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Wireless Internet coming to Duval

By Timothy J. Gibbons
Published by Florida Times-Union on June 3, 2004.

WASHINGTON -- Communications industry pioneer Craig McCaw will launch a wireless broadband service in Jacksonville over the next few months, using the First Coast as the starting point for a national network.

McCaw's company, Clearwire, will offer a bundled service of Internet access and telephone service designed to compete with high-speed Internet service providers like Comcast's cable modem and BellSouth's direct subscriber line offerings as well as voice-over Internet providers, such as Vonage.

The technology works much like cellular phones. Clearwire will stream an Internet signal from a tower, allowing users to access the network through a book-sized modem-like device connected to a computer. Each tower will have a range of 3 to 7 miles, depending on the terrain. The cost will be competitive with cable broadband service, the company said.

The company is touting the ease of use of the technology: The receiver simply gets plugged into the computer and doesn't need a technician or even a CD-ROM to start working. That also saves the company money, eliminating the need for installers.

"We have to be easier and more human than the cable companies, the phone company," Clark Peterson, president of major markets for Clearwire, said in an interview at the Wireless Communication Association International's convention, where the company announced the roll-out.

The new service should spur growth in the broadband Internet market, industry watchers said, with McCaw's investment making the technology more high-profile.

"It's huge," said Steve Stroh, editor of Focus on Broadband Wireless Internet Access, an industry publication that has closely followed McCaw's acquisitions. "McCaw's entrance into the market is going to put broadband wireless on the map for people who thought it was just a niche."

Clearwire's service should be available to local consumers in the next few months, the company president said, first being made available in the downtown area and east of the St. Johns River. The company has hopes of providing Internet access to visitors to Jacksonville during the Super Bowl.

Nationally, the service also will be targeted at rural areas where traditional forms of broadband are prohibitively expensive for companies to provide.

Jacksonville was selected as Clearwire's entry market for a rollout that should eventually extend throughout the state.

"It has a great population size and a very welcoming business environment," Peterson said, explaining why Jacksonville will be among the first cities to be offered the service. "The market seems very interested in wireless technology."

McCaw's venture has little to do with Clearwire Holdings Inc., which set up operations in Jacksonville early in 2003. In March, McCaw purchased the company, which had the rights to spectrum in Jacksonville and about 100 other cities across the country. The original Clearwire focused on business users and utilized a more complex receiver set-up. The companies are also different in that the original company did not own the equipment manufacturer and didn't have plans as grandiose as McCaw's.

McCaw's Clearwire does use the same slice of the radio spectrum as the original company.

The type of radio frequencies used by Clearwire were originally reserved by the Federal Communications Commission for non-profit educational institutions. Educational broadcasts don't use the entire spectrum, so the organizations who have the rights to them are able to lease them to other businesses.

The spectrum used in Jacksonville belongs to the Hispanic Information and Telecommunications Network and the Duval County school system.

As part of the slew of acquisitions that brought McCaw the Clearwire name, the company also purchased NextNet, which designed Clearwire's wireless access system.

Owning the equipment manufacturer gives Clearwire more leeway over the direction it takes, Peterson said. "You control the roadmap," he said.

Charting that course is important for Clearwire, which is entering a marketplace where many have fallen in the past. "Every company that has gotten into this space in a major way in trying to provide broad-scale communications has failed," McCaw said. "We're very modestly going forward, conscious of the wasteland of bankrupt companies."

Part of Clearwire's modesty is not overselling the product. For example, although the company touts the fact that the Clearwire service doesn't tie users to a cable, executives are quick to stress that they're not selling it as a mobile option.

"Mobility is part of our roadmap," McCaw said. "We're thinking about how it should evolve."

Problems the company will face, investment banker George Bigar of Veritas Advisors said, include fighting for market share with well-established cable and telephone companies with an existing user base and making the investment in rural areas -- a key market for Clearwire -- pay off.

"That said, it's hard for anyone to bet against Craig McCaw," Bigar said, following the speech. "He's had some failures, but he's had some big successes."

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Sidebar:
QUESTIONS & ANSWERS: Service provides speed without a physical link

Clearwire announced Wednesday it would roll out wireless broadband Internet service nationally, starting with Jacksonville.

What is it?
Clearwire provides the wireless broadband Internet connection, giving users the high speeds of a cable modem or direct subscriber line but without a physical connection. The company sends the signal from a network of towers, similar to how cellular phones operate. Potentially this could be used as a mobile source for the Internet but for now the company is focusing on fixed residential and business users.

When will Jacksonville service be launched?
In the next few months, downtown and east side of the St. Johns River and extend to the entire city over the next year.

Hasn't Clearwire been operating in Jacksonville already?
A company with the same name offered a similar service last year. That company was purchased. Although the name is the same, this is a different venture.

Where else will it be available?
The company will roll the service out in 20 cities, including Daytona, Orlando and St. Cloud, Minn., over the next year, but has not released a full list.

What's the range?
Three to seven miles, depending on terrain.

How much will it cost?
The company would not discuss pricing, although Clark Peterson, president of major markets for Clearwire,Peterson said it would be competitive with other forms of high-speed Internet access. Broadband connections usually cost upward of $45 a month, while voice-over Internet service, such as phone service, generally costs $35 to $50.

Who's their competition?
Clearwire's service will compete with Comcast, BellSouth and other providers of high-speed Internet service. In general, wireless broadband is seen as particularly attractive to those that cannot get high-speed connections in other ways.

Who is Clearwire Inc.?
Clearwire is a Kirkland, Wash.-based company formed through the purchase of the former Dallas-based Clearwire, equipment manufacturer NextNet and some other companies.

Who is Craig McCaw?
McCaw made his reputation when he created the first national cellular network years ago, eventually selling it to AT&T in 1994 for $11.5 billion, turning him into a telecom star and darling of Wall Street. However, he had some high-profile failures as well; nevertheless, he has been seen as a star in the wireless communications field.

McCaw's announcement energized the wireless communications convention, which brought investors, analysts, equipment manufacturers and other industry players together.

"It's terrific for the industry," Wireless Communication Association International Association President Andrew Kreig said. "He has a vision that is amplified by, that is very congruent with what other companies are talking about. I'm very excited about that vision."




About

This is a showcase of the work done by Timothy J. Gibbons during a journalism career now stretching back more than a decade.

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