said.

IP Wireless chief executive Chris Gilbert, a former Motorola executive, showed the Herald prototypes of next generation modems his engineers were working on.

Within two months IP Wireless, which Gilbert sees as being "the next Cisco", will begin building the high-speed modems into PC cards that can slot into a user's computer.

By the middle of next year, Gilbert expects the same technology to be embedded in laptops and other portable devices.

ON THE WEB

www.claritypartners.net


www.ipwireless.com


www.walkerwireless.co.nz