Unwired Net covers Sydney

Unwired has spent $33 million rolling out its wireless broadband network, has achieved almost total coverage of the Sydney metro area and plans to migrate to WiMax technology in the future, the company CEO told shareholders on Wednesday at its annual general meeting.

The Sydney network, which operates in the 3.43GHz spectrum, now covers two-thousand square kilometres, or 1.2 million households, said CEO David Spence. This is thanks to the roll-out of 69 base stations in 10 months, with a further four to be completed in the near future, he said.

Spence said this was an incredible feat for a company that had been operating only since December last year.

Unwired floated on the ASX just before Christmas, raising $105 million through the sale of 116 million shares.

For the financial year which ended June 30, Unwired reported a net loss of $7.213 million. Operating revenue was a tiny $335,000 and that was money derived from the sale of wireless modems, spectrum leases and subscriptions from the first sign-ups.

Subscriptions, he said, appear to be tracking well. In the two months after its commercial launch in August, the company is getting a better idea of who its customers are.

"About half our customers have come to us from Telstra and Optus -- 30 per cent have churned from Telstra; 15 per cent from Optus," Spence said. Of these, more than 60 per cent were dial-up customers.

Unwired uses the proprietary wireless technology supplied by American wireless firm Navini, which means it works differently from standard 802.11 Wi-Fi products. Its modems, also supplied by Navini, can connect within a range of up to 10kms from a tower and users do not require line of sight.

WiMax (Worldwide Interoperability for Microwave Access) technology, based on the Institute of Electrical and Electronics Engineers' 802.16 standard, can extend broadband wireless over longer distances and at higher speeds than current Wi-Fi or Bluetooth systems. Its access range, for instance, is up to around 48km, compared to Wi-Fi's 91m and Bluetooth's 10m. It supports data transmission speeds up to 70Mbps, while the popular 802.11b Wi-Fi standard is 11Mbps and the 802.11a standard is 54Mbps.

According to Unwired's CTO Eric Hamilton, another benefit of WiMax is the mobility component. "You can use it on the move," he said. Literally, people can access their internet while in a car or on a train and travelling at pace. Currently, if a user is moving fast, for example 100KM/h, there is a tendency to drop out and lose a connection. The 802.16e standard will address this issue, he said.

"Unwired is the company best placed to move easily to the WiMax standard. When the standard is ratified, Unwired intends to move to WiMax," Spence said.

The standard, however, is still one-to-two years away from being ratified.

The company said that despite the massive spend so far, it currently had $47 million in reserves. It also planned to move beyond Sydney and into other capital cities. Although it owns spectrum in other capital cities, no formal plans have been announced as to which city Unwired would launch in next

Meanwhile, Unwired also announced on Wednesday that retailers Dick Smith, Tandy and Dick Smith PowerHouse would sell Unwired wireless broadband through 64 stores across Sydney, beginning Sunday October 31.

The three retailers join Harvey Norman as part of Unwired's retail channel. Unwired also distributes packages via University bookshop franchiser, The Co-Op Bookshops.

Unwired packages start from $34.95 a month and go up to $119.95. Download speeds range from 256Kbps through to 1024Kbps. Setup fees cost $200, but that be waived depending on plans. Modems cost $189.

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Howard Dahdah

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