Hot rival for Walker Wireless

By CHRIS BARTON

Walker Wireless may soon be facing competition in the wireless broadband market from listed company Newcall, which plans to use Navini Networks technology in New Zealand.

Navini, which has headquarters in Texas, is close to signing a distribution agreement with UCC Technologies, which is backing itself into Newcall, for wireless modem and base station hardware that delivers fast internet of up to 2 Mbps.

Navini's technology, similar to the IP Wireless gear used by Walker Wireless' broadband trial in Auckland, features "nomadic" non line-of-sight modems that can carry voice and internet traffic using frequencies in the 2-3 GHz range.

UCC is shortlisted, with Telecom/BCL and Walker Wireless/Vodafone, to provide community telecommunications services to the Far North and Wairarapa as part of the Government's regional broadband project, Probe.

UCC is to lease the nationwide block of 3.5 GHz frequency the lines company Counties Power acquired in the last Government radio spectrum auction. UCC's wireless subsidiary C Squared and Newcall's wholly owned internet provider Iprolink hope to have a trial network functioning in the second quarter of next year.

Navini business development manager Philip Levy said his company's solution gave "the most bits per Hertz, per dollar" of all fixed wireless technologies now being sold. It expects bit rates of 3 to 7bits/sec/Hz. The technology's other advantage is capability to provide for 2000 to 3000 subscribers off a single base station using its "beamforming" antennas. The technology forms individual signal beams that are optimised for a customer's location, distance and quality requirements.

Both Navini and IP Wireless were selected in May for trials by US telco Sprint, which is looking for a wireless system that has self-installation, non-line-of-sight capability and is affordable for customers. Like IP Wireless, Navini's Ripwave product looks like a sleek modem with a small antenna. A PC Card version is being developed.

At present, installation costs per line are around US$500 ($1000) but the company hopes that will drop to the US$200 range.

Navini has raised US$66.5 million from a group of investment firms, including Austin Ventures, Sequoia Capital, Intel Ventures and Sternhill Partners.

For the New Zealand trial to become a reality, Newcall has a number of hurdles to jump - not the least of which is getting agreement from shareholders to acquire UCC and its subsidiary. The vote on the issue of 90 million shares in Newcall at 4c a share is likely to happen in January.

If approved, the deal will give UCC a controlling interest of Newcall, which at present has just over 134 million shares on issue.

Key figures in the initiative are UCC director Leicester Chatfield and Iprolink chief executive Mike Conner, the founders of wireless internet provider Radionet.

Both will be anxious not to have a repeat of the disastrous sale of Radionet to Wilson Neill, now in liquidation.

Asked how the company proposes to finance the rollout of wireless networks should UCC be successful in the Far North or Wairarapa tenders, Chatfield said he had a number of investors committed, although he declined to name them.

For Newcall, the transaction will provide a much-needed revenue stream. The company has been selling all its assets since it decided to quit its telecommunications business in January last year.

For the six months to June, Newcall reported a profit of $144,006 on revenue of $12.12 million, the bulk of which came from its Energy Online electricity retailing subsidiary that has now been sold to Genesis Power for around $4 million.

UCC supplies and manages computer hardware, software and support services to New Zealand tertiary institutions and large organisations and is believed to have sales of around $14 million a year.

For the past two years Newcall has looked very much like a casualty of the tech wreck.

Launched in October 1999 when it acquired the shell company NZ Salmon, Newcall reached a high of around 60c in early 2000, but then crashed to about 8c at the start of last year, falling to a low of 1c. The shares are now trading at 4c.