Woosh claims 5000 users, answers criticism

By PETER GRIFFIN

Wireless broadband operator Woosh Wireless claims it is "fast approaching" the 5000 subscriber mark and is picking up 30 to 40 per cent of new broadband subscribers in the areas it covers.

Woosh, which has recently extended coverage to around 70 per cent of Auckland and has a couple of coverage zones in Southland, fronted up to the press today to deliver a progress report on a network expansion plan that has given chief executive Bob Smith "a few grey hairs".

Ironically, the briefing took place as communications minister Paul Swain presented his views on the vexed issue of local loop unbundling to a cabinet economic development committee.

Woosh joined Telecom and Broadcast Communications in opposing local loop unbundling last year, claiming it would hurt the business plans of those operators taking the riskier road of building alternative networks.

The Government will release its final position on unbundling this month but isn't expected to significantly disagree with the Commerce Commission's rejection of full unbundling.

Smith said overcoming Telecom's stranglehold on the "last-mile" copper wire connections to homes and business with wireless technology was the only option. Trying to lay a new cable infrastructure was fraught with problems, principly its massive cost.

"It's like getting this proposed motorway project through. It gets [more] disheartening by the day," he said.

Telecom revealed last month that it was signing up 2000 broadband customers a week, spurred by new Jetstream deals it released in March. That would make the progress of Woosh, which launched in September last year, modest in comparison.

But Woosh, which is backed by investors such as Stephen Tindall, Craig Heatley, Todd Corporation and US venture capitalist Clarity Partners, has been subsidising its service and doing extensive advertising.

Woosh addressed concerns raised in the media that Auckland customers were receiving patchy service from the company and that deadlines for delivering an alternative phone calling service via the Woosh modems that lapsed.

"Coverage in the early days wasn't what we'd have liked," Smith acknowledged.

"The network performance is improving all the time," said Andrew McPherson, Woosh's general manager of networks who has just been in Britain and Germany where other networks using IP Wireless technology are rolling out.

Users would be able to make voice calls over their Woosh modems at the end of the year. That will see Woosh having pushed its phone calling target out by a year in total. Woosh said that its technology supplier, US company IP Wireless, had decided on a new method of delivering voice that gave dedicated bandwidth to "calling channels" rather than the straight voice over internet protocol (VoIP) method that was originally proposed. Software upgrades would handle the changes, said Woosh which unveiled a new, lighter modem.

Smith said that holes in coverage in Auckland were being plugged. The resource consent process had been difficult in some areas, with Woosh working on gaining permission to erect one site on Auckland's North Shore for the last seven months.

"Vodafone took three years to get a particular cell site on the North Shore," said Smith.

After co-funding a trial of Woosh's service in the early days, Vodafone had not exercised its option to buy into the company and Woosh had yet to co-locate its equipment on Vodafone cellsites.

But Woosh chairman Rod Inglis said the relationship was still tight.

"They've the option to sit and have a look," he said.

Woosh was in "final negotiations" with the Government and regional bodies to supply broadband in Northland, Canterbury and Wairarapa, as part of the Government-funded Project Probe. Woosh had already signed a deal to supply Southland and has built operational sites in Invercargill and Tuatapere.

But the other regions have been slower to negotiate with issues around timing of delivery still to be settled.

Woosh has made no secret of the fact that it will seek to undertake a listing on the stock exchange next year, so its progress during the rest of the year will be crucial to winning analyst and investor support.

Woosh will launch its network in central Wellington on May 24, enabling Auckland users to "roam" on the network when visiting the capital. Christchurch will begin to receive coverage from the end of June.

A new chip to be delivered by IP Wireless towards the end of the year would increase throughput speed up to one megabit per second. Currently the highest theoretical download speed delivered by Woosh is about half of that, with the bulk of the subscriber base sitting on 256Kbps (kilobits per second) $55 a month plans.