Wireless Internet shape of things to come

By CHRIS BARTON

When Savoy Technologies, a subsidiary of listed property investor Savoy Equities, acquired 70 per cent of Safetynet last month in a deal worth about $7 million, most said: "Safety who?"

But for Savoy chief executive Kerry Haycock, a controlling interest in a wireless data network made business sense.

"We can see applications for it. It had revenue and customers, and we understand where it's heading."

So, apparently, do others. Last month, hospitality company Wilson Neill snapped up wireless internet provider Radionet and its parent Onthenet for 75 million of its shares, worth about $11 million.

A few months earlier, National Business Review publisher Barry Colman said he was prepared to spend $15 million developing the internet and data network business of Alternative Futures, a company he eventually merged with Walker Wireless. The latter is seeking $20 million to expand its wireless network, probably by public float.

Making data ride the airwaves is no longer a technology trend; it's hot.

The common thread linking Safetynet, Radionet and Walker Wireless is their use of unlicensed general radio frequencies in the 2.4GHz, 5.8GHz and 900MHz bands to send and receive fast internet data for businesses with no Telecom landlines involved.

Prices range from $120 to $750 a month, depending on the speed and type of connection.

The big advantage for businesses is cost savings. The concern for Telecom must be the loss of so many business customers to these new players.

Safetynet senior network engineer Craig Sutherland says what is happening now is just the beginning. The company started 18 months ago, the result of a merging of his network installation business with the web design company World One Net Navigators.

Today, Safetynet has a growing multinational and public company client list including Richina Pacific and its construction arm Mainzeal, Pepsi - on the islands of Kauai and Maui in Hawaii - and United Airlines' sales network in Australasia.

Not all its business is wireless, although that is the significant growth area. Safetynet also specialises in virtual private network deployment using a mix of wireless and landline technologies.

Like Radionet, its wireless network is constructed so that every time it puts on another client, using aerials sprinkled on high points around the city, the network expands. That is why Safetynet prefers to keep ownership of the Lucent and Cisco technology it installs - renting it out, along with internet bandwidth, to its customers.

In August, the company got some much-needed financial and administrative advice in the form of RSM Management Services, the business advisory division of a "boutique" accountancy company. The result was that Kevin Wheeler and Craig Wigglesworth took shares in the company in exchange for the services they provided. The pair became a permanent fixture as part of the Savoy deal.

Safetynet is taking $4 milllion to $5 million annually in revenue but expects big growth to about $12 million next year.

Mr Wheeler regards Safetynet as a "network architect," designing and building failsafe business connections employing both conventional landlines and wireless technologies.

It is that cutting edge - combining the old with the new - that attracts Savoy.

Clear has signalled that it is now serious about wireless, too, and has announced plans for a $120 million first-stage rollout of a broadband wireless network using licensed frequencies in the 26GHz range.

Dutch-based broadband satellite provider Chello has set up in New Zealand, joining internet provider ihug in pushing the boundaries of satellite-based fast internet. Ihug, too, has radio frequencies that it is using to "multicast" internet protocol-based TV programmes from Auckland's Sky Tower.

Then there are the "3G" (third-generation) mobile frequencies about to go under the auction hammer in July. They, too, have the potential to deliver fast, multimedia-capable content "anywhere, anytime," suggesting in the not-too-distant future a very crowded sky.